Kyoei Steel Ltd. (5440) 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

Toyota Tsusho Corp.

Okaya & Co., Ltd.

Yamato Kogyo Co., Ltd.

Sojitz Corp.

Yodogawa Steel Works, Ltd.

JFE Holdings, Inc.

Daido Steel Co., Ltd.

Kyoei Steel Ltd.

Kobe Steel, Ltd.

Tokyo Steel Manufacturing Co., Ltd.

Sanyo Special Steel Co., Ltd.

Why is Kyoei Steel Ltd. ?

Negative results in Jun 26

ROCE(HY) Lowest at 4.41%
INTEREST COVERAGE RATIO(Q) Lowest at 858.15
OPERATING PROFIT MARGIN(Q) Lowest at 6.4 %

With ROCE of 8.30%, it has a very attractive valuation with a 0.45 Enterprise value to Capital Employed

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 -13.67%, its profits have risen by 71.6% ; the PEG ratio of the company is 0.1

Below par performance in long term as well as near term

Along with generating -13.67% returns in the last 1 year, the stock has also underperformed Japan Nikkei 225 in the last 3 years, 1 year and 3 months

Real-Time Research Report

Verdict Report

How much should you hold?

Overall Portfolio exposure to Kyoei Steel Ltd. should be less than 10%
Overall Portfolio exposure to Ferrous Metals should be less than 30%

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

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

Is Kyoei Steel Ltd. for you?

Low Risk, Low Return

Absolute

Risk Adjusted

Volatility

Kyoei Steel Ltd.

-13.74%

-0.39

28.21%

Japan Nikkei 225

60.14%

2.04

29.37%

Quality

Management Risk

Growth

Capital Structure

Quality grade scale :

Below Average, Average, Good, Excellent

Quality key factors

Factor

Value

Sales Growth (5y)

7.50%

EBIT Growth (5y)

4.30%

EBIT to Interest (avg)

6.34

Debt to EBITDA (avg)

1.41

Net Debt to Equity (avg)

0.10

Sales to Capital Employed (avg)

1.12

Tax Ratio

26.96%

Dividend Payout Ratio

39.65%

Pledged Shares

Institutional Holding

0.02%

ROCE (avg)

6.83%

ROE (avg)

5.51%

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

0.38

EV to EBIT

5.41

EV to EBITDA

3.80

EV to Capital Employed

0.45

EV to Sales

0.33

PEG Ratio

0.09

Dividend Yield

ROCE (Latest)

8.30%

ROE (Latest)

5.90%

Technicals

Technical key factors

Indicator

Weekly

Monthly

MACD

Mildly Bullish

Mildly Bearish

RSI

No Signal

Bullish

Bollinger Bands

Mildly Bearish

Bearish

Moving Averages

Mildly Bearish (Daily)

KST

Mildly Bullish

Mildly Bearish

Dow Theory

Mildly Bearish

No Trend

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

2What is working for the Company

DEBTORS TURNOVER RATIO(HY)

Highest at 4.74 times

NET SALES(Q)

Highest at JPY 87,118 MM

-13What is not working for the Company

ROCE(HY)

Lowest at 4.41%

INTEREST COVERAGE RATIO(Q)

Lowest at 858.15

OPERATING PROFIT MARGIN(Q)

Lowest at 6.4 %

RAW MATERIAL COST(Y)

Grown by 23.08% (YoY

INTEREST(Q)

Highest at JPY 650 MM

OPERATING PROFIT(Q)

Lowest at JPY 5,578 MM

PRE-TAX PROFIT(Q)

Lowest at JPY 3,391 MM

NET PROFIT(Q)

Lowest at JPY 1,940.56 MM

Here's what is working for Kyoei Steel Ltd.

Net Sales

Highest at JPY 87,118 MM

in the last five periods

MOJO Watch

Near term sales trend is positive

Net Sales (JPY MM)

Debtors Turnover Ratio

Highest at 4.74 times

in the last five Semi-Annual periods

MOJO Watch

Company has been able to sell its Debtors faster

Debtors Turnover Ratio

Depreciation

Highest at JPY 2,174 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 Kyoei Steel Ltd.

Interest

At JPY 650 MM has Grown at 19.49%

period on period (QoQ)

MOJO Watch

Rising interest cost signifies increased borrowings

Interest Paid (JPY MM)

Interest Coverage Ratio

Lowest at 858.15

in the last five periods

MOJO Watch

The company's ability to manage interest payments is deteriorating

Operating Profit to Interest

Operating Profit Margin

Lowest at 6.4 % and Fallen

In each period in the last five periods

MOJO Watch

Company's profit margin has deteriorated

Operating Profit to Sales

Interest

Highest at JPY 650 MM

in the last five periods and Increased by 19.49% (QoQ)

MOJO Watch

Rising interest cost signifies increased borrowings

Interest Paid (JPY MM)

Operating Profit

Lowest at JPY 5,578 MM

in the last five periods

MOJO Watch

Near term Operating Profit trend is negative

Operating Profit (JPY MM)

Pre-Tax Profit

Lowest at JPY 3,391 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 1,940.56 MM

in the last five periods

MOJO Watch

Near term Net Profit trend is negative

Net Profit (JPY MM)

Raw Material Cost

Grown by 23.08% (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