Fact based stock research
West Japan Railway (TSE:9021)
JP3659000008
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.
West Japan Railway stock research in summary
ANALYSIS: With an Obermatt Combined Rank of 20 (worse than 80% compared with investment alternatives), West Japan Railway (Railroads, Japan) shares have lower financial characteristics compared with similar stocks. Shares of West Japan Railway are a good value (attractively priced) with a consolidated Value Rank of 52 (better than 52% of alternatives) but show below-average growth (Growth Rank of 27), and are riskily financed (Safety Rank of 31), which means above-average debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 20, is a sell recommendation based on West Japan Railway's financial characteristics. As the company West Japan Railway's key financial metrics exhibit good value (Obermatt Value Rank of 52) but low growth (Obermatt Growth Rank of 27) and risky financing practices (Obermatt Safety Rank of 31), it may be a risky investment, because debt in times of crises can make things worse. The good value, better than 52% of comparable companies, may indicate 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. 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 | Railroads |
| Index | TOPIX 100, Nikkei 225 |
| Size class | X-Large |
25-Apr-2024. Stock data may be delayed. Log in or sign up to get the most recent research.
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: West Japan Railway
| RESEARCH HISTORY | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 41 |
|
59 |
|
60 |
|
52 |
|
| GROWTH | ||||||||
| GROWTH | 24 |
|
57 |
|
37 |
|
27 |
|
| SAFETY | ||||||||
| SAFETY | 11 |
|
41 |
|
35 |
|
31 |
|
| SENTIMENT | ||||||||
| SENTIMENT | n/a |
|
55 |
|
43 |
|
new |
|
| 360° VIEW | ||||||||
| 360° VIEW | n/a |
|
53 |
|
30 |
|
new |
|
Combined financial peformance in Detail
ANALYSIS: With an Obermatt Combined Rank of 20 (worse than 80% compared with investment alternatives), West Japan Railway (Railroads, Japan) shares have lower financial characteristics compared with similar stocks. Shares of West Japan Railway are a good value (attractively priced) with a consolidated Value Rank of 52 (better than 52% of alternatives) but show below-average growth (Growth Rank of 27), and are riskily financed (Safety Rank of 31), which means above-average debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 20, is a sell recommendation based on West Japan Railway's financial characteristics. As the company West Japan Railway's key financial metrics exhibit good value (Obermatt Value Rank of 52) but low growth (Obermatt Growth Rank of 27) and risky financing practices (Obermatt Safety Rank of 31), it may be a risky investment, because debt in times of crises can make things worse. The good value, better than 52% of comparable companies, may indicate 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. 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 | 41 |
|
59 |
|
60 |
|
52 |
|
| GROWTH | ||||||||
| GROWTH | 24 |
|
57 |
|
37 |
|
27 |
|
| SAFETY | ||||||||
| SAFETY | 11 |
|
41 |
|
35 |
|
31 |
|
| COMBINED | ||||||||
| COMBINED | 14 |
|
60 |
|
34 |
|
20 |
|
Value Metrics in Detail
ANALYSIS: With an Obermatt Value Rank of 52 (better than 52% compared with alternatives), West Japan Railway shares are more attractively priced than the majority of comparable stocks. The Value Rank is based on consolidating four value indicators, where half the indicators are below and half are above average for West Japan Railway. Price-to-Sales (P/S) is 59, which means that the stock price compared with what market professionals expect for future sales is lower than for 59% of comparable companies, indicating a good value concerning West Japan Railway's revenue size. The same is valid for expected Price-to-Profits (or Price / Earnings, P/E), more favorable than for 59% of alternatives. It is also positive for expected dividend yields with a Dividend Yield rank of 42 (dividends are expected to be higher than for 42% of other stocks). But, compared with other companies in the same industry, the Price-to-Book Capital ratio (also referred to as market-to-book ratio) is higher than average, making the stock more expensive. Only 53% of all competitors have an even higher price compared with book capital which puts the Price-to-Capital Rank for West Japan Railway to 47. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 52, is a buy recommendation based on West Japan Railway's stock price compared with the company's operational size and dividend yields. A low level of book capital means that the company has a business that is leaner on assets than its competitors. For instance, the company could be leasing its production facilities, or be more focussed on intellectual property, such as its brand and software, which is less visible in its book capital. If that is the case, the low Dividend Yield is also explained as such companies tend to invest their income into market development. The other good value ranks for Sales and Profits are encouraging indicators for the stock price value. 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) | 64 |
