Photo by Jason Briscoe on Unsplash
 

Sinopharm Group Co Ltd (SHTDY) was founded in 2003 and listed on the Hong Kong Stock Exchange in September 2009.

Its main business is drug distribution in mainland China, which contributes about 75% of total revenue. It is the largest drug distributor, with approximately 20% market share.

Other notable segments are medical device distribution, which contributes about 20% of revenue, and retail pharmacies, which contribute about 5%.

These are fast-growing industries, where government policy is designed to encourage consolidation and promote large players with scale and efficiency advantages.

Founded in 2003 the company is headquartered in Shanghai, the People's Republic of China.

Sinopharm Group Co. Ltd. is a subsidiary of Sinopharm Industrial Investment Co., Ltd.

Three key data points gauge Sinopharm Group Co Ltd, or any dividend-paying firm.

The key three are:

(1) Price

(2) Dividends

(3) Returns

Those three basic keys best tell whether any company has made, is making, and will make money.
 

SHTDY Price

Over the past year, Sinopharm’s share price rose 30% from $11.72 to $15.24 as of Wednesday’s market close.

If Sinopharm’’s stock trades in the range of $10.00 to $20.00 this next year, its recent $15.24 share price might rise to $16.50 by next year. Of course, Sinopharm’’s price could drop about the same $1.26 amount, or more.

My upside estimate of $1.26, however, is not supported by analysts tracking the stock for brokers, but price history shows that’s the average Orion annual price increase per share over the last 3 years.
 

SHTDY Dividend

Sinopharm’’s most recent $0.60 annual dividend, payable August 29th to shareholders of record June 15th, throws a yield of 3.91% as of Wednesday’s closing price.
 

SHTDY Returns

Adding the $0.60 anticipated annual dividend to Sinopharm’’s estimated $1.26 price upside reveals a $1.86 potential gross gain per share for the coming year.

At Wednesday’s $15.24 closing price, a little over $1000 would buy 66 shares.

A $10 broker fee (if charged), paid half at purchase and half at sale, might cost us about $0.15 per share.

Subtracting that maybe $0.15 brokerage cost from my estimated $1.86 gross gain per share makes a net gain amounting to $1.71 X 66 shares = $112.86 for about an 11.3% net gain.

This may be the time to pounce on Sinopharm Group Co Ltd. But beware, as its dividend is variable, its price is volatile, and it bounces between $9 up to the stock’s all-time high of $29.09 posted back on or about April 5, 2018.

The foregoing article is based on past history of Sinopharm Group Co Ltd. The only accurate measure of future performance is from active investment in the company.

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