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Fundamental analysis: China Automotive Systems, Inc. (CAAS)

Awarener score: 5.8

Conclusion

Note: All scores range from 1 (worst) to 10 (best). Conclusions are updated daily with closing stock prices and new reported quarterly financial statements.

Revenue score: 5.0

• Business has been shrinking. It's been weak when measured against peer companies.
• China Automotive Systems, Inc. business trend stability is good. The higher the stability, the lower the risk. It looks slightly worse than rivals.

Margins score: 4.5

• CAAS profit margins -on goods and services sold- are usually extremely poor. They stand somewhat worse than rival companies.
• Business profit on sales tends to be hardly sufficient. It's weak when measured against competitors.
• Profits on sales made -available to repay debt and purchase properties- are usually hardly sufficient. They remain close to average when compared to peers.
• Earnings -before income taxes and interests on loans taken- tend to be hardly sufficient in relation to total revenues. They're still somewhat worse than similar companies.
• Profits -before income taxes- are usually hardly sufficient considering total sales, and remain below average when measured against rivals.
• Total net profit tends to be hardly sufficient when confronted to sales. Company stands almost average when measured against comparable firms.

Growth score: 2.4

• China Automotive Systems, Inc. profit -on goods and services sold- has been growing at a very low pace. It's been rather normal in relation to competitors.
• In recent years, the firm hasn't always been able to profit from operations, which has been bottom tier against comparable firms.
• Profits -available to repay debt and purchase properties- have been growing at a very good pace, which compares encouraging in relation to peer enterprises.
• In the previous years, the firm couldn't always make a profit -before income taxes and interests on loans taken-. It turns to be a disappointment compared to similar stocks.
• In past years, at least once the company lost money -before income taxes-. It was bottom tier against rivals.
• In the previous years, the firm had at least a total net loss, and last-in-rank when measured against peer companies.
• The company lost money at least once in the past years. It's been a disappointment compared to industry peers.

Miscellaneous score: 4.7

• CAAS had to pay too much income taxes in relation to profits made in the past years. It's been mediocre against peers.
• Research and development expenses consume a sparse portion of revenues. It's encouraging in relation to competitors.
• The company grows very little in relation to research and development efforts. It stands lacking compared to rival companies.

Profitability score: 5.0

• China Automotive Systems, Inc. usually gets hardly sufficient returns on the resources it controls. It proves below average when measured against peer firms.
• The company normally gets hardly sufficient proceeds -on the resources directly invested in the business-. They remain in a weak position compared to similar companies.
• Profitability -in relation to owned resources- is usually modest. It ranks below average when measured against competitors.
• In the past, got barely sufficient returns -on the tangible resources it controls-. This metric is usually related to the industry in which operates and combines profitability versus reinvestment needs. It's below average when measured against comparable enterprises.

Usage of Funds score: 3.7

• CAAS usually uses almost all genuine funds generated to buy or replace property, plant, or equipment. The need for reinvestments is huge. It stands below average when measured against rival firms.
• The company is usually somewhat investing in new property, plant, and equipment, to improve its operating capabilities, which is encouraging in relation to industry peers.
• In the past twelve months the stock paid no dividends. It came bottom tier against competitors.
• The company pays no dividend, so measuring its growth is meaningless. The company has behaved in an conservative way compared to similar firms.
• As no dividends are paid, it is useless trying to estimate their sustainability in time. Sustainability looks not applicable in regard to comparable companies.
• The company usually neither enlarges nor reduces the pool of investors, resulting in approximately the same mouths feeding on the pie of profits. It remains a slight improvement compared to peer enterprises.
• Repurchase effectiveness metric is very complex. Run again in analytical mode if you're interested in a technical explanation. It stands in a weak position compared to rivals.
• The company generates very few genuine funds. Investor rewards must be paid burning existing cash or by borrowing money, which isn't sustainable in the long run. Unless business prospects improve greatly, stockholder compensation could be at risk. It still looks last-in-rank when measured against competitors.

