CYD
China Yuchai International Limited
$36.73
Stable Earnings Power
80%
P/Adj-EPS × Normalized Multiple
Mild
·
Conviction
Overvalued
Trading 10.7% above fair value
You pay
$36.73
Bear
$29.04
Fair
$33.19
Bull
$37.34
Bear
$29.04
-20.9%
$2.07 × 14x P/E
Fair
$33.19
-9.6%
$2.07 × 16x P/E
Bull
$37.34
+1.7%
$2.07 × 18x P/E
Adjust Assumptions
16.0x
2.07$
Key Value Driver
Normalized P/E multiple (16x base case)
Implied Market Multiple
17.7x
Summary
Applying a 16x P/E to adjusted EPS of $2.07, the base-case value is $33.19 per share. DDM cross-check: $30.20.
Warnings
The company pays out 99% of its profits as dividends. That leaves little cushion — the dividend could be cut if business slows down.
Financial statements were converted from CNY into USD using USDCNY at 0.1490 USD per CNY.
Key Risks
- Growth DCF inappropriate — terminal value assumptions dominate
- EV/EBITDA misleading for regulated businesses where capex is mandated
- Regulatory risk is a fat tail not visible in normal multiples