Fact based stock research
DENKA (TSE:4061)

JP3549600009

How to read the free ranks

For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".

Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".

Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.

Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.

(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).

(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.

DENKA stock research in summary

denka.co.jp

ANALYSIS: With an Obermatt Combined Rank of 47 (worse than 53% compared with investment alternatives), DENKA (Commodity Chemicals, Japan) shares have somewhat below-average financial characteristics compared with similar stocks. Shares of DENKA are a good value (attractively priced) with a consolidated Value Rank of 85 (better than 85% of alternatives), are safely financed (Safety Rank of 55, which means low debt burdens), but show below-average growth (Growth Rank of 9). ...read more

RECOMMENDATION: A Combined Rank of 47, is a hold recommendation based on DENKA's financial characteristics. As the company DENKA's key financial metrics exhibit good value (Obermatt Value Rank of 85) but low growth (Obermatt Growth Rank of 9) while being safely financed (Obermatt Safety Rank of 55), it may be a safer investment because companies with low debt can better withstand times of crises. Yet the good value, better than 85% of comparable companies, may also indicate that the company's future is challenging. If you believe that low growth is temporary or just due to a specific current event, you may conclude that the good value of the stock provides an attractive investment opportunity and the downside is limited due to below-average financing risks. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more

Latest Obermatt Ranks


360° View^new
Sentiment Rank^new
Value Rank	85
Growth Rank	9
Safety Rank	55
Combined Rank	47

Country	Japan
Industry	Commodity Chemicals
Index	Low Emissions, Energy Efficient, Nikkei 225
Size class	X-Large

This stock has achievements: Top 10 Stock.

14-Nov-2024. Stock data may be delayed. Log in or sign up to get the most recent research.

Further information

Multiple opinions. One number.

Analysts rarely agree on a stock’s future. So, who do you believe? Obermatt translates those collective views into a single Sentiment Rank. That plus the financial ranks give you the ultimate 360° View. Sign up to access them.

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Review the performance ranks of the individual metrics that form each investment strategy.

Research History: DENKA

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	98	73	97	85
GROWTH
GROWTH	36	17	17	9
SAFETY
SAFETY	57	50	57	55
SENTIMENT
SENTIMENT	n/a	22	18	^new
360° VIEW
360° VIEW	n/a	23	54	^new

Most recent update of the stock research: 14-Nov-2024. Financial reporting date used for calculating ranks: 30-Jun-2024. Stock research history is based on the Obermatt Method. The higher the rank, the better DENKA is in the corresponding investment strategy.
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Combined financial peformance in Detail

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	98	73	97	85
GROWTH
GROWTH	36	17	17	9
SAFETY
SAFETY	57	50	57	55
COMBINED
COMBINED	80	42	71	47

Last update of combined financial performance: 14-Nov-2024. Stock analysis on combined financial performance: The higher the rank of DENKA the better the performance.

Value Metrics in Detail

ANALYSIS: With an Obermatt Value Rank of 85 (better than 85% compared with alternatives) for 2024, DENKA shares are significantly less expensive than comparable stocks. The Value Rank is based on consolidating four value indicators that are all above average for DENKA. Price-to-Sales is 70 which means that the stock price compared with what market professionals expect for future sales is lower than for 70% of comparable companies, indicating a good value for DENKA's revenue size. The same is valid for expected Price-to-Profits, more favorable than for 50% of alternatives, and this is also true for the Price-to-Book capital ratio (also referred to as market-to-book ratio) with a Price-to-Capital Rank of 80. Compared with other companies in the same industry, dividend yields of DENKA are expected to be higher than for 98% of all competitors (a Dividend Yield rank of 98). ...read more

RECOMMENDATION: The overall picture with a consolidated Value Rank of 85, is a buy recommendation based on DENKA's stock price compared with the company's operational size and dividend yields. Since all value metrics are above the industry average, there is no objection to investing in DENKA based on its detailed value metrics. We recommend further analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks, including the 360° View, before making an investment decision. ...read more

VALUE METRICS	2021	2022	2023	2024
PRICE VS. REVENUES (P/S)
PRICE VS. REVENUES (P/S)	80	51	70	70
PRICE VS. PROFITS (P/E)
PRICE VS. PROFITS (P/E)	84	56	83	50
PRICE VS. CAPITAL (Market-to-Book)
PRICE VS. CAPITAL (Market-to-Book)	90	53	82	80
DIVIDEND YIELD
DIVIDEND YIELD	88	91	98	98
CONSOLIDATED RANK: VALUE
CONSOLIDATED RANK: VALUE	98	73	97	85

Last update of Value Rank: 14-Nov-2024. Stock analysis on value ratios: The higher the rank, the lower the value ratio of DENKA; except for dividend yield where the rank is higher, the higher the yield.

