NEC Capital Solutions (TSE:8793) - Share price, News & Analysis

8793 fundamental analysis
Snowflake Score
Valuation	5/6
Future Growth	1/6
Past Performance	5/6
Financial Health	3/6
Dividends	5/6

8793 Stock Overview

NEC Capital Solutions Limited provides financial services in Japan.

Rewards

Trading at 37.4% below our estimate of its fair value

Earnings are forecast to grow 3.92% per year

Earnings grew by 68.5% over the past year

Risk Analysis

Debt is not well covered by operating cash flow

Unstable dividend track record

NEC Capital Solutions Competitors

Mitsubishi HC Capital

TSE:8593

JP¥831.3b

Tokyo Century

TSE:8439

JP¥510.8b

Fuyo General Lease

TSE:8424

JP¥223.2b

Mizuho Leasing Company

TSE:8425

JP¥145.1b

Price History & Performance

Summary of all time highs, changes and price drops for NEC Capital Solutions
Historical stock prices
Current Share Price	JP¥1,948.00
52 Week High	JP¥2,219.00
52 Week Low	JP¥1,914.00
Beta	0.62
1 Month Change	-5.71%
3 Month Change	-9.69%
1 Year Change	-1.32%
3 Year Change	12.80%
5 Year Change	13.06%
Change since IPO	-19.84%

Shareholder Returns

	8793	JP Diversified Financial	JP Market
7D	-3.0%	-2.4%	-3.6%
1Y	-1.3%	3.3%	-3.3%

Return vs Industry: 8793 underperformed the JP Diversified Financial industry which returned 3.3% over the past year.

Return vs Market: 8793 exceeded the JP Market which returned -3.3% over the past year.

Price Volatility

Is 8793's price volatile compared to industry and market?
8793 volatility
8793 Average Weekly Movement	3.3%
Diversified Financial Industry Average Movement	4.3%
Market Average Movement	4.5%
10% most volatile stocks in JP Market	8.9%
10% least volatile stocks in JP Market	2.5%

Stable Share Price: 8793 is less volatile than 75% of JP stocks over the past 3 months, typically moving +/- 3% a week.

Volatility Over Time: 8793's weekly volatility (3%) has been stable over the past year.

About the Company

Founded	Employees	CEO	Website
1970	811	Tomoo Imazeki	https://www.necap.co.jp

NEC Capital Solutions Limited provides financial services in Japan. It operates through Leasing and Installment Sales, Finance, RISA, and Other segments. The Leasing and Installment Sales segment engages in the leasing and rental of information devices and office equipment, and industrial and construction machinery, as well as installment sales business.

NEC Capital Solutions Fundamentals Summary

How do NEC Capital Solutions's earnings and revenue compare to its market cap?
8793 fundamental statistics
Market Cap	JP¥41.94b
Earnings (TTM)	JP¥6.94b
Revenue (TTM)	JP¥249.91b

6.0x

P/E Ratio

0.2x

P/S Ratio

Is 8793 overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
8793 income statement (TTM)
Revenue	JP¥249.91b
Cost of Revenue	JP¥218.21b
Gross Profit	JP¥31.70b
Other Expenses	JP¥24.76b
Earnings	JP¥6.94b

Last Reported Earnings

Mar 31, 2022

Next Earnings Date

n/a

Earnings per share (EPS)	322.31
Gross Margin	12.69%
Net Profit Margin	2.78%
Debt/Equity Ratio	692.0%

How did 8793 perform over the long term?

See historical performance and comparison

Dividends

3.8%

Current Dividend Yield

23%

Payout Ratio

Valuation

Is NEC Capital Solutions undervalued compared to its fair value and its price relative to the market?

Valuation Score

5/6

Valuation Score 5/6

Below Fair Value
Significantly Below Fair Value
PE vs Industry
PE vs Market
PEG Ratio
PB vs Industry

37.4%

Undervalued compared to fair value

Share Price vs. Fair Value

Below Fair Value: 8793 (¥1948) is trading below our estimate of fair value (¥3112.72)

Significantly Below Fair Value: 8793 is trading below fair value by more than 20%.

Price To Earnings Ratio

PE vs Industry: 8793 is good value based on its PE Ratio (6x) compared to the JP Diversified Financial industry average (10.4x).

