Hongli Group (HLP) Stock Analysis & Winston Score

Hongli Group Inc., through its subsidiaries, designs, customizes, manufactures, and sells cold roll formed steel profiles for machinery and equipment in the People's Republic of China, South Korea, Japan, the United States, and Sweden. It serves mining and excavation, construction, agriculture, and transportation industries. The company was incorporated in 2021 and is headquartered in Weifang, China. Hongli Group Inc. is a subsidiary of Hongli Development Limited.

Winston Score History

Growth Profile

For growth stock investors

When traditional metrics don't capture the full picture, these are the signals growth stock investors use instead.

Revenue Growth

+40.2% YoY

YoY Growth Rate

Revenue accelerating

EPS Growth

>+1,000% YoY

YoY Growth Rate

EPS growth accelerating

Insider Activity

40.7%ownership

↑ Rising

Insiders increasing their stake — aligned with shareholders

Cash Position

Cash flow positive

$2M cash & investments

Quarterly Free Cash Flow

→ Burn rate stable

Company generates more cash than it spends — no dilution risk from fundraising

Revenue accelerating

Hongli Group grew revenue 40% year-over-year and the growth rate is speeding up. That's the kind of momentum growth investors look for — the question is whether margins can follow.

The Winston Score above measures business quality today. Growth stocks often score lower because they invest in the future rather than maximising current profits. These metrics show what matters most for evaluating that future.

Score breakdown

Every number that matters to educated investors.

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Quality

Gross Margin

30.9%

Modest — 30.9% gross margin

Operating Margin

11.5%

Modest — 11.5% operating margin

ROCE

1.7%

Weak — 1.7% return on capital

ROIC between 0% and 5%. They earn a few cents back per dollar invested in the business.

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Growth

Sales YoY

-7.1%

Shrinking sales (-7.1% YoY)

EPS YoY

-139.1%

Earnings shrinking (-139.1% YoY)

Earnings per share down more than 10%. Either a bad year, or a real decline.

EPS Consistency

2/8 quarters

Earnings rarely grow — volatile business

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Cash Flow

Cash Conversion

758%

Turns 758% of profit into real cash

FCF Margin

-0.6%

Burning cash (-0.6%)

Free cash flow is negative. They are burning cash, not generating it.

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Stability

Debt / Equity

0.20

Conservative — low debt load (0.20)

Interest Cover

0.91x

Dangerous — barely covers interest (0.9x)

Interest coverage below 1. Their profits don't cover the interest bill.

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Valuation

P/E Ratio (TTM)

41.9x

no trend

Pricey — P/E 41.9

P/E over 35. The market is pricing in heavy, sustained growth.

P/E vs Forward

N/A

not available

Data not available

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Dividends

Not applicable for this business.

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