Fact based stock research
JFE (TSE:5411)

JP3386030005

How to read the 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.

JFE stock research in summary

jfe-holdings.co.jp

ANALYSIS: With an Obermatt Combined Rank of 85 (better than 85% compared with investment alternatives), JFE (Steel, Japan) shares have much better financial characteristics than comparable stocks. Shares of JFE are a good value (attractively priced) with a consolidated Value Rank of 94 (better than 94% of alternatives), show above-average growth (Growth Rank of 61) but are riskily financed (Safety Rank of 49), which means above-average debt burdens. ...read more

RECOMMENDATION: A Combined Rank of 85, is a strong buy recommendation based on JFE's financial characteristics. As the company JFE's key financial metrics exhibit excellent performance in two areas, such as good value (Obermatt Value Rank of 94) and above-average growth (Obermatt Growth Rank of 61), it could be argued that the risk-taking in financing (Obermatt Safety Rank of only 49) indicates that the company is optimistic about the future and sees debt as an opportunity to boost returns. More debt means more shareholder returns if everything goes well. However, higher debt burdens are risky when interest rates rise or the business deteriorates in a crisis. If you believe the company's future is market-typical or even better, this could be an argument for a share purchase. 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	94
Growth Rank	61
Safety Rank	49
Combined Rank	85

Country	Japan
Industry	Steel
Index	Low Emissions, Energy Efficient, Nikkei 225
Size class	XX-Large

18-Apr-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

It’s easier said than done. When your stock drops, it’s easy to want to sell it and find a better performer. Think twice, or even three times, before trading. Those fees (especially the hidden ones) can eat up your gains.

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

Research History: JFE

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	90	95	96	94
GROWTH
GROWTH	63	81	59	61
SAFETY
SAFETY	20	24	53	49
SENTIMENT
SENTIMENT	n/a	18	28	^new
360° VIEW
360° VIEW	n/a	57	56	^new

Most recent update of the stock research: 18-Apr-2024. Financial reporting date used for calculating ranks: 31-Dec-2023. Stock research history is based on the Obermatt Method. The higher the rank, the better JFE is in the corresponding investment strategy.
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Combined financial peformance in Detail

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	90	95	96	94
GROWTH
GROWTH	63	81	59	61
SAFETY
SAFETY	20	24	53	49
COMBINED
COMBINED	59	80	81	85

Last update of combined financial performance: 18-Apr-2024. Stock analysis on combined financial performance: The higher the rank of JFE the better the performance.

Value Metrics in Detail

ANALYSIS: With an Obermatt Value Rank of 94 (better than 94% compared with alternatives) for 2024, JFE shares are significantly less expensive than comparable stocks. The Value Rank is based on consolidating four value indicators that are all above average for JFE. Price-to-Sales is 84 which means that the stock price compared with what market professionals expect for future sales is lower than for 84% of comparable companies, indicating a good value for JFE's revenue size. The same is valid for expected Price-to-Profits, more favorable than for 94% 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 85. Compared with other companies in the same industry, dividend yields of JFE are expected to be higher than for 75% of all competitors (a Dividend Yield rank of 75). ...read more

RECOMMENDATION: The overall picture with a consolidated Value Rank of 94, is a buy recommendation based on JFE'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 JFE 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)	90	93	90	84
PRICE VS. PROFITS (P/E)
PRICE VS. PROFITS (P/E)	83	89	92	94
PRICE VS. CAPITAL (Market-to-Book)
PRICE VS. CAPITAL (Market-to-Book)	98	93	87	85
DIVIDEND YIELD
DIVIDEND YIELD	72	63	81	75
CONSOLIDATED RANK: VALUE
CONSOLIDATED RANK: VALUE	90	95	96	94

Last update of Value Rank: 18-Apr-2024. Stock analysis on value ratios: The higher the rank, the lower the value ratio of JFE; except for dividend yield where the rank is higher, the higher the yield.

Growth Metrics in Detail

ANALYSIS: With an Obermatt Growth Rank of 61 (better than 61% compared with alternatives), JFE 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, with half of the indicators below and half above average for JFE. Profit Growth has a rank of 62, which means that currently professionals expect the company to grow its profits more than 62% of its competitors. This is a good sign for shareholders, which is confirmed by an above-average Stock Returns rank of 84 (above 84% of alternative investments). But Sales Growth has a below the median rank of 41, which means that, currently, professionals expect the company to grow less than 59% of its competitors, and Capital Growth also has a lower rank of 25. ...read more

RECOMMENDATION: The overall picture with a consolidated Growth Rank of 61, is a buy recommendation for growth and momentum investors. Because revenues and invested capital are the more solid growth indicators, the positive development on the profit side is less relevant. It may have been caused by cost-cutting, which may be a negative growth indicator. Finally, the above-average stock returns recently are a thing of the past and not a good indicator of future returns. Investors should be confident that the cost-cutting initiative leading to higher profits is to benefit the company's future. If not, there is little growth momentum, and investment is only advisable if the Value Ranks suggest a good investment timing for JFE. 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	15	24	34	41
PROFIT GROWTH
PROFIT GROWTH	70	96	70	62
CAPITAL GROWTH
CAPITAL GROWTH	n/a	67	27	25
STOCK RETURNS
STOCK RETURNS	90	89	73	84
CONSOLIDATED RANK: GROWTH
CONSOLIDATED RANK: GROWTH	63	81	59	61

Last update of Growth Rank: 18-Apr-2024. Stock analysis on growth metrics: The higher the rank, the higher the growth and returns of JFE.

Safety Metrics in Detail

ANALYSIS: With an Obermatt Safety Rank of 49 (better than 49% compared with alternatives), the company JFE has financing practices on the riskier side, which means that their overall debt burden is above the industry average. This doesn't mean that the business of JFE is also risky, it only means that the company is on the riskier side in respect to bankruptcy in case things turn sour, 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 JFE. Refinancing is at 79, meaning the portion of the debt that is about to be refinanced is below average. It has less debt in the refinancing stage than 79% of its competitors. Liquidity is also good at 57, meaning the company generates more profit to service its debt than 57% of its competitors. This indicates that the company is safer when it comes to debt service. However, Leverage is rather large at 22, which means the company has an above-average debt-to-equity ratio. It has more debt than 78% of its competitors. ...read more

RECOMMENDATION: With a consolidated Safety Rank of 49 (worse than 51% compared with alternatives), JFE has a financing structure that is riskier 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 JFE 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 JFE 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	1	20	20	22
REFINANCING
REFINANCING	96	79	83	79
LIQUIDITY
LIQUIDITY	10	6	55	57
CONSOLIDATED RANK: SAFETY
CONSOLIDATED RANK: SAFETY	20	24	53	49

Last update of Safety Rank: 18-Apr-2024. Stock analysis on safety metrics: The higher the rank, the lower the leverage of JFE 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	46	43	^new
OPINIONS CHANGE
OPINIONS CHANGE	n/a	50	60	^new
PRO HOLDINGS
PRO HOLDINGS	n/a	25	46	^new
MARKET PULSE
MARKET PULSE	n/a	18	19	^new
CONSOLIDATED RANK: SENTIMENT
CONSOLIDATED RANK: SENTIMENT	n/a	18	28	^new

Last update of Sentiment Rank: 18-Apr-2024. Stock analysis on sentiment metrics: The higher the rank, the more positive the sentiment for JFE.
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