TSE:3863

Stock Analysis Report

Nippon Paper Industries

Executive Summary

Nippon Paper Industries Co., Ltd. engages in paper manufacturing and related businesses in Japan and internationally.


Snowflake Analysis

Mediocre balance sheet with questionable track record.


Similar Companies

Share Price & News

How has Nippon Paper Industries's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: 3863 has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

4.3%

3863

10.6%

JP Forestry

10.7%

JP Market


1 Year Return

-34.6%

3863

-16.4%

JP Forestry

-10.7%

JP Market

Return vs Industry: 3863 underperformed the JP Forestry industry which returned -14.6% over the past year.

Return vs Market: 3863 underperformed the JP Market which returned -8.2% over the past year.


Shareholder returns

3863IndustryMarket
7 Day4.3%10.6%10.7%
30 Day-1.6%8.1%-5.2%
90 Day-16.7%-6.3%-16.6%
1 Year-33.0%-34.6%-14.5%-16.4%-8.4%-10.7%
3 Year-18.5%-23.7%-0.6%-5.7%2.3%-4.8%
5 Year-6.5%-17.6%16.1%5.7%6.4%-5.0%

Price Volatility Vs. Market

How volatile is Nippon Paper Industries's share price compared to the market and industry in the last 5 years?


Simply Wall St News

No news available

Valuation

Is Nippon Paper Industries undervalued compared to its fair value and its price relative to the market?

12.63x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: 3863 (¥1583) is trading above our estimate of fair value (¥1172.6)

Significantly Below Fair Value: 3863 is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: 3863 is poor value based on its PE Ratio (13x) compared to the Forestry industry average (9.6x).

PE vs Market: 3863 is poor value based on its PE Ratio (13x) compared to the JP market (12.7x).


Price to Earnings Growth Ratio

PEG Ratio: 3863 is poor value based on its PEG Ratio (1.9x)


Price to Book Ratio

PB vs Industry: 3863 is good value based on its PB Ratio (0.5x) compared to the JP Forestry industry average (0.6x).


Next Steps

Future Growth

How is Nippon Paper Industries forecast to perform in the next 1 to 3 years based on estimates from 7 analysts?

6.9%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: 3863's forecast earnings growth (6.9% per year) is above the savings rate (-0.09%).

Earnings vs Market: 3863's earnings (6.9% per year) are forecast to grow slower than the JP market (9.3% per year).

High Growth Earnings: 3863's earnings are forecast to grow, but not significantly.

Revenue vs Market: 3863's revenue (0.5% per year) is forecast to grow slower than the JP market (3.3% per year).

High Growth Revenue: 3863's revenue (0.5% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: 3863's Return on Equity is forecast to be low in 3 years time (4.8%).


Next Steps

Past Performance

How has Nippon Paper Industries performed over the past 5 years?

-46.4%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: 3863 has high quality earnings.

Growing Profit Margin: 3863 became profitable in the past.


Past Earnings Growth Analysis

Earnings Trend: 3863's earnings have declined by -46.4% per year over the past 5 years.

Accelerating Growth: 3863 has become profitable in the last year, making the earnings growth rate difficult to compare to its 5-year average.

Earnings vs Industry: 3863 has become profitable in the last year, making it difficult to compare its past year earnings growth to the Forestry industry (33.5%).


Return on Equity

High ROE: 3863's Return on Equity (4.2%) is considered low.


Next Steps

Financial Health

How is Nippon Paper Industries's financial position?


Financial Position Analysis

Short Term Liabilities: 3863's short term assets (¥511.0B) exceed its short term liabilities (¥489.0B).

Long Term Liabilities: 3863's short term assets (¥511.0B) exceed its long term liabilities (¥499.7B).


Debt to Equity History and Analysis

Debt Level: 3863's debt to equity ratio (168.9%) is considered high.

Reducing Debt: 3863's debt to equity ratio has increased from 155.6% to 168.9% over the past 5 years.

Debt Coverage: 3863's debt is not well covered by operating cash flow (6.5%).

Interest Coverage: 3863's interest payments on its debt are well covered by EBIT (6.8x coverage).


Balance Sheet

Inventory Level: 3863 has a high level of physical assets or inventory.

Debt Coverage by Assets: 3863's debt is not covered by short term assets (assets are 0.8x debt).


Next Steps

Dividend

What is Nippon Paper Industries's current dividend yield, its reliability and sustainability?

2.60%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: 3863's dividend (2.53%) is higher than the bottom 25% of dividend payers in the JP market (1.66%).

High Dividend: 3863's dividend (2.53%) is low compared to the top 25% of dividend payers in the JP market (3.7%).


Stability and Growth of Payments

Stable Dividend: 3863 has been paying a dividend for less than 10 years and during this time payments have been volatile.

