Overall FUTU gets a fundamental rating of 6 out of 10. We evaluated FUTU against 238 industry peers in the Capital Markets industry. While FUTU belongs to the best of the industry regarding profitability, there are concerns on its financial health. FUTU is not priced too expensively while it is growing strongly. Keep and eye on this one!

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1. Profitability

2. Health

3. Growth

4. Valuation

5. Dividend

1. Profitability

1.1 Basic Checks

In the past year FUTU was profitable.
In the past 5 years FUTU has always been profitable.
FUTU had a positive operating cash flow in 4 of the past 5 years.

1.2 Ratios

With a decent Return On Assets value of 4.03%, FUTU is doing good in the industry, outperforming 60.92% of the companies in the same industry.
Looking at the Return On Equity, with a value of 26.93%, FUTU belongs to the top of the industry, outperforming 92.02% of the companies in the same industry.
Looking at the Return On Invested Capital, with a value of 20.53%, FUTU belongs to the top of the industry, outperforming 97.06% of the companies in the same industry.
FUTU had an Average Return On Invested Capital over the past 3 years of 14.12%. This is significantly above the industry average of 7.28%.
The 3 year average ROIC (14.12%) for FUTU is below the current ROIC(20.53%), indicating increased profibility in the last year.

		Industry Rank	Sector Rank
ROA	4.03%
ROE	26.93%
ROIC	20.53%

ROA(3y)3.64%

ROA(5y)3.11%

ROE(3y)16.96%

ROE(5y)16.05%

ROIC(3y)14.12%

ROIC(5y)11.45%

1.3 Margins

FUTU has a better Profit Margin (47.11%) than 89.08% of its industry peers.
FUTU's Profit Margin has improved in the last couple of years.
Looking at the Operating Margin, with a value of 58.30%, FUTU belongs to the top of the industry, outperforming 94.96% of the companies in the same industry.
FUTU's Operating Margin has improved in the last couple of years.
With an excellent Gross Margin value of 85.66%, FUTU belongs to the best of the industry, outperforming 90.34% of the companies in the same industry.
In the last couple of years the Gross Margin of FUTU has grown nicely.

		Industry Rank	Sector Rank
OM	58.3%
PM (TTM)	47.11%
GM	85.66%

OM growth 3Y2.89%

OM growth 5Y22.44%

PM growth 3Y0.47%

PM growth 5Y24.32%

GM growth 3Y-0.42%

GM growth 5Y2.22%

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ROA

ROE

ROIC

Operating and Profit Margin

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2. Health

2.1 Basic Checks

FUTU has less shares outstanding than it did 1 year ago.
The number of shares outstanding for FUTU has been increased compared to 5 years ago.
FUTU has a better debt/assets ratio than last year.

2.2 Solvency

FUTU has an Altman-Z score of 1.05. This is a bad value and indicates that FUTU is not financially healthy and even has some risk of bankruptcy.
FUTU has a Altman-Z score (1.05) which is in line with its industry peers.
A Debt/Equity ratio of 0.36 indicates that FUTU is not too dependend on debt financing.
FUTU has a better Debt to Equity ratio (0.36) than 69.75% of its industry peers.

		Industry Rank	Sector Rank
Debt/Equity	0.36
Debt/FCF	N/A
Altman-Z	1.05

ROIC/WACCN/A

WACCN/A

2.3 Liquidity

A Current Ratio of 1.16 indicates that FUTU should not have too much problems paying its short term obligations.
FUTU has a Current ratio of 1.16. This is comparable to the rest of the industry: FUTU outperforms 54.20% of its industry peers.
A Quick Ratio of 1.16 indicates that FUTU should not have too much problems paying its short term obligations.
FUTU's Quick ratio of 1.16 is in line compared to the rest of the industry. FUTU outperforms 58.40% of its industry peers.

		Industry Rank	Sector Rank
Current Ratio	1.16
Quick Ratio	1.16

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WACC

Debt/Equity

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Altman-Z score

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3. Growth

3.1 Past

The Earnings Per Share has grown by an impressive 110.96% over the past year.
FUTU shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 90.12% yearly.
FUTU shows a strong growth in Revenue. In the last year, the Revenue has grown by 80.74%.
FUTU shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 66.52% yearly.

EPS 1Y (TTM)110.96%

EPS 3Y28.79%

EPS 5Y90.12%

EPS Q2Q%134.2%

Revenue 1Y (TTM)80.74%

Revenue growth 3Y24.07%

Revenue growth 5Y66.52%

Sales Q2Q%86.34%

3.2 Future

Based on estimates for the next years, FUTU will show a very strong growth in Earnings Per Share. The EPS will grow by 27.39% on average per year.
The Revenue is expected to grow by 31.93% on average over the next years. This is a very strong growth

EPS Next Y89.51%

EPS Next 2Y45.09%

EPS Next 3Y27.39%

EPS Next 5YN/A

Revenue Next Year74.94%

Revenue Next 2Y41.58%

Revenue Next 3Y31.93%

Revenue Next 5YN/A

3.3 Evolution

The estimated forward EPS growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
Although the future Revenue growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.

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4. Valuation

4.1 Price/Earnings Ratio

The Price/Earnings ratio is 17.54, which indicates a rather expensive current valuation of FUTU.
Compared to the rest of the industry, the Price/Earnings ratio of FUTU is on the same level as its industry peers.
Compared to an average S&P500 Price/Earnings ratio of 28.41, FUTU is valued a bit cheaper.
The Price/Forward Earnings ratio is 14.55, which indicates a correct valuation of FUTU.
The rest of the industry has a similar Price/Forward Earnings ratio as FUTU.
When comparing the Price/Forward Earnings ratio of FUTU to the average of the S&P500 Index (25.64), we can say FUTU is valued slightly cheaper.

		Industry Rank	Sector Rank
PE	17.54
Fwd PE	14.55

4.2 Price Multiples

84.87% of the companies in the same industry are more expensive than FUTU, based on the Enterprise Value to EBITDA ratio.

		Industry Rank	Sector Rank
P/FCF	N/A
EV/EBITDA	12.63

4.3 Compensation for Growth

FUTU's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
The excellent profitability rating of FUTU may justify a higher PE ratio.
FUTU's earnings are expected to grow with 27.39% in the coming years. This may justify a more expensive valuation.