Nichiha (TSE:7943) - Share price, News & Analysis

Q: What is the Fair Price of 7943 when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

7943 (¥2783) is trading above our estimate of [[fair value]] (¥1627.78)

7943 fundamental analysis
Snowflake Score
Valuation	3/6
Future Growth	2/6
Past Performance	4/6
Financial Health	6/6
Dividends	4/6

7943 Stock Overview

Nichiha Corporation manufactures and sells exterior and interior building products for houses, and commercial and public facilities in Japan, the United States, China, and internationally.

Rewards

Price-To-Earnings ratio (9.7x) is below the JP market (12.6x)

Earnings are forecast to grow 6.78% per year

Earnings grew by 8.9% over the past year

Risk Analysis

Unstable dividend track record

Nichiha Competitors

Nitto Boseki

TSE:3110

JP¥99.6b

Takara StandardLtd

TSE:7981

JP¥95.7b

Takasago Thermal Engineering

TSE:1969

JP¥107.7b

Bunka Shutter

TSE:5930

JP¥72.1b

Price History & Performance

Summary of all time highs, changes and price drops for Nichiha
Historical stock prices
Current Share Price	JP¥2,783.00
52 Week High	JP¥3,565.00
52 Week Low	JP¥2,173.00
Beta	0
1 Month Change	6.83%
3 Month Change	22.12%
1 Year Change	-9.50%
3 Year Change	8.67%
5 Year Change	-25.98%
Change since IPO	382.10%

Shareholder Returns

	7943	JP Building	JP Market
7D	3.5%	0.5%	0.06%
1Y	-9.5%	-9.8%	-2.0%

Return vs Industry: 7943 matched the JP Building industry which returned -9.8% over the past year.

Return vs Market: 7943 underperformed the JP Market which returned -2% over the past year.

Price Volatility

Is 7943's price volatile compared to industry and market?
7943 volatility
7943 Average Weekly Movement	3.4%
Building Industry Average Movement	3.1%
Market Average Movement	3.9%
10% most volatile stocks in JP Market	8.0%
10% least volatile stocks in JP Market	2.1%

Stable Share Price: 7943 is not significantly more volatile than the rest of JP stocks over the past 3 months, typically moving +/- 3% a week.

Volatility Over Time: 7943's weekly volatility (3%) has been stable over the past year.

About the Company

Founded	Employees	CEO	Website
1956	3,139	Shigemitsu Yoshioka	https://www.nichiha.co.jp

Nichiha Corporation manufactures and sells exterior and interior building products for houses, and commercial and public facilities in Japan, the United States, China, and internationally. The company offers exterior building products, such as exterior fiber cement sidings and sidings accessories, roofing materials, face material bearing walls, fire-resistant roofing boards, and remodeling products, as well as interior building products. It also provides thermal insulating products comprising solar heat insulation and underfloor thermal insulation panels; and fiberboards, as well as offers installation, maintenance, and repair services.

Nichiha Fundamentals Summary

How do Nichiha's earnings and revenue compare to its market cap?
7943 fundamental statistics
Market Cap	JP¥102.07b
Earnings (TTM)	JP¥10.49b
Revenue (TTM)	JP¥130.34b

9.7x

P/E Ratio

0.8x

P/S Ratio

Is 7943 overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
7943 income statement (TTM)
Revenue	JP¥130.34b
Cost of Revenue	JP¥78.76b
Gross Profit	JP¥51.59b
Other Expenses	JP¥41.10b
Earnings	JP¥10.49b

Last Reported Earnings

Jun 30, 2022

Next Earnings Date

n/a

Earnings per share (EPS)	285.88
Gross Margin	39.58%
Net Profit Margin	8.04%
Debt/Equity Ratio	13.4%

How did 7943 perform over the long term?

See historical performance and comparison

Dividends

3.5%

Current Dividend Yield

34%

Payout Ratio

Does 7943 pay a reliable dividends?

See 7943 dividend history and benchmarks

When do you need to buy 7943 by to receive an upcoming dividend?
Nichiha dividend dates
Ex Dividend Date	Sep 29 2022
Dividend Pay Date	Dec 01 2022
Days until Ex dividend	47 days
Days until Dividend pay date	110 days

Does 7943 pay a reliable dividends?

See 7943 dividend history and benchmarks

We’ve recently updated our valuation analysis.

Valuation

Is 7943 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
Analyst Forecast

Key Valuation Metric

Which metric is best to use when looking at relative valuation for 7943?

Other financial metrics that can be useful for relative valuation.

The above table shows the n/a ratio for 7943. This is calculated by dividing 7943's market cap by their current preferred multiple.
What is 7943's n/a Ratio?
n/a Ratio	0x
n/a	n/a
Market Cap	JP¥102.07b

7943 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	0.6x
Enterprise Value/EBITDA	4.5x
PEG Ratio	1.4x

Price to Earnings Ratio vs Peers

How does 7943's PE Ratio compare to its peers?

