Fact based stock research
Kansai Paint (TSE:4613)

JP3229400001

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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.

Kansai Paint stock research in summary

kansai.co.jp

ANALYSIS: With an Obermatt Combined Rank of 27 (worse than 73% compared with investment alternatives), Kansai Paint (Specialty Chemicals, Japan) shares have somewhat below-average financial characteristics compared with similar stocks. Shares of Kansai Paint are low in value (priced high) with a consolidated Value Rank of 33 (worse than 67% of alternatives) and show below-average growth (Growth Rank of 11) but are safely financed (Safety Rank of 63), which means low debt burdens. ...read more

RECOMMENDATION: A Combined Rank of 27, is a hold recommendation based on Kansai Paint's financial characteristics. As the company Kansai Paint's critical financial metrics exhibit below-average performance, such as low value (Obermatt Value Rank of 33) and low growth (Obermatt Growth Rank of 11), it is a somewhat questionable stock investment, where the risk of paying too much for the shares is significant, unless the company has an exceptionally bright future. In this case, good financing practices (Obermatt Safety Rank of 63) are a positive sign, because it may allow the company to weather challenging times until the hoped-for cash flows materialize. This may be true for high-tech or biotechnology companies with enough cash to sustain prolonged business development. If they own properties that only provide cash flows in the future, the stock may look excessively expensive and unattractive today. In such cases, the Obermatt Method has limited value, as it is based on facts we can observe today. If the facts lie all in the future, stock investing becomes guesswork, and this should only be a driver in a limited number of investments that account for a small fraction of a safe portfolio. 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	33
Growth Rank	11
Safety Rank	63
Combined Rank	27

Country	Japan
Industry	Specialty Chemicals
Index
Size class	X-Large

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

Further information

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

Research History: Kansai Paint

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	68	23	39	33
GROWTH
GROWTH	45	9	91	11
SAFETY
SAFETY	95	39	52	63
SENTIMENT
SENTIMENT	n/a	60	78	^new
360° VIEW
360° VIEW	n/a	13	84	^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 Kansai Paint is in the corresponding investment strategy.
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Combined financial peformance in Detail

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	68	23	39	33
GROWTH
GROWTH	45	9	91	11
SAFETY
SAFETY	95	39	52	63
COMBINED
COMBINED	87	6	76	27

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

Value Metrics in Detail

ANALYSIS: With an Obermatt Value Rank of 33 (worse than 67% compared with alternatives), Kansai Paint shares are more expensive than the average comparable stock. The Value Rank is based on consolidating four value indicators, where the majority of metrics are below, and only one is above average for Kansai Paint. Price-to-Sales (P/S) is 53, which means that the stock price compared with what market professionals expect for future sales is lower than 53% of comparable companies, indicating a good value concerning to Kansai Paint's revenue size. But all other performance indicators point in a different direction. Dividend yields have a Dividend Yield rank of 31, meaning that dividends are expected to be lower than for 69% of comparable investments. Furthermore, Price-to-Book Capital (also referred to as market-to-book ratio) is less favorable than 75% of alternatives (only 25% of peers have an even higher ratio). The same is valid for Price-to-Profit (or Price / Earnings, P/E), which is higher than for 57% of comparable companies, making the stock more expensive compared with the company's expected profit levels. ...read more

RECOMMENDATION: The overall picture with a consolidated Value Rank of 33, is a hold recommendation based on Kansai Paint's stock price compared with the company's operational size and dividend yields. Since Price-to-Sales is a stable value indicator even in challenging times, investing in Kansai Paint could be seen as a value investment. However, there must be a good reason for the low market-to-book rank. If the company has a typical capital investment practice, the stock may be overvalued because the profit and dividend-related performance indicators are also low. The stock is only good value if investors can expect profits and dividends to pick up in the future. Else, Kansai Paint looks like an expensive investment today. We recommend further analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks, including the 360° View, before making an investment decision, which is especially important in this case, as the financial indicators are inconclusive. ...read more

