olivLaw · US equity research
Waton Financial Limited WTF
Security & Commodity Brokers, Dealers, Exchanges & Services · SIC 6200 · Vertical: Security & Commodity Brokers, Dealers, Exchanges & Services (SIC 6200)
Waton Financial Limited is a British Virgin Islands holding company that provides securities brokerage and software services for small and mid-sized brokers through its Hong Kong subsidiaries. The company grew revenue in the fiscal year ended March 2026 but remained loss-making, which makes its model worth examining in the post-IPO period.
At the close of 05 Nov 2026, Waton Financial Limited (WTF) stock was 1.96 USD (−1.01% on the day), with market capitalisation 94.5 m USD, beta 0.74, 52-week range 1.96–5.87 USD.
Data as of · AI analysis dated · Source: SEC filings and closing prices, computed by olivLaw.
Price history
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Technical reading
- RSI (14)
- 36.1
- weak (30–45)
- Bollinger (20, 2)
- 1.82 – 2.82
- in the lower half of the band · %B 0.14 · band width 43.1%
- SMA 50 / 200
- 2.46 / 3.15
- downtrend (price < SMA50 < SMA200)
- MACD (12, 26, 9)
- -0.15 / -0.11
- MACD below signal
Indicators describe past prices; on their own they do not predict direction. On our history the RSI ≤ 40 filter added no return (see the signals methodology).
Performance
| Company | S&P 500 | vs S&P 500 | Vertical median | |
|---|---|---|---|---|
| 1 month | −17.3% | −5.9% | −11.3 pp | — |
| 3 months | −34.2% | −4.6% | −29.6 pp | — |
| 6 months | −48.7% | +0.2% | −48.9 pp | — |
| Year to date | −40.6% | +7.4% | −48.0 pp | — |
| 1 year | −61.6% | +8.2% | −69.8 pp | +10.6% |
| 3 years | unavailable | +68.4% | unavailable | +38.0% |
| 5 years | unavailable | +56.5% | unavailable | — |
Price returns, dividends excluded.
Quarterly results
ESEF annual reports carry no quarters: the results are annual (below).
E/P over time
E/P = trailing-12-month diluted EPS / price at quarter end. E/P is the inverse of P/E and stays defined when earnings are negative.
Fiscal years
| Fiscal year | 2023 | 2024 | 2025 | 2026 |
|---|---|---|---|---|
| Revenue | 5.7 m | 10.1 m | 7.4 m | 11.1 m |
| Revenue YoY | unavailable | +75.2% | −25.9% | +48.8% |
| Net income | 3.1 m | 2.5 m | -12.0 m | -15.2 m |
| Net income YoY | unavailable | −19.0% | −579.4% | unavailable |
| Diluted EPS | 0.09 | 0.04 | -0.29 | -0.31 |
| Diluted EPS YoY | unavailable | −55.6% | −825.0% | unavailable |
| net % | 53.7% | 24.8% | -160.7% | -136.7% |
| Free cash flow | 12.0 m | -2.1 m | 346.2 k | -7.4 m |
Reported results vs expectations
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Balance sheet & financial health
Fiscal year 2026 · 31 Mar 2026
- Cash
- 10.4 m USD
- Financial debt
- unavailable USD
- Net debt
- unavailable USD
- Equity
- 21.7 m USD
- Total assets
- 54.7 m USD
- Debt / equity
- unavailable
- Current ratio
- 1.54x
- ROE
- -87.9%
- ROA
- -35.5%
- FCF margin
- -66.6%
Financial statements (source on every figure)
Revenue and net income (USD)
Margins
Income statement · USD
| Line | 2023 | 2024 | 2025 | 2026 | Source (latest year) |
|---|---|---|---|---|---|
| Revenue | 5.7 m | 10.1 m | 7.4 m | 11.1 m | SEC (XBRL)· 31 Jul 2026verified |
| Research & development | 0 | 0 | 427.7 k | 726.3 k | SEC (XBRL)· 31 Jul 2026verified |
| Operating income | 3.1 m | 2.9 m | -10.7 m | -14.5 m | SEC (XBRL)· 31 Jul 2026verified |
| Depreciation & amortisation | 5.6 k | 67.1 k | 102.7 k | 153.1 k | SEC (XBRL)· 31 Jul 2026verified |
| EBITDA | 3.1 m ≈ | 3.0 m ≈ | -10.5 m ≈ | -14.4 m ≈ | SEC (XBRL)· 31 Jul 2026derived |
| Pre-tax income | 3.8 m | 2.9 m | -11.8 m | -15.2 m | SEC (XBRL)· 31 Jul 2026verified |
| Income tax | 714.9 k | 439.9 k | 153.4 k | 0 | SEC (XBRL)· 31 Jul 2026verified |
| Net income | 3.1 m | 2.5 m | -12.0 m | -15.2 m | SEC (XBRL)· 31 Jul 2026verified |
| Diluted EPS | 0.09 | 0.04 | -0.29 | -0.31 | SEC (XBRL)· 31 Jul 2026verified |
| Weighted average diluted shares | 34.7 m | 62.8 m | 41.8 m | 48.2 m | SEC (XBRL)· 31 Jul 2026verified |
≈ computed by olivLaw from the reported lines of the same year: Operating income + Depreciation & amortisation.
