Metaplanet (TSE:3350) Valuation Check as New MARS and Mercury Preferred Shares Target Bigger Bitcoin Treasury

Metaplanet (TSE:3350) just moved ahead in Japan’s crypto-financing race, detailing plans for new MARS and Mercury preferred-share structures to fund additional Bitcoin purchases, while a key rival sidelines similar offerings for at least a year.

See our latest analysis for Metaplanet.

The latest MARS and Mercury plans come after a volatile stretch, with the share price down 11.25 percent over the last day but still showing a positive year to date share price return of 16.92 percent and a three year total shareholder return of 703.85 percent. This suggests momentum is cooling in the short term but remains powerful over a longer horizon.

If Metaplanet’s bold Bitcoin treasury bet has caught your eye, this could be a moment to explore other high conviction ideas through fast growing stocks with high insider ownership.

With momentum cooling and Bitcoin exposure set to deepen, investors now face a key question: is Metaplanet’s valuation still catching up with its bold strategy, or has the market already priced in the next leg of growth?

Price-to-Earnings of 23.6x: Is it justified?

On a trailing basis, Metaplanet trades on a price-to-earnings ratio of 23.6x, which indicates that investors are paying a premium for each unit of current earnings.

The price-to-earnings multiple links today’s share price to the company’s accounting profits and is a common way to gauge how much growth and profitability investors are pricing in for hospitality and service businesses like Metaplanet.

Relative to peers overall, the stock appears expensive, given its 23.6x P/E is higher than the peer average of 15.9x. This suggests the market is willing to assign a richer multiple to its earnings. However, compared with the broader Japanese hospitality industry, the picture changes. Metaplanet’s 23.6x multiple is effectively in line with the 23.7x sector average, and it even looks inexpensive relative to an estimated fair P/E of 46.1x.

Explore the SWS fair ratio for Metaplanet

Result: Price-to-Earnings of 23.6x (ABOUT RIGHT)

However, investors should still weigh volatility in Bitcoin prices and execution risks in Metaplanet’s expanding Web3 and hospitality ambitions, which could unsettle sentiment.

Find out about the key risks to this Metaplanet narrative.

Another Angle on Value

While the 23.6x earnings multiple looks roughly in line with the hospitality sector, our DCF model paints a far harsher picture, suggesting fair value closer to ¥36. That gap implies the share price bakes in a lot of future success, leaving little room for missteps. Or does it?

Look into how the SWS DCF model arrives at its fair value.

Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out Metaplanet for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover 907 undervalued stocks based on their cash flows. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity.

Build Your Own Metaplanet Narrative

If you see the numbers differently or want to dig into the details yourself, you can build a full narrative from scratch in just a few minutes: Do it your way.

A great starting point for your Metaplanet research is our analysis highlighting 2 key rewards and 2 important warning signs that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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