Breaking Down Foran Energy Group Co.,Ltd. Financial Health: Key Insights for Investors

Curious whether Foran Energy Group Co., Ltd. (002911.SZ) is a buy, hold or watch? The quarter ended September 30, 2025 showed revenue of 8.16 billion CNY (TTM revenue 32.79 billion CNY) against a market capitalization of 15.78 billion CNY, while profitability flags include a TTM EPS of 0.55 CNY, first-half 2025 net income up 7.13% to 309 million CNY and margins of 3.36% (operating) / 2.69% (profit); valuation sits at a TTM P/E of 21.57 (forward P/E 15.68) with a dividend yield of 1.89% and a high payout ratio of 87.41%, balance-sheet signals show net cash of 837.89 million CNY, debt-to-equity of 0.44 and an Altman Z-Score of 2.67, and analysts model earnings/revenue growth of roughly 8%/7.5% (EPS growth ~13.1% p.a.) as the company expands its supply chain, R&D and equipment manufacturing-read on to see how these figures translate into risk, valuation and upside for investors.

Foran Energy Group Co.,Ltd. (002911.SZ) Revenue Analysis

• Quarter (Q3 2025) revenue: 8.16 billion CNY (‑0.16% QoQ).
• TTM revenue: 32.79 billion CNY (+8.74% YoY).
• FY 2024 revenue: 31.59 billion CNY (+23.70% vs 2023).
• Revenue per employee: ~13.15 million CNY (2,493 employees).
• P/S ratio: 0.48; Market cap: 15.78 billion CNY; Share price: 12.27 CNY (15 Dec 2025).

• Drivers: solid FY 2024 expansion (+23.7% YoY) contributing to elevated TTM figures despite a flat Q3 2025 quarter.
• Efficiency: revenue/employee at ~13.15M CNY indicates high per-capita productivity relative to mid-cap peers.
• Valuation context: P/S of 0.48 and market cap of 15.78B CNY suggest market is pricing modest revenue growth into the equity.

Foran Energy Group Co.,Ltd. (002911.SZ) Profitability Metrics

• Net income (H1 2025): 309 million CNY (+7.13% YoY)
• Trailing twelve months (TTM) EPS: 0.55 CNY
• Return on Equity (ROE): 11.28%
• Operating margin: 3.36%
• Profit margin (net margin): 2.69%
• Annual dividend: 0.23 CNY per share
• Dividend yield: 1.89%
• Payout ratio: 87.41%

• Strength: ROE above 10% signals competent capital deployment.
• Risk: High payout ratio limits retained earnings for growth or buffering downturns.
• Profitability pressure: Low operating and net margins mean small revenue shocks can materially affect net income.
• Shareholder return: Dividend of 0.23 CNY and EPS of 0.55 CNY show most profits returned to investors.

Foran Energy Group Co.,Ltd. (002911.SZ) - Debt vs. Equity Structure

• Debt-to-equity ratio: 0.44 (44%), indicating a balanced approach to debt vs. shareholders' equity.
• Five-year trend: debt-to-equity declined from 53.3% to ~43%, reflecting deleveraging and/or equity growth.
• Net debt to equity: 8%, a low net leverage level after cash and equivalents are considered.
• Operating cash flow covers 25.1% of total debt, showing operational cash generation contributes materially to debt servicing.
• Interest coverage ratio: 10.49 - EBIT covers interest expense more than tenfold, indicating strong capacity to meet interest obligations.
• Current ratio: 1.04, signifying short-term assets slightly exceed short-term liabilities.

• Implication for creditors: low net leverage (8%) and high interest coverage (10.49) reduce default risk under normal operating conditions.
• Implication for equity investors: declining debt-to-equity (53.3% → ~43%) may support improved earnings stability and lower financial risk.
• Potential watch items: operating cash covers 25.1% of debt - continued focus on free cash flow growth is important to accelerate de-risking.

