If I remember, correct me i f I am wrong somebody, Tec engines go as follows H50 = horizotal 5 hp aluminum engine and bore, aluminum flywheel sometimes, plain bearings... HM50= horizontal 5hp medium duty, aluminum engine cast-bore, cast iron flywheel, ball bearings..... HH50 =5hp heavy duty , cast iron engine, ball bearings cast iron flywheel.
Well, I think all the talk of rebuilding the engine is getting me excited ( not that way...) ....
I like the idea of doing everything 100 %, But these engines will run forever if they are taken care of, or take alot of abuse before being rebuilt..
The low compression could be caused by the interaction of compression release and the valve clearance being to tight... Or the there could be carbon on the exaust valve face, or a sticking intake valve ( lagging in speed for spring return closing ) due to gummy/ sticky fuel deposits on the valve stem... All this could be checked before ordering parts for overhaul..
I would rule out fuel deposits, then spray a good penetrating oil in the spark plug hole with a needle/ straw sprayer on the valve faces , try to spray some on the valve stems of intake & exaust valve as you slowly turn the motor over with you other hand. Spray the stems when the valves are open to free gum and carbon that may be present ..
Try running the motor after it soaks for a hour or so... see if you compression has improved. After the penetrateing oil has burned through, Watch for engine for signs of burning oil, listen for a rod knocks..
If the motor seems unhealthy, tear off the head and look for large carbon deposits from burning oil, look for a ring ridge where the piston rings come to stop on the upstoke ( look for the ridge near the valves on the cylinder wall or 180 degrees opposite)..
Chck you valve clearance, and observe how much slop the valves have in there guides (most older small engines were not really really tight ), If they are sloppy pull them out and observe how much wear is on the stem...
Then of course look for scoring (deep scoring), not just little black lines that you cannot feel with your fingernail... slosh the psiton around in the cylinder from side to side at a few diffrent spots, look to see if you can see a worn trend...
Well, I have pissed in your ear long enough..
Good luck,
Friiy