7943 PE Ratio vs Peers

The above table shows the PE ratio for 7943 vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	PE	Estimated Growth	Market Cap
Peer Average	9.8x
3110 Nitto Boseki	9.5x	2.5%	JP¥99.6b
7981 Takara StandardLtd	9.1x	n/a	JP¥95.7b
1969 Takasago Thermal Engineering	9.6x	-0.5%	JP¥107.7b
5930 Bunka Shutter	10.9x	n/a	JP¥72.1b
7943 Nichiha	9.7x	6.8%	JP¥102.1b

Price-To-Earnings vs Peers: 7943 is good value based on its Price-To-Earnings Ratio (9.7x) compared to the peer average (9.8x).

Price to Earnings Ratio vs Industry

How does 7943's PE Ratio compare vs other companies in the JP Building Industry?

Price-To-Earnings vs Industry: 7943 is good value based on its Price-To-Earnings Ratio (9.7x) compared to the JP Building industry average (10.2x)

Price to Earnings Ratio vs Fair Ratio

What is 7943'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.

7943 PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio	9.7x
Fair PE Ratio	11.3x

Price-To-Earnings vs Fair Ratio: 7943 is good value based on its Price-To-Earnings Ratio (9.7x) compared to the estimated Fair Price-To-Earnings Ratio (11.3x).

Share Price vs Fair Value

What is the Fair Price of 7943 when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: 7943 (¥2783) is trading above our estimate of fair value (¥1627.78)

Significantly Below Fair Value: 7943 is trading above our estimate of fair value.

Analyst Price Targets

What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?

Analyst Forecast: Target price is more than 20% higher than the current share price, but there are not enough analysts covering the stock to determine statistical confidence in agreement.

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Future Growth

How is Nichiha forecast to perform in the next 1 to 3 years based on estimates from 2 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

6.8%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: 7943's forecast earnings growth (6.8% per year) is above the savings rate (0.04%).

Earnings vs Market: 7943's earnings (6.8% per year) are forecast to grow slower than the JP market (8.3% per year).

High Growth Earnings: 7943's earnings are forecast to grow, but not significantly.

Revenue vs Market: 7943's revenue (4.5% per year) is forecast to grow faster than the JP market (4.3% per year).

High Growth Revenue: 7943's revenue (4.5% per year) is forecast to grow slower than 20% per year.

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: 7943's Return on Equity is forecast to be low in 3 years time (9.4%).

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Past Performance

How has Nichiha 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

-1.0%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: 7943 has high quality earnings.

Growing Profit Margin: 7943's current net profit margins (8%) are higher than last year (7.9%).

Past Earnings Growth Analysis

Earnings Trend: 7943's earnings have declined by 1% per year over the past 5 years.

Accelerating Growth: 7943's earnings growth over the past year (8.9%) exceeds its 5-year average (-1% per year).

Earnings vs Industry: 7943 earnings growth over the past year (8.9%) exceeded the Building industry -0.6%.

Return on Equity

High ROE: 7943's Return on Equity (9.3%) is considered low.

Discover strong past performing companies

Financial Health

How is Nichiha's financial position?

Financial Health Score

6/6

Financial Health Score 6/6

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

Financial Position Analysis

Short Term Liabilities: 7943's short term assets (¥87.9B) exceed its short term liabilities (¥33.9B).

Long Term Liabilities: 7943's short term assets (¥87.9B) exceed its long term liabilities (¥15.8B).

Debt to Equity History and Analysis

Debt Level: 7943 has more cash than its total debt.

Reducing Debt: 7943's debt to equity ratio has reduced from 26.7% to 13.4% over the past 5 years.

Debt Coverage: 7943's debt is well covered by operating cash flow (99.2%).

Interest Coverage: 7943 earns more interest than it pays, so coverage of interest payments is not a concern.

Balance Sheet

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Dividend

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

Dividend Score

4/6

Dividend Score 4/6

Notable Dividend
High Dividend
Stable Dividend
Growing Dividend
Earnings Coverage
Cash Flow Coverage

3.49%

Current Dividend Yield

Upcoming Dividend Payment

Dividend Yield vs Market

Notable Dividend: 7943's dividend (3.49%) is higher than the bottom 25% of dividend payers in the JP market (1.64%).

High Dividend: 7943's dividend (3.49%) is low compared to the top 25% of dividend payers in the JP market (3.63%).

Stability and Growth of Payments

Stable Dividend: 7943's dividend payments have been volatile in the past 10 years.

Growing Dividend: 7943's dividend payments have increased over the past 10 years.

Earnings Payout to Shareholders

Earnings Coverage: With its reasonably low payout ratio (33.9%), 7943's dividend payments are well covered by earnings.

Cash Payout to Shareholders

Cash Flow Coverage: With its reasonably low cash payout ratio (49.2%), 7943's dividend payments are well covered by cash flows.

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Management

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

4.3yrs

Average management tenure

CEO

Shigemitsu Yoshioka (59 yo)

1.17yrs

Tenure

Leadership Team

Experienced Management: 7943's management team is considered experienced (4.3 years average tenure).

Board Members

Experienced Board: 7943's board of directors are considered experienced (6.2 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	2022/08/12 00:00
End of Day Share Price	2022/08/12 00:00
Earnings	2022/06/30
Annual Earnings	2022/03/31