Fact based stock research
Murata Manufacturing (TSE:6981)
JP3914400001
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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.
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Murata Manufacturing stock research in summary
ANALYSIS: With an Obermatt Combined Rank of 20 (worse than 80% compared with investment alternatives), Murata Manufacturing (Electronic Components, Japan) shares have lower financial characteristics compared with similar stocks. Shares of Murata Manufacturing are low in value (priced high) with a consolidated Value Rank of 19 (worse than 81% of alternatives). But they show above-average growth (Growth Rank of 55) and are safely financed (Safety Rank of 90, which means below-average debt burdens). ...read more
RECOMMENDATION: A Combined Rank of 20, is a sell recommendation based on Murata Manufacturing's financial characteristics. Investors looking for growth and low financial risk may find this stock attractive. While the company Murata Manufacturing exhibits low value (Obermatt Value Rank of 19), which means that the stock price is rather high, it also demonstrates above-average growth (Obermatt Growth Rank of 55). This is a typical case, as high-growth companies are often expensive. Good financing practices (Obermatt Safety Rank of 90) are a double-edged sword: if the company continues growing, low debt limits shareholder returns. But if the company increases its debt, it will also increase risk. In other words, this is an investment on the safer side, despite the above-average price (low value). Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more
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360° Viewnew| Country | Japan |
| Industry | Electronic Components |
| Index | TOPIX 100, Low Emissions, Energy Efficient |
| Size class | XX-Large |
2-May-2024. Stock data may be delayed. Log in or sign up to get the most recent research.
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Review the performance ranks of the individual metrics that form each investment strategy.
Research History: Murata Manufacturing
| RESEARCH HISTORY | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 75 |
|
9 |
|
11 |
|
19 |
|
| GROWTH | ||||||||
| GROWTH | 63 |
|
27 |
|
55 |
|
55 |
|
| SAFETY | ||||||||
| SAFETY | 98 |
|
81 |
|
89 |
|
90 |
|
| SENTIMENT | ||||||||
| SENTIMENT | n/a |
|
6 |
|
54 |
|
new |
|
| 360° VIEW | ||||||||
| 360° VIEW | n/a |
|
13 |
|
43 |
|
new |
|
Combined financial peformance in Detail
ANALYSIS: With an Obermatt Combined Rank of 20 (worse than 80% compared with investment alternatives), Murata Manufacturing (Electronic Components, Japan) shares have lower financial characteristics compared with similar stocks. Shares of Murata Manufacturing are low in value (priced high) with a consolidated Value Rank of 19 (worse than 81% of alternatives). But they show above-average growth (Growth Rank of 55) and are safely financed (Safety Rank of 90, which means below-average debt burdens). ...read more
RECOMMENDATION: A Combined Rank of 20, is a sell recommendation based on Murata Manufacturing's financial characteristics. Investors looking for growth and low financial risk may find this stock attractive. While the company Murata Manufacturing exhibits low value (Obermatt Value Rank of 19), which means that the stock price is rather high, it also demonstrates above-average growth (Obermatt Growth Rank of 55). This is a typical case, as high-growth companies are often expensive. Good financing practices (Obermatt Safety Rank of 90) are a double-edged sword: if the company continues growing, low debt limits shareholder returns. But if the company increases its debt, it will also increase risk. In other words, this is an investment on the safer side, despite the above-average price (low value). Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more
| RESEARCH HISTORY | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 75 |
|
9 |
|
11 |
|
19 |
|
| GROWTH | ||||||||
| GROWTH | 63 |
|
27 |
|
55 |
|
55 |
|
| SAFETY | ||||||||
| SAFETY | 98 |
|
81 |
|
89 |
|
90 |
|
| COMBINED | ||||||||
| COMBINED | 93 |
|
17 |
|
45 |
|
20 |
|
Value Metrics in Detail
ANALYSIS: With an Obermatt Value Rank of 19 (worse than 81% compared with alternatives), Murata Manufacturing shares are significantly more expensive than comparable stocks. The Value Rank is based on consolidating four value indicators where three out of four are below average for Murata Manufacturing. Only the Price-to-Book Capital ratio (also referred to as market-to-book ratio) indicates good stock value with a Price-to-Book Rank of 50, which means that the stock price is lower compared with invested capital than for 50% of comparable investments. All other value indicators are below the market median. Price-to-Sales is 17 which means the stock price compared with what market professionals expect for future profits is higher than 83% of comparable companies, indicating a low value concerning Murata Manufacturing's revenue levels. The same is valid for the Price-to-Book Capital ratio (also referred to as market-to-book ratio) with a Price-to-Book Rank of 50 and for the dividend yields rank which is lower than for 59% of comparable companies, making the stock more expensive as regards to with the company's expected dividend payouts. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 19, is a sell recommendation based on Murata Manufacturing's stock price compared with the company's operational size and dividend yields. Why are market participants paying such a high price for Murata Manufacturing, where three out of four value indicators are below par? One reason could be that the company is well financed, indicated by the high book capital level, and has a promising future that is not yet visible in reported revenues and profits. That would also explain the low dividend yield because the company needs the cash to invest in its future. If investors can verify a picture in this sense, the stock may still be a good investment, even though current company-reported financials don't fully explain current stock prices. 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 essential 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) | 43 |
