Tingyi stock showed a remarkable 10% daily gain, creating a bullish breakout from the existing price zone. A solid fundamental background is present behind the upward movement of the stock, where the debt repayment rate is a solid reason.
Tingyi Debt Structure
A closer look at the most recent balance sheet data reveals that Tingyi (Cayman Islands) Holding experienced CN¥34.9b in liabilities due within a year and CN¥5.34b in past-due responsibilities. These debts were offset by CN¥13.1b in cash and CN¥2.14b in receivables due within a year. As a result, the liabilities exceed the total of the money and (near-term) invoices by CN¥25.0b.
Being worth CN¥52.5b, Tingyi (Cayman Islands) Holding could likely obtain enough cash to build up its financial standing if necessary, so this deficit isn't too severe. It is still worthwhile, nevertheless, to carefully consider its debt-repayment capabilities.
Is Tingyi's Debt Repayment Rate Good?
At just 0.26, Tingyi (Cayman Islands) Holding features a small debt-to-EBITDA ratio. Surprisingly, during the past 12 months, it has earned more interest than it has paid, even though it has net debt. Thus, this business may undoubtedly take on debt without losing its calm.
Another encouraging development is that Tingyi (Cayman Islands) Holding increased its EBIT by 23% in the previous year, which should facilitate future debt repayment. The amount remaining is, without question, the prime source of information about debt. But in the end, whether Tingyi (Cayman Islands) Holding might steadily improve its balance sheet will depend on how profitable the company is in the future.
Tingyi Other Key Financial Metrics
In key financial metrics, the current ratio (1:0.63) and quick ratio (1: 0.51) are below the 1.00 mark, which signals a weaker liquidity position than the industry average.
However, the Return on Equity of 28.27% shows a positive sign on the earnings side, but the solvency shows a weaker position as the debt-to-equity ratio is over the 1.00 mark. Raising further debts could be challenging because the company has a higher amount of debt than equity finance.
Tingyi Stock Technical Analysis
In the daily chart of Tingyi stock, the ongoing bullish momentum is supported by a rising trendline support where the most recent price shows a massive daily gain of over 10%.
The volume structure, the price is trading on buyers' zone as the most active level since January 2024 is below the current price. Moreover, the most recent daily candle formed a valid range breakout with a stable position above the Moving Average wave area.
Based on the daily outlook, the rising trendline support with a stable position above the MA wave area suggests a valid trend trading opportunity. In that case, any minor downside correction in the intraday price could be a long opportunity, aiming for the 12.50 level.
On the other hand, the downside pressure with a stable momentum below the 9.61 level could signal an immediate counter impulsive momentum. In that case, the price could enter a deeper correction zone towards the 8.00 level.
