Fact based stock research
Nippon Light Metal (TSE:5703)

JP3700200003

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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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Nippon Light Metal stock research in summary

nikkeikinholdings.co.jp

ANALYSIS: With an Obermatt Combined Rank of 86 (better than 86% compared with investment alternatives), Nippon Light Metal (Aluminum, Japan) shares have much better financial characteristics than comparable stocks. Shares of Nippon Light Metal are a good value (attractively priced) with a consolidated Value Rank of 97 (better than 97% of alternatives), are safely financed (Safety Rank of 79, which means low debt burdens), but show below-average growth (Growth Rank of 29). ...read more

RECOMMENDATION: A Combined Rank of 86, is a strong buy recommendation based on Nippon Light Metal's financial characteristics. As the company Nippon Light Metal's key financial metrics exhibit good value (Obermatt Value Rank of 97) but low growth (Obermatt Growth Rank of 29) while being safely financed (Obermatt Safety Rank of 79), it may be a safer investment because companies with low debt can better withstand times of crises. Yet the good value, better than 97% 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	97
Growth Rank	29
Safety Rank	79
Combined Rank	86

Country	Japan
Industry	Aluminum
Index	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

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Research History: Nippon Light Metal

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	93	99	84	97
GROWTH
GROWTH	6	33	41	29
SAFETY
SAFETY	31	77	45	79
SENTIMENT
SENTIMENT	n/a	32	72	^new
360° VIEW
360° VIEW	n/a	75	70	^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 Nippon Light Metal is in the corresponding investment strategy.
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Combined financial peformance in Detail

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	93	99	84	97
GROWTH
GROWTH	6	33	41	29
SAFETY
SAFETY	31	77	45	79
COMBINED
COMBINED	46	90	65	86

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

Value Metrics in Detail

ANALYSIS: With an Obermatt Value Rank of 97 (better than 97% compared with alternatives) for 2024, Nippon Light Metal shares are significantly less expensive than comparable stocks. The Value Rank is based on consolidating four value indicators that are all above average for Nippon Light Metal. Price-to-Sales is 97 which means that the stock price compared with what market professionals expect for future sales is lower than for 97% of comparable companies, indicating a good value for Nippon Light Metal's revenue size. The same is valid for expected Price-to-Profits, more favorable than for 88% 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 90. Compared with other companies in the same industry, dividend yields of Nippon Light Metal are expected to be higher than for 80% of all competitors (a Dividend Yield rank of 80). ...read more

RECOMMENDATION: The overall picture with a consolidated Value Rank of 97, is a buy recommendation based on Nippon Light Metal'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 Nippon Light Metal 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)	97	93	93	97
PRICE VS. PROFITS (P/E)
PRICE VS. PROFITS (P/E)	60	85	67	88
PRICE VS. CAPITAL (Market-to-Book)
PRICE VS. CAPITAL (Market-to-Book)	96	91	95	90
DIVIDEND YIELD
DIVIDEND YIELD	86	82	55	80
CONSOLIDATED RANK: VALUE
CONSOLIDATED RANK: VALUE	93	99	84	97

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

Growth Metrics in Detail

ANALYSIS: With an Obermatt Growth Rank of 29 (better than 29% compared with alternatives), Nippon Light Metal 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 half of the indicators below and half above average for Nippon Light Metal. Sales Growth has a rank of 52, which means that, currently, professionals expect the company to grow more than 52% of its competitors. Profit Growth with a rank of 61 is also above average. But Capital Growth has only a rank of 17, and Stock Returns with 29 are also below-average. Stock returns for Nippon Light Metal have recently been below 71% of alternative investments. ...read more

RECOMMENDATION: The overall picture with a consolidated Growth Rank of 29, is a hold recommendation for growth and momentum investors. Are investors forecasting troubles based on the lack of operating investment activity at the company? This could be one explanation as to why stock returns are low. But stock returns can also be the result of correcting an error in the past, in this case, an overly optimistic outlook on the future, which is now more realistic. The Value Ranks may confirm such a picture. The more important growth indicators are revenues and profits, which are both above average for Nippon Light Metal. This is a positive sign from the company's operational side and may give investors courage, despite the poor recent stock price performance. 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 the Obermatt 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	6	38	4	52
PROFIT GROWTH
PROFIT GROWTH	39	85	57	61
CAPITAL GROWTH
CAPITAL GROWTH	n/a	27	55	17
STOCK RETURNS
STOCK RETURNS	12	17	55	29
CONSOLIDATED RANK: GROWTH
CONSOLIDATED RANK: GROWTH	6	33	41	29

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

Safety Metrics in Detail

ANALYSIS: With an Obermatt Safety Rank of 79 (better than 79% compared with alternatives) for 2024, the company Nippon Light Metal has safe financing practices, which means that their overall debt burden is low. This doesn't mean that the business of Nippon Light Metal 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 Nippon Light Metal. Refinancing is at 99, meaning the portion of the debt that is about to be refinanced is below average. It has less debt in the refinancing stage than 99% of its competitors. Liquidity is also good at 58, meaning the company generates more profit to service its debt than 58% of its competitors. This indicates that the company is safer when it comes to debt service. However, Leverage is rather large at 30, which means the company has an above-average debt-to-equity ratio. It has more debt than 70% of its competitors. ...read more

RECOMMENDATION: With a consolidated Safety Rank of 79 (better than 79% compared with alternatives), Nippon Light Metal has a financing structure that is significantly 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 Nippon Light Metal 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 Nippon Light Metal 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	4	28	24	30
REFINANCING
REFINANCING	96	91	95	99
LIQUIDITY
LIQUIDITY	19	66	27	58
CONSOLIDATED RANK: SAFETY
CONSOLIDATED RANK: SAFETY	31	77	45	79

Last update of Safety Rank: 14-Nov-2024. Stock analysis on safety metrics: The higher the rank, the lower the leverage of Nippon Light Metal 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	21	40	^new
OPINIONS CHANGE
OPINIONS CHANGE	n/a	13	89	^new
PRO HOLDINGS
PRO HOLDINGS	n/a	43	39	^new
MARKET PULSE
MARKET PULSE	n/a	75	74	^new
CONSOLIDATED RANK: SENTIMENT
CONSOLIDATED RANK: SENTIMENT	n/a	32	72	^new

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