MTR Corporation Limited (0066.HK) stock analysis

In our weekly check, MTR Corporation Limited is graded C (A to F). Of 25 checks on debt, profit, cash flow and trend: 14 pass, warnings: 2, red flags: 9.

About MTR Corporation Limited

MTR Corporation Limited is an Industrials company (Railroads) based in Hong Kong, listed on HKSE as 0066.HK.

What our checks show for 0066.HK

Red flags

• Net debt is 5.3x a year of EBITDA (debt/equity 1). That limits room in a downturn and raises refinancing risk.
• Operating profit does not cover the interest bill (0.5x): interest is paid from cash or new debt.
• Analysts expect the net margin to shrink by 10.7 points from today's 25.3%.
• Free cash flow is negative (-13.9% of revenue): the business spends more cash than it brings in.
• The dividend takes 456% of profit: little cushion if profit falls.
• The stock has fallen as much as 62% from a peak. Would you have held through that?
• Recovering from its deepest fall took about 6.1 years.
• Return on capital (ROCE) is only 0.8%.
• Pay in shares equals 0% of free cash flow: it dilutes shareholders.

Warning signs

• Analysts expect earnings per share to shrink about 16.8% a year.
• Analysts expect only about 1.3% a year of growth in revenue.

Strengths

• The net margin rose by 5.1 points over 5 years, to 25.3%.
• The gross margin is 24.2% and has risen by 17.8 points: pricing power is holding.
• Earnings per share grew 14.1% a year over the last 3 years.
• Net profit grew 12.6% a year over the last 3 years.
• The company keeps 25.3% of its revenue as net profit.
• The price is 8.8 times earnings (P/E), reasonable for its growth.

Similar companies

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Questions

What grade does MTR Corporation Limited (0066.HK) have?

In our weekly check, MTR Corporation Limited is graded C (A to F). Of 25 checks on debt, profit, cash flow and trend: 14 pass, warnings: 2, red flags: 9. The grade is a risk check, not a buy or sell recommendation.

What are the main risks of 0066.HK stock?

This week's biggest flags for MTR Corporation Limited: High debt, Weak interest cover, Margins expected to shrink. In total 11 of 25 checks show a warning or a red flag.

What does MTR Corporation Limited do?

MTR Corporation Limited is an Industrials company (Railroads) based in Hong Kong, listed on HKSE as 0066.HK.

The grade is a risk check, not a price forecast, and not investment advice. In our 10-year test (S&P 500, 2016-2026), stocks we graded A or B fell more than 30% 2-3 times less often than D or F, without a lower average return.

Updated 2026-10-24

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