Narrow-moat Ganfeng’s fourth-quarter net loss was below the midpoint of its preliminary announcement. The results missed our expectations principally because of the decline in the prices of lithium products and a drop in gross margin. With lithium prices plunging more than 70% in the fourth quarter, the gross margin contracted to only 1%.
Despite a decline in the lithium price this year, lithium demand will remain resilient, driven by vehicle electrification. Ganfeng's cost advantage over higher-cost new supplies, will be enhanced in the long term.
Decrease in the price of the lithium mines or lithium compounds will significantly affect Ganfeng’s profitability, resulting in significant decline and volatility in earnings forecast.
|
Metric
|
01772
|
09696
|
ALB
|
|---|---|---|---|
Price/Earnings (Normalized) | 13.55 | 5.45 | 5.18 |
Price/Book Value | 0.83 | 0.80 | 1.44 |
Price/Sales | 1.17 | 1.04 | 1.41 |
Price/Cash Flow | 8.78 | 1.86 | 4.78 |
|
Metric
|
01772
|
09696
|
ALB
|
|---|---|---|---|
Quick Ratio | — | 1.62 | 0.77 |
Current Ratio | — | 2.17 | 1.47 |
Interest Coverage | — | 92.63 | 2.71 |
|
Metric
|
01772
|
09696
|
ALB
|
|---|---|---|---|
Return on Assets (Normalized) | — | 43.45% | 14.67% |
Return on Equity (Normalized) | — | 63.19% | 28.28% |
Return on Invested Capital (Normalized) | — | 51.17% | 20.38% |
|
Ticker
|
Name
|
Morningstar Rating for Stocks
|
Capital Allocation
|
Economic Moat
|
Market Cap
|
|---|---|---|---|---|---|
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