Victory Securities (SEHK:8540) EPS Surge In 1H 2025 Tests Cautious Valuation Narratives

Victory Securities (Holdings) (SEHK:8540) has set a clear earnings marker for FY 2025, with first half revenue of HK$121.4 million and basic EPS of HK$0.213 supported by net income of HK$41.3 million. Over the past three reporting halves, revenue has moved from HK$26.8 million in 1H 2024 to HK$42.2 million in 2H 2024 and then to HK$121.4 million in 1H 2025, while EPS has shifted from a loss of HK$0.030 in 1H 2024 to HK$0.014 in 2H 2024 and HK$0.213 in 1H 2025. Together with trailing twelve month profitability and what appears to be high quality earnings, the latest figures indicate firmer margins and a business that is currently converting revenue into bottom line results more effectively.

See our full analysis for Victory Securities (Holdings).

With the headline numbers on the table, the next step is to assess how this profit profile lines up against the most widely held narratives around Victory Securities and where those views might need updating.

Curious how numbers become stories that shape markets? Explore Community Narratives

TTM revenue reaches HK$223.3 million

• On a trailing twelve month (TTM) basis, total revenue sits at HK$223.3 million, compared with HK$163.5 million at the prior TTM data point and HK$68.9 million one period before that. This highlights how much of the recent story is concentrated in the latest few halves.
• What stands out for a more bullish read is how this revenue profile lines up with profitability, because:
  • TTM net income moved from a loss of HK$3.1 million to a profit of HK$43.9 million and then HK$60.4 million. This supports the view that the business is now earning money on a larger top line.
  • Basic EPS on the same TTM view improved from a loss of HK$0.016 to HK$0.226 and then HK$0.309. This indicates that recent revenue is feeding through to per share results rather than just higher activity with no earnings.

Profitability shift supports high quality label

• Across the last three reported halves, net income moved from a loss of HK$5.8 million in 1H 2024 to HK$2.6 million in 2H 2024 and HK$41.2 million in 1H 2025. This lines up with the comment that the company became profitable over the last year.
• Supporters of a bullish narrative argue that this kind of move reflects a more durable earnings base, and the data gives them some backing because:
  • Five year earnings growth is cited at 5.7% per year and TTM earnings are described as high quality. This sits alongside the recent turn into profit rather than relying on a one off spike.
  • The step up in 1H 2025 EPS to HK$0.213 from a small profit of HK$0.014 in 2H 2024 and a loss in 1H 2024 reinforces the view that the business is not just marginally profitable but currently generating meaningfully higher per share earnings than a year ago.

On the back of this earnings shift, it is worth seeing how other investors frame the full story, from the optimistic takes to the more cautious ones through the community narratives.Curious how numbers become stories that shape markets? Explore Community Narratives.

P/E of 16.5x versus higher peer multiples

• The trailing P/E of 16.5x sits below both the Hong Kong Capital Markets industry average of 17.5x and the peer average of 45.4x. This places Victory Securities on the lower side of the valuation range in the comparison set provided.
• General market opinion that the shares are not priced like the most optimistic peers finds some support in the figures, yet there is also a twist worth noting:
  • A five year earnings growth rate of 5.7% per year and TTM EPS of HK$0.309 sit alongside this 16.5x multiple, so the current price of HK$4.69 is being compared against a business that is both profitable and reporting earnings growth over a multi year period.
  • At the same time, the gap to the 45.4x peer average shows that, even with recent profitability, the market data provided does not put Victory Securities in the same valuation bracket as higher rated names. Some investors may interpret this as leaving room for further fundamental evidence before that kind of rating is considered.

Next Steps

Don't just look at this quarter; the real story is in the long-term trend. We've done an in-depth analysis on Victory Securities (Holdings)'s growth and its valuation to see if today's price is a bargain. Add the company to your watchlist or portfolio now so you don't miss the next big move.

If this combination of improving earnings and a lower P/E has you curious, consider reviewing the details yourself. Stress test the numbers against your own expectations, and then see how those compare with the 2 key rewards.

See What Else Is Out There

Victory Securities trades on a lower P/E than many peers, which suggests the market may still be cautious about the strength and consistency of its earnings story.

If you want ideas where the market already prices in stronger quality signals and valuation support, check out the 228 high quality undervalued stocks to compare alternatives quickly.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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