What's Driving Hollysys Automation Technologies Ltd's Surprising 11% Stock Rally?

Hollysys Automation Technologies Ltd (HOLI, Financial), a leading player in the Industrial Products industry, has seen a significant shift in its stock performance recently. Over the past week, the company's stock price has decreased by 6.45%, but it has seen a substantial increase of 10.67% over the past three months. The GF Value, defined by GuruFocus.com, calculates a stock's intrinsic value using historical multiples, past performance adjustments, and future business estimates. Currently, the GF Value of Hollysys Automation Technologies Ltd stands at $19.18, indicating that the stock is fairly valued. This is a slight increase from the past GF Value of $18.65, suggesting a steady performance.

Unveiling Hollysys Automation Technologies Ltd

Hollysys Automation Technologies Ltd is a China-based company that provides automation and control technologies and products. The company operates through three segments: Industrial Automation (IA), Rail, and Mechanical & Electrical (M&E). The IA segment supplies solutions including third-party hardware-centric products, proprietary software products, and others. The Rail segment supplies train control center and automation train protection to the rail and subway industries. The M&E segment consists of its two Southeast Asia-based subsidiaries that provide mechanical and electrical solutions. Hollysys Automation Technologies generates most of its sales from the Chinese domestic market. 1716820054839980032.png

Profitability Analysis of Hollysys Automation Technologies Ltd

With a Profitability Rank of 8/10, Hollysys Automation Technologies Ltd demonstrates a high level of profitability. The company's operating margin stands at 11.97%, which is better than 73.85% of companies in the same industry. This indicates a strong ability to generate profits from its operations. Furthermore, the company's ROE, ROA, and ROIC are all better than the majority of companies in the same industry, standing at 9.12%, 6.35%, and 11.04% respectively. Notably, the company has maintained consistent profitability over the past 10 years, outperforming 99.96% of companies. 1716820075597590528.png

Growth Prospects of Hollysys Automation Technologies Ltd

Hollysys Automation Technologies Ltd has a Growth Rank of 6/10, indicating moderate growth. The company's 3-year and 5-year revenue growth rates per share are 14.70% and 7.50% respectively, both of which are better than the majority of companies in the same industry. Furthermore, the company's 3-year EPS without NRI growth rate is 9.50%, which is better than 46.53% of companies in the same industry. However, the company's 5-year EPS without NRI growth rate is -3.50%, which is better than 23.3% of companies in the same industry. 1716820093637292032.png

Major Holders of Hollysys Automation Technologies Ltd Stock

The top three holders of Hollysys Automation Technologies Ltd's stock are Chris Davis (Trades, Portfolio), Jim Simons (Trades, Portfolio), and Jeremy Grantham (Trades, Portfolio). Chris Davis (Trades, Portfolio) holds the largest share with 5,428,153 shares, accounting for 8.75% of the total shares. Jim Simons (Trades, Portfolio) holds 896,570 shares, representing 1.45% of the total shares. Jeremy Grantham (Trades, Portfolio) holds 559,392 shares, accounting for 0.9% of the total shares.

Competitors of Hollysys Automation Technologies Ltd

Hollysys Automation Technologies Ltd faces competition from GrafTech International Ltd (EAF, Financial), Powell Industries Inc (POWL, Financial), and Preformed Line Products Co (PLPC, Financial). GrafTech International Ltd has a market capitalization of $852.602 million, Powell Industries Inc has a market capitalization of $881.538 million, and Preformed Line Products Co has a market capitalization of $670.818 million. These figures are close to Hollysys Automation Technologies Ltd's market capitalization of $1.22 billion, indicating a competitive market environment.

Conclusion

In conclusion, Hollysys Automation Technologies Ltd has demonstrated a strong performance in terms of profitability and growth. The company's stock performance has seen a significant increase over the past three months, despite a slight decrease over the past week. The company's profitability and growth ranks indicate a high level of profitability and moderate growth. The company's major holders and competitors also play a significant role in its stock performance. As such, Hollysys Automation Technologies Ltd presents an interesting case for investors looking for opportunities in the Industrial Products industry.

This article, generated by GuruFocus, is designed to provide general insights and is not tailored financial advice. Our commentary is rooted in historical data and analyst projections, utilizing an impartial methodology, and is not intended to serve as specific investment guidance. It does not formulate a recommendation to purchase or divest any stock and does not consider individual investment objectives or financial circumstances. Our objective is to deliver long-term, fundamental data-driven analysis. Be aware that our analysis might not incorporate the most recent, price-sensitive company announcements or qualitative information. GuruFocus holds no position in the stocks mentioned herein.

Disclosures

I/We may personally own shares in some of the companies mentioned above. However, those positions are not material to either the company or to my/our portfolios.