Scala, Inc. (Japan) (4845) 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

Flect Co., Ltd.

Ad-Sol Nissin Corp.

Startia Holdings, Inc.

ISB Corp.

HIMACS Ltd.

NEOJAPAN, Inc.

Focus Systems Corp.

Uluru Co., Ltd.

Scala, Inc. (Japan)

J-Stream, Inc.

Tecnos Japan Inc.

Why is Scala, Inc. (Japan) ?

Poor Management Efficiency with a low ROE of 0.82%

The company has been able to generate a Return on Equity (avg) of 0.82% signifying low profitability per unit of shareholders funds

Poor long term growth as Net Sales has grown by an annual rate of -10.99% and Operating profit at -22.43% over the last 5 years

Negative results in Dec 25

INTEREST(HY) At JPY 28.29 MM has Grown at 22.05%
NET PROFIT(Q) At JPY 99.33 MM has Fallen at -56.05%
RAW MATERIAL COST(Y) Grown by 6.74% (YoY)

With ROE of -9.04%, it has a risky valuation with a 1.65 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 -18.88%, its profits have risen by 75.4%

Consistent Underperformance against the benchmark over the last 3 years

Along with generating -18.88% returns in the last 1 year, the stock has also underperformed Japan Nikkei 225 in each of the last 3 annual periods

Real-Time Research Report

Verdict Report

How much should you hold?

Overall Portfolio exposure to Scala, Inc. (Japan) should be less than 10%
Overall Portfolio exposure to Computers - Software & Consulting should be less than 30%

(If sector exposure > 30%, please use optimiser tool to see which are the best stocks to hold in Computers - Software & Consulting)

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

Is Scala, Inc. (Japan) for you?

Low Risk, Low Return

Absolute

Risk Adjusted

Volatility

Scala, Inc. (Japan)

-18.88%

-2.08

24.84%

Japan Nikkei 225

36.73%

1.30

28.24%

Quality

Management Risk

Growth

Capital Structure

Quality grade scale :

Below Average, Average, Good, Excellent

Quality key factors

Factor

Value

Sales Growth (5y)

-10.99%

EBIT Growth (5y)

-22.43%

EBIT to Interest (avg)

2.52

Debt to EBITDA (avg)

Net Debt to Equity (avg)

-0.27

Sales to Capital Employed (avg)

0.88

Tax Ratio

37.93%

Dividend Payout Ratio

29.16%

Pledged Shares

Institutional Holding

ROCE (avg)

3.84%

ROE (avg)

0.82%

Valuation

Valuation Scorecard

Valuation grade scale :

Very Risky, Risky, Very Expensive, Expensive, Fair, Attractive, Very Attractive

Valuation Key Factors

Factor

Value

P/E Ratio

NA (Loss Making)

Industry P/E

Price to Book Value

1.65

EV to EBIT

14.63

EV to EBITDA

10.62

EV to Capital Employed

1.88

EV to Sales

0.63

PEG Ratio

Dividend Yield

ROCE (Latest)

12.87%

ROE (Latest)

-9.04%

Technicals

Technical key factors

Indicator

Weekly

Monthly

MACD

Bearish

Mildly Bullish

RSI

Bullish

No Signal

Bollinger Bands

Bearish

Moving Averages

Bearish (Daily)

KST

Bearish

Mildly Bullish

Dow Theory

Mildly Bearish

OBV

No Trend

Mildly Bearish

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

6What is working for the Company

NET PROFIT(9M)

Higher at JPY 499.64 MM

NET SALES(Q)

At JPY 2,143.89 MM has Grown at 13.27%

-17What is not working for the Company

INTEREST(HY)

At JPY 28.29 MM has Grown at 22.05%

NET PROFIT(Q)

At JPY 99.33 MM has Fallen at -56.05%

RAW MATERIAL COST(Y)

Grown by 6.74% (YoY

CASH AND EQV(HY)

Lowest at JPY 8,556.94 MM

PRE-TAX PROFIT(Q)

At JPY 131.32 MM has Fallen at -27.77%

Here's what is working for Scala, Inc. (Japan)

Net Sales

At JPY 2,143.89 MM has Grown at 13.27%

over average net sales of the previous four periods of JPY 1,892.68 MM

MOJO Watch

Near term sales trend is positive

Net Sales (JPY MM)

Here's what is not working for Scala, Inc. (Japan)

Interest

At JPY 28.29 MM has Grown at 22.05%

over previous Semi-Annual period

MOJO Watch

Rising interest cost signifies increased borrowings

Interest Paid (JPY MM)

Net Profit

At JPY 99.33 MM has Fallen at -56.05%

over average net sales of the previous four periods of JPY 226 MM

MOJO Watch

Near term Net Profit trend is very negative

Net Profit (JPY MM)

Pre-Tax Profit

At JPY 131.32 MM has Fallen at -27.77%

over average net sales of the previous four periods of JPY 181.8 MM

MOJO Watch

Near term Pre-Tax Profit trend is negative

Pre-Tax Profit (JPY MM)

Cash and Eqv

Lowest at JPY 8,556.94 MM

in the last six Semi-Annual periods

MOJO Watch

Short Term liquidity is deteriorating

Cash and Cash Equivalents

Raw Material Cost

Grown by 6.74% (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