Balance sheet · USD
| Line | 2023 | 2024 | 2025 | 2026 | Source (latest year) |
|---|---|---|---|---|---|
| Cash | 19.1 m | 4.9 m | 7.7 m | 10.4 m | SEC (XBRL)· 31 Jul 2026verified |
| Current assets | — | 25.8 m | 25.3 m | 50.1 m | SEC (XBRL)· 31 Jul 2026verified |
| Property, plant & equipment, net | — | 211.0 k | 123.3 k | 294.1 k | SEC (XBRL)· 31 Jul 2026verified |
| Total assets | — | 32.7 m | 30.7 m | 54.7 m | SEC (XBRL)· 31 Jul 2026verified |
| Current liabilities | — | 21.5 m | 17.9 m | 32.5 m | SEC (XBRL)· 31 Jul 2026verified |
| Total liabilities | — | 21.9 m | 18.0 m | 32.9 m | SEC (XBRL)· 31 Jul 2026verified |
| Equity | 14.2 m † | 10.7 m † | 12.8 m † | 21.7 m † | SEC (XBRL)· 31 Jul 2026verified |
| Shares outstanding at year end | — | — | 48.2 m | 48.2 m | SEC (XBRL)· 31 Jul 2026verified |
† equity attributable to the parent's shareholders: in these years the issuer no longer reports the total including non-controlling interests.
Cash flow · USD
| Line | 2023 | 2024 | 2025 | 2026 | Source (latest year) |
|---|---|---|---|---|---|
| Operating cash flow | 12.0 m | -1.8 m | 360.0 k | -7.1 m | SEC (XBRL)· 31 Jul 2026verified |
| Capex | 5.0 k | 262.1 k | 13.7 k | 323.6 k | SEC (XBRL)· 31 Jul 2026verified |
| Free cash flow | 12.0 m ≈ | -2.1 m ≈ | 346.2 k ≈ | -7.4 m ≈ | SEC (XBRL)· 31 Jul 2026derived |
| Investing cash flow | -5.0 k | -8.2 m | -13.7 k | -2.0 m | SEC (XBRL)· 31 Jul 2026verified |
| Financing cash flow | 13.0 m | -8.3 m | 2.8 m | 19.6 m | SEC (XBRL)· 31 Jul 2026verified |
| Share repurchases | 0 | 6.0 m | 0 | 0 | SEC (XBRL)· 31 Jul 2026verified |
≈ computed by olivLaw from the reported lines of the same year: Operating cash flow − Capex.
Computed indicators
Growth
Profitability
Returns
Balance sheet
Liquidity
Cash
Efficiency
Market and valuation
1 indicators that do not apply to the sector.
Valuation
olivLaw classification
- indicators available: 5 of at least 6
- score weight coverage: 33.3% of at least 60%
- valuation methods computed: 0 of at least 1
A scoring methodology on indicators and valuation, not investment advice.
Closing price
05 Nov 2026Source: olivLaw, closing series
Market cap: 94.5 m USD
Key indicators
Coverage and freshness
Score by group
33% · Insufficient data
Estimated value range
unavailable — no valuation method could be computed
Valuation assumptions are editorial choices, not measured; beta is not measured.
Valuation methods
- DCF (discounted cash flow)unavailable · input data missing
- Peers: EV/EBITDAunavailable · net debt missing: EV cannot be bridged to equity (missing debt is not zero)
- Peers: P/Eunavailable · the base of the ratio is not positive
- Dividend discount (DDM)unavailable · the company pays no dividend: a dividend model needs an explicit initiation assumption
no valuation method could be computed
Classification (SIC) comparables group by industry code, not by economic activity; the direct group is an editorial selection by activity. Members' multiples are on their own trailing twelve months, at their own latest close.
