Shenzhou Intl Group Holdings (2313) Earnings: FY Net Income Meets Estimates with 4.56 Billion Yuan

Shenzhou Intl Group Holdings on Smartkarma

Shenzhou Intl Group Holdings (2313 HK) is a major supplier to global sportswear brand Nike, making up 30% of its sales. Recently, Nike reported its 2QFY24 results with a guidance cut, leading to a drop in Shenzhou’s stock by 8%. However, according to independent analyst Steve Zhou, CFA, the market seems to have overlooked the fact that Nike’s inventory is down by 14% year-on-year and high-single-digit compared to the previous quarter. This presents an opportunity for investors as Nike’s inventory decline could potentially benefit Shenzhou in the long run.

Further analysis by Steve Zhou, CFA, shows that Nike’s inventories have declined by 10% year-on-year in 1Q24, which is better than expected. This has resulted in an 8% increase in Nike’s stock in after-market trading. Considering that Nike is Shenzhou’s largest customer, this decline in inventories is a positive sign for the company. Shenzhou is currently trading at a lower PE ratio of 15x 2024 estimates, compared to its average of 21x over the last decade, making it an attractive investment opportunity according to Zhou.

A look at Shenzhou Intl Group Holdings Smart Scores

Smart Score is a compound score for the Company indicating its overall outlook. It is derived by taking an equally weighted average of underlying Factor scores computed by Smartkarma

Based on the Smartkarma Smart Scores, the long-term outlook for Shenzhou International Group Holdings Ltd looks promising. With a score of 3 for value, this indicates that the company is fairly priced and offers good value for investors. Additionally, Shenzhou International Group Holdings scores a 4 for dividends, meaning that the company has a strong track record of providing consistent dividends to its shareholders.

Furthermore, with a score of 3 for growth, Shenzhou International Group Holdings is expected to continue growing in the future. The company also scores a 4 for resilience, which suggests that it has a strong financial standing and is well-equipped to weather any potential economic downturns. Lastly, with a score of 3 for momentum, Shenzhou International Group Holdings is showing positive signs of growth and could potentially see a boost in its stock value in the near future.

Shenzhou International Group Holdings Ltd is a textile manufacturing and processing company that specializes in producing, dyeing, finishing, printing, embroidering, cutting, and sewing knitwear. With a strong focus on value, dividends, growth, resilience, and momentum, the company is well-positioned for long-term success in the textile industry.

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