Earth (TSE:4985) - Share price, News & Analysis

4985 fundamental analysis
Snowflake Score
Valuation	1/6
Future Growth	2/6
Past Performance	2/6
Financial Health	6/6
Dividends	4/6

4985 Stock Overview

Earth Corporation manufactures, markets, imports, and exports pharmaceutical products, quasi-drug products, medical tools, household products, etc.

Rewards

Price-To-Earnings ratio (21.9x) is below the Household Products industry average (23.4x)

Earnings are forecast to grow 9.87% per year

Risk Analysis

Dividend of 2.23% is not well covered by earnings

Earth Competitors

Price History & Performance

Summary of all time highs, changes and price drops for Earth
Historical stock prices
Current Share Price	JP¥5,300.00
52 Week High	JP¥7,280.00
52 Week Low	JP¥4,980.00
Beta	0.33
1 Month Change	2.51%
3 Month Change	-5.69%
1 Year Change	-20.54%
3 Year Change	9.96%
5 Year Change	-8.30%
Change since IPO	92.03%

Shareholder Returns

	4985	JP Household Products	JP Market
7D	4.5%	8.1%	1.9%
1Y	-20.5%	-6.1%	-6.2%

Return vs Industry: 4985 underperformed the JP Household Products industry which returned -6.1% over the past year.

Return vs Market: 4985 underperformed the JP Market which returned -6.2% over the past year.

Price Volatility

Is 4985's price volatile compared to industry and market?
4985 volatility
4985 Average Weekly Movement	3.3%
Household Products Industry Average Movement	3.8%
Market Average Movement	4.2%
10% most volatile stocks in JP Market	8.5%
10% least volatile stocks in JP Market	2.3%

Stable Share Price: 4985 is not significantly more volatile than the rest of JP stocks over the past 3 months, typically moving +/- 3% a week.

Volatility Over Time: 4985's weekly volatility (3%) has been stable over the past year.

About the Company

Founded	Employees	CEO	Website
1892	4,522	Katsunori Kawabata	https://www.earth.jp

Earth Corporation manufactures, markets, imports, and exports pharmaceutical products, quasi-drug products, medical tools, household products, etc. in Japan and internationally. The company offers insecticides and repellents, bath products, oral care products, deodorizers and air fresheners, cleaning products, hygiene products, gardening products, hair growth formulas, masks, ice packs, dehumidifying agents, and other products, as well as products for pets. It also provides sanitation management services.

Earth Fundamentals Summary

How do Earth's earnings and revenue compare to its market cap?
4985 fundamental statistics
Market Cap	JP¥116.72b
Earnings (TTM)	JP¥5.33b
Revenue (TTM)	JP¥193.11b

21.9x

P/E Ratio

0.6x

P/S Ratio

Is 4985 overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
4985 income statement (TTM)
Revenue	JP¥193.11b
Cost of Revenue	JP¥115.19b
Gross Profit	JP¥77.92b
Other Expenses	JP¥72.59b
Earnings	JP¥5.33b

Last Reported Earnings

Mar 31, 2022

Next Earnings Date

n/a

Earnings per share (EPS)	242.16
Gross Margin	40.35%
Net Profit Margin	2.76%
Debt/Equity Ratio	17.8%

How did 4985 perform over the long term?

See historical performance and comparison

Dividends

2.2%

Current Dividend Yield

49%

Payout Ratio

We’ve recently updated our valuation analysis.

Valuation

Is 4985 undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

1/6

Valuation Score 1/6

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 4985?

Other financial metrics that can be useful for relative valuation.

The above table shows the n/a ratio for 4985. This is calculated by dividing 4985's market cap by their current preferred multiple.
What is 4985's n/a Ratio?
n/a Ratio	0x
n/a	n/a
Market Cap	JP¥116.72b

4985 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	8.9x
PEG Ratio	2.2x

Price to Earnings Ratio vs Peers

How does 4985's PE Ratio compare to its peers?

4985 PE Ratio vs Peers

The above table shows the PE ratio for 4985 vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	PE	Estimated Growth	Market Cap
Peer Average	21.7x

Forward PE

Price-To-Earnings vs Peers: 4985 is expensive based on its Price-To-Earnings Ratio (21.9x) compared to the peer average (21.7x).

Price to Earnings Ratio vs Industry

How does 4985's PE Ratio compare vs other companies in the Household Products Industry?