Assumptions (illustrative, editorial)
- Risk-free rate
- 4.3%
- Equity risk premium
- 5.0%
- Beta (default)
- 1.00
- Cost of equity
- 9.3%
- Terminal growth
- 2.5%
Factor scorecard
Insufficient data
Minimum-evidence gate: indicators available: 5 of at least 6; score weight coverage: 33.3% of at least 60%; valuation methods computed: 0 of at least 1
| Factor | Value | Score | Weight used |
|---|---|---|---|
| ROIC · Quality | unavailable | unavailable | — |
| Net margin · Quality | -136.7% | 21 (vs peers) | 19% |
| FCF conversion · Quality | unavailable | unavailable | — |
| Revenue CAGR 3Y · Growth | 24.5% | 100 (on a fixed band) | 25% |
| EPS CAGR 3Y · Growth | unavailable | unavailable | — |
| Net debt / EBITDA · Balance sheet | unavailable | unavailable | — |
| Interest coverage · Balance sheet | unavailable | unavailable | — |
| Current ratio · Balance sheet | 1.5x | 62 (on a fixed band) | 13% |
| P/E (TTM) · Valuation | unavailable | unavailable | — |
| EV/EBITDA · Valuation | unavailable | unavailable | — |
| FCF yield · Valuation | -7.8% | 0 (on a fixed band) | 25% |
| Shareholder yield (distributions) · Returns | 0.0% | 0 (on a fixed band) | 19% |
| Payout ratio (FCF) · Returns | unavailable | unavailable | — |
Factors without a value were dropped; the remaining weights were renormalised.
Score groups
- Balance sheet· partial62/100 · 1/3 factors with a value
- Growth· partial100/100 · 1/2 factors with a value
- Quality· partial21/100 · 1/3 factors with a value
- Returns· partial0/100 · 1/2 factors with a value
- Valuation· partial0/100 · 1/3 factors with a value
A «partial» group is computed from under half of its weight or from one factor: it is not a full assessment of the group.
Memo
Waton Financial Limited (WTF). Latest full fiscal year: 2026; data up to 2026-03-31.
Figures computed from the financial statements: revenue 11.1 m USD in 2026; YoY growth 48.8%; net margin -136.7%; ROE -87.9%.
Valuation cannot be computed from the available data.
Insufficient data for a verdict (indicators available: 5 of at least 6; score weight coverage: 33.3% of at least 60%; valuation methods computed: 0 of at least 1).
Text generated deterministically from the figures shown; no language model. Not investment advice.
What supports the thesis
- Revenue CAGR 3Y: 24.5%
What contradicts it
- Net margin: -136.7%
- FCF yield: -7.8%
- Shareholder yield (distributions): 0.0%
Not assessed (insufficient data or a ratio without meaning): ROIC, FCF conversion, EPS CAGR 3Y, Net debt / EBITDA, Interest coverage, P/E (TTM), EV/EBITDA, Payout ratio (FCF).
Versus the vertical median
Security & Commodity Brokers, Dealers, Exchanges & Services (SIC 6200) · same industry (4-digit SIC) · compared with 15 companies
Multiples and returns vs the median
Price rebased to 100 (monthly, 5 years)
Companies in the vertical
| Market cap | P/E | ROE | Net margin | Revenue YoY | 1A / 3A | |
|---|---|---|---|---|---|---|
| ICEIntercontinental Exchange, Inc. | 97.2 bn | 23.7 | 14.2% | 29.6% | +7.5% | +11% / +53% |
| NDAQNasdaq, Inc. | 59.3 bn | 29.2 | 17.4% | 22.8% | +11.6% | +17% / +91% |
| CBOECboe Global Markets, Inc. | 36.8 bn | 25.1 | 27.4% | 28.0% | +15.1% | +37% / +94% |
| LPLALPL Financial Holdings Inc. | 23.4 bn | 17.3 | 25.7% | 6.8% | +37.2% | −15% / +35% |
| SNEXStoneX Group Inc. | 6.5 bn | 12.3 | 21.9% | 0.3% | +32.5% | +33% / +196% |
| MRXMarex Group Ltd | 4.7 bn | 16.8 | 28.7% | 14.5% | +26.9% | +87% / unavailable |
| TOPTop Financial Group Limited | 438.2 m | — | -1.0% | -23.3% | +41.9% | +113% / −46% |
| EBONEbang International Holdings Inc. | 182.3 m | — | -5.6% | -215.6% | +11.4% | −52% / −75% |
| GSIWGarden Stage Limited | 162.5 m | 7.5 | -89.5% | -190.1% | +33.2% | −65% / unavailable |
| WTFWaton Financial Limited | 94.5 m | — | -87.9% | -136.7% | +48.8% | −62% / unavailable |
| STEXStreamex Corp. | 38.0 m | — | -705.4% | — | +122.2% | −93% / −87% |
| SOSSOS Limited | 20.9 m | — | -22.7% | -63.1% | −33.3% | −85% / −100% |
| CMECme Group Inc. | — | 25.1 | 16.1% | 63.3% | +6.4% | +9% / +41% |
| PLUTPlutus Financial Group Limited | — | — | -55.3% | -377.3% | +6.9% | −64% / unavailable |
| BGCBGC Group, Inc. | — | 25.5 | 19.5% | 6.0% | +30.0% | +20% / +61% |
| TWTradeweb Markets Inc. | 0 | 29.9 | 14.1% | 39.8% | +18.9% | +17% / +32% |
1- and 3-year price returns: for WTF from daily closes (the same as the performance table), for the other companies from month-end closes.