Balance Sheet score: 5.8

• China Automotive Systems, Inc. intangible assets (like brands and goodwill) represent a very small portion of resources controlled, according to accounting books, which is mostly safe. It happens to be encouraging in relation to peer companies.
• The company has more short-term resources than short-term obligations. Liquidity concerns shouldn't be an issue. It turns to be in a very weak position compared to similar firms.
• Very few resources controlled were provided for with financial debt. Financial strength is very solid. Company could increase debt if it wished so, to reinvest in business, to buy a smaller company or to reward stockholders. It remains well ranked against rival firms.
• Resources controlled can be quickly made into cash, which is very good for liquidity and risk. It looks more than average in relation to rivals.
• For every dollar of short-term obligations, the company has roughly another of cash and short-term receivables. It's close to average when compared to peer firms.
• For every dollar of short-term obligations, the company has roughly half of cash and equivalents, which is slightly better than similar enterprises.
• Usually, sales are on many months credit. It still ranks last-in-rank when measured against peers.
• Normally has approximately three months of sales worth in inventory. It comes up as lacking compared to competitors.
• On average, it takes a lot of months from the purchase to charging customers. It happens to be worse than most peers.
• On average pays suppliers approximately four months or higher after the purchase. It ranks top tier when measured against industry peers.
• The company pays its suppliers roughly two months before charging its customers, so there's some money invested in working capital. It's a slight improvement compared to similar companies.
• Company earns net interest income on its investments and therefore is in a quite comfortable financial position. It stands top-notch against rival firms.
• Business earnings have usually been very good when measured against loans taken. Cutting back reinvesting in the business, it could take less than two years to repay the obligations with current profitability. It ranks great when measured against comparable enterprises.
• Revenues are reasonable in relation to property, plant, and equipment required to operate. This metric is likely dependent on the industry the company operates in. The more property, plant, and equipment used, the more the company must reinvest to fight obsolescence, which usually means less available funds for the shareholders in the long run. It looks rather normal in relation to similar firms.
• Resource exploitation is quite good when yearly sales are considered. This metric is normally tied to the industry where the firm belongs. It's still mediocre against peer companies.

Valuation score: 7.9

• China Automotive Systems, Inc. looks extremely cheap in relation to profits and financial position. It happens to be top tier when measured against competitors.
• Price-to-Tangible-Book-Value is a fairly complex metric. Run again in analytical mode if you're interested in a technical explanation. It remains excellent in relation to peers.
• In the past twelve months, the company consumed lots of funds. Either it reinvested heavily in the business or genuine fund generation might be struggling, which stands bottom tier against similar companies.
• The company usually consumes more funds than can genuinely generate. Business needs are meet by borrowing money or consuming preexistent cash, which can only keep up until a certain limit. Unless the company is driving business growth, genuine profitability may be brought into question. It's still last-in-rank when measured against industry firms.
• In the past twelve months, the company hasn't rewarded investors, considering both dividends and share on the pie of earnings. It came up lacking compared to peer ventures.
• This company is sitting in a mountain of cash. It's very well poised to substantially increase stockholder payments, or to fund new business projects. It looks top-notch against similar enterprises.
• Considering the past twelve months, traditional Price-to-Earnings relation looks cheap. Possible reasons are that the market might be betting current earnings will be hard to sustain through time, or that the company has very high fund needs, or a weak financial position, among others. If that isn't the case, the current stock price might be attractive. It ranks great when measured against peer companies.
• Comparing the current stock price with the past twelve-months revenues gives a low relationship. One common cause includes profitability being poor. It looks in good shape compared to rival firms.
• The stock price is significantly below the accounting book value. Unless profitability is extremely low, the stock may be selling at a large discount. Pay attention to the other key indicators for hints. The company remains better than most peer firms.
• In the past twelve months, the operating business earned huge money when compared to the current stock price and financial position. It happens to be top tier when measured against industry peers.
• In an alternate metric of bang for the buck, the company has usually shown an extreme earnings power ability when measured against the current stock price and financial position. Further analysis is recommended, as the stock might currently be significantly undervalued. It's still impressive in relation to peer companies.

Total score: 4.9

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Awarener score: 5.8

Conclusion

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