Bridgestone (TSE:5108) - Share price, News & Analysis

Q: What is the Fair Price of 5108 when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

5108 (¥4745) is trading below our estimate of [[fair value]] (¥10679.5)

5108 fundamental analysis
Snowflake Score
Valuation	3/6
Future Growth	2/6
Past Performance	4/6
Financial Health	5/6
Dividends	3/6

5108 Stock Overview

Bridgestone Corporation, together with its subsidiaries, manufactures and sells tires and rubber products.

Rewards

Trading at 55.6% below our estimate of its fair value

Earnings are forecast to grow 10.21% per year

Earnings grew by 1690.2% over the past year

Risk Analysis

Dividend of 3.58% is not well covered by earnings

Bridgestone Competitors

Sumitomo Rubber Industries

TSE:5110

JP¥300.6b

Yokohama Rubber

TSE:5101

JP¥289.7b

Toyo Tire

TSE:5105

JP¥253.2b

DENSO

TSE:6902

JP¥5.3t

Price History & Performance

Summary of all time highs, changes and price drops for Bridgestone
Historical stock prices
Current Share Price	JP¥4,745.00
52 Week High	JP¥5,467.00
52 Week Low	JP¥4,042.00
Beta	0.54
1 Month Change	-8.54%
3 Month Change	0.30%
1 Year Change	-8.22%
3 Year Change	13.00%
5 Year Change	-1.02%
Change since IPO	335.32%

Shareholder Returns

	5108	JP Auto Components	JP Market
7D	-8.6%	-4.2%	-1.1%
1Y	-8.2%	-14.2%	-7.0%

Return vs Industry: 5108 exceeded the JP Auto Components industry which returned -14.2% over the past year.

Return vs Market: 5108 underperformed the JP Market which returned -7% over the past year.

Price Volatility

Is 5108's price volatile compared to industry and market?
5108 volatility
5108 Average Weekly Movement	3.2%
Auto Components Industry Average Movement	4.2%
Market Average Movement	4.2%
10% most volatile stocks in JP Market	8.4%
10% least volatile stocks in JP Market	2.2%

Stable Share Price: 5108 is not significantly more volatile than the rest of JP stocks over the past 3 months, typically moving +/- 3% a week.

Volatility Over Time: 5108's weekly volatility (3%) has been stable over the past year.

About the Company

Founded	Employees	CEO	Website
1931	135,636	Shu Ishibashi	https://www.bridgestone.co.jp

Bridgestone Corporation, together with its subsidiaries, manufactures and sells tires and rubber products. It operates through two segments, Tires and Diversified Products. The company offers tires and tire tubes for passenger cars, trucks, buses, construction and mining vehicles, industrial machinery, agricultural machinery, aircraft, motorcycles, scooters, etc.; automotive parts; retreading materials and services; automotive maintenance and repair services; tire raw materials; and other tire-related products.

Bridgestone Fundamentals Summary

How do Bridgestone's earnings and revenue compare to its market cap?
5108 fundamental statistics
Market Cap	JP¥3.32t
Earnings (TTM)	JP¥313.03b
Revenue (TTM)	JP¥3.38t

10.6x

P/E Ratio

1.0x

P/S Ratio

Is 5108 overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
5108 income statement (TTM)
Revenue	JP¥3.38t
Cost of Revenue	JP¥2.01t
Gross Profit	JP¥1.37t
Other Expenses	JP¥1.05t
Earnings	JP¥313.03b

Last Reported Earnings

Mar 31, 2022

Next Earnings Date

Aug 10, 2022

Earnings per share (EPS)	448.02
Gross Margin	40.43%
Net Profit Margin	9.26%
Debt/Equity Ratio	17.6%

How did 5108 perform over the long term?

See historical performance and comparison

Dividends

3.6%

Current Dividend Yield

38%

Payout Ratio

We’ve recently updated our valuation analysis.

Valuation

Is 5108 undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

3/6

Valuation Score 3/6

Price-To-Earnings vs Peers
Price-To-Earnings vs Industry
Price-To-Earnings vs Fair Ratio
Below Fair Value
Significantly Below Fair Value
PEG Ratio

Key Valuation Metric

Which metric is best to use when looking at relative valuation for 5108?

Other financial metrics that can be useful for relative valuation.

The above table shows the n/a ratio for 5108. This is calculated by dividing 5108's market cap by their current preferred multiple.
What is 5108's n/a Ratio?
n/a Ratio	0x
n/a	n/a
Market Cap	JP¥3.32t

5108 key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue	1x
Enterprise Value/EBITDA	5.3x
PEG Ratio	1x

Price to Earnings Ratio vs Peers

How does 5108's PE Ratio compare to its peers?

5108 PE Ratio vs Peers

The above table shows the PE ratio for 5108 vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	PE	Estimated Growth	Market Cap
Peer Average	10.6x
5110 Sumitomo Rubber Industries	9.8x	11.5%	JP¥300.6b
5101 Yokohama Rubber	7x	8.9%	JP¥289.7b
5105 Toyo Tire	5.4x	8.7%	JP¥253.2b
6902 DENSO	20.2x	17.1%	JP¥5.3t
5108 Bridgestone	10.6x	10.2%	JP¥3.3t

Forward PE

Price-To-Earnings vs Peers: 5108 is good value based on its Price-To-Earnings Ratio (10.6x) compared to the peer average (10.6x).

Price to Earnings Ratio vs Industry

How does 5108's PE Ratio compare vs other companies in the JP Auto Components Industry?

