MeritValue

Huadi International Group Co., Ltd.

HUDIdata completeness 100%8 fiscal years on file
The thesis, from the filings

Huadi International Group Co., Ltd. earns about 2% on invested capital, but has diluted owners by 18% over 5 years — worth asking whether the growth reaches owners. The applicable estimate puts fair value near $1.4 a share.Whether it’s worth owning at today’s price is the last question — and yours to answer, below.

i. The business — what you’d actually own
FigureFY 2021FY 2022FY 2023FY 2024FY 2025
Revenue$3.24M1$76.4M2$84.3M3$74.3M3$62.9M3
Net income$2.53M4$1.92M5$3.26M6$137,4226−$1.4M6
Operating cash flow−$5.65M7$8.03M8−$2.45M9$13M9−$8.48M9
Capital expenditure$917,53910$206,17511$157,57112$308,63112$1.46M12
Free cash flow (derived)−$6.57M7$7.82M8−$2.61M9$12.7M9−$9.94M9
Total debt$33.5M13$30.5M14$15.3M15$1.25M16$20.3M17
Cash & equivalents$15.4M18$13.2M19$20.2M20$18.1M20$6.48M20
Diluted shares12.1M13.2M14.1M14.3M14.3M

Superscripts are receipts. Each links to the SEC filing the number came from (full list at the bottom).

ii. Your slice — ownership made literal
If you owned
shares
Net assets behind them
$52.89
your share of equity
Profit it earned you last year
−$0.98
Free cash flow it threw off
−$6.96
Debt you’d be carrying
$14.19

10 shares is a claim on $52.89 of net worth that earned you −$0.98 and generated −$6.96 of cash last year, against $14.19 of debt.

iii. Is this a good business?
Moat signal · return on invested capital
2% avg · 5y
FY21 1%FY22 5%FY23 5%FY24 0%FY25 -2%

It earned an average 2% on invested capital over 5 years. Compare that to what it costs to fund the business.

seeing a moat in the numbers →
Management signal · capital allocation
+18% shares · 5y

Share count is up 18% over 5 years — owners have been diluted. Worth asking what they got for it. Total debt has fallen 39% — deleveraging.

reading capital allocation →

Signals, not verdicts — read from the filings above. Numbers don’t prove a moat; they show its footprint. You decide.

iv. What it’s worth — engine v0.1.0
DCF · Growth Exit 10Y
not applicable
3y-median FCF non-positive — growth-exit DCF not applicable (see EPV)
DCF · Growth Exit 5Y
not applicable
3y-median FCF non-positive — growth-exit DCF not applicable (see EPV)
Earnings Power Value
$1.4
assumptions (8)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • normalizedEarnings$1.92M
  • growthAssumed0.0%
Graham Number
not applicable
diluted EPS missing or non-positive — Graham Number undefined

Different models answer different questions — which to trust when →

Sources — the receipts
  1. 20-F · period ending 2021-09-30 · accession 0001213900-24-009988 (Revenues)
  2. 20-F/A · period ending 2022-09-30 · accession 0001013762-25-003358 (RevenueFromContractWithCustomerIncludingAssessedTax)
  3. 20-F · period ending 2023-09-30 · accession 0001213900-26-010177 (RevenueFromContractWithCustomerIncludingAssessedTax)
  4. 20-F · period ending 2021-09-30 · accession 0001213900-24-009988 (NetIncomeLoss)
  5. 20-F/A · period ending 2022-09-30 · accession 0001013762-25-003358 (NetIncomeLoss)
  6. 20-F · period ending 2023-09-30 · accession 0001213900-26-010177 (NetIncomeLoss)
  7. 20-F · period ending 2021-09-30 · accession 0001213900-24-009988 (NetCashProvidedByUsedInOperatingActivities)
  8. 20-F/A · period ending 2022-09-30 · accession 0001013762-25-003358 (NetCashProvidedByUsedInOperatingActivities)
  9. 20-F · period ending 2023-09-30 · accession 0001213900-26-010177 (NetCashProvidedByUsedInOperatingActivities)
  10. 20-F · period ending 2021-09-30 · accession 0001213900-24-009988 (PaymentsToAcquirePropertyPlantAndEquipment)
  11. 20-F/A · period ending 2022-09-30 · accession 0001013762-25-003358 (PaymentsToAcquirePropertyPlantAndEquipment)
  12. 20-F · period ending 2023-09-30 · accession 0001213900-26-010177 (PaymentsToAcquirePropertyPlantAndEquipment)
  13. 20-F/A · period ending 2021-09-30 · accession 0001213900-23-012477 (ShortTermBorrowings)
  14. 20-F · period ending 2022-09-30 · accession 0001213900-24-009988 (LongTermDebtNoncurrent)
  15. 20-F/A · period ending 2023-09-30 · accession 0001013762-25-003358 (LongTermDebtNoncurrent)
  16. 20-F · period ending 2024-09-30 · accession 0001213900-26-010177 (ShortTermBorrowings)
  17. 20-F · period ending 2025-09-30 · accession 0001213900-26-010177 (LongTermDebtNoncurrent)
  18. 20-F/A · period ending 2021-09-30 · accession 0001213900-23-012477 (CashAndCashEquivalentsAtCarryingValue)
  19. 20-F/A · period ending 2022-09-30 · accession 0001013762-25-003358 (CashAndCashEquivalentsAtCarryingValue)
  20. 20-F · period ending 2023-09-30 · accession 0001213900-26-010177 (CashAndCashEquivalentsAtCarryingValue)