Price-To-Earnings vs Industry: 4985 is good value based on its Price-To-Earnings Ratio (21.9x) compared to the JP Household Products industry average (23.4x)

Price to Earnings Ratio vs Fair Ratio

What is 4985'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.

4985 PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio	21.9x
Fair PE Ratio	19.1x

Price-To-Earnings vs Fair Ratio: 4985 is expensive based on its Price-To-Earnings Ratio (21.9x) compared to the estimated Fair Price-To-Earnings Ratio (19.1x).

Share Price vs Fair Value

What is the Fair Price of 4985 when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: 4985 (¥5300) is trading above our estimate of fair value (¥4805.11)

Significantly Below Fair Value: 4985 is trading above our estimate of fair value.

Price to Earnings Growth Ratio

PEG Ratio: 4985 is poor value based on its PEG Ratio (2.2x)

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Future Growth

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

9.9%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: 4985's forecast earnings growth (9.9% per year) is above the savings rate (0.02%).

Earnings vs Market: 4985's earnings (9.9% per year) are forecast to grow faster than the JP market (9% per year).

High Growth Earnings: 4985's earnings are forecast to grow, but not significantly.

Revenue vs Market: 4985's revenue (1.8% per year) is forecast to grow slower than the JP market (4.4% per year).

High Growth Revenue: 4985's revenue (1.8% per year) is forecast to grow slower than 20% per year.

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: 4985's Return on Equity is forecast to be low in 3 years time (12%).

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Past Performance

How has Earth performed over the past 5 years?

Past Performance Score

2/6

Past Performance Score 2/6

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

36.2%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: 4985 has high quality earnings.

Growing Profit Margin: 4985's current net profit margins (2.8%) are lower than last year (2.9%).

Past Earnings Growth Analysis

Earnings Trend: 4985's earnings have grown significantly by 36.2% per year over the past 5 years.

Accelerating Growth: 4985's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: 4985 had negative earnings growth (-7%) over the past year, making it difficult to compare to the Household Products industry average (-7%).

Return on Equity

High ROE: 4985's Return on Equity (8.6%) is considered low.

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Financial Health

How is Earth'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: 4985's short term assets (¥86.4B) exceed its short term liabilities (¥64.5B).

Long Term Liabilities: 4985's short term assets (¥86.4B) exceed its long term liabilities (¥2.9B).

Debt to Equity History and Analysis

Debt Level: 4985 has more cash than its total debt.

Reducing Debt: 4985's debt to equity ratio has reduced from 57.9% to 17.8% over the past 5 years.

Debt Coverage: 4985's debt is well covered by operating cash flow (41.7%).

Interest Coverage: 4985 earns more interest than it pays, so coverage of interest payments is not a concern.

Balance Sheet

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Dividend

What is Earth 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

2.23%

Current Dividend Yield

Dividend Yield vs Market

Notable Dividend: 4985's dividend (2.23%) is higher than the bottom 25% of dividend payers in the JP market (1.68%).

High Dividend: 4985's dividend (2.23%) is low compared to the top 25% of dividend payers in the JP market (3.74%).

Stability and Growth of Payments

Stable Dividend: 4985's dividends per share have been stable in the past 10 years.

Growing Dividend: 4985's dividend payments have increased over the past 10 years.

Earnings Payout to Shareholders

Earnings Coverage: With its reasonably low payout ratio (48.8%), 4985's dividend payments are well covered by earnings.

Cash Payout to Shareholders

Cash Flow Coverage: With its high cash payout ratio (118.2%), 4985'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?

7.3yrs

Average management tenure

CEO

Katsunori Kawabata (50 yo)

8.25yrs

Tenure

JP¥260,000,000

Compensation

Mr. Katsunori Kawabata has been President at Earth Chemical Co., Ltd. since March 2014 and had been its Group Chief Executive Officer since January 2017 until 2021. Mr. Kawabata serves as Chief Executive O...

CEO Compensation Analysis

Compensation vs Market: Katsunori's total compensation ($USD1.92M) is about average for companies of similar size in the JP market ($USD1.54M).

Compensation vs Earnings: Katsunori's compensation has increased by more than 20% whilst company earnings have fallen more than 20% in the past year.

Leadership Team

Experienced Management: 4985's management team is seasoned and experienced (7.3 years average tenure).

Board Members

Experienced Board: 4985's board of directors are seasoned and experienced ( 12.3 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	2022/06/26 00:00
End of Day Share Price	2022/06/24 00:00
Earnings	2022/03/31
Annual Earnings	2021/12/31