Price-To-Earnings vs Industry: 5108 is expensive based on its Price-To-Earnings Ratio (10.6x) compared to the JP Auto Components industry average (8.9x)

Price to Earnings Ratio vs Fair Ratio

What is 5108's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

5108 PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio	10.6x
Fair PE Ratio	10.4x

Price-To-Earnings vs Fair Ratio: 5108 is expensive based on its Price-To-Earnings Ratio (10.6x) compared to the estimated Fair Price-To-Earnings Ratio (10.4x).

Share Price vs Fair Value

What is the Fair Price of 5108 when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: 5108 (¥4745) is trading below our estimate of fair value (¥10679.5)

Significantly Below Fair Value: 5108 is trading below fair value by more than 20%.

Price to Earnings Growth Ratio

PEG Ratio: 5108 is poor value based on its PEG Ratio (1x)

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Future Growth

How is Bridgestone forecast to perform in the next 1 to 3 years based on estimates from 13 analysts?

Future Growth Score

2/6

Future Growth Score 2/6

Earnings vs Savings Rate
Earnings vs Market
High Growth Earnings
Revenue vs Market
High Growth Revenue
Future ROE

10.2%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: 5108's forecast earnings growth (10.2% per year) is above the savings rate (0.04%).

Earnings vs Market: 5108's earnings (10.2% per year) are forecast to grow faster than the JP market (8.9% per year).

High Growth Earnings: 5108's earnings are forecast to grow, but not significantly.

Revenue vs Market: 5108's revenue (4.1% per year) is forecast to grow slower than the JP market (4.5% per year).

High Growth Revenue: 5108's revenue (4.1% per year) is forecast to grow slower than 20% per year.

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: 5108's Return on Equity is forecast to be low in 3 years time (12.3%).

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Past Performance

How has Bridgestone performed over the past 5 years?

Past Performance Score

4/6

Past Performance Score 4/6

Quality Earnings
Growing Profit Margin
Earnings Trend
Accelerating Growth
Earnings vs Industry
High ROE

-12.9%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: 5108 has high quality earnings.

Growing Profit Margin: 5108's current net profit margins (9.3%) are higher than last year (0.6%).

Past Earnings Growth Analysis

Earnings Trend: 5108's earnings have declined by 12.9% per year over the past 5 years.

Accelerating Growth: 5108's earnings growth over the past year (1690.2%) exceeds its 5-year average (-12.9% per year).

Earnings vs Industry: 5108 earnings growth over the past year (1690.2%) exceeded the Auto Components industry 35.9%.

Return on Equity

High ROE: 5108's Return on Equity (11.5%) is considered low.

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Financial Health

How is Bridgestone's financial position?

Financial Health Score

5/6

Financial Health Score 5/6

Short Term Liabilities
Long Term Liabilities
Debt Level
Reducing Debt
Debt Coverage
Interest Coverage

Financial Position Analysis

Short Term Liabilities: 5108's short term assets (¥2,347.0B) exceed its short term liabilities (¥1,003.4B).

Long Term Liabilities: 5108's short term assets (¥2,347.0B) exceed its long term liabilities (¥917.9B).

Debt to Equity History and Analysis

Debt Level: 5108 has more cash than its total debt.

Reducing Debt: 5108's debt to equity ratio has increased from 12.1% to 17.6% over the past 5 years.

Debt Coverage: 5108's debt is well covered by operating cash flow (52.7%).

Interest Coverage: 5108's interest payments on its debt are well covered by EBIT (52.5x coverage).

Balance Sheet

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Dividend

What is Bridgestone current dividend yield, its reliability and sustainability?

Dividend Score

3/6

Dividend Score 3/6

Notable Dividend
High Dividend
Stable Dividend
Growing Dividend
Earnings Coverage
Future Dividend Coverage

3.58%

Current Dividend Yield

Dividend Yield vs Market

Notable Dividend: 5108's dividend (3.58%) is higher than the bottom 25% of dividend payers in the JP market (1.69%).

High Dividend: 5108's dividend (3.58%) is low compared to the top 25% of dividend payers in the JP market (3.74%).

Stability and Growth of Payments

Stable Dividend: 5108's dividend payments have been volatile in the past 10 years.

Growing Dividend: 5108's dividend payments have increased over the past 10 years.

Earnings Payout to Shareholders

Earnings Coverage: With its reasonably low payout ratio (38.2%), 5108's dividend payments are well covered by earnings.

Cash Payout to Shareholders

Cash Flow Coverage: With its high cash payout ratio (218.7%), 5108's dividend payments are not well covered by cash flows.

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Management

How experienced are the management team and are they aligned to shareholders interests?

2.5yrs

Average management tenure

CEO

Shu Ishibashi (68 yo)

2.33yrs

Tenure

Mr. Shuichi Ishibashi, also known as Shu, serves as Director and Global Chief Executive officer at Bridgestone Corporation since 2020 and also serves as it's Representative Executive Officer since January...

Leadership Team

Experienced Management: 5108's management team is considered experienced (2.5 years average tenure).

Board Members

Experienced Board: 5108's board of directors are considered experienced (4.3 years average tenure).

Ownership

Who are the major shareholders and have insiders been buying or selling?

Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.

Data	Last Updated (UTC time)
Company Analysis	2022/07/02 00:00
End of Day Share Price	2022/07/01 00:00
Earnings	2022/03/31
Annual Earnings	2021/12/31