Morningstar

JL Mag Rare-Earth Co Ltd Class A 300748

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Stock XSHE Rating as of
¥14.44 +2.05 (16.55%)
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As of Delayed Price Closed

Company Report

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JL Mag Earnings: Profit Slips as Margins Remain Under Pressure

Vincent Sun

JL Mag's second-quarter results disappointed, with first-half revenue and net profit accounting for 40% and 23% of our previous full-year forecasts, respectively. Extended price drops in various rare-earth materials during the quarter raised price pressure for the company’s rare-earth magnet products, leading to gross margin trending down another 3 percentage points from last quarter.

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Price vs Fair Value

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300748 is trading at a 613% premium.
Price
¥14.44
Fair Value
¥1.20
Uncertainty
High
1-Star Price
¥2.69
5-Star Price
¥6.26
Economic Moat
Jbnrjl
Capital Allocation
Zxfsjth

Bulls Say, Bears Say

Bulls

Benefiting from China’s significant increase in NEV sales, JL Mag would record strong demand from leading NEV manufacturers and fast revenue growth.

Bears

Rare earths account for over 70% of JL Mag’s cost of sales and the company has less control on rare earth prices. A shortage in rare earth supply may drive up prices and negatively affect profitability.

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Trading Information

Previous Close Price
¥12.39
Day Range
¥12.88–14.58
52-Week Range
¥9.99–20.81
Bid/Ask
¥14.44 / ¥14.45
Market Cap
¥19.43 Bil
Volume/Avg
62.5 Mil / 11.6 Mil

Key Statistics

Price/Earnings (Normalized)
47.92
Price/Sales
2.93
Dividend Yield (Trailing)
2.35%
Dividend Yield (Forward)
2.35%
Total Yield
2.35%

Company Profile

JL Mag Rare-Earth, or JL Mag, is a leading global producer of high-performance rare earth permanent magnets, or REPMs. JL Mag focuses on the production and sale of NdFeB PMs, the most widely used type of REPMs, mainly made from an alloy of neodymium (Nd), iron (Fe) and boron (B). The company is ranked first in the world by high-performance REPMs, according to Frost & Sullivan. JL Mag is also ranked first in the global grain boundary diffusion, or GBD, REPMs market. Its products have a wide array of applications, mainly in new energy vehicles, or NEVs, automotive parts, wind turbine generators, energy-saving variable-frequency air-conditioners, or VFACs.
Sector
Industrials
Industry
Metal Fabrication
Stock Style Box
Mid Core
Total Number of Employees
5,461
Website
https://www.jlmag.com.cn

Competitors

Valuation

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Metric
300748
002466
00916
Price/Earnings (Normalized)
 47.928.197.05
Price/Book Value
 2.871.300.82
Price/Sales
 2.932.611.60
Price/Cash Flow
 29.484.662.68
Price/Earnings
300748
002466
00916

Financial Strength

Metric
300748
002466
00916
Quick Ratio
 1.652.210.57
Current Ratio
 2.113.440.62
Interest Coverage
 7.5824.063.00
Quick Ratio
300748
002466
00916

Profitability

Metric
300748
002466
00916
Return on Assets (Normalized)
 2.10%14.17%2.17%
Return on Equity (Normalized)
 3.47%21.11%7.36%
Return on Invested Capital (Normalized)
 2.67%16.13%3.84%
Return on Assets
300748
002466
00916

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