Echo Trading Co., Ltd. (7427) AI Stock Analysis

• Market Cap: ¥5.74B
• Dividend Yield: 3.31%
• Average Volume (3M): 12.78K
• Price to Earnings (P/E): 7.6
• Beta (1Y): 0.63
• Revenue Growth: -1.22%
• EPS Growth: -36.92%
• Country: JP
• Employees: 323
• Sector: Consumer Defensive
• Sector Strength: 42
• Industry: Packaged Foods
• EPS (TTM): 6.25
• Shares Outstanding: 6,114,546
• 10 Day Avg. Volume: 9,500
• 30 Day Avg. Volume: 12,776
• PEG Ratio: -0.29
• Price to Book (P/B): 0.44
• Price to Sales (P/S): 0.05
• P/FCF Ratio: -68.65
• 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
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 73 Outperform
• Price Target: ¥979.00 ▲(5.27% Upside)

Echo Trading Co., Ltd. demonstrates strong valuation with a low P/E ratio and high dividend yield, which are key strengths. However, financial performance issues such as declining profitability and volatile cash flows, combined with bearish technical indicators, present challenges. The lack of recent earnings call data or notable corporate events limits further insights.

Positive Factors

Revenue Growth

Consistent revenue growth indicates strong market demand and effective business strategies, supporting long-term expansion and stability.

Balance Sheet Health

A strong balance sheet with a healthy equity ratio suggests prudent financial management, providing resilience against economic fluctuations.

Product and Market Diversification

Diversification across sectors reduces dependency on a single market, enhancing stability and providing growth opportunities in various industries.

Negative Factors

Declining Profitability Margins

Declining profitability margins can hinder the company's ability to reinvest in growth and maintain competitive pricing, affecting long-term viability.

Volatile Cash Flows

Volatile cash flows can limit the company's ability to fund operations and investments, potentially impacting growth and financial flexibility.

Declining Revenue Growth

Negative revenue growth indicates potential challenges in market demand or competitive pressures, which could affect future performance.

Echo Trading Co., Ltd. Business Overview & Revenue Model