PE vs Market: 8793 is good value based on its PE Ratio (6x) compared to the JP market (12.1x).

Price to Earnings Growth Ratio

PEG Ratio: 8793 is poor value based on its PEG Ratio (1.5x)

Price to Book Ratio

PB vs Industry: 8793 is good value based on its PB Ratio (0.4x) compared to the JP Diversified Financial industry average (0.8x).

Future Growth

How is NEC Capital Solutions forecast to perform in the next 1 to 3 years based on estimates from 1 analyst?

Future Growth Score

1/6

Future Growth Score 1/6

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

3.9%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: 8793's forecast earnings growth (3.9% per year) is above the savings rate (0.02%).

Earnings vs Market: 8793's earnings (3.9% per year) are forecast to grow slower than the JP market (8% per year).

High Growth Earnings: 8793's earnings are forecast to grow, but not significantly.

Revenue vs Market: 8793's revenue (0.4% per year) is forecast to grow slower than the JP market (4.3% per year).

High Growth Revenue: 8793's revenue (0.4% per year) is forecast to grow slower than 20% per year.

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: 8793's Return on Equity is forecast to be low in 3 years time (6.6%).

Past Performance

How has NEC Capital Solutions performed over the past 5 years?

Past Performance Score

5/6

Past Performance Score 5/6

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

0.9%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: 8793 has high quality earnings.

Growing Profit Margin: 8793's current net profit margins (2.8%) are higher than last year (1.9%).

Past Earnings Growth Analysis

Earnings Trend: 8793's earnings have grown by 0.9% per year over the past 5 years.

Accelerating Growth: 8793's earnings growth over the past year (68.5%) exceeds its 5-year average (0.9% per year).

Earnings vs Industry: 8793 earnings growth over the past year (68.5%) exceeded the Diversified Financial industry 12.2%.

Return on Equity

High ROE: 8793's Return on Equity (7.5%) is considered low.

Financial Health

How is NEC Capital Solutions's financial position?

Financial Health Score

3/6

Financial Health Score 3/6

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

Financial Position Analysis

Short Term Liabilities: 8793's short term assets (¥899.0B) exceed its short term liabilities (¥497.9B).

Long Term Liabilities: 8793's short term assets (¥899.0B) exceed its long term liabilities (¥411.0B).

Debt to Equity History and Analysis

Debt Level: 8793's net debt to equity ratio (661%) is considered high.

Reducing Debt: 8793's debt to equity ratio has increased from 648.9% to 692% over the past 5 years.

Debt Coverage: 8793's debt is not well covered by operating cash flow (5.6%).

Interest Coverage: 8793 earns more interest than it pays, so coverage of interest payments is not a concern.

Balance Sheet

Dividend

What is NEC Capital Solutions's 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
Future Dividend Coverage

3.80%

Current Dividend Yield

Dividend Yield vs Market

Notable Dividend: 8793's dividend (3.8%) is higher than the bottom 25% of dividend payers in the JP market (1.61%).

High Dividend: 8793's dividend (3.8%) is in the top 25% of dividend payers in the JP market (3.6%)

Stability and Growth of Payments

Stable Dividend: 8793's dividend payments have been volatile in the past 10 years.

Growing Dividend: 8793's dividend payments have increased over the past 10 years.

Earnings Payout to Shareholders

Earnings Coverage: With its low payout ratio (23%), 8793's dividend payments are well covered by earnings.

Cash Payout to Shareholders

Cash Flow Coverage: With its low cash payout ratio (3.5%), 8793's dividend payments are thoroughly covered by cash flows.

Next Steps

Explore strong dividend paying companies in the Diversified Financials industry.

Management

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

4.9yrs

Average management tenure

CEO

Tomoo Imazeki

4.92yrs

Tenure

Mr. Tomoo Imazeki has been President of NEC Capital Solutions Limited since June 2017. Mr. Imazeki served as Senior Executive Officer of NEC Capital Solutions Limited since April 2015 until June 2017 and...

Leadership Team

Experienced Management: 8793's management team is considered experienced (4.9 years average tenure).

Board Members

Experienced Board: 8793's board of directors are not considered experienced ( 1.9 years average tenure), which suggests a new board.

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	2022/05/14 00:00
End of Day Share Price	2022/05/13 00:00
Earnings	2022/03/31
Annual Earnings	2022/03/31