I looked at Perfect Medical recently. It has a solid track record for growing at a high return on capital. Dividend payout attractive. Was tempted but didn't pull the trigger. I read a lot of the customer reviews on google. Definitely get the impression that it is sales-oriented and perhaps not generating much customer loyalty. I wonder how much of sales are being gifted to friends/family. As for competition - read that Hong Kong Ferry Holdings (stock code 50, another bombed-out HK stock) is set to enter the business. What is to stop other cash rich property developers/investors from diversifying into these pseudo health care areas? My other concern is changing customer behavior - seems increasingly Asian women are more focused on exercise and diet and are less susceptible to these gimmicky 'slimming services' etc. But overall I see huge value in small caps in HK, stock may perform.
1. Not aware of any significant portion of sales generated from gifts.
2. Medical aesthetics like Thermage make up majority of their revenue now. Slimming is only a small item on their service menu.
3. The “value” in HK small/mid caps has been around for a least the past 5 years. But it is a generalization that we refuse to use because there are way more value traps.
4. Competition - we understand that HK Ferry’s venture is to provide add-on service for an associated hospital, Union. The threats are to be seen but our understanding is they are not aggressive. And this is not a market that wins by pricing lower for psychological reasons
Enjoyed this analysis! I did the Esop valuation review for perfect shape for 3 years in a row and was always amazed at their high payout ratio. Now I understand why!
I looked at Perfect Medical recently. It has a solid track record for growing at a high return on capital. Dividend payout attractive. Was tempted but didn't pull the trigger. I read a lot of the customer reviews on google. Definitely get the impression that it is sales-oriented and perhaps not generating much customer loyalty. I wonder how much of sales are being gifted to friends/family. As for competition - read that Hong Kong Ferry Holdings (stock code 50, another bombed-out HK stock) is set to enter the business. What is to stop other cash rich property developers/investors from diversifying into these pseudo health care areas? My other concern is changing customer behavior - seems increasingly Asian women are more focused on exercise and diet and are less susceptible to these gimmicky 'slimming services' etc. But overall I see huge value in small caps in HK, stock may perform.
1. Not aware of any significant portion of sales generated from gifts.
2. Medical aesthetics like Thermage make up majority of their revenue now. Slimming is only a small item on their service menu.
3. The “value” in HK small/mid caps has been around for a least the past 5 years. But it is a generalization that we refuse to use because there are way more value traps.
4. Competition - we understand that HK Ferry’s venture is to provide add-on service for an associated hospital, Union. The threats are to be seen but our understanding is they are not aggressive. And this is not a market that wins by pricing lower for psychological reasons
Enjoyed this analysis! I did the Esop valuation review for perfect shape for 3 years in a row and was always amazed at their high payout ratio. Now I understand why!
Glad to hear that you enjoyed our article. Thank you!
Thanks , enjoyed the article and dipped my toes a bit , but not entirely sure what the current weakness is due to any idea ?
The company held an investor meeting to update that revenue holds but growth is not expected this year.
Ahh ok, thanks . Do you find it attractive at current levels.
We still hold positions in the name. No change in our thinking of not paying for growth at this point.