HMM is Korea's largest liner shipping company, carrying manufactured and consumer goods by container ship. Its profit is effectively driven by swings in container freight rates (the SCFI), giving it high operating leverage in which rising rates fall straight through to profit, and the roughly ₩15 trillion in current assets built up during the past boom generates steady interest income as well. In March, its corporate value-up plan proposed a policy of returning at least the smaller of a 30% payout ratio or a 5% dividend-to-market yield through 2030; in 2025 it returned a total of ₩2.7 trillion for a total shareholder-return ratio of 72.8%, and in June freight rates rebounded to their highest in one year and ten months. What stands out lately is that a solid balance sheet with a 26% debt ratio, a P/B of 0.65x, codified shareholder returns, and the freight-rate rebound are strengths, while volatility from earnings being tied almost entirely to the single variable of freight rates, and supply-demand uncertainty tied to the sale of roughly 70% of the shares, are points to watch.
At-a-glance assessment financial health · growth · profitability · valuation
- Debt ratio, current ratio and interest burden all look healthy.
- Revenue fell 6.9% year over year (3-year trend: mixed).
- Most recent quarter (Q1 2026) revenue was 4.8% lower than a year earlier.
- ROE is 7.1% (controlling-interest basis). It is above the sector average.
- Operating margin is 13.4%.
- The forward P/E sits above the sector median, reflecting elevated expectations.
Ownership & governance As of 2025-12-31
Largest shareholder Korea Development Bank 35.42% (corporate)
Controlling bloc incl. related parties 35.42%
With the controlling bloc holding 35%, the ownership structure is stable.
🔎 In-depth analysis
- HMM is Korea's largest liner (scheduled-service) shipping company, carrying manufactured and consumer goods by container ship.
- Most of its revenue comes from container transport, with the trans-Pacific (US West and East Coast) and Europe routes being core lines.
- There is some bulk (raw-materials and grain) business too, but its weight is small, and profit and loss are effectively driven by swings in container freight rates.
- Because rising rates fall straight through to profit even on the same ship and the same voyage — high operating leverage — the freight index (SCFI) effectively determines quarterly results.
- Also, unlike other shipping companies, it holds a lot of cash built up during the past boom (current assets of about ₩15 trillion), so interest income arises steadily apart from operations.
- The recent closing price is ₩19,320 and the market cap is ₩18.2 trillion.
- The price sits below its 20-day line (₩19,668) and below its 60-day line (₩20,036).
- Being below both short- and medium-term moving averages, the trend looks subdued.
- The RSI (a gauge that compares upward and downward strength over the last 14 days on a 0–100 scale) is 48.3, a neutral level.
- The price is up 5.1% over one month and down 4.1% over three months, and sits 25.6% below its 52-week high.
- Relative strength versus the KOSPI is 23 (1–99, a measure of return versus the index over the past year weighted toward recent performance; higher means stronger than the market).
- That places it in roughly the top 77% of all stocks by strength.
- Over the past three months it lagged the index by 24.6%.
- Chart readings are best viewed alongside trading volume and disclosure dates.
- The P/E is 9.70x and the P/B is 0.69x, trading below net asset value.
- ROE (how much a company earns in a year on its equity) is 7.1%, the operating margin is 13.4%, and the net margin is 17.3%, so profitability itself is good.
- The balance sheet is very solid, with a low debt ratio of 26% and a current ratio (assets soon convertible to cash against debts due within a year) of 581%, so cash is very thick.
- A dividend yield of 3.8% (₩700 per share) also supports it.
- That said, the 9.2x P/E is based on 2025 results, when profit plunged (net profit of ₩1.88 trillion), so in a sector like shipping, where profit swings widely year to year, it is hard to conclude it is expensive or cheap on a single year's number alone.
- It is more appropriate to view it on a forward (this-year estimate) basis reflecting this year's freight-rate trend.
- Net profit over the past five years — ₩5.3 trillion in 2021, ₩10.1 trillion in 2022 (a record boom), ₩1.0 trillion in 2023 (a downturn trough), ₩3.8 trillion in 2024, and ₩1.9 trillion in 2025 — swung widely, tracking the freight cycle.
