HLS
CyclicalsValuation Breakdown
Cyclical companies (chemicals, oil & gas, basic resources) have earnings that swing dramatically with commodity prices and economic cycles. Valuing them on a single year's earnings is misleading: they look cheap at peaks and expensive at troughs. This model uses 7-year median EBITDA ("mid-cycle" earnings) and a 7-year median EV/EBITDA multiple to estimate what the firm is worth at a normal point in the cycle.
Valuation Track Record
Retroactive intrinsic value vs actual close price — HLS
Earnings Quality
Fiscal year 2024
Financial Forensics
Beneish M-Score · 2020
HLS shows a Beneish M-Score of -0.56, indicating no immediate signs of earnings manipulation, as it is above the manipulation threshold of -1.78. However, the high DSRI of 2.1325 suggests potential issues with inventory management, and the low cash conversion score of 32.9/100 raises concerns about the sustainability of earnings quality.
- High DSRI of 2.1325 indicates potential overstatement of inventory, which may lead to future write-downs.
- Low cash conversion score of 32.9/100 suggests that earnings may not be translating into cash, raising liquidity concerns.
- Strong receivables score of 100.0/100 indicates effective management of accounts receivable.
- Earnings Quality Score of 57.0/100 reflects a reasonable level of earnings quality, suggesting some reliability in reported earnings.
The ownership structure is concentrated among a few individuals, with the largest shareholder holding 21.8%. This could lead to governance risks, as decisions may favor the interests of major shareholders over minority investors.
Investors should closely monitor inventory levels and cash flow metrics in upcoming quarters. It may be prudent to approach HLS with caution, considering potential liquidity risks and the concentrated ownership structure.
Generated by AI based on quantitative data. Not financial advice.
Quantitative Scores
Key Ratios
Company Overview
// OWNERSHIP_NETWORK
> mapping common ownership for HLS — hover nodes for intel, click to navigate