Japan Tobacco Inc.
Japan Tobacco Inc. Fundamental Analysis
Japan Tobacco Inc. (JAPAY) shows moderate financial fundamentals with a PE ratio of 20.80, profit margin of 14.68%, and ROE of 12.72%. The company generates $3526.2B in annual revenue with strong year-over-year growth of 10.86%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 75.1/100 based on profitability, valuation, growth, and balance sheet metrics. The B grade reflects solid fundamentals with room for improvement in valuation or growth.
Fundamental Health Score
We analyze JAPAY's fundamental strength across five key dimensions:
Efficiency Score
WeakJAPAY struggles to generate sufficient returns from assets.
Valuation Score
ExcellentJAPAY trades at attractive valuation levels.
Growth Score
ModerateJAPAY shows steady but slowing expansion.
Financial Health Score
ExcellentJAPAY maintains a strong and stable balance sheet.
Profitability Score
WeakJAPAY struggles to sustain strong margins.
Key Financial Metrics
Is JAPAY Expensive or Cheap?
P/E Ratio
JAPAY trades at 20.80 times earnings. This indicates a fair valuation.
PEG Ratio
When adjusting for growth, JAPAY's PEG of 0.00 indicates potential undervaluation.
Price to Book
The market values Japan Tobacco Inc. at 2.61 times its book value. This may indicate undervaluation.
EV/EBITDA
Enterprise value stands at 9.83 times EBITDA. This is generally considered low.
How Well Does JAPAY Make Money?
Net Profit Margin
For every $100 in sales, Japan Tobacco Inc. keeps $14.68 as profit after all expenses.
Operating Margin
Core operations generate 22.17 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $12.72 in profit for every $100 of shareholder equity.
ROA
Japan Tobacco Inc. generates $6.09 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Japan Tobacco Inc. produces operating cash flow of $532.57B, showing steady but balanced cash generation.
Free Cash Flow
Japan Tobacco Inc. generates strong free cash flow of $384.96B, providing ample flexibility for dividends, buybacks, or growth.
FCF Per Share
Each share generates $108.42 in free cash annually.
FCF Yield
JAPAY converts 3.54% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
20.80
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
0.001
vs 25 benchmark
P/B Ratio
Price to book value ratio
2.61
vs 25 benchmark
P/S Ratio
Price to sales ratio
3.08
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
0.41
vs 25 benchmark
Current Ratio
Current assets to current liabilities
1.93
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.13
vs 25 benchmark
ROA
Return on assets percentage
0.06
vs 25 benchmark
ROCE
Return on capital employed
0.12
vs 25 benchmark
How JAPAY Stacks Against Its Sector Peers
| Metric | JAPAY Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 20.80 | 22.46 | Neutral |
| ROE | 12.72% | 1263.00% | Weak |
| Net Margin | 14.68% | -5460.00% (disorted) | Strong |
| Debt/Equity | 0.41 | 1.24 | Strong (Low Leverage) |
| Current Ratio | 1.93 | 2.47 | Neutral |
| ROA | 6.09% | -192347.00% (disorted) | Weak |
JAPAY outperforms its industry in 2 out of 6 key metrics, particularly excelling in Net Margin, but lagging in ROE.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews Japan Tobacco Inc.'s 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
44.88%
Industry Style: Defensive, Dividend, Low Volatility
High GrowthEPS CAGR
-48.49%
Industry Style: Defensive, Dividend, Low Volatility
DecliningFCF CAGR
16.66%
Industry Style: Defensive, Dividend, Low Volatility
High Growth