Foran Energy Group Co.,Ltd. (002911.SZ) - Liquidity and Solvency

• Current ratio: 1.04 - just above the 1.0 threshold, indicating the company can cover short-term liabilities with short-term assets but with limited cushion.
• Quick ratio: 0.60 - below 1.0, suggesting reliance on inventory or slower assets to meet immediate obligations.
• Working capital: 294.39 million CNY - positive and supporting ongoing operations and short-term commitments.
• Net cash position: 837.89 million CNY - more cash than debt, enhancing financial flexibility and lowering solvency risk.
• Altman Z-Score: 2.67 - in the moderate-risk territory, not healthy enough to be "safe" but not in immediate distress.
• Piotroski F-Score: 5 - average operational and accounting health compared with peers.

• Operational implication: positive working capital and substantial net cash provide breathing room for investment or cyclical downturns, despite a low quick ratio.
• Risk consideration: Altman and Piotroski scores signal investors to monitor profitability, leverage trends, and cash flow stability.
• Actionable focus areas: strengthen quick liquidity (cash/equivalents and receivables) and maintain net cash advantage while improving profitability metrics.

Foran Energy Group Co.,Ltd. (002911.SZ) Valuation Analysis

Key market valuation metrics for Foran Energy Group Co.,Ltd. (002911.SZ) show the stock trades at a premium on several traditional multiples while forward measures imply expected earnings improvement.

• Premium current P/E (21.57) vs industry (16.06) signals market is pricing in either stronger future growth or lower perceived risk compared with peers.
• Forward P/E (15.68) falls notably below TTM P/E, aligning with the PEG (1.96) that suggests valuation roughly in line with expected growth.
• P/B of 1.64 indicates investors pay a meaningful premium over net asset value-important for capital-intensive or asset-heavy segments.
• EV/EBITDA at 10.97 is within a mid-range territory: not deeply cheap but not prohibitively expensive for industrial/energy peers.
• EV/FCF of 28.90 is elevated, implying the market assigns a high multiple to free cash flow-monitor free cash flow conversion and sustainability.

For deeper shareholder composition, trading patterns and investor motivations see: Exploring Foran Energy Group Co.,Ltd. Investor Profile: Who's Buying and Why?

Foran Energy Group Co.,Ltd. (002911.SZ) - Risk Factors

• Regulatory & policy risk: As a utilities-sector company, Foran Energy is exposed to changes in energy policy, environmental regulation, grid rules and subsidy regimes that can materially affect permitted tariffs, allowed returns and capital expenditure timing.
• Commodity-price exposure: Fluctuations in natural gas prices can materially impact revenue and gross margins, particularly when pass-through mechanisms are limited or lagged.
• High payout pressure: A high dividend payout reduces retained earnings available for reinvestment and debt reduction, constraining balance sheet flexibility and growth spending.
• Short-term liquidity constraints: A quick ratio below 1.0 indicates potential difficulty meeting immediate liabilities without converting inventory or raising external funds.
• Financial distress indicators: Credit and solvency metrics point to moderate bankruptcy risk; changes in operating cash flow or leverage could push the company into higher-risk territory.

• How these risks interact:
  • Regulatory shocks that compress allowed rates or increase compliance costs reduce operating cash flow, worsening quick-ratio pressure and making a high payout ratio unsustainable.
  • Sharp rises or falls in natural gas prices can create margin volatility; if revenues decline, a high payout combined with moderate Altman Z-Score (2.67) increases bankruptcy risk.
  • Piotroski F-Score of 5 highlights mixed operational and balance-sheet signals - management must improve returns on assets and reduce leverage to strengthen resilience.

Foran Energy Group Co.,Ltd. (002911.SZ) Growth Opportunities

• Core expansion areas: energy supply chain integration, engineering services, technology R&D, and equipment manufacturing.
• Business diversification: supply chain & other business revenue rose 21.52% YoY, signaling shifting revenue mix.
• Resource integration: consolidating upstream/downstream capabilities to improve margin capture and project delivery speed.

• Projected compounding of EPS (13.1% p.a.) outpaces revenue growth, implying margin expansion or efficiency gains from vertical integration and higher‑margin services.
• ROE target of 11.7% in three years suggests management expects improved capital allocation and returns as new businesses scale.
• Supply chain revenue jump (21.52% YoY) validates strategy to diversify away from cyclic core segments and capture aftermarket/engineering service margins.