Returns At Xiaomi (HKG:1810) Appear To Be Weighed Down

Simply Wall St.10-08

To find a multi-bagger stock, what are the underlying trends we should look for in a business? Firstly, we'll want to see a proven return on capital employed (ROCE) that is increasing, and secondly, ...

Source Link

Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.

Comments

We need your insight to fill this gap

Leave a comment

{"i18n":{"language":"en_US"},"isChannel":false,"data":{"share":"https://ttm.financial/m/news/2473499493?lang=en_US&edition=fundamental","thumbnail":"https://images.simplywall.st/asset/industry/9621091-choice2-main-header/1585186855318","is_english":true,"pubTime":"2024-10-08 11:07","share_image_url":"https://static.laohu8.com/e9f99090a1c2ed51c021029395664489","id":"2473499493","market":"hk","top_or_hot":-1,"title":"Returns At Xiaomi (HKG:1810) Appear To Be Weighed Down","media":"Simply Wall St.","content":"<div>\n<p>To find a multi-bagger stock, what are the underlying trends we should look for in a business?  Firstly, we'll want to see a proven return on capital employed (ROCE) that is increasing, and secondly, ...</p>\n\n<a href=\"https://simplywall.st/stocks/hk/tech/hkg-1810/xiaomi-shares/news/returns-at-xiaomi-hkg1810-appear-to-be-weighed-down\">Source Link</a>\n\n</div>\n","source":"simplywall_highlight","html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>Returns At Xiaomi (HKG:1810) Appear To Be Weighed Down</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nReturns At Xiaomi (HKG:1810) Appear To Be Weighed Down\n</h2>\n\n<h4 class=\"meta\">\n\n\n2024-10-08 11:07 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://simplywall.st/stocks/hk/tech/hkg-1810/xiaomi-shares/news/returns-at-xiaomi-hkg1810-appear-to-be-weighed-down><strong>Simply Wall St.</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>To find a multi-bagger stock, what are the underlying trends we should look for in a business?  Firstly, we'll want to see a proven return on capital employed (ROCE) that is increasing, and secondly, ...</p>\n\n<a href=\"https://simplywall.st/stocks/hk/tech/hkg-1810/xiaomi-shares/news/returns-at-xiaomi-hkg1810-appear-to-be-weighed-down\">Source Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","isBrief":false,"type":0,"news_type":1,"symbol":"BK1193","symbol_name":"电脑硬件、储存设备及电脑周边","start_time":0,"source_url":"https://simplywall.st/stocks/hk/tech/hkg-1810/xiaomi-shares/news/returns-at-xiaomi-hkg1810-appear-to-be-weighed-down","article_id":"2473499493","we_media_id":null,"thumbnails":["https://images.simplywall.st/asset/industry/9621091-choice2-main-header/1585186855318"],"rights":null,"url":"https://stock-news.laohu8.com/highlight/detail?id=2473499493","pubTimestamp":1728356826,"sourceInfo":{"source_id":"simplywall_highlight","name":"Simply Wall St."},"weMediaInfo":null,"summary":"To find a multi-bagger stock, what are the underlying trends we should look for in a business? Firstly, we'll want to...","collect":0,"end_time":0,"defaultTopTitle":"simplywall.st","property":[],"viewcount":null,"language":"en","relate_stocks":{"81810":"小米集团-WR","BK1193":"电脑硬件、储存设备及电脑周边","EBIT":"Harbor AlphaEdge Small Cap Earners ETF","BK1523":"武汉本地概念股","LU2097828557.USD":"AZ EQUITY CHINA \"A\" (USD) ACC","LU0345776255.USD":"NINETY ONE GSF ASIAN EQUITY \"A\" (USD) INC","LU2097828631.EUR":"AZ EQUITY CHINA \"A\" (EUR) ACC","LU1770034418.SGD":"ALL CHINA EQUITY \"A\" (SGDHDG) ACC","BK1521":"挪威政府全球养老基金持仓","LU2097828714.EUR":"AZ EQUITY CHINA \"BAZ\" (EUR) ACC","LU0314109678.HKD":"MANULIFE GF DRAGON GROWTH \"AA\" (HKD) INC","LU1813983027.USD":"MANULIFE GF DRAGON GROWTH \"AA\" (USD) INC","LU2097828805.USD":"AZ EQUITY CHINA \"A-AZ\" (USD) ACC","LU2097828474.EUR":"AZ EQUITY CHINA \"A\" (EUR) ACC A","XIACY":"小米集团ADR","LU0345775950.USD":"NINETY ONE GSF ASIAN EQUITY \"A\" (USD) ACC","BK1502":"双十一","BK1575":"同股不同权","LU1770036033.HKD":"NINETY ONE GSF ASIAN EQUITY \"A\" (HKD) ACC","BK1607":"新IT概念","BK1589":"北水核心资产","LU1328277881.USD":"MANULIFE GF DRAGON GROWTH FUND \"AA\" (USD) INC","LU0611395673.USD":"NINETY ONE GSF EMERGING MARKETS EQUITY \"A\" (USD) ACC","BK1506":"5G概念","LU2039709279.SGD":"MANULIFE GF DRAGON GROWTH \"AA\" (SGDHDG) INC","01810":"小米集团-W","SG9999002463.SGD":"LionGlobal China Growth SGD"},"translate_title":"小米（HKG：1810）的回报似乎受到压力","themeId":null,"isJumpTheme":false,"ttsUrl":null,"symbols_score_info":{"81810":0.6,"EBIT":1,"01810":1,"XIACY":0.6},"content_text":"To find a multi-bagger stock, what are the underlying trends we should look for in a business?  