|
16 |
|
16 |
|
17 |
|
| PRICE VS. PROFITS (P/E) | ||||||||
| PRICE VS. PROFITS (P/E) | 81 |
|
21 |
|
33 |
|
42 |
|
| PRICE VS. CAPITAL (Market-to-Book) | ||||||||
| PRICE VS. CAPITAL (Market-to-Book) | 60 |
|
44 |
|
50 |
|
50 |
|
| DIVIDEND YIELD | ||||||||
| DIVIDEND YIELD | 74 |
|
18 |
|
34 |
|
41 |
|
| CONSOLIDATED RANK: VALUE | ||||||||
| CONSOLIDATED RANK: VALUE | 75 |
|
9 |
|
11 |
|
19 |
|
Growth Metrics in Detail
ANALYSIS: With an Obermatt Growth Rank of 55 (better than 55% compared with alternatives), Murata Manufacturing shows an above-average growth dynamic in its industry. Investors also speak of positive momentum. The Growth Rank is based on consolidating four value indicators, where half of the indicators are below and half above average for Murata Manufacturing. Profit Growth, with a rank of 67 (better than 67% of its competitors), and Capital Growth, with a rank of 60, are both positive, which is a healthy sign for positive development. But Sales Growth has only a rank of 27, which means that, currently, professionals expect the company to grow less than 73% of its competitors, and Stock Returns are at a rank of 41. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 55, is a buy recommendation for growth and momentum investors. Stock returns that are a thing of the past can be less of a problem. Below-average revenue growth may be caused by divestments of underperforming businesses. If that is the case, then the positive developments of profit and capital growth are signs of a company with growth potential. If these are the reasons, overall growth is well on track to making this stock attractive for growth investors. 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 mixed here. ...read more
| GROWTH METRICS | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| REVENUE GROWTH | ||||||||
| REVENUE GROWTH | 33 |
|
30 |
|
33 |
|
27 |
|
| PROFIT GROWTH | ||||||||
| PROFIT GROWTH | 25 |
|
37 |
|
63 |
|
67 |
|
| CAPITAL GROWTH | ||||||||
| CAPITAL GROWTH | n/a |
|
48 |
|
43 |
|
60 |
|
| STOCK RETURNS | ||||||||
| STOCK RETURNS | 68 |
|
37 |
|
55 |
|
41 |
|
| CONSOLIDATED RANK: GROWTH | ||||||||
| CONSOLIDATED RANK: GROWTH | 63 |
|
27 |
|
55 |
|
55 |
|
Safety Metrics in Detail
ANALYSIS: With an Obermatt Safety Rank of 90 (better than 90% compared with alternatives) for 2024, the company Murata Manufacturing has safe financing practices, which means that their overall debt burden is low. This doesn't mean that the business of Murata Manufacturing 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 Murata Manufacturing. Leverage is at a rank of 88, meaning the company has a below-average debt-to-equity ratio. It has less debt than 88% of its competitors. Liquidity is also good at a rank of 94, meaning the company generates more profit to service its debt than 94% of its competitors. This indicates that the company is on the safer side when it comes to debt service. But Refinancing is lower at a rank of 45, which means that the portion of the debt that is about to be refinanced is above-average. It has more debt in the refinancing stage than 55% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 90 (better than 90% compared with alternatives), Murata Manufacturing has a financing structure that is significantly safer than that of its competitors. The refinancing issues could be a short-term problem, especially if the company has reputation issues. Banks and investors don't like to refinance debt if there are clouds on the horizon. For this reason, investors should look at the refinancing environment for Murata Manufacturing. Does it look safe that debt that is coming due can be covered with new debt? If that is the case, then the financing situation of the company is on the safer side. If not, it may be better to wait until refinancing has been completed and the Refinancing rank is good again. Investors may have a short-term debt challenge with Murata Manufacturing 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 | 74 |
|
80 |
|
86 |
|
88 |
|
| REFINANCING | ||||||||
| REFINANCING | 62 |
|
35 |
|
35 |
|
45 |
|
| LIQUIDITY | ||||||||
| LIQUIDITY | 100 |
|
95 |
|
93 |
|
94 |
|
| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 98 |
|
81 |
|
89 |
|
90 |
|
Sentiment Metrics in Detail
| SENTIMENT | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| ANALYST OPINIONS | ||||||||
| ANALYST OPINIONS | n/a |
|
45 |
|
37 |
|
new |
|
| OPINIONS CHANGE | ||||||||
| OPINIONS CHANGE | n/a |
|
30 |
|
88 |
|
new |
|
| PRO HOLDINGS | ||||||||
| PRO HOLDINGS | n/a |
|
25 |
|
100 |
|
new |
|
| MARKET PULSE | ||||||||
| MARKET PULSE | n/a |
|
12 |
|
18 |
|
new |
|
| CONSOLIDATED RANK: SENTIMENT | ||||||||
| CONSOLIDATED RANK: SENTIMENT | n/a |
|
6 |
|
54 |
|
new |
|
Free stock analysis by the purely fact based Obermatt Method for Murata Manufacturing from May 2, 2024.
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