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XCMG Construction Machinery Co.

000425.SZ
50
Industrial - Machinery · Industrials
Price
¥7.15
-0.03 (-0.42%)
Market Cap
¥83.74B
Exchange
Shenzhen Stock Exchange
Winston Score
50
Winston is curious
Mixed quality — meaningful strengths and weaknesses.
Data as of Oct 9, 2026 · filings through Jun 30, 2026

§How the score breaks down

Quality
Mixed
8/30
Growth
Mixed
8/20
Cash Flow
Strong
8/10
Stability
Good
5/10
Valuation
Strong
7/10
Ownership
Good
10/15
Dividends
Strong
4/5

50 of 100 counted points = Winston Score 50.

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Share count rising — dilution

+47.2% over 4y

The company has issued more shares over this period, which dilutes each existing shareholder’s stake.

Diluted shares outstanding: 7.83B (2021) → 11.53B (2025)

§Winston Score History

The full picture

XCMG Construction Machinery is one of China's largest makers of heavy construction equipment. It builds cranes, excavators, road rollers, concrete machinery, and other tools used on building sites, mines, and infrastructure projects. The company is a top-ranked global construction machinery brand and a key supplier for large-scale projects in China and abroad.

XCMG earns revenue by selling and leasing heavy equipment, along with providing spare parts and after-sales service. It is headquartered in Xuzhou, Jiangsu Province, and exports to over 190 countries, making it one of the most internationally active Chinese machinery firms. Its scale, broad product lineup, and strong domestic distribution network give it a competitive edge. Key growth drivers include China's ongoing infrastructure spending and expanding overseas sales, though the business is cyclical and sensitive to slowdowns in construction activity both at home and globally.

Growth Profile

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

Revenue Growth

+12.4% YoY

YoY Growth Rate

Steady revenue growth

EPS Growth

-20.0% YoY

YoY Growth Rate

Earnings declining

R&D Spend

¥3.3B/ year

↓ Declining (-10% vs prior year)

3.3% of revenue

In line with sector average (4%)

R&D spend declining — could signal cost-cutting or efficiency

Insider Activity

35.7%ownership

→ Flat

Insider ownership roughly steady over the past year

Cash Runway

~5 years

¥35.4B cash & investments

Quarterly Free Cash Flow

↑ Burn rate improving

¥35.4B cash & investments at current burn rate

Growth context

XCMG Construction Machinery Co. is growing revenue at 12% year-over-year. The Winston Score measures business quality today — these growth metrics show what could matter tomorrow.

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

Profit per sale
Gross Margin
21.0%
Thin — 21.0% gross margin
Profit after running costs
Operating Margin
10.5%
Modest — 10.5% operating margin
Return on the money invested
ROCE
6.0%
Weak — 6.0% return on capital

ROIC between 5% and 15%. They earn 5 to 15 cents back per year on every dollar invested.

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Growth

Sales growth
Sales YoY
+10.8%
Steady sales growth (+10.8% YoY)
Profit growth
EPS YoY
-6.3%
Earnings shrinking (-6.3% YoY)

Slight earnings drop. Typical near a cyclical low.

How steady the profit is
EPS Consistency
5/8 quarters
Mixed — about half the quarters showed growth

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Cash Flow

Profit that turns into cash
Cash Conversion
241%
Turns 241% of profit into real cash
Spare cash per sale
FCF Margin
6.7%
Modest free cash flow (6.7%)

FCF margin between 0% and 10%. Some cash from sales, but not a lot.

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Stability

What it owes vs what it owns
Debt / Equity
1.09
Elevated debt (1.09)
Covers its interest
Interest Cover
7.66x
Adequate interest coverage (7.7x)

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

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Valuation

Price vs profit
P/E Ratio (TTM)
13.5x
Attractive valuation — P/E 13.5

P/E in the normal range. Price is roughly $15 for every $1 of yearly profit.

Cheaper or dearer next year
P/E vs Forward
+2.9
GROWING
Earnings expected to grow — slightly cheaper on forward P/E

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Dividends

Dividend
Dividend Yield
2.84%
Moderate income — 2.84% yield

Standard yield zone for stable dividend payers. A meaningful piece of total return.

Dividend record
Dividend Growth
+57.8%
Dividend growing fast (57.8% YoY)

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