Rhythm Co., Ltd. (7769) 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

Yamaichi Electronics Co., Ltd.

Takaoka Toko Co., Ltd.

SMK Corp.

I-PEX, Inc.

Teikoku Tsushin Kogyo Co., Ltd.

Nippon Chemi-Con Corp.

Rhythm Co., Ltd.

Kyoden Co., Ltd.

Imagica Group, Inc.

OXIDE Corp.

Ohara, Inc.

Why is Rhythm Co., Ltd. ?

Poor Management Efficiency with a low ROE of 2.66%

The company has been able to generate a Return on Equity (avg) of 2.66% signifying low profitability per unit of shareholders funds

Weak Long Term Fundamental Strength with an average Return on Equity (ROE) of 2.66%

Poor long term growth as Net Sales has grown by an annual rate of 4.12% and Operating profit at 62.03% over the last 5 years
The company has been able to generate a Return on Equity (avg) of 2.66% signifying low profitability per unit of shareholders funds

Poor long term growth as Net Sales has grown by an annual rate of 4.12% and Operating profit at 62.03% over the last 5 years

Negative results in Jun 26

INTEREST(HY) At JPY 43 MM has Grown at 22.86%
RAW MATERIAL COST(Y) Grown by 7.75% (YoY)
DEBT-EQUITY RATIO (HY) Highest at -14.94 %

With ROE of 7.70%, it has a very attractive valuation with a 0.92 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 26.42%, its profits have risen by 126% ; the PEG ratio of the company is 0.1
At the current price, the company has a high dividend yield of 0

Real-Time Research Report

Verdict Report

How much should you hold?

Overall Portfolio exposure to Rhythm Co., Ltd. should be less than 10%
Overall Portfolio exposure to Electronics & Appliances should be less than 30%

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

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

Is Rhythm Co., Ltd. for you?

Low Risk, Low Return

Absolute

Risk Adjusted

Volatility

Rhythm Co., Ltd.

24.69%

0.16

20.01%

Japan Nikkei 225

57.85%

1.98

29.31%

Quality

Management Risk

Growth

Capital Structure

Quality grade scale :

Below Average, Average, Good, Excellent

Quality key factors

Factor

Value

Sales Growth (5y)

4.12%

EBIT Growth (5y)

62.03%

EBIT to Interest (avg)

18.89

Debt to EBITDA (avg)

Net Debt to Equity (avg)

-0.18

Sales to Capital Employed (avg)

0.85

Tax Ratio

6.96%

Dividend Payout Ratio

58.23%

Pledged Shares

Institutional Holding

ROCE (avg)

3.89%

ROE (avg)

2.66%

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

0.92

EV to EBIT

14.51

EV to EBITDA

7.78

EV to Capital Employed

0.91

EV to Sales

0.74

PEG Ratio

0.10

Dividend Yield

ROCE (Latest)

6.25%

ROE (Latest)

7.70%

Technicals

Technical key factors

Indicator

Weekly

Monthly

MACD

Bullish

Mildly Bearish

RSI

Bearish

No Signal

Bollinger Bands

Bullish

Moving Averages

Bullish (Daily)

KST

Bullish

Dow Theory

Mildly Bullish

OBV

No Trend

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

3What is working for the Company

CASH AND EQV(HY)

Highest at JPY 27,290 MM

INVENTORY TURNOVER RATIO(HY)

Highest at 3.52 times

OPERATING PROFIT(Q)

Highest at JPY 928 MM

-18What is not working for the Company

INTEREST(HY)

At JPY 43 MM has Grown at 22.86%

RAW MATERIAL COST(Y)

Grown by 7.75% (YoY

DEBT-EQUITY RATIO (HY)

Highest at -14.94 %

NET PROFIT(Q)

At JPY 408.5 MM has Fallen at -34.96%

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

Operating Profit

Highest at JPY 928 MM

in the last five periods

MOJO Watch

Near term Operating Profit trend is positive

Operating Profit (JPY MM)

Cash and Eqv

Highest at JPY 27,290 MM

in the last six Semi-Annual periods

MOJO Watch

Short Term liquidity is improving

Cash and Cash Equivalents

Inventory Turnover Ratio

Highest at 3.52 times

in the last five Semi-Annual periods

MOJO Watch

Company has been able to sell its inventory faster

Inventory Turnover Ratio

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

Interest

At JPY 43 MM has Grown at 22.86%

over previous Semi-Annual period

MOJO Watch

Rising interest cost signifies increased borrowings

Interest Paid (JPY MM)

Net Profit

At JPY 408.5 MM has Fallen at -34.96%

over average net sales of the previous four periods of JPY 628.11 MM

MOJO Watch

Near term Net Profit trend is negative

Net Profit (JPY MM)

Debt-Equity Ratio

Highest at -14.94 %

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

Raw Material Cost

Grown by 7.75% (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