Growth Metrics in Detail

ANALYSIS: With an Obermatt Growth Rank of 9 (better than 9% compared with alternatives), DENKA shows one of the most restricted growth dynamics in its industry. There is little momentum in this company. The Growth Rank is based on consolidating four value indicators, with all four metrics below average for DENKA. Sales Growth has a rank of 16, which means that currently professionals expect the company to grow less than 84% of its competitors. The same is valid for Profit Growth, with a rank of 9, and Capital Growth with 23. In addition, Stock Returns have a below market rank of 45, which means that the stock returns have recently been below 55% of alternative investments. ...read more

RECOMMENDATION: The overall picture with a consolidated Growth Rank of 9, is a sell recommendation for growth and momentum investors. These are all bad growth momentum indicators. These are negative signals for investors interested in growth companies. Value is likely good for this company, as investors may have left this stock in the cold. If that is the case, investors should look at the company's outlook, especially Sentiment performance, because it may be a turnaround situation that could entail above-average stock returns in the future. But it remains a risky bet, as no growth signals are in the green zone yet. While momentum is a popular investment factor, the value aspect might be the more important one, in the longer term. We recommend analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks to arrive at a 360° View of the stock purchase case, especially since the growth performance is low here. ...read more

GROWTH METRICS	2021	2022	2023	2024
REVENUE GROWTH
REVENUE GROWTH	28	57	27	16
PROFIT GROWTH
PROFIT GROWTH	84	30	66	9
CAPITAL GROWTH
CAPITAL GROWTH	n/a	27	25	23
STOCK RETURNS
STOCK RETURNS	38	23	9	45
CONSOLIDATED RANK: GROWTH
CONSOLIDATED RANK: GROWTH	36	17	17	9

Last update of Growth Rank: 14-Nov-2024. Stock analysis on growth metrics: The higher the rank, the higher the growth and returns of DENKA.

Safety Metrics in Detail

ANALYSIS: With an Obermatt Safety Rank of 55 (better than 55% compared with alternatives), the company DENKA has financing practices on the safer side, which mean that their overall debt burden is lower than average. This doesn't mean that the business of DENKA is safe, it only means that the company is on the safer side regarding possible bankruptcy, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with two out of three indicators above-average for DENKA. Refinancing is at 57, meaning the portion of the debt that is about to be refinanced is below average. It has less debt in the refinancing stage than 57% of its competitors. Liquidity is also good at 63, meaning the company generates more profit to service its debt than 63% of its competitors. This indicates that the company is safer when it comes to debt service. However, Leverage is rather large at 32, which means the company has an above-average debt-to-equity ratio. It has more debt than 68% of its competitors. ...read more

RECOMMENDATION: With a consolidated Safety Rank of 55 (better than 55% compared with alternatives), DENKA has a financing structure that is safer than that of its competitors. This is not bad if things go well. The higher debt level means better returns to shareholders if things go well. Many top-performing companies operate with higher debt levels, and DENKA could be in that group. But if you expect the environment to turn rougher, the higher leverage could become a problem. The same is valid if you expect interest rates to rise. That could squeeze shareholder returns, which so far have benefitted from better conditions. In the long-term, investors may have a debt challenge with DENKA and should also compare Obermatt’s Value, Growth, and Sentiment Ranks before making a decision. ...read more

SAFETY METRICS	2021	2022	2023	2024
LEVERAGE
LEVERAGE	12	42	36	32
REFINANCING
REFINANCING	96	33	47	57
LIQUIDITY
LIQUIDITY	44	72	71	63
CONSOLIDATED RANK: SAFETY
CONSOLIDATED RANK: SAFETY	57	50	57	55

Last update of Safety Rank: 14-Nov-2024. Stock analysis on safety metrics: The higher the rank, the lower the leverage of DENKA and the more cash is available to service its debt.

Sentiment Metrics in Detail

SENTIMENT	2021	2022	2023	2024
ANALYST OPINIONS
ANALYST OPINIONS	n/a	61	34	^new
OPINIONS CHANGE
OPINIONS CHANGE	n/a	13	17	^new
PRO HOLDINGS
PRO HOLDINGS	n/a	20	15	^new
MARKET PULSE
MARKET PULSE	n/a	64	52	^new
CONSOLIDATED RANK: SENTIMENT
CONSOLIDATED RANK: SENTIMENT	n/a	22	18	^new

Last update of Sentiment Rank: 14-Nov-2024. Stock analysis on sentiment metrics: The higher the rank, the more positive the sentiment for DENKA.
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