- 2025 shrank, with revenue −6.9%, operating profit −58%, and net profit −50%, largely because the freight premium from rerouting faded as the Red Sea and Middle East situation normalized, and fuel costs rose.
- The first quarter of 2026 was also weak, with revenue of ₩2.72 trillion, operating profit of ₩269.1 billion (−56%), and net profit of ₩353.6 billion (−52%), the direct cause being the quarterly average SCFI falling 14% to 1,507 from 1,762 a year earlier.
- The forward picture, however, is different.
- On June 12 the SCFI hit 2,985, the highest in one year and ten months, rising for a seventh straight week — about double the first-quarter average.
- Because freight rates drive quarterly profit and loss, it is reasonable to see a trajectory of second- and third-quarter profit recovering clearly, rather than simply multiplying the first-quarter trough by four.
- That the company itself cited increased supply from newbuild deliveries in the second half as a downward factor for rates is a variable that limits the extent of recovery.
- In the March 27, 2026 corporate value-up plan (voluntary disclosure), the company presented a policy of returning at least the smaller of a 30% payout ratio or a 5% dividend-to-market yield through 2030, along with targets of a 4% three-year average ROE and 9% average annual revenue growth.
- The company said that in 2025 it returned a total of ₩2.7 trillion — combining a year-end dividend of about ₩528.6 billion with the acquisition and retirement of 81.8 million treasury shares (about ₩2.1 trillion) — for a total shareholder-return ratio of 72.8%.
- On May 13, the first-quarter report confirmed the earnings decline from weak freight rates.
- Meanwhile, the sale (privatization) of the stake held jointly at about 70% by the Korea Development Bank and Korea Ocean Business Corporation restarted in 2026, remaining a key variable for governance and supply and demand.
- The strengths are clear: a solid balance sheet with a 26% debt ratio and a 581% current ratio, a P/B of 0.65x below net asset value, codified shareholder returns that put a floor under the payout ratio at 30%, and freight rates that rebounded in June to their highest in one year and ten months.
- The first-quarter weakness is closer to a temporary bottom made by a freight-rate trough, and on a forward basis, even if the trailing P/E looks high, there is a strong chance profit rises again this year on the freight-rate recovery.
- Conversely, the points to watch are the intrinsic volatility of earnings being tied almost entirely to the single variable of freight rates, increased vessel-space supply from newbuild deliveries in the second half, external variables such as US tariffs and the Middle East situation, and the supply-demand uncertainty the sale of roughly 70% of the shares will create.
- If freight rates carry on the current rebound and the sale proceeds in an orderly way, the undervaluation appeal comes to the fore; if rates turn down again or the sale drifts, it becomes a stock of greater volatility.
🔎 Valuation vs peers Undervalued
Compared against domestic maritime-transport (liner and bulk) listed companies whose business substance is closest. HMM is container-liner-centered while Pan Ocean and Korea Line are bulk-centered, so with differences in business composition, the absolute-multiple gaps are treated only as reference.
| Peer | P/E | P/B | ROE |
|---|---|---|---|
| Pan Ocean | 8.87x | 0.47x | 5.27% |
| Korea Line | 3.30x | 0.28x | 8.35% |
(a) Against the domestic shipping peer set (Pan Ocean P/E 8.1x, P/B 0.43x; Korea Line P/E 3.2x, P/B 0.27x), HMM's P/B of 0.65x is the highest, but this is explained as a premium for overwhelming cash and balance-sheet stability and codified shareholder returns. (b) Conversely, the absolute levels of the P/E and P/B themselves are low, as across the sector, so it is at a discount relative to asset value. (c) The headline P/E of 9.2x is based on 2025, when profit halved, so it carries the limitation typical of earnings-inflection stocks. Simply extending the first-quarter freight trough would understate it; on a forward basis reflecting the June rate rebound, profit rises again and the valuation burden falls further. Taking the solid balance sheet, low asset multiple, and freight-rate rebound together, we see it as undervalued, but the volatility from earnings tied to the single freight-rate variable and the supply-demand variable of the share sale must be weighed together.
