Legend Holdings Corporation (3396.HK) stock analysis

In our weekly check, Legend Holdings Corporation is graded D (A to F). Of 24 checks on debt, profit, cash flow and trend: 11 pass, warnings: 4, red flags: 9.

About Legend Holdings Corporation

Legend Holdings Corporation is a Financial Services company (Financial - Conglomerates) based in China, listed on HKSE as 3396.HK.

What our checks show for 3396.HK

Red flags

• Net debt is 4x a year of EBITDA (debt/equity 3.94). 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.
• The net margin fell by 1 points over 5 years, to 0.2%: the company keeps less of each sale as profit.
• Operating cash flow is negative while the company reports a profit: the profit does not arrive as cash.
• The net margin is only 0.2%: little room if costs rise.
• Free cash flow is negative (-2.8% of revenue): the business spends more cash than it brings in.
• The price swings a lot: 62% annual volatility. Expect large ups and downs.
• The stock has fallen as much as 88% from a peak. Would you have held through that?
• Pay in shares equals 0% of free cash flow: it dilutes shareholders.

Warning signs

• The gross margin fell by 0.8 points, to 16.8%: costs are rising faster than prices.
• Earnings per share fell 3.5% a year over the last 3 years.
• Net profit fell 3.1% a year over the last 3 years.
• The stock is still below its previous peak.

Strengths

• Analysts expect earnings per share to grow about 120% a year over the next years.
• Analysts expect revenue to grow about 18.9% a year over the next years.
• The price is 11.7 times earnings (P/E), reasonable for its growth.
• Actively traded: about 11.9 million shares a day.

Similar companies

6881.HK · EXO.AS · SOL.AX · STB.OL · 4065.KL · FRHC

Questions

What grade does Legend Holdings Corporation (3396.HK) have?

In our weekly check, Legend Holdings Corporation is graded D (A to F). Of 24 checks on debt, profit, cash flow and trend: 11 pass, warnings: 4, red flags: 9. The grade is a risk check, not a buy or sell recommendation.

What are the main risks of 3396.HK stock?

This week's biggest flags for Legend Holdings Corporation: High debt, Weak interest cover, Margins falling. In total 13 of 24 checks show a warning or a red flag.

What does Legend Holdings Corporation do?

Legend Holdings Corporation is a Financial Services company (Financial - Conglomerates) based in China, listed on HKSE as 3396.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 2026-10-31

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