ABC-Mart (TSE:2670): Assessing Valuation After Positive October 2025 Sales Growth

ABC-MartInc (TSE:2670) just released its October 2025 sales update, showing a 3% increase in all stores sales compared to last year. Existing stores also saw a 2% year-on-year rise, highlighting steady consumer demand.

See our latest analysis for ABC-MartInc.

ABC-MartInc’s positive October sales update, reflecting steady growth at both new and existing stores, helped shore up sentiment after a challenging year. The share price has fallen 16.7% year-to-date, but the 5-year total shareholder return of nearly 56% signals that longer-term investors have still enjoyed strong gains, even as recent momentum has faded.

If this retail rebound has sparked your interest, it could be the perfect moment to broaden your search and discover fast growing stocks with high insider ownership

But with shares trading nearly 16% below analyst price targets and recent growth figures in hand, is ABC-MartInc flying under the radar, or has the market already fully accounted for its future prospects?

Price-to-Earnings of 14.5x: Is it Justified?

ABC-MartInc is currently trading at a price-to-earnings (P/E) ratio of 14.5 times, slightly above the Japanese Specialty Retail industry average of 14 times. With a last close price of ¥2,673, the stock appears a touch pricier than its immediate industry peers, raising questions about whether this premium is warranted.

The P/E ratio reflects how much investors are willing to pay for each yen of earnings. For specialty retailers like ABC-MartInc, this multiple signals the market’s view on the company’s future growth prospects and earnings stability. A higher ratio often suggests optimism about profit growth or business quality. A lower ratio can indicate uncertainty or sector headwinds.

However, when placed side by side with the peer average (25x), ABC-MartInc looks favorably valued. Its price-to-earnings ratio is also well below what regression models estimate as a fair multiple for the company (17.4x). If the market adjusts to this benchmark, there could be further upside in store.

Explore the SWS fair ratio for ABC-MartInc

Result: Price-to-Earnings of 14.5x (UNDERVALUED)

However, slowing revenue and net income growth could limit future upside, especially if consumer demand falters in the coming quarters.

Find out about the key risks to this ABC-MartInc narrative.

Another View: What Does the DCF Model Say?

While ABC-MartInc’s current price-to-earnings multiple suggests potential value, our SWS DCF model adds another layer. According to this method, the company is trading about 16% below its estimated fair value. That points to a possible bargain, but does the DCF capture all the risks ahead?

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 ABC-MartInc 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 879 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 ABC-MartInc Narrative

If you see these findings differently, or want to dig into the numbers for yourself, you can quickly build your own perspective in just a few minutes. Do it your way

A great starting point for your ABC-MartInc research is our analysis highlighting 4 key rewards and 1 important warning sign 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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