Fact based stock research
NEXON (TSE:3659)

JP3758190007

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.

NEXON stock research in summary

company.nexon.co.jp

ANALYSIS: With an Obermatt Combined Rank of 34 (worse than 66% compared with investment alternatives), NEXON (Interactive Home Entertainment, Japan) shares have somewhat below-average financial characteristics compared with similar stocks. Shares of NEXON are low in value (priced high) with a consolidated Value Rank of 39 (worse than 61% of alternatives) and show below-average growth (Growth Rank of 25) but are safely financed (Safety Rank of 76), which means low debt burdens. ...read more

RECOMMENDATION: A Combined Rank of 34, is a hold recommendation based on NEXON's financial characteristics. As the company NEXON's critical financial metrics exhibit below-average performance, such as low value (Obermatt Value Rank of 39) and low growth (Obermatt Growth Rank of 25), 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 76) 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	39
Growth Rank	25
Safety Rank	76
Combined Rank	34

Country	Japan
Industry	Interactive Home Entertainment
Index
Size class	Large

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.

Why popular stocks have low ratings

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

Research History: NEXON

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	78	41	26	39
GROWTH
GROWTH	13	69	85	25
SAFETY
SAFETY	100	82	81	76
SENTIMENT
SENTIMENT	n/a	54	86	^new
360° VIEW
360° VIEW	n/a	80	89	^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 NEXON is in the corresponding investment strategy.
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Combined financial peformance in Detail

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	78	41	26	39
GROWTH
GROWTH	13	69	85	25
SAFETY
SAFETY	100	82	81	76
COMBINED
COMBINED	75	77	78	34

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

Value Metrics in Detail

ANALYSIS: With an Obermatt Value Rank of 39 (worse than 61% compared with alternatives), NEXON shares are more expensive than the average comparable stock. The Value Rank is based on consolidating four value indicators, with three out of four indicators below average for NEXON. Only Price-to-Profit (also referred to as price-earnings, P/E) indicates good stock value with a rank of 71, which means that the stock price compared with what market professionals expect for future profits is lower than for 71% of comparable companies, indicating a good value concerning NEXON's profit levels. But Price-to-Sales is 27 which means that the stock price compared with what market professionals expect for future profits is higher than for 73% of comparable companies, indicating a low value concerning NEXON's profit levels. The same is valid for Price-to-Book Capital (also referred to as market-to-book ratio) with a Price-to-Book Rank of 47 and for dividend yield, which is lower than for 66% of comparable companies, making the stock more expensive as regards to the company's expected dividend payouts. ...read more

RECOMMENDATION: The overall picture with a consolidated Value Rank of 39, is a hold recommendation based on NEXON's stock price compared with the company's operational size and dividend yields. Can we rely on only one good value indicator? Only if we know the company well. In this case, a high Price-to-Profit Rank, while Price-to-Sales and Price-to-Book are both below the market typical levels, means that the company can charge higher prices for its products and needs less capital to produce them. If this is sustainable, then NEXON is a good investment because profits count most in enterprise valuations. The low dividend yield indicates that the company is confident it can do something with the generated cash that is more valuable than paying the profits out to the shareholders in the form of dividends. 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)	34	32	19	27
PRICE VS. PROFITS (P/E)
PRICE VS. PROFITS (P/E)	81	67	59	71
PRICE VS. CAPITAL (Market-to-Book)
PRICE VS. CAPITAL (Market-to-Book)	71	67	46	47
DIVIDEND YIELD
DIVIDEND YIELD	65	33	31	34
CONSOLIDATED RANK: VALUE
CONSOLIDATED RANK: VALUE	78	41	26	39

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

Growth Metrics in Detail

ANALYSIS: With an Obermatt Growth Rank of 25 (better than 25% compared with alternatives), NEXON shows a below-average growth dynamic in its industry. There is limited momentum in this company. The Growth Rank is based on consolidating four value indicators, with three out of four metrics below average for NEXON. While Profit Growth has a good rank of 74, as professionals currently expect the company to grow its profits more than 74% of its competitors, all other growth indicators are below market averages. Sales Growth has a rank of 23, which means that currently professionals expect the company to grow less than 77% of its competitors, while Capital Growth has a rank of 30 and Stock Returns have been below market median, with a rank of 29 (71% of alternative investments were better). ...read more

RECOMMENDATION: The overall picture with a consolidated Growth Rank of 25, is a hold recommendation for growth and momentum investors. While revenue growth and capital growth are good growth momentum indicators, profit is less reliable, because profits may increase due to cost-cutting measures which typically indicate negative growth momentum. "You can save a dollar only once" is the saying about such situations. Growth Investors should look at company priorities closely if they are interested in growth, because the increase in profits is not usually an indicator of growth, and stock prices have been below market, too. 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 limited here. ...read more

GROWTH METRICS	2021	2022	2023	2024
REVENUE GROWTH
REVENUE GROWTH	33	70	67	23
PROFIT GROWTH
PROFIT GROWTH	100	89	56	74
CAPITAL GROWTH
CAPITAL GROWTH	n/a	59	91	30
STOCK RETURNS
STOCK RETURNS	17	15	45	29
CONSOLIDATED RANK: GROWTH
CONSOLIDATED RANK: GROWTH	13	69	85	25

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

Safety Metrics in Detail

ANALYSIS: With an Obermatt Safety Rank of 76 (better than 76% compared with alternatives) for 2024, the company NEXON has safe financing practices, which means that their overall debt burden is low. This doesn't mean that the business of NEXON 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 NEXON. Leverage is at 70, meaning the company has a below-average debt-to-equity ratio. It has less debt than 70% of its competitors. Refinancing is at a rank of 72, meaning that the portion of the debt about to be refinanced is below average. It has less debt in the refinancing stage than 72% of its competitors. Finally, Liquidity is also good at a rank of 70, which means that the company generates more profit to service its debt than 70% of its competitors. ...read more

RECOMMENDATION: With a consolidated Safety Rank of 76 (better than 76% compared with alternatives), NEXON has a financing structure that is significantly 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 NEXON 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	92	71	77	70
REFINANCING
REFINANCING	65	80	68	72
LIQUIDITY
LIQUIDITY	100	78	73	70
CONSOLIDATED RANK: SAFETY
CONSOLIDATED RANK: SAFETY	100	82	81	76

Last update of Safety Rank: 14-Nov-2024. Stock analysis on safety metrics: The higher the rank, the lower the leverage of NEXON 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	75	87	^new
OPINIONS CHANGE
OPINIONS CHANGE	n/a	50	78	^new
PRO HOLDINGS
PRO HOLDINGS	n/a	14	80	^new
MARKET PULSE
MARKET PULSE	n/a	57	45	^new
CONSOLIDATED RANK: SENTIMENT
CONSOLIDATED RANK: SENTIMENT	n/a	54	86	^new

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