Eco's Co., Ltd. (7520) Stock Recommendation | Score, Valuation, Technicals & Financial Trend

Score

Click here to find our call on this stock

Strong Sell

Sell

Hold

Buy

Strong Buy

Comparison

Company

Score

Quality

Valuation

Financial

Technical

Axial Retailing, Inc.

Mammy Mart Corp.

Eco's Co., Ltd.

Uoriki Co., Ltd.

JM Holdings Co., Ltd.

Kakiyasu Honten Co., Ltd.

Saint Marc Holdings Co., Ltd.

RETAIL PARTNERS CO., LTD.

Okuwa Co., Ltd.

Ministop Co., Ltd.

Inageya Co., Ltd.

Why is Eco's Co., Ltd. ?

High Management Efficiency with a high ROE of 18.47%

Company has very low debt and has enough cash to service the debt requirements

Poor long term growth as Net Sales has grown by an annual rate of 1.62% and Operating profit at 7.02% over the last 5 years

Negative results in Nov 25

INTEREST(HY) At JPY 48 MM has Grown at 50%
INTEREST COVERAGE RATIO(Q) Lowest at 7,091.3
DEBT-EQUITY RATIO (HY) Highest at -1.95 %

With ROE of 15.92%, it has a very attractive valuation with a 1.03 Price to Book Value

The stock is trading at a premium compared to its peers' average historical valuations
Over the past year, while the stock has generated a return of 22.65%, its profits have risen by 8% ; the PEG ratio of the company is 0.8

Underperformed the market in the last 1 year

The stock has generated a return of 22.65% in the last 1 year, much lower than market (Japan Nikkei 225) returns of 36.73%

Real-Time Research Report

Verdict Report

How much should you hold?

Overall Portfolio exposure to Eco's Co., Ltd. should be less than 10%
Overall Portfolio exposure to Retailing should be less than 30%

(If sector exposure > 30%, please use optimiser tool to see which are the best stocks to hold in Retailing)

When to exit? - We will constantly monitor the company and suggest at the appropriate time to exit from the stock

Is Eco's Co., Ltd. for you?

Low Risk, Low Return

Absolute

Risk Adjusted

Volatility

Eco's Co., Ltd.

22.65%

0.54

25.55%

Japan Nikkei 225

36.73%

1.30

28.24%

Quality

Management Risk

Growth

Capital Structure

Quality grade scale :

Below Average, Average, Good, Excellent

Quality key factors

Factor

Value

Sales Growth (5y)

1.62%

EBIT Growth (5y)

7.02%

EBIT to Interest (avg)

100.00

Debt to EBITDA (avg)

Net Debt is too low

Net Debt to Equity (avg)

-0.03

Sales to Capital Employed (avg)

3.42

Tax Ratio

31.28%

Dividend Payout Ratio

17.64%

Pledged Shares

Institutional Holding

ROCE (avg)

26.91%

ROE (avg)

18.47%

Valuation

Valuation Scorecard

Valuation grade scale :

Very Risky, Risky, Very Expensive, Expensive, Fair, Attractive, Very Attractive

Valuation Key Factors

Factor

Value

P/E Ratio

Industry P/E

Price to Book Value

1.03

EV to EBIT

4.46

EV to EBITDA

3.38

EV to Capital Employed

1.03

EV to Sales

0.20

PEG Ratio

0.80

Dividend Yield

ROCE (Latest)

23.01%

ROE (Latest)

15.92%

Technicals

Technical key factors

Indicator

Weekly

Monthly

MACD

Bearish

Bullish

RSI

Bullish

No Signal

Bollinger Bands

Bearish

Mildly Bullish

Moving Averages

Mildly Bullish (Daily)

KST

Mildly Bearish

Bullish

Dow Theory

Mildly Bearish

OBV

No Trend

Mildly Bearish

Technical Indicator Scale: Bearish, Mildly Bearish, Sideways, Mildly Bullish, Bullish Turned

Technical Movement

Analyse All Technical Factors

Financial Trend

Financial Trend Scorecard

Financial Trend scale:

Very Negative, Negative, Flat, Positive, Very Positive, Outstanding

1What is working for the Company

RAW MATERIAL COST(Y)

Fallen by -4.78% (YoY

-15What is not working for the Company

INTEREST(HY)

At JPY 48 MM has Grown at 50%

INTEREST COVERAGE RATIO(Q)

Lowest at 7,091.3

DEBT-EQUITY RATIO (HY)

Highest at -1.95 %

DEBTORS TURNOVER RATIO(HY)

Lowest at 27.55 times

NET SALES(Q)

Lowest at JPY 33,548 MM

PRE-TAX PROFIT(Q)

At JPY 1,081 MM has Fallen at -27.06%

NET PROFIT(Q)

At JPY 724.01 MM has Fallen at -31.05%

Here's what is working for Eco's Co., Ltd.

Raw Material Cost

Fallen by -4.78% (YoY)

MOJO Watch

The company's ability to pass on the cost of raw materials to customers has improved; this may lead to a rise in profit margin

Raw Material Cost as a percentage of Sales

Depreciation

Highest at JPY 574 MM

in the last five periods

MOJO Watch

The expenditure on assets done by the company may have gone into operation

Depreciation (JPY MM)

Here's what is not working for Eco's Co., Ltd.

Interest

At JPY 48 MM has Grown at 50%

over previous Semi-Annual period

MOJO Watch

Rising interest cost signifies increased borrowings

Interest Paid (JPY MM)

Interest Coverage Ratio

Lowest at 7,091.3

in the last five periods

MOJO Watch

The company's ability to manage interest payments is deteriorating

Operating Profit to Interest

Net Sales

Lowest at JPY 33,548 MM

in the last five periods

MOJO Watch

Near term sales trend is negative

Net Sales (JPY MM)

Pre-Tax Profit

At JPY 1,081 MM has Fallen at -27.06%

over average net sales of the previous four periods of JPY 1,482 MM

MOJO Watch

Near term Pre-Tax Profit trend is negative

Pre-Tax Profit (JPY MM)

Net Profit

At JPY 724.01 MM has Fallen at -31.05%

over average net sales of the previous four periods of JPY 1,050.04 MM

MOJO Watch

Near term Net Profit trend is negative

Net Profit (JPY MM)

Debt-Equity Ratio

Highest at -1.95 %

in the last five Semi-Annual periods

MOJO Watch

The company is borrowing more to fund its operations; it's liquidity situation may be stressed

Debt-Equity Ratio

Debtors Turnover Ratio

Lowest at 27.55 times

in the last five Semi-Annual periods

MOJO Watch

Company's pace of selling Debtors has slowed

Debtors Turnover Ratio