Holmen AB (HOLM B) Stock Recommendation | Score, Valuation, Technicals & Financial Trend

Score

Click here to find our call on this stock

Strong Sell

Sell

Hold

Buy

Strong Buy

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Comparison

Company

Score

Quality

Valuation

Financial

Technical

Holmen AB

Billerud AB

Svenska Cellulosa AB SCA

Embellence Group AB

Nordic Paper Holding AB

Bong AB

Rottneros AB

Why is Holmen AB ?

Poor Management Efficiency with a low ROE of 5.92%

The company has been able to generate a Return on Equity (avg) of 5.92% signifying low profitability per unit of shareholders funds

Company's ability to service its debt is strong with a healthy EBIT to Interest (avg) ratio of 48.15

Weak Long Term Fundamental Strength with an average Return on Equity (ROE) of 5.92%

The company has declared Negative results for the last 7 consecutive quarters

ROCE(HY) Lowest at 4.86%
INTEREST COVERAGE RATIO(Q) Lowest at 2,620
RAW MATERIAL COST(Y) Grown by 72.52% (YoY)

With ROE of 3.38%, it has a fair valuation with a 1.00 Price to Book Value

The stock is trading at a fair value compared to its peers' average historical valuations
Over the past year, while the stock has generated a return of -17.16%, its profits have fallen by -21.1%

Majority shareholders : FIIs

Consistent Underperformance against the benchmark over the last 3 years

Along with generating -17.16% returns in the last 1 year, the stock has also underperformed OMX Stockholm 30 in each of the last 3 annual periods

Real-Time Research Report

Verdict Report

How much should you hold?

Overall Portfolio exposure to Holmen AB should be less than 10%
Overall Portfolio exposure to Paper, Forest & Jute Products should be less than 30%

(If sector exposure > 30%, please use optimiser tool to see which are the best stocks to hold in Paper, Forest & Jute Products)

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

Is Holmen AB for you?

Low Risk, Low Return

Absolute

Risk Adjusted

Volatility

Holmen AB

-100.0%

-0.85

21.25%

OMX Stockholm 30

17.06%

0.95

17.88%

Quality

Management Risk

Growth

Capital Structure

Quality grade scale :

Below Average, Average, Good, Excellent

Quality key factors

Factor

Value

Sales Growth (5y)

6.59%

EBIT Growth (5y)

4.76%

EBIT to Interest (avg)

48.15

Debt to EBITDA (avg)

0.60

Net Debt to Equity (avg)

0.06

Sales to Capital Employed (avg)

0.38

Tax Ratio

22.24%

Dividend Payout Ratio

49.95%

Pledged Shares

Institutional Holding

0.15%

ROCE (avg)

7.25%

ROE (avg)

5.92%

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

1.00

EV to EBIT

24.47

EV to EBITDA

15.63

EV to Capital Employed

1.00

EV to Sales

2.72

PEG Ratio

Dividend Yield

2.50%

ROCE (Latest)

4.10%

ROE (Latest)

3.38%

Technicals

Technical key factors

Indicator

Weekly

Monthly

MACD

Mildly Bullish

Bearish

RSI

No Signal

Bollinger Bands

Sideways

Mildly Bearish

Moving Averages

Mildly Bearish (Daily)

KST

Mildly Bullish

Bearish

Dow Theory

Mildly Bearish

No Trend

OBV

Mildly Bullish

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

0What is working for the Company

NO KEY POSITIVE TRIGGERS

-11What is not working for the Company

ROCE(HY)

Lowest at 4.86%

INTEREST COVERAGE RATIO(Q)

Lowest at 2,620

RAW MATERIAL COST(Y)

Grown by 72.52% (YoY

DEBT-EQUITY RATIO (HY)

Highest at 9.57 %

INTEREST(Q)

Highest at SEK 35 MM

PRE-TAX PROFIT(Q)

At SEK 513 MM has Fallen at -24.34%

NET PROFIT(Q)

At SEK 399.52 MM has Fallen at -24.39%

Here's what is working for Holmen AB

Depreciation

Highest at SEK 370 MM

in the last five periods

MOJO Watch

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

Depreciation (SEK MM)

Here's what is not working for Holmen AB

Interest

At SEK 35 MM has Grown at 29.63%

period on period (QoQ)

MOJO Watch

Rising interest cost signifies increased borrowings

Interest Paid (SEK MM)

Interest Coverage Ratio

Lowest at 2,620

in the last five periods

MOJO Watch

The company's ability to manage interest payments is deteriorating

Operating Profit to Interest

Interest

Highest at SEK 35 MM

in the last five periods and Increased by 29.63% (QoQ)

MOJO Watch

Rising interest cost signifies increased borrowings

Interest Paid (SEK MM)

Pre-Tax Profit

At SEK 513 MM has Fallen at -24.34%

over average net sales of the previous four periods of SEK 678 MM

MOJO Watch

Near term Pre-Tax Profit trend is negative

Pre-Tax Profit (SEK MM)

Net Profit

At SEK 399.52 MM has Fallen at -24.39%

over average net sales of the previous four periods of SEK 528.39 MM

MOJO Watch

Near term Net Profit trend is negative

Net Profit (SEK MM)

Debt-Equity Ratio

Highest at 9.57 %

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

Raw Material Cost

Grown by 72.52% (YoY)

MOJO Watch

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

Raw Material Cost as a percentage of Sales