VALUE METRICS	2021	2022	2023	2024
PRICE VS. REVENUES (P/S)
PRICE VS. REVENUES (P/S)	74	34	48	53
PRICE VS. PROFITS (P/E)
PRICE VS. PROFITS (P/E)	60	16	72	43
PRICE VS. CAPITAL (Market-to-Book)
PRICE VS. CAPITAL (Market-to-Book)	52	35	36	25
DIVIDEND YIELD
DIVIDEND YIELD	60	26	18	31
CONSOLIDATED RANK: VALUE
CONSOLIDATED RANK: VALUE	68	23	39	33

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

Growth Metrics in Detail

ANALYSIS: With an Obermatt Growth Rank of 11 (better than 11% compared with alternatives), Kansai Paint 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 three out of four indicators below average for Kansai Paint. Sales Growth has a below market rank of 20, which means that, currently, professionals expect the company to grow less than 80% of its competitors. The same is valid for Capital Growth, with a rank of 7, and Profit Growth, with a rank of 21. Currently, professionals expect the company to grow its profits less than 79% of its competitors). Only shareholders are optimistic. Stock Returns are above average at a rank of 77, which means that the stock returns have recently been above 77% of alternative investments. ...read more

RECOMMENDATION: The overall picture with a consolidated Growth Rank of 11, is a sell recommendation for growth and momentum investors. That picture may be the result for a company that has reached the bottom. All went south for Kansai Paint, and it still looks bad, but some investors already see light at the end of the tunnel, rewarding the stock with recent above-market stock returns. It could also mean that investors are correcting an overreaction to negative news. If that were the case, the positive stock returns are not yet a sign of recovery. Investors should look closely at the Value and Sentiment indicators before they make a stock purchasing decision, because growth is unlikely to be the driving argument behind this investment. 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	29	55	43	20
PROFIT GROWTH
PROFIT GROWTH	90	14	89	21
CAPITAL GROWTH
CAPITAL GROWTH	n/a	33	66	7
STOCK RETURNS
STOCK RETURNS	46	11	93	77
CONSOLIDATED RANK: GROWTH
CONSOLIDATED RANK: GROWTH	45	9	91	11

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

Safety Metrics in Detail

ANALYSIS: With an Obermatt Safety Rank of 63 (better than 63% compared with alternatives), the company Kansai Paint 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 Kansai Paint 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, where all three are above average for Kansai Paint. Leverage is at 60, meaning the company has a below-average debt-to-equity ratio. It has less debt than 60% of its competitors. Refinancing is at a rank of 55, meaning that the portion of the debt about to be refinanced is below average. It has less debt in the refinancing stage than 55% of its competitors. Finally, Liquidity is also good at a rank of 67, which means that the company generates more profit to service its debt than 67% of its competitors. ...read more

RECOMMENDATION: With a consolidated Safety Rank of 63 (better than 63% compared with alternatives), Kansai Paint has a financing structure that is safer than that of its competitors. These three positive financing indicators signal that the company is less likely to default on its debt obligations. However, it also means that its shareholder returns will be more modest if things go well. A low safety means fewer troubles in downtimes and less upside in good times. Investors may not have a debt issue with Kansai Paint but they should also compare Obermatt’s Value, Growth, and Sentiment Ranks before making a decision. ...read more

SAFETY METRICS	2021	2022	2023	2024
LEVERAGE
LEVERAGE	60	48	58	60
REFINANCING
REFINANCING	72	33	33	55
LIQUIDITY
LIQUIDITY	100	49	62	67
CONSOLIDATED RANK: SAFETY
CONSOLIDATED RANK: SAFETY	95	39	52	63

Last update of Safety Rank: 14-Nov-2024. Stock analysis on safety metrics: The higher the rank, the lower the leverage of Kansai Paint 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	64	63	^new
OPINIONS CHANGE
OPINIONS CHANGE	n/a	26	50	^new
PRO HOLDINGS
PRO HOLDINGS	n/a	63	92	^new
MARKET PULSE
MARKET PULSE	n/a	56	58	^new
CONSOLIDATED RANK: SENTIMENT
CONSOLIDATED RANK: SENTIMENT	n/a	60	78	^new

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