Nintendo Co., Ltd. Fundamental Analysis (JPX: 7974.T)
Nintendo Co., Ltd. Fundamental Analysis (JPX: 7974.T)
Nintendo Co., Ltd. (JPX: 7974.T) shows moderate financial fundamentals with a PE ratio of 21.70, profit margin of 21.05%, and ROE of 16.30%. The company generates $2258.5B in annual revenue with weak year-over-year growth of -30.32%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 45.7/100 based on profitability, valuation, growth, and balance sheet metrics. The D grade reflects weak fundamentals and significant financial concerns.
Fundamental Health Score
We analyze 7974.T's fundamental strength across five key dimensions:
Efficiency Score
Excellent7974.T demonstrates superior asset utilization.
Valuation Score
Excellent7974.T trades at attractive valuation levels.
Growth Score
Weak7974.T faces weak or negative growth trends.
Financial Health Score
Excellent7974.T maintains a strong and stable balance sheet.
Profitability Score
Excellent7974.T achieves industry-leading margins.
Key Financial Metrics
Is 7974.T Expensive or Cheap?
P/E Ratio
7974.T trades at 21.70 times earnings. This indicates a fair valuation.
PEG Ratio
When adjusting for growth, 7974.T's PEG of 0.35 indicates potential undervaluation.
Price to Book
The market values Nintendo Co., Ltd. at 3.51 times its book value. This suggests the stock is fully valued or overvalued on an asset basis.
EV/EBITDA
Enterprise value stands at 19.42 times EBITDA. This signals the market has high growth expectations.
How Well Does 7974.T Make Money?
Net Profit Margin
For every $100 in sales, Nintendo Co., Ltd. keeps $21.05 as profit after all expenses.
Operating Margin
Core operations generate 19.74 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $16.30 in profit for every $100 of shareholder equity.
ROA
Nintendo Co., Ltd. generates $12.46 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Nintendo Co., Ltd. produces operating cash flow of $289.79B, showing steady but balanced cash generation.
Free Cash Flow
Nintendo Co., Ltd. generates strong free cash flow of $262.62B, providing ample flexibility for dividends, buybacks, or growth.
FCF Per Share
Each share generates $227.80 in free cash annually.
FCF Yield
7974.T converts 2.56% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
21.70
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
0.35
vs 25 benchmark
P/B Ratio
Price to book value ratio
3.51
vs 25 benchmark
P/S Ratio
Price to sales ratio
4.54
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
0.02
vs 25 benchmark
Current Ratio
Current assets to current liabilities
3.73
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.16
vs 25 benchmark
ROA
Return on assets percentage
0.12
vs 25 benchmark
ROCE
Return on capital employed
0.15
vs 25 benchmark
How 7974.T Stacks Against Its Sector Peers
| Metric | 7974.T Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 21.70 | 35.30 | Better (Cheaper) |
| ROE | 16.30% | 752.00% | Weak |
| Net Margin | 21.05% | -2918.00% (disorted) | Strong |
| Debt/Equity | 0.02 | 0.60 | Strong (Low Leverage) |
| Current Ratio | 3.73 | 6.15 | Strong Liquidity |
| ROA | 12.46% | 323.00% | Weak |
7974.T outperforms its industry in 4 out of 6 key metrics, particularly excelling in Net Margin, but lagging in ROE.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews Nintendo Co., Ltd.'s 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
-8.91%
Industry Style: Growth, Innovation, High Beta
DecliningEPS CAGR
10.30%
Industry Style: Growth, Innovation, High Beta
High GrowthFCF CAGR
-96.45%
Industry Style: Growth, Innovation, High Beta
Declining