olivLaw engine forecast
The world engine ran after the company's latest material disclosure. Probabilities are of TOUCHING a level within the horizon (not closing there) and sit next to the random walk (p_rw), the no-information benchmark.
The engine has no published run for this company yet.
Valuation scenarios (editable assumptions)
Illustrative scenarios
Illustrative: not forecasts and without probabilities. Each case is one coherent set of assumptions, computed on today's figures.
Estimated price (USD)
| Estimated price | Bear | Base | Bull |
|---|---|---|---|
| 1 years | insufficient data Total return unavailable · Per year unavailable | insufficient data Total return unavailable · Per year unavailable | insufficient data Total return unavailable · Per year unavailable |
| 3 years | insufficient data Total return unavailable · Per year unavailable | insufficient data Total return unavailable · Per year unavailable | insufficient data Total return unavailable · Per year unavailable |
| 5 years | insufficient data Total return unavailable · Per year unavailable | insufficient data Total return unavailable · Per year unavailable | insufficient data Total return unavailable · Per year unavailable |
AI analysis
AI-generatedAI-generated analysis (Claude) from cited public sources; it may contain errors. Not investment advice. As of 27 Oct 2026 · Model: claude-haiku-5-5.
In brief
Waton Financial Limited is a British Virgin Islands holding company that provides securities brokerage and software services for small and mid-sized brokers through its Hong Kong subsidiaries. The company grew revenue in the fiscal year ended March 2026 but remained loss-making, which makes its model worth examining in the post-IPO period.
SWOT
Strengths
Weaknesses
Opportunities
- Expanding the broker client base for Broker Cloud solutions, including in other countries and regions 1.
- Developing the asset management business, for which the company has launched segregated funds 1.
- New service types, such as trading securities on other exchanges, if the necessary licenses are obtained 1.
Risks
- Recurring net losseshigh
The company reported a net loss in fiscal 2026, while personnel and share-based compensation costs rose. If revenue does not grow enough, losses could continue.
- Dependence on one supplierhigh
Software is outsourced to a related party, and this could affect service continuity if the relationship changes.
- PRC regulatory riskhigh
Any PRC government measures affecting Hong Kong operations could materially change the business and the value of the shares.
- Revenue volatilitymedium
Bond distribution and proprietary trading revenue is irregular, which makes results difficult to predict.
- Data and cybersecuritymedium
Data protection and cybersecurity rules could impose extra compliance costs or sanctions.
Investment thesis
What would need to be true (bull case)
- If Hong Kong trading volumes stay high, brokerage revenue could keep growing, as it did in fiscal 2026 1.
- If the software model attracts new brokers, it could diversify revenue and reduce reliance on trading commissions 1.
- With an experienced management team and IPO proceeds, the company could fund expansion and the asset management business 1.
What would break the thesis
- Persistent net losses could use up IPO proceeds if revenue does not grow fast enough.
- Reliance on one external supplier and a small number of software customers could make revenue vulnerable to sudden changes.
- Tighter Chinese oversight could limit investor access to offerings and weigh on Hong Kong operations 1.
