Rengo Co., Ltd.

Market Cap: Small Cap
Industry: Paper, Forest & Jute Products
ISIN: JP3981400009

JPY

1,146.00

23.5 (2.09%)

Dec 11

TKS

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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

Nippon Kodoshi Corp.

Tokushu Tokai Paper Co., Ltd.

Nippon Filcon Co., Ltd.

Rengo Co., Ltd.

Daio Paper Corp.

Mitsubishi Paper Mills Ltd.

Tomoegawa Corp.

Nichiban Co., Ltd.

Hokuetsu Corp.

Nippon Paper Industries Co., Ltd.

Chuetsu Pulp & Paper Co., Ltd.

Why is Rengo Co., Ltd. ?

High Debt Company with a Debt to Equity ratio (avg) at times

High Debt Company with a Debt to Equity ratio (avg) at times

High Debt company with Weak Long Term Fundamental Strength

The company has declared Negative results for the last 5 consecutive quarters

INTEREST(HY) At JPY 2,499 MM has Grown at 37.01%
ROCE(HY) Lowest at 4.64%
NET PROFIT(Q) Fallen at -39.78%

With ROCE of 4.58%, it has a very attractive valuation with a 0.68 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 32.67%, its profits have fallen by -20.8%
At the current price, the company has a high dividend yield of 0.1

Real-Time Research Report

Verdict Report

How much should you hold?

Overall Portfolio exposure to Rengo Co., Ltd. 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 Rengo Co., Ltd. for you?

Low Risk, Low Return

Absolute

Risk Adjusted

Volatility

Rengo Co., Ltd.

32.67%

0.43

24.61%

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)

7.75%

EBIT Growth (5y)

-1.92%

EBIT to Interest (avg)

16.16

Debt to EBITDA (avg)

3.63

Net Debt to Equity (avg)

0.76

Sales to Capital Employed (avg)

1.08

Tax Ratio

28.58%

Dividend Payout Ratio

25.65%

Pledged Shares

Institutional Holding

0.17%

ROCE (avg)

5.42%

ROE (avg)

7.62%

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

0.43

EV to EBIT

14.75

EV to EBITDA

5.69

EV to Capital Employed

0.68

EV to Sales

0.56

PEG Ratio

Dividend Yield

0.07%

ROCE (Latest)

4.58%

ROE (Latest)

5.84%

Technicals

Technical key factors

Indicator

Weekly

Monthly

MACD

Bullish

RSI

No Signal

Bollinger Bands

Bullish

Moving Averages

Bullish (Daily)

KST

Bullish

Mildly Bullish

Dow Theory

Mildly Bullish

OBV

Bullish

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

-13What is not working for the Company

INTEREST(HY)

At JPY 2,499 MM has Grown at 37.01%

ROCE(HY)

Lowest at 4.64%

NET PROFIT(Q)

Fallen at -39.78%

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

Interest

At JPY 2,499 MM has Grown at 37.01%

over previous Semi-Annual period

MOJO Watch

Rising interest cost signifies increased borrowings

Interest Paid (JPY MM)

Net Profit

Fallen at -39.78%

Year on Year (YoY)

MOJO Watch

Near term Net Profit trend is negative

Net Profit (JPY MM)