Growing Dividend: 3863 has only been paying a dividend for 7 years, and since then payments have not increased.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (32.8%), 3863's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: Insufficient data to determine if a dividend will be paid in 3 years and that it will be covered by earnings.


Next Steps

Management

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

1.2yrs

Average management tenure


CEO

Toru Nozawa (60yo)

1.17s

Tenure

Mr. Toru Nozawa President & Representative Director at Nippon Paper Industries Co. Ltd. since 2019. Mr. Nozawa served as General Manager of Financial Division of Nippon Paper Industries Co., Ltd. since Jun ...


Leadership Team

NamePositionTenureCompensationOwnership
Toru Nozawa
President & Representative Director1.17yrsno data0.0083% ¥14.8m
Shoji Ueda
GM of Technical & Engineering Division & Energy Business Division and Executive Officer3.17yrsno datano data
Takeo Konno
Managing Executive Officer1.67yrsno data0.0071% ¥12.7m
Akihiro Utsumi
Senior Managing Executive Officer4.67yrsno data0.0080% ¥14.2m
Kazufumi Yamasaki
Executive VP Corporate Officer10.17yrsno data0.017% ¥29.5m
Takahiro Maeda
Managing Executive Officer1.17yrsno datano data
Satoru Muto
Managing Executive Officer1.17yrsno datano data
Kazumori Fukushima
Senior Managing Corporate Officer1.17yrsno datano data
Masanobu Iizuka
Executive Officer1.17yrsno data0.0038% ¥6.8m

1.2yrs

Average Tenure

61yo

Average Age

Experienced Management: 3863's management team is not considered experienced ( 1.2 years average tenure), which suggests a new team.


Board Members

NamePositionTenureCompensationOwnership
Toru Nozawa
President & Representative Director1.17yrsno data0.0083% ¥14.8m
Takeo Konno
Managing Executive Officer1.67yrsno data0.0071% ¥12.7m
Akihiro Utsumi
Senior Managing Executive Officer4.67yrsno data0.0080% ¥14.2m
Kazufumi Yamasaki
Executive VP Corporate Officer10.17yrsno data0.017% ¥29.5m
Masanobu Iizuka
Executive Officer1.17yrsno data0.0038% ¥6.8m
Makoto Fujioka
Outside Director3.67yrsno data0.00087% ¥1.5m
Fumio Manoshiro
Chairman1.17yrsno data0.023% ¥41.1m
Seiichi Fusamura
Outside Member of Audit & Supervisory Board8.17yrsno datano data
Yoshimitsu Aoyama
Outside Director6.67yrsno datano data
Yoko Hatta
Outside Director0.67yrno datano data

4.2yrs

Average Tenure

65yo

Average Age

Experienced Board: 3863'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.


Top Shareholders

Company Information

Nippon Paper Industries Co., Ltd.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Nippon Paper Industries Co., Ltd.
  • Ticker: 3863
  • Exchange: TSE
  • Founded: 1949
  • Industry: Paper Products
  • Sector: Materials
  • Market Cap: JP¥177.769b
  • Shares outstanding: 115.51m
  • Website: https://www.nipponpapergroup.com

Number of Employees


Location

  • Nippon Paper Industries Co., Ltd.
  • 4-6, Kanda-Surugadai
  • Chiyoda-ku
  • Tokyo
  • 101-0062
  • Japan

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
3863TSE (The Tokyo Stock Exchange)YesCommon SharesJPJPYJan 1992
9NIDB (Deutsche Boerse AG)YesCommon SharesDEEURJan 1992

Biography

Nippon Paper Industries Co., Ltd. engages in paper manufacturing and related businesses in Japan and internationally. The company operates through Paper and Paperboard Business; Livelihood-Related Business; Energy Business; Lumber, Construction Material, Civil Engineering and Construction-Related Business; and Other Business. It offers newsprint, printing and writing, and business communication papers; household paper products, including facial and bath tissues, paper towel, pre-moistened and industrial-use wipes, personal-care product; adult diapers and underwear; wrap and kitchen paper products; wrapping paper, paperboards, paper packs, linerboard and corrugated medium, and converting paper products; and functionality specialty paper products. The company also provides cartons, filling machines, and maintenance services; dissolving pulp, functional chemicals and coating resins, and functional films; logs and lumber products, and building materials; and cellulose nanofibers. In addition, it is involved in energy, agricultural, warehouse, transport, and freight shipment businesses; and the operation of sports clubs and leisure facilities. Nippon Paper Industries Co., Ltd. was founded in 1949 and is headquartered in Tokyo, Japan. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/03/31 16:21
End of Day Share Price2020/03/31 00:00
Earnings2019/12/31
Annual Earnings2019/03/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.