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HUTCHMED (China) Limited (HCM) Stock Analysis

Falling Knife setup

SellVALUE-TRAP 2/5Moderate Confidence

Healthcare · Drug Manufacturers - Specialty & Generic

Sell if holding. Engine safety override at $13.45: Quality below floor (3.8 < 4.0) triggers a hard block regardless of the otherwise-positive setup — overall score 4.3/10 and A.R:R 7.6:1 is above the 1.5:1 BUY gate. Specifically: Elevated put/call ratio: 5.50; Below-average business quality; Negative price momentum.

HUTCHMED (China) Limited, together with its subsidiaries, discovers, develops, and commercializes targeted therapeutics and immunotherapies to treat cancer and immunological diseases in Hong Kong, the United States, and internationally. It provides Fruquintinib, a selective and... Read more

$13.45+52.9% A.UpsideScore 4.3/10#29 of 29 Drug Manufacturers - Specialty & Generic
Stop $12.81Target $20.57(analyst − 10%)A.R:R 7.6:1
Analyst target$22.85+69.9%15 analysts
$20.57our TP
$13.45price
$22.85mean
$40

Sell if holding. Engine safety override at $13.45: Quality below floor (3.8 < 4.0) triggers a hard block regardless of the otherwise-positive setup — overall score 4.3/10 and A.R:R 7.6:1 is above the 1.5:1 BUY gate. Specifically: Elevated put/call ratio: 5.50; Below-average business quality; Negative price momentum. Chart setup: Death cross, below all MAs, RSI 25, MACD bearish. Score 4.3/10, moderate confidence.

Passes 5/7 gates (favorable risk/reward ratio, clean insider activity, no SEC red flags, earnings proximity 91d clear, semi cycle peak clear). Fails on weak momentum and death cross (50MA < 200MA). Suitability: aggressive.

Val7.7Qual3.8Grw0.0Mom1.8Sent7.4Ins5.0Peer3.8Tech7.3Risk3.74.3OVERALL

Thesis

Rewards
No bull case signals
Risks
Cyclical trap - fwd PE 26x vs trail 5x (5.1x)
Quality below floor (3.8 < 4.0)
Value-trap signals (2/5): High leverage (D/E 2.9), Material insider selling (6 sells, 0.21% of cap)

Key Metrics

P/E (TTM)5.0
P/E (Fwd)25.7
Mkt Cap$2.3B
EV/EBITDA-395.7
Profit Mgn83.3%
ROE45.3%
Rev Growth-16.5%
Beta0.45
DividendNone
Rating analysts27

Quality Signals

Piotroski F1/9

Options Flow

P/C5.50bearish
IV84%elevated
Max Pain$13-7.1% vs spot

Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results. Full disclaimer

Rating Breakdown

4 floor-breakers

Revenue shrinking — -16.5% YoY. Growth thesis broken unless recovery story develops.static

Revenue Growth
0.0
Earnings Growth
0.0
Declining revenue: -16%

Price action weak — below key moving averages, no momentum carry. Needs a base before trend-continuation setups apply.static

Macd
0.0
Volume
0.1
Ma Position
1.0
Rsi
3.0
Obv
4.9
Capitulation risk (RSI 25, below 200MA)Below 200-MA, MA slope -1.1%/30d — confirmed downtrend

Quality below the gate floor. Component breakdown shows what dragged the score down.static

Roa
0.0
Gross Margin
0.0
Operating Margin
0.0
Fcf Quality
0.0
Piotroski F
1.1
Moat
5.0
Current Ratio
8.0
Roe
10.0
Net Margin
10.0
Excellent ROE: 45%Strong margins: 83%Earnings quality RED FLAG: -12% FCF/NINo competitive moatWeak Piotroski F-Score: 1/9

Ranks in the bottom of its industry peers on the composite signal. Better names in the same sector exist.static

Growth Rank
0.0
Value Rank
5.8
Quality Rank
9.4
Attractive P/E vs peersSuperior ROE vs peers
GatesMomentum 1.8<4.5Death cross (50MA < 200MA)A.R:R 7.6 ≥ 1.5Insider activity: OKNo SEC red flagsEARNINGS PROXIMITY 91d clearSEMI CYCLE PEAK CLEARFalling KnifeSuitability: Aggressive
RSI
25 · Oversold
↓ 20D MA↓ 50D MA↓ 200D MADEATH CROSSSupport $13.21Resistance $15.79