|
68 |
|
67 |
|
59 |
|
| PRICE VS. PROFITS (P/E) | ||||||||
| PRICE VS. PROFITS (P/E) | 1 |
|
19 |
|
63 |
|
59 |
|
| PRICE VS. CAPITAL (Market-to-Book) | ||||||||
| PRICE VS. CAPITAL (Market-to-Book) | 67 |
|
66 |
|
51 |
|
47 |
|
| DIVIDEND YIELD | ||||||||
| DIVIDEND YIELD | 53 |
|
52 |
|
47 |
|
42 |
|
| CONSOLIDATED RANK: VALUE | ||||||||
| CONSOLIDATED RANK: VALUE | 41 |
|
59 |
|
60 |
|
52 |
|
Growth Metrics in Detail
ANALYSIS: With an Obermatt Growth Rank of 27 (better than 27% compared with alternatives), West Japan Railway 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 indicators below average for West Japan Railway. Sales Growth has a below market rank of 48, which means that, currently, professionals expect the company to grow less than 52% of its competitors. The same is valid for Capital Growth, with a rank of 37, and Profit Growth, with a rank of 34. Currently, professionals expect the company to grow its profits less than 66% of its competitors). Only shareholders are optimistic. Stock Returns are above average at a rank of 50, which means that the stock returns have recently been above 50% of alternative investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 27, is a hold recommendation for growth and momentum investors. That picture may be the result for a company that has reached the bottom. All went south for West Japan Railway, and it still looks bad, but some investors already see light at the end of the tunnel, rewarding the stock with recent above-market stock returns. It could also mean that investors are correcting an overreaction to negative news. If that were the case, the positive stock returns are not yet a sign of recovery. Investors should look closely at the Value and Sentiment indicators before they make a stock purchasing decision, because growth is unlikely to be the driving argument behind this investment. 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 low here. ...read more
| GROWTH METRICS | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| REVENUE GROWTH | ||||||||
| REVENUE GROWTH | 18 |
|
84 |
|
56 |
|
48 |
|
| PROFIT GROWTH | ||||||||
| PROFIT GROWTH | 14 |
|
45 |
|
39 |
|
34 |
|
| CAPITAL GROWTH | ||||||||
| CAPITAL GROWTH | n/a |
|
33 |
|
53 |
|
37 |
|
| STOCK RETURNS | ||||||||
| STOCK RETURNS | 55 |
|
33 |
|
43 |
|
50 |
|
| CONSOLIDATED RANK: GROWTH | ||||||||
| CONSOLIDATED RANK: GROWTH | 24 |
|
57 |
|
37 |
|
27 |
|
Safety Metrics in Detail
ANALYSIS: With an Obermatt Safety Rank of 31 (better than 31% compared with alternatives), the company West Japan Railway 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 West Japan Railway 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 all three metrics below average for West Japan Railway. Liquidity is at 32, meaning that the company generates less profit to service its debt than 68% of its competitors. This indicates that the company is on the riskier side when it comes to debt service. Even worse, Leverage is at a rank of 28, meaning the company has an above-average debt-to-equity ratio. It has more debt than 72% of its competitors. Finally, Refinancing is at a rank of 49 which means that the portion of the debt about to be refinanced is above average. It has more debt in the refinancing stage than 51% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 31 (worse than 69% compared with alternatives), West Japan Railway has a financing structure that is riskier than that of its competitors. This combination is rather dangerous in most situations. Only very promising companies with bright future outlooks and stellar reputations can operate with such risky financing. Investors should look at Obermatt’s Value, Growth, and Sentiment Ranks to confirm a very positive outlook or be careful with investing in stocks of West Japan Railway because it may suffer significantly in case of future difficulties. ...read more
| SAFETY METRICS | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| LEVERAGE | ||||||||
| LEVERAGE | 20 |
|
32 |
|
28 |
|
28 |
|
| REFINANCING | ||||||||
| REFINANCING | 20 |
|
81 |
|
47 |
|
49 |
|
| LIQUIDITY | ||||||||
| LIQUIDITY | 13 |
|
6 |
|
30 |
|
32 |
|
| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 11 |
|
41 |
|
35 |
|
31 |
|
Sentiment Metrics in Detail
| SENTIMENT | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| ANALYST OPINIONS | ||||||||
| ANALYST OPINIONS | n/a |
|
56 |
|
73 |
|
new |
|
| OPINIONS CHANGE | ||||||||
| OPINIONS CHANGE | n/a |
|
50 |
|
89 |
|
new |
|
| PRO HOLDINGS | ||||||||
| PRO HOLDINGS | n/a |
|
86 |
|
40 |
|
new |
|
| MARKET PULSE | ||||||||
| MARKET PULSE | n/a |
|
5 |
|
5 |
|
new |
|
| CONSOLIDATED RANK: SENTIMENT | ||||||||
| CONSOLIDATED RANK: SENTIMENT | n/a |
|
55 |
|
43 |
|
new |
|
Stock analysis by the purely fact based Obermatt Method for West Japan Railway from April 25, 2024.
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