Nichia Steel Works, Ltd. (5658) 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

Pacific Metals Co., Ltd.

Aichi Steel Corp.

Canox Corp.

Mory Industries Inc.

Kurimoto Ltd.

Nippon Yakin Kogyo Co., Ltd.

Nakayama Steel Works, Ltd.

Tokyo Tekko Co., Ltd.

Nichia Steel Works, Ltd.

Chubu Steel Plate Co., Ltd.

OSAKA STEEL CO., LTD.

Why is Nichia Steel Works, Ltd. ?

Poor Management Efficiency with a low ROE of 3.08%

The company has been able to generate a Return on Equity (avg) of 3.08% 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 84.18

Poor long term growth as Net Sales has grown by an annual rate of 1.98% over the last 5 years

Negative results in Dec 25

NET PROFIT(HY) At JPY 163.22 MM has Grown at -73.51%
ROCE(HY) Lowest at 1.59%
INTEREST(Q) At JPY 5.89 MM has Grown at 44.64%

With ROE of 2.47%, it has a very attractive valuation with a 0.30 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 15.03%, its profits have fallen by -10.8%
At the current price, the company has a high dividend yield of 0.2

Underperformed the market in the last 1 year

The stock has generated a return of 15.03% in the last 1 year, much lower than market (Japan Nikkei 225) returns of 40.96%

Real-Time Research Report

Verdict Report

How much should you sell?

All quantity irrespective of whether you are making profits or losses

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

When to re-enter? - We will constantly monitor the company and review our call based on new data

Is Nichia Steel Works, Ltd. for you?

Low Risk, Low Return

Absolute

Risk Adjusted

Volatility

Nichia Steel Works, Ltd.

15.03%

0.63

28.43%

Japan Nikkei 225

41.2%

1.44

28.42%

Quality

Management Risk

Growth

Capital Structure

Quality grade scale :

Below Average, Average, Good, Excellent

Quality key factors

Factor

Value

Sales Growth (5y)

1.98%

EBIT Growth (5y)

-5.07%

EBIT to Interest (avg)

84.18

Debt to EBITDA (avg)

Net Debt to Equity (avg)

-0.18

Sales to Capital Employed (avg)

0.62

Tax Ratio

24.16%

Dividend Payout Ratio

44.49%

Pledged Shares

Institutional Holding

ROCE (avg)

4.03%

ROE (avg)

3.08%

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

0.30

EV to EBIT

4.87

EV to EBITDA

2.38

EV to Capital Employed

0.15

EV to Sales

0.19

PEG Ratio

Dividend Yield

0.16%

ROCE (Latest)

3.16%

ROE (Latest)

2.47%

Technicals

Technical key factors

Indicator

Weekly

Monthly

MACD

Mildly Bearish

Bullish

RSI

No Signal

Bollinger Bands

Sideways

Mildly Bullish

Moving Averages

Mildly Bullish (Daily)

KST

Bullish

Dow Theory

Mildly Bearish

Bullish

OBV

Mildly Bearish

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

12What is working for the Company

RAW MATERIAL COST(Y)

Fallen by -2.83% (YoY

OPERATING PROFIT(Q)

Highest at JPY 847.16 MM

OPERATING PROFIT MARGIN(Q)

Highest at 9.75 %

PRE-TAX PROFIT(Q)

Highest at JPY 1,091.01 MM

NET PROFIT(Q)

Highest at JPY 665.9 MM

EPS(Q)

Highest at JPY 11.83

-20What is not working for the Company

NET PROFIT(HY)

At JPY 163.22 MM has Grown at -73.51%

ROCE(HY)

Lowest at 1.59%

INTEREST(Q)

At JPY 5.89 MM has Grown at 44.64%

Here's what is working for Nichia Steel Works, Ltd.

Pre-Tax Profit

At JPY 1,091.01 MM has Grown at 1,028.29%

over average net sales of the previous four periods of JPY 96.7 MM

MOJO Watch

Near term Pre-Tax Profit trend is very positive

Pre-Tax Profit (JPY MM)

Net Profit

At JPY 665.9 MM has Grown at 890.11%

over average net sales of the previous four periods of JPY 67.25 MM

MOJO Watch

Near term Net Profit trend is very positive

Net Profit (JPY MM)

Operating Profit

Highest at JPY 847.16 MM

in the last five periods

MOJO Watch

Near term Operating Profit trend is positive

Operating Profit (JPY MM)

Operating Profit Margin

Highest at 9.75 %

in the last five periods

MOJO Watch

Company's profit margin has improved

Operating Profit to Sales

Pre-Tax Profit

Highest at JPY 1,091.01 MM

in the last five periods

MOJO Watch

Near term Pre-Tax Profit trend is positive

Pre-Tax Profit (JPY MM)

Net Profit

Highest at JPY 665.9 MM

in the last five periods

MOJO Watch

Near term Net Profit trend is positive

Net Profit (JPY MM)

EPS

Highest at JPY 11.83

in the last five periods

MOJO Watch

Increasing profitability; company has created higher earnings for shareholders

EPS (JPY)

Raw Material Cost

Fallen by -2.83% (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 Nichia Steel Works, Ltd.

Interest

At JPY 5.89 MM has Grown at 44.64%

period on period (QoQ)

MOJO Watch

Rising interest cost signifies increased borrowings

Interest Paid (JPY MM)