Price Targets

$13
$21
A.Upside+52.9%
A.R:R7.6:1

Position Sizing

ConvictionNone
Suggested %0.5%
Max %1%
RegimeSteady

Risk Alerts

! Cyclical trap - fwd PE 26x vs trail 5x (5.1x)
! Quality below floor (3.8 < 4.0)
! Value-trap signals (2/5): High leverage (D/E 2.9), Material insider selling (6 sells, 0.21% of cap)

Earnings

B
B
B
M
3/4 beats
Next Earnings2026-07-30 (91d)

Verdict History

reverse chrono — latest first
Loading history...
Verdicts are recorded on every nightly pipeline run. Rows capture transitions (verdict flips, score deltas ≥0.3, entry/TP/SL changes). Rows with a ▶ can be expanded to see the change reason. Aggregate cohort performance is tracked in the recommendation ledger.
Frequently Asked Questions
Is HCM stock a buy right now?

Sell if holding. Engine safety override at $13.45: Quality below floor (3.8 < 4.0) triggers a hard block regardless of the otherwise-positive setup — overall score 4.3/10 and A.R:R 7.6:1 is above the 1.5:1 BUY gate. Specifically: Elevated put/call ratio: 5.50; Below-average business quality; Negative price momentum. Chart setup: Death cross, below all MAs, RSI 25, MACD bearish. Prior stop was $12.81. Score 4.3/10, moderate confidence.

What is the HCM stock price target?

Take-profit target: $20.57 (+52.9% upside). Prior stop was $12.81. Stop-loss: $12.81.

What are the risks of investing in HCM?

Cyclical trap - fwd PE 26x vs trail 5x (5.1x); Quality below floor (3.8 < 4.0); Value-trap signals (2/5): High leverage (D/E 2.9), Material insider selling (6 sells, 0.21% of cap).

Is HCM overvalued or undervalued?

HUTCHMED (China) Limited trades at a P/E of 5.0 (forward 25.7). TrendMatrix value score: 7.7/10. Verdict: Sell.

What do analysts say about HCM?

27 analysts cover HCM with a consensus score of 4.2/5. Average price target: $23.

What does HUTCHMED (China) Limited do?HUTCHMED (China) Limited, together with its subsidiaries, discovers, develops, and commercializes targeted therapeutics...

HUTCHMED (China) Limited, together with its subsidiaries, discovers, develops, and commercializes targeted therapeutics and immunotherapies to treat cancer and immunological diseases in Hong Kong, the United States, and internationally. It provides Fruquintinib, a selective and potent oral inhibitor of vascular endothelial growth factor receptors for treatment of colorectal cancer (CRC), breast cancer, gastric cancer (GC), microsatellite stable-CRC endometrial cancer (EMC), non-small cell lung cancer (NSCLC), renal cell carcinoma (RCC), endometrial cancer (EMC); and Savolitinib, a potent and selective inhibitor of mesenchymal-epithelial transition receptor to treat NSCLC, papillary RCC, and GC. It also develops Surufatinib to treat pancreatic neuroendocrine tumor (NET), non pancreatic NET, and pancreatic ductal adenocarcinoma; Sovleplenib, to treat immune thrombocytopenic purpura and warm autoimmune hemolytic anemia; and Tazemetostat, a treatment for epithelioid sarcoma and follicular lymphoma; Fanregratinib that treats intrahepatic cholangiocarcinoma; and Ranosidenib, a novel dual-inhibitor of dehydrogenase-1 and isocitrate dehydrogenase-2 enzymes to treat acute myeloid leukemia (AML). In addition, the company is developing HMPL-760, which is in phase I and II clinical trial to treat relapsed and/or refractory diffuse large B cell lymphoma, chronic lymphocytic leukemia, small lymphocytic lymphoma, and other B-NHL; HMPL-506 to treat Mixed-lineage leukemia-rearrange/rearrangement and nucleophosmin 1-mutantAML. It has collaboration agreements with AstraZeneca AB (publ), Lilly (Shanghai) Management Company Limited, Takeda, Inmagene Biopharmaceuticals Co. Ltd., Innovent Biologics Co., Inc., and Epizyme, Inc., and Epizyme, Inc. The company was formerly known as Hutchison China MediTech Limited and changed its name to HUTCHMED (China) Limited in May 2021. HUTCHMED (China) Limited was incorporated in 2000 and is headquartered in Hong Kong, Hong Kong.

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