Rengo Co., Ltd. (3941) 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

Nippon Kodoshi Corp.

Mitsubishi Paper Mills Ltd.

Chuetsu Pulp & Paper Co., Ltd.

Tomoegawa Corp.

Rengo Co., Ltd.

Tokushu Tokai Paper Co., Ltd.

Nippon Filcon Co., Ltd.

Nichiban Co., Ltd.

Nippon Paper Industries Co., Ltd.

Hokuetsu Corp.

Daio Paper Corp.

Why is Rengo Co., Ltd. ?

The company is Net-Debt Free

The company is Net-Debt Free

High Debt company with Weak Long Term Fundamental Strength

Positive results in Jun 26

RAW MATERIAL COST(Y) Fallen by -10.49% (YoY)
DEBTORS TURNOVER RATIO(HY) Highest at 3.6 times
NET SALES(Q) Highest at JPY 275,750 MM

With ROCE of 4.25%, it has a very attractive valuation with a 0.88 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 84.58%, its profits have risen by 2.4% ; the PEG ratio of the company is 6.2
At the current price, the company has a high dividend yield of 0

Market Beating Performance

The stock has generated a return of 84.58% in the last 1 year, much higher than market (Japan Nikkei 225) returns of 59.79%

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.

79.96%

1.83

29.54%

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)

8.26%

EBIT Growth (5y)

-0.26%

EBIT to Interest (avg)

12.71

Debt to EBITDA (avg)

3.70

Net Debt to Equity (avg)

0.76

Sales to Capital Employed (avg)

1.07

Tax Ratio

44.83%

Dividend Payout Ratio

47.22%

Pledged Shares

Institutional Holding

0.17%

ROCE (avg)

4.92%

ROE (avg)

7.68%

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

0.78

EV to EBIT

20.67

EV to EBITDA

7.72

EV to Capital Employed

0.88

EV to Sales

0.76

PEG Ratio

6.16

Dividend Yield

ROCE (Latest)

4.25%

ROE (Latest)

5.20%

Technicals

Technical key factors

Indicator

Weekly

Monthly

MACD

Bullish

RSI

No Signal

Bollinger Bands

Bullish

Moving Averages

Bullish (Daily)

KST

Bullish

Dow Theory

Bullish

OBV

Mildly 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

16What is working for the Company

RAW MATERIAL COST(Y)

Fallen by -10.49% (YoY

DEBTORS TURNOVER RATIO(HY)

Highest at 3.6 times

NET SALES(Q)

Highest at JPY 275,750 MM

OPERATING PROFIT(Q)

Highest at JPY 33,318 MM

OPERATING PROFIT MARGIN(Q)

Highest at 12.08 %

PRE-TAX PROFIT(Q)

Highest at JPY 19,195 MM

NET PROFIT(Q)

At JPY 11,663.03 MM has Grown at 93.24%

-9What is not working for the Company

INTEREST(HY)

At JPY 3,342 MM has Grown at 33.73%

INVENTORY TURNOVER RATIO(HY)

Lowest at 7.61 times

Here's what is working for Rengo Co., Ltd.

Net Sales

Highest at JPY 275,750 MM

in the last five periods

MOJO Watch

Near term sales trend is positive

Net Sales (JPY MM)

Operating Profit

Highest at JPY 33,318 MM

in the last five periods

MOJO Watch

Near term Operating Profit trend is positive

Operating Profit (JPY MM)

Operating Profit Margin

Highest at 12.08 %

in the last five periods

MOJO Watch

Company's profit margin has improved

Operating Profit to Sales

Pre-Tax Profit

Highest at JPY 19,195 MM

in the last five periods

MOJO Watch

Near term Pre-Tax Profit trend is positive

Pre-Tax Profit (JPY MM)

Pre-Tax Profit

At JPY 19,195 MM has Grown at 83.95%

Year on Year (YoY)

MOJO Watch

Near term Pre-Tax Profit trend is positive

Pre-Tax Profit (JPY MM)

Net Profit

At JPY 11,663.03 MM has Grown at 93.24%

Year on Year (YoY)

MOJO Watch

Near term Net Profit trend is positive

Net Profit (JPY MM)

Debtors Turnover Ratio

Highest at 3.6 times

in the last five Semi-Annual periods

MOJO Watch

Company has been able to sell its Debtors faster

Debtors Turnover Ratio

Raw Material Cost

Fallen by -10.49% (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 Rengo Co., Ltd.

Interest

At JPY 3,342 MM has Grown at 33.73%

over previous Semi-Annual period

MOJO Watch

Rising interest cost signifies increased borrowings

Interest Paid (JPY MM)

Inventory Turnover Ratio

Lowest at 7.61 times

in the last five Semi-Annual periods

MOJO Watch

Company's pace of selling inventory has slowed

Inventory Turnover Ratio

Non Operating Income

Highest at JPY 0.15 MM

in the last five periods

MOJO Watch

Increased income from non business activities may not be sustainable

Non Operating income