What to watch
- Number of software customers and any new contracts2027
- Any new PRC regulatory measures on Hong Kong-based issuers2027
Products, market & competition
AI-generatedAI-generated analysis (Claude) from cited public sources; it may contain errors. Not investment advice. As of 27 Oct 2026 · Model: claude-haiku-5-5.
The business
The company operates mainly through Waton Securities International Limited (WSI) and Waton Technology International Limited (WTI), both in Hong Kong. WSI offers brokerage for shares listed on the Hong Kong Stock Exchange, via Stock Connect, NYSE and Nasdaq, plus margin financing and bond distribution. Brokerage and interest income were 83.4% of total revenue in fiscal 2026 1, and total revenues were 11.1 million USD 1.
The second pillar is software licensing (including subscription) and support services for trading platforms, delivered under the Broker Cloud solution. These services produced 11.9% of revenue in fiscal 2026 1. The company outsources software development to a single supplier, Shenzhen Jinhui Technology Co., Ltd., which is a related party 1.
Segments
Brokerage and commissions
The brokerage segment includes trading commissions, bond distribution, IPO subscription fees and margin interest income. Commission revenue rose in fiscal 2026, mainly on higher trading volume on the Hong Kong exchange and more IPO subscriptions, while bond distribution fell sharply 1.
Software and technical support
The software segment sells trading platform (APP) licenses to small and mid-sized brokers and financial institutions. The number of customers fell from four to three in fiscal 2026, and revenue declined 1. The business depends on one external supplier, which concentrates operational risk 1.
Market context
The company operates in Hong Kong securities brokerage and in financial technology for small and mid-sized brokers. The source points to a growing Hong Kong stock market in fiscal 2026, with higher trading volumes and IPO subscriptions, which supported commission revenue 1. The volatility of these volumes could significantly influence results.
In the software segment, demand comes from brokers seeking to digitize operations without large IT infrastructure costs 1. Given the small customer base, a few contracts can meaningfully change software revenue.
Trends
- Hong Kong trading volumestailwind
Higher daily trading volumes and more IPO subscriptions supported brokerage revenue in fiscal 2026 1. If these volumes fall, commission revenue could decline just as quickly.
- Bond distributionheadwind
Bond distribution revenue fell sharply, as these projects are handled case by case and their outcomes are hard to forecast 1. This component could be a source of volatility.
- Brokerage digitizationtailwind
Small and mid-sized brokers need digital platforms without large infrastructure investment, which supports demand for Broker Cloud solutions 1. Adoption, however, depends on winning new clients.
- PRC regulatory riskheadwind
The company notes that the PRC government could extend oversight to Hong Kong-based issuers, which could affect operations and the value of the shares 1. Legal uncertainty remains high.
Competitive position
The analyzed source does not explicitly name direct competitors. The Hong Kong brokerage market is nonetheless competitive, and the company competes on commissions, IPO subscription costs and trading platform quality. A stated advantage is its integrated platform for small and mid-sized brokers 1.
In software, the company differentiates through integrated front, middle and back office solutions plus business-to-business clearing and settlement services 1. This is a niche positioning, with competition from banking and trading software vendors.
- Brokerage software vendors
Competitors in the trading platform segment for small and mid-sized brokers, not named in the source.
- Hong Kong securities brokers
Brokerage firms offering the same services on the Hong Kong exchange, not named in the source.
- Clearing and settlement providers
Operators providing clearing and settlement for brokers, not named in the source.
- Outsourced IT service providers
Firms offering software development and support, such as the company's external supplier, not named explicitly.
Links, dependencies and risks
Who the company is tied to, from its own SEC filings (customers, suppliers, production, partners, competitors, countries, regulation), from the 5 %+ holders' statements (13D/13G) and from what other companies say about it. Click a node for its evidence; on a listed company the graph moves to it.
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News & filings
In the press
No news in our archive over the last 180 days.
SEC filings
- Annual report (foreign issuer)31 Jul 2026
- Current report (foreign issuer)21 Apr 2026
- Current report (foreign issuer)29 Jan 2026
- Current report (foreign issuer)13 Aug 2025
- Annual report (foreign issuer)24 Jul 2025
- Current report (foreign issuer)02 Apr 2025
Sources
- [1] Form 20-F, fiscal year ended 2026-03-31 · SEC / Waton Financial Limited · 31 Jul 2026
Figures computed by olivLaw from SEC filings and closing prices; the qualitative analysis is AI-generated from cited sources. Not investment advice.