Fact based stock research
SMS (TSE:2175)

JP3162350007

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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.

SMS stock research in summary

bm-sms.co.jp

ANALYSIS: With an Obermatt Combined Rank of 49 (worse than 51% compared with investment alternatives), SMS (HR- & Employment Services, Japan) shares have somewhat below-average financial characteristics compared with similar stocks. Shares of SMS are a good value (attractively priced) with a consolidated Value Rank of 53 (better than 53% of alternatives), are safely financed (Safety Rank of 67, which means low debt burdens), but show below-average growth (Growth Rank of 31). ...read more

RECOMMENDATION: A Combined Rank of 49, is a hold recommendation based on SMS's financial characteristics. As the company SMS's key financial metrics exhibit good value (Obermatt Value Rank of 53) but low growth (Obermatt Growth Rank of 31) while being safely financed (Obermatt Safety Rank of 67), it may be a safer investment because companies with low debt can better withstand times of crises. Yet the good value, better than 53% 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	53
Growth Rank	31
Safety Rank	67
Combined Rank	49

Country	Japan
Industry	HR- & Employment Services
Index
Size class	Medium

19-Dec-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: SMS

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	8	31	28	53
GROWTH
GROWTH	35	41	37	31
SAFETY
SAFETY	58	28	51	67
SENTIMENT
SENTIMENT	n/a	67	94	^new
360° VIEW
360° VIEW	n/a	21	63	^new

Most recent update of the stock research: 19-Dec-2024. Financial reporting date used for calculating ranks: 30-Sep-2024. Stock research history is based on the Obermatt Method. The higher the rank, the better SMS is in the corresponding investment strategy.
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Combined financial peformance in Detail

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	8	31	28	53
GROWTH
GROWTH	35	41	37	31
SAFETY
SAFETY	58	28	51	67
COMBINED
COMBINED	4	8	15	49

Last update of combined financial performance: 19-Dec-2024. Stock analysis on combined financial performance: The higher the rank of SMS the better the performance.

Value Metrics in Detail

ANALYSIS: With an Obermatt Value Rank of 53 (better than 53% compared with alternatives), SMS shares are more attractively priced than the majority of comparable stocks. The Value Rank is based on consolidating four value indicators that are all above average for SMS. Price-to-Sales is 55 which means that the stock price compared with what market professionals expect for future sales is lower than for 55% of comparable companies, indicating a good value for SMS's revenue size. The same is valid for expected Price-to-Profits, more favorable than for 71% 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 51. Compared with other companies in the same industry, dividend yields of SMS are expected to be higher than for 62% of all competitors (a Dividend Yield rank of 62). ...read more

RECOMMENDATION: The overall picture with a consolidated Value Rank of 53, is a buy recommendation based on SMS'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 SMS 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)	8	26	29	55
PRICE VS. PROFITS (P/E)
PRICE VS. PROFITS (P/E)	36	26	27	71
PRICE VS. CAPITAL (Market-to-Book)
PRICE VS. CAPITAL (Market-to-Book)	6	20	14	51
DIVIDEND YIELD
DIVIDEND YIELD	46	48	51	62
CONSOLIDATED RANK: VALUE
CONSOLIDATED RANK: VALUE	8	31	28	53

Last update of Value Rank: 19-Dec-2024. Stock analysis on value ratios: The higher the rank, the lower the value ratio of SMS; except for dividend yield where the rank is higher, the higher the yield.

Growth Metrics in Detail

ANALYSIS: With an Obermatt Growth Rank of 31 (better than 31% compared with alternatives), SMS 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 SMS. Sales Growth has a rank of 66 which means that currently, professionals expect the company to grow more than 66% of its competitors. Capital Growth is also above 34% of competitors with a rank of 51. But Profit Growth only has a rank of 34, which means that currently professionals expect the company to grow its profits less than 66% of its competitors. And Stock Returns have also been below average with a rank of only 3. ...read more

RECOMMENDATION: The overall picture with a consolidated Growth Rank of 31, is a hold recommendation for growth and momentum investors. Profits are sometimes low if the company invests in the future. The positive revenue and capital investment outlook confirms such an interpretation. Both revenues and capital are solid growth indicators, and lower profits in such a case would be encouraging. But the investors see it differently by punishing the share price. Sometimes, Mister Market is not very reliable, because it is not uncommon for it to be volatile. Investors should look out for signs of growth expenditure that could justify low profit growth, and they may also find reasons why recent stock price developments don't confirm the growth outlook of operations. While operating growth indicators are not perfect, they are more reliable indicators for future performance than stock prices that can repeatedly surprise 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	19	52	77	66
PROFIT GROWTH
PROFIT GROWTH	43	43	46	34
CAPITAL GROWTH
CAPITAL GROWTH	n/a	51	23	51
STOCK RETURNS
STOCK RETURNS	60	47	29	3
CONSOLIDATED RANK: GROWTH
CONSOLIDATED RANK: GROWTH	35	41	37	31

Last update of Growth Rank: 19-Dec-2024. Stock analysis on growth metrics: The higher the rank, the higher the growth and returns of SMS.

Safety Metrics in Detail

ANALYSIS: With an Obermatt Safety Rank of 67 (better than 67% compared with alternatives), the company SMS 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 SMS 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 SMS. Leverage is at 50, meaning the company has a below-average debt-to-equity ratio. It has less debt than 50% of its competitors. Refinancing is at a rank of 51, meaning that the portion of the debt about to be refinanced is below average. It has less debt in the refinancing stage than 51% of its competitors. Finally, Liquidity is also good at a rank of 76, which means that the company generates more profit to service its debt than 76% of its competitors. ...read more

RECOMMENDATION: With a consolidated Safety Rank of 67 (better than 67% compared with alternatives), SMS 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 SMS 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	42	17	40	50
REFINANCING
REFINANCING	46	27	31	51
LIQUIDITY
LIQUIDITY	88	60	73	76
CONSOLIDATED RANK: SAFETY
CONSOLIDATED RANK: SAFETY	58	28	51	67

Last update of Safety Rank: 19-Dec-2024. Stock analysis on safety metrics: The higher the rank, the lower the leverage of SMS 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	1	89	^new
OPINIONS CHANGE
OPINIONS CHANGE	n/a	50	89	^new
PRO HOLDINGS
PRO HOLDINGS	n/a	100	70	^new
MARKET PULSE
MARKET PULSE	n/a	70	75	^new
CONSOLIDATED RANK: SENTIMENT
CONSOLIDATED RANK: SENTIMENT	n/a	67	94	^new

Last update of Sentiment Rank: 19-Dec-2024. Stock analysis on sentiment metrics: The higher the rank, the more positive the sentiment for SMS.
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