Shengfeng Development Limited (SFWL) Stock Analysis & Winston Score

Shengfeng Development Limited is a Chinese logistics and freight transportation company. It moves goods across China for businesses, mainly using a network of trucks and regional hubs to deliver cargo from one city to another. The company operates in China's less-than-truckload (LTL) freight market, where shipments from multiple customers are combined into single truck loads to cut costs.

Shengfeng earns money by charging businesses a fee to pick up, sort, and deliver their freight. It operates entirely within China and is a relatively small player in a fragmented industry dominated by larger rivals like S.F. Holdings and ZTO Express. Margins are thin — gross margin sits around 9% — because fuel, labor, and vehicle costs are high. The main growth driver is rising domestic e-commerce demand in China, but the biggest risk is intense price competition from well-funded national carriers that have larger networks and stronger brand recognition.

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

+11.6% YoY

YoY Growth Rate

Steady revenue growth

EPS Growth

+3.8% YoY

YoY Growth Rate

Slow EPS growth

R&D Spend

$0/ year

0.0% of revenue

Below sector average (4%)

Research and development spending

Insider Activity

75.9%ownership

→ Flat

Insiders holding steady — not selling despite ability to

Cash Position

Cash flow positive

$39M cash & investments

Quarterly Free Cash Flow

↑ Burn rate improving

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

Growth + cash flow

Shengfeng Development Limited is a rare growth stock that's already generating positive cash flow while growing at 12%. The Winston Score doesn't fully credit this transition from "burner" to "earner."

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.

Share count broadly stable

+0.1% over 4y

The share count has stayed roughly flat over this period — little dilution or buyback activity.

Diluted shares outstanding: 82.4M (2021) → 82.5M (2025)

Score breakdown

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Quality

Gross Margin

9.4%

Thin — 9.4% gross margin

Operating Margin

2.9%

Thin — 2.9% operating margin

ROCE

4.0%

Weak — 4.0% 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

+39.0%

Fast-growing sales (39.0% YoY)

EPS YoY

+24.3%

Earnings growing fast (24.3% YoY)

Healthy double-digit earnings growth — what compounders look like.

EPS Consistency

6/8 quarters

Earnings grew in most of the last 8 quarters

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Cash Flow

Cash Conversion

136%

Turns 136% of profit into real cash

FCF Margin

-2.5%

Burning cash (-2.5%)

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

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Stability

Debt / Equity

0.71

Moderate — manageable debt (0.71)

Interest Cover

6.70x

Adequate interest coverage (6.7x)

Interest coverage between 3 and 8. Profits cover interest several times over.

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Valuation

P/E Ratio (TTM)

2.9x

Attractive valuation — P/E 2.9

P/E under 10. The price tag is small relative to last year's profit.

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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