Firstly, we'll want to see a proven return on capital employed (ROCE) that is increasing, and secondly, an expanding base of capital employed.  Put simply, these types of businesses are compounding machines, meaning they are continually reinvesting their earnings at ever-higher rates of return.    However, after investigating Xiaomi (HKG:1810), we don't think it's current trends fit the mold of a multi-bagger.     Return On Capital Employed (ROCE): What Is It?  If you haven't worked with ROCE before, it measures the 'return' (pre-tax profit) a company generates from capital employed in its business.  To calculate this metric for Xiaomi, this is the formula:  Return on Capital Employed = Earnings Before Interest and Tax (EBIT) ÷ (Total Assets - Current Liabilities) 0.087 = CN¥19b ÷ (CN¥342b - CN¥126b) (Based on the trailing twelve months to June 2024). Thus, Xiaomi has an ROCE of 8.7%.  On its own that's a low return, but compared to the average of 6.0% generated by the Tech industry, it's much better.   See our latest analysis for Xiaomi SEHK:1810 Return on Capital Employed October 8th 2024 Above you can see how the current ROCE for Xiaomi compares to its prior returns on capital, but there's only so much you can tell from the past.  If you'd like, you can  check out the forecasts from the analysts covering Xiaomi  for free.  The Trend Of ROCE  The returns on capital haven't changed much for Xiaomi in recent years.   The company has consistently earned 8.7% for the last  five years, and the capital employed within the business has risen 143% in that time.   Given the company has increased the amount of capital employed, it appears the investments that have been made simply don't provide a high return on capital.    What We Can Learn From Xiaomi's ROCE  In summary, Xiaomi has simply been reinvesting capital and generating the same low rate of return as before.        Yet to long term shareholders the stock has gifted them an incredible 189% return in the last  five years, so the market appears to be rosy about its future.   However, unless these underlying trends turn more positive, we wouldn't get our hopes up too high.     While Xiaomi doesn't shine too bright in this respect, it's still worth seeing if the company is trading at attractive prices. You can find that out with our  FREE intrinsic value estimation for 1810  on our platform.     While Xiaomi isn't earning the highest return, check out this free list of companies that are earning high returns on equity with solid balance sheets. New: AI Stock Screener & AlertsOur new AI Stock Screener scans the market every day to uncover opportunities.• Dividend Powerhouses (3%+ Yield)• Undervalued Small Caps with Insider Buying• High growth Tech and AI CompaniesOr build your own from over 50 metrics.Explore Now for FreeHave feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.","kind":null,"is_publish_news":true,"is_publish_highlight":false,"is_publish_live":false,"is_publish_wemedia":null,"editions":null,"column":"","sentiment":"-1","news_tag":"Business Data","news_rank":0,"symbols":[],"gpt_button":0},"commentList":[],"isCommentEnd":true,"newsSizeData":{"likeSize":0,"commentSize":0,"repostSize":0,"favoriteSize":0,"likeStatus":false,"favoriteStatus":false},"APP":{"userAgent":"Mozilla/5.0 AppleWebKit/537.36 (KHTML, like Gecko; compatible; ClaudeBot/1.0; +claudebot@anthropic.com)","isDev":false,"isTTM":true,"deviceId":"web-server-community-laohu8-v3","version":"4.29.1","shortVersion":"4.29.1","platform":"web","vendor":"web","appName":"ttm","isIOS":false,"isAndroid":false,"isTiger":false,"isTHS":false,"isWeiXin":false,"isWeiXinMini":false,"isWeiBo":false,"isQQ":false,"isBaiduSwan":false,"isBaiduBox":false,"isDingTalk":false,"isToutiao":false,"isOnePlus":false,"isHuaWei":false,"isXiaomi":false,"isXiaomiWebView":false,"isOppo":false,"isVivo":false,"isSamsung":false,"isMobile":false},"href":"/m/news/2473499493"}