Price history Close · MA20 · MA60
The latest close is ₩19,320 and the market capitalization is ₩18.2 trillion. The price sits below its 20-day moving average (₩19,668) and below its 60-day moving average (₩20,036). It is under both its short- and medium-term moving averages, so the trend looks subdued. The RSI (a supplementary indicator that gauges the strength of gains versus losses over the past 14 days on a 0-100 scale) is 48.3, a neutral level. The one-month change is +5.1%, the three-month change is -4.1%, and the position relative to the 52-week high is -25.6%. Relative strength versus the KOSPI is 24 (on a 1-99 scale, converted from returns against the index over the past year with more weight on recent performance; higher means stronger than the market). It is stronger than roughly 23% of all stocks. Over the past three months it lagged the index by 24.6%. Chart interpretation is best done alongside trading volume and the dates on which disclosures occur.
Relative performance stock vs index · start = 100
Excess return vs index · 3M -24.65% / 6M -39.81% / 12M -65.45%
Key metrics vs sector median
Valuation
The P/E of 9.70x is in line with the sector median (8.87x). The P/B of 0.69x is above the sector median (0.47x).
Enterprise value (EV)
EV = market cap + net debt. It reflects cash and debt, so it captures the real cost of the whole business that market cap alone misses; lower multiples are cheaper relative to earnings or sales.
Intrinsic value (DCF estimate)
DCF (discounted cash flow) estimate — discount rate 10.4%, initial growth 2.0%→terminal 2.0%, 10-yr forecast, free-cash-flow basis, forward earnings power normalized 0.689x. A reference range that shifts materially with assumptions.
Profitability & financials
Return on equity (ROE) is 7.1%, in line with the sector average (7.0%). The operating margin is 13.4%. The debt ratio is 26.3%, so the financial structure is stable.
Growth FY2025 · annual report (consolidated)
| Item | 2023 | 2024 | 2025 | YoY |
|---|---|---|---|---|
| Revenue | $5.6B | $7.8B | $7.2B | -6.91% ↓ slower |
| Operating profit | $387.6M | $2.3B | $968.4M | -58.40% ↓ slower |
| Net profit | $641.9M | $2.5B | $1.2B | -50.33% ↓ slower |
| 5-year | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|
| Revenue | $9.1B | $12.3B | $5.6B | $7.8B | $7.2B |
| Operating profit | $4.9B | $6.6B | $387.6M | $2.3B | $968.4M |
| Net profit | $3.5B | $6.7B | $641.9M | $2.5B | $1.2B |
| Revenue CAGR | 4-yr avg -5.74% | ||||
Revenue fell 6.9% year over year (2023 ₩8.4 trillion → 2024 ₩11.7 trillion → 2025 ₩10.9 trillion), and the three-year trend is 'mixed'. The rate of decline widened from the prior year. Operating profit fell 58.4% year over year. The decline widened. Over the 5 years on record, revenue compound annual growth (CAGR) is -5.7%. The two-year revenue CAGR is 13.9%. In the most recent quarter (Q1 2026), revenue was 4.8% lower than the same period a year earlier.
Latest quarterly results Q1 2026 · vs year-ago
Technical indicators
What stands out
- The dividend yield, at 3.6%, is on the high side.
- The balance sheet is stable in terms of debt and liquidity.
Points to watch
- Revenue fell 6.9% year over year (3-year trend: mixed).
- The price is high versus peers, so expectations already appear priced in.
Recent news & events searched · sourced
- 2026-03-27FilingCorporate value-up plan (voluntary disclosure): returning at least the smaller of a 30% payout ratio or a 5% dividend-to-market yield through 2030, with targets of a 4% three-year average ROE and 9% average annual revenue growthMedium term: codifies a floor for dividend and buyback returns, raising the predictability of shareholder returns. Source
- 2026-05-13EarningsQ1 2026 quarterly report: revenue of ₩2.72 trillion, operating profit of ₩269.1 billion (−56% year on year), net profit of ₩353.6 billion (−52% year on year), operating margin of 9.9%Short term: confirms a freight-rate trough (quarterly average SCFI of 1,507, −14% year on year), reflecting the sharp profit decline. Source
- 2026-06-01FilingLarge-business-group status disclosure: confirms a governance structure in which the Korea Development Bank and Korea Ocean Business Corporation hold about 70% combinedMedium term: draws attention to the supply-demand and governance variable of the ongoing share sale (privatization). Source
- 2026-04-01FilingReport on large holdings of stock, etc. (abbreviated): disclosure of changes in key holdingsShort term: provides background information on major-shareholder ownership trends and the sale discussions. Source
Figure cross-check computed ↔ external
Recent filings
- 2026-06-01Corporate governance report
- 2026-06-01Large-business-group status disclosure
- 2026-06-01Large-business-group status disclosure
- 2026-05-13PeriodicQuarterly report
- 2026-05-08Shareholders' meeting notice
- 2026-04-23Disclosure
- 2026-04-23Shareholders' meeting notice
- 2026-04-01OwnershipOwnership-change filing
- 2026-03-30Shareholders' meeting notice
- 2026-03-30Disclosure
- 2026-03-27Disclosure
- 2026-03-26Disclosure
📖 Plain-language glossary — expand if you are new to this
- P/E
- How many times a year's net profit the price is worth (lower is cheaper relative to earnings). The P/E here is on trailing (last full-year) results; for companies whose earnings swing fast (memory chips and other cyclicals/high-growth), a forward P/E on this year's expected earnings is more accurate.
- P/B
- Price relative to net assets (equity). Around 1x means it trades near book value; below 1x means below book.
- P/S
- Price relative to a year's revenue — useful for growth companies with thin earnings.
- Net debt / EV
- Net debt = interest-bearing debt − cash. Negative means more cash than debt (net cash). EV (enterprise value) = market cap + net debt, closer to what it would cost to buy the whole business.
- EV/EBIT · EV/EBITDA · EV/Sales
- Enterprise value against operating profit (EBIT), EBITDA, or revenue. Unlike P/E these reflect debt and cash; lower is cheaper relative to earnings power or sales.
- FCF / FCF yield
- Free cash flow = operating cash − capex, the cash actually left over. FCF yield = FCF ÷ market cap; higher means more cash generated per unit of market value.
- Intrinsic value (DCF)
- Future free cash flow (or, for some capex-heavy but profitable names, forecast earnings) discounted to today to estimate per-share value. Because it shifts a lot with the discount-rate and growth assumptions, it is shown as a bear/base/bull range, and the basis and assumptions are disclosed in one line beneath it.
- ROE
- How much profit the company earns in a year on its equity (%). Higher means better returns on capital.
- EPS / BPS
- Earnings per share / net assets (book value) per share.
- Operating / net margin
- Profit left from the core business / final profit after tax and interest, per unit of revenue.
- Debt ratio
- Debt relative to equity (%). Higher means more reliance on borrowing (norms vary by sector).
- Current ratio
- Assets convertible to cash within a year against debt due within a year. Above 100% leaves some short-term headroom.
- Interest coverage
- How many times operating profit covers the interest owed. Below 1x means operating profit alone struggles to cover interest.
- Dividend yield / payout ratio
- The year's dividend as a % of today's price / the share of earnings paid out as dividends.
- Revenue CAGR
- Multi-year growth expressed as a single yearly average (compound annual growth rate).
- RSI (short-term signal)
- Whether recent price action is overheated or beaten down. Above 70 is overbought, below 30 oversold.
- MA20 / MA60 (moving averages)
- The 20- and 60-day average price. Price above them signals a firmer short-term trend.
- vs 52-week high
- How far below the past year's peak the price sits now (%).
All figures are for reference only; how they read varies by sector and over time.
Sources: Korea FSC market-price API (data.go.kr), OpenDART, KRX/KIND — public data only.
Bong Stocks presents public-data-based information for reference only. It is not investment advice and contains no target prices, ratings, or buy/sell recommendations. Verify independently before making any decision.