Kato Sangyo Co., Ltd. (9869) 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

OIE SANGYO Co., Ltd.

ITOCHU Corp.

Kato Sangyo Co., Ltd.

Mitsubishi Shokuhin Co., Ltd.

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Premium Water Holdings, Inc.

Yamatane Corp.

Lacto Japan Co., Ltd.

Itochu-Shokuhin Co., Ltd.

Tohto Suisan Co., Ltd.

Nishimoto Co., Ltd. /Chuo-Ku/

Why is Kato Sangyo Co., Ltd. ?

Low Debt Company with Strong Long Term Fundamental Strength

Healthy long term growth as Operating profit has grown by an annual rate 9.36%
Company's ability to service its debt is strong with a healthy EBIT to Interest (avg) ratio of 85.86
The company has been able to generate a Return on Capital Employed (avg) of 20.52% signifying high profitability per unit of total capital (equity and debt)

With ROE of 9.88%, it has a very attractive valuation with a 1.17 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 37.35%, its profits have risen by 9.2% ; the PEG ratio of the company is 1.3
At the current price, the company has a high dividend yield of 0

Real-Time Research Report

Verdict Report

How much should you buy?

Overall Portfolio exposure to Kato Sangyo 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 Kato Sangyo Co., Ltd. for you?

Low Risk, High Return

Absolute

Risk Adjusted

Volatility

Kato Sangyo Co., Ltd.

37.35%

2.39

20.79%

Japan Nikkei 225

28.54%

1.11

25.75%

Quality

Management Risk

Growth

Capital Structure

Quality grade scale :

Below Average, Average, Good, Excellent

Quality key factors

Factor

Value

Sales Growth (5y)

2.07%

EBIT Growth (5y)

9.36%

EBIT to Interest (avg)

85.86

Debt to EBITDA (avg)

Net Debt to Equity (avg)

-0.41

Sales to Capital Employed (avg)

7.18

Tax Ratio

33.81%

Dividend Payout Ratio

25.83%

Pledged Shares

Institutional Holding

1.00%

ROCE (avg)

20.52%

ROE (avg)

8.67%

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

1.17

EV to EBIT

6.97

EV to EBITDA

5.13

EV to Capital Employed

1.30

EV to Sales

0.10

PEG Ratio

1.29

Dividend Yield

0.02%

ROCE (Latest)

18.61%

ROE (Latest)

9.88%

Technicals

Technical key factors

Indicator

Weekly

Monthly

MACD

Bullish

RSI

No Signal

Bollinger Bands

Bullish

Moving Averages

Bullish (Daily)

KST

Mildly Bearish

Bullish

Dow Theory

No Trend

Bullish

OBV

No Trend

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

6What is working for the Company

OPERATING CASH FLOW(Y)

Highest at JPY 15,040 MM

INTEREST COVERAGE RATIO(Q)

Highest at 9,980.36

RAW MATERIAL COST(Y)

Fallen by -2.3% (YoY

-4What is not working for the Company

CASH AND EQV(HY)

Lowest at JPY 143,700 MM

DEBT-EQUITY RATIO (HY)

Highest at -35.25 %

PRE-TAX PROFIT(Q)

Lowest at JPY 4,753 MM

NET PROFIT(Q)

Lowest at JPY 3,147.89 MM

Here's what is working for Kato Sangyo Co., Ltd.

Operating Cash Flow

Highest at JPY 15,040 MM and Grown

In each year in the last three years

MOJO Watch

The company has generated higher cash revenues from business operations

Operating Cash Flows (JPY MM)

Interest Coverage Ratio

Highest at 9,980.36

in the last five periods

MOJO Watch

The company's ability to manage interest payments is improving

Operating Profit to Interest

Raw Material Cost

Fallen by -2.3% (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

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

Pre-Tax Profit

Lowest at JPY 4,753 MM

in the last five periods

MOJO Watch

Near term Pre-Tax Profit trend is negative

Pre-Tax Profit (JPY MM)

Net Profit

Lowest at JPY 3,147.89 MM

in the last five periods

MOJO Watch

Near term Net Profit trend is negative

Net Profit (JPY MM)

Cash and Eqv

Lowest at JPY 143,700 MM

in the last six Semi-Annual periods

MOJO Watch

Short Term liquidity is deteriorating

Cash and Cash Equivalents

Debt-Equity Ratio

Highest at -35.25 %

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