Recomm Co., Ltd. (3323) AI Stock Analysis

• Market Cap: ¥6.45B
• Dividend Yield: 1.95%
• Average Volume (3M): 527.55K
• Price to Earnings (P/E): 57.9
• Beta (1Y): 0.47
• Revenue Growth: 22.67%
• EPS Growth: -69.80%
• Country: JP
• Employees: 514
• Sector: Communication Services
• Sector Strength: 84
• Industry: Telecommunications Services
• EPS (TTM): 1.58
• Shares Outstanding: 82,630,260
• 10 Day Avg. Volume: 520,770
• 30 Day Avg. Volume: 527,546
• PEG Ratio: -0.09
• Price to Book (P/B): 1.60
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 35.09
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0

• Rating: 77 Outperform
• Price Target: ¥85.00 ▲(3.66%Upside)

The stock demonstrates strong technical momentum, which is the most significant positive factor. However, the high P/E ratio indicates overvaluation, which could limit potential upside. Financial performance is stable but has areas for improvement in profitability and cash flow stability.

Recomm Co., Ltd. Business Overview & Revenue Model

Company Description

Recomm Co., Ltd. (3323) is a Japanese company primarily engaged in the recycling business. The company operates in various sectors, including the recycling of electronic devices, home appliances, and other materials. Its core services include the collection, dismantling, and recycling of end-of-life electronic products, offering environmentally friendly solutions for waste management.

How the Company Makes Money

Recomm Co., Ltd. makes money through its comprehensive recycling services. The company generates revenue by collecting fees for the disposal and recycling of electronic waste from manufacturers, retailers, and consumers. By processing and extracting valuable materials from discarded electronic devices and appliances, Recomm Co., Ltd. can sell these recovered materials, such as metals and plastics, to various industries, further contributing to its earnings. Additionally, partnerships with electronic manufacturers and governmental waste management programs play a significant role in the company's revenue streams by ensuring a steady flow of materials for recycling.

Recomm Co., Ltd. Financial Statement Overview

Summary

Recomm Co., Ltd. shows promising revenue growth and a balanced financial position with manageable leverage. However, profitability margins indicate room for improvement in net profitability and operational efficiency. Cash flows are robust in operations but face challenges in sustaining free cash flow.

Income Statement

Recomm Co., Ltd. demonstrated a solid revenue growth trajectory with a TTM increase of 9.6% compared to the previous year. Gross profit margins remain strong at 22.72%, reflecting efficient cost management. However, the net profit margin is modest at 0.85%, suggesting room for improvement in controlling overheads and operational expenses. The EBITDA margin of 2.8% indicates moderate profitability, with potential to enhance operational efficiency.

Balance Sheet

The company exhibits a stable financial structure with a debt-to-equity ratio of 1.02, indicating balanced leverage. The equity ratio of 38.24% reflects a solid equity base, though slightly below industry averages. The return on equity stands at 2.29%, suggesting potential for higher profitability relative to equity.

Cash Flow

Recomm Co., Ltd. presents a mixed cash flow picture. The operating cash flow to net income ratio is healthy at 2.26 for TTM, highlighting strong cash generation relative to net income. However, the free cash flow growth rate is -74.9%, indicating challenges in sustaining free cash flow levels. The free cash flow to net income ratio is 1.81, suggesting effective capital expenditure management but with room for improvement in cash flow stability.

Breakdown
TTM	Sep 2024	Sep 2023	Sep 2022	Sep 2021	Sep 2020
Income Statement		Total Revenue
12.80B	11.69B	9.51B	8.92B	6.63B	7.15B
	Gross Profit
2.91B	2.87B	2.43B	2.61B	2.45B	2.15B
	EBIT
243.28M	269.39M	450.18M	413.18M	210.66M	-143.91M
	EBITDA
358.40M	464.08M	689.74M	619.13M	383.55M	1.32B
	Net Income Common Stockholders
109.42M	83.94M	314.85M	351.55M	-316.52M	364.43M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
2.44B	3.06B	2.69B	2.84B	3.10B	3.48B
	Total Assets
12.49B	12.65B	10.84B	9.24B	8.25B	9.64B
	Total Debt
4.87B	4.83B	3.51B	2.48B	2.13B	2.61B
	Net Debt
2.43B	1.85B	888.55M	-221.53M	-861.07M	-751.83M
	Total Liabilities
7.34B	7.35B	5.89B	4.60B	4.07B	5.09B
	Stockholders Equity
4.78B	4.96B	4.69B	4.33B	3.68B	4.11B
Cash Flow		Free Cash Flow
197.70M	787.38M	-147.06M	197.12M	373.42M	184.52M
	Operating Cash Flow
246.80M	841.61M	-104.76M	266.45M	391.47M	216.06M
	Investing Cash Flow
-1.57B	-1.35B	-843.76M	-536.57M	-242.43M	1.29B
	Financing Cash Flow
1.07B	816.51M	876.37M	-262.07M	-558.73M	-221.76M

Recomm Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 82.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:3323, the sentiment is Positive. The current price of 82 is above the 20-day moving average (MA) of 76.50, above the 50-day MA of 71.96, and above the 200-day MA of 69.28, indicating a bullish trend. The MACD of 1.91 indicates Negative momentum. The RSI at 62.02 is Neutral, neither overbought nor oversold. The STOCH value of 79.63 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:3323.

Recomm Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
3323	77 Outperform	¥6.45B	57.88		1.95%	22.67%	-69.80%
4395	74 Outperform	¥6.30B	56.63		0.71%	32.90%	―
9445	69 Neutral	¥8.55B	11.66		4.71%	3.93%	1.66%
3776	68 Neutral	¥9.59B	25.13		1.28%	4.70%	35.62%
4415	66 Neutral	¥4.20B	10.11		―	15.58%	38.21%
Sector *	61 Neutral	$14.55B	5.92	-3.82%	8.36%	2.79%	-33.24%
9421	58 Neutral	¥3.86B	22.14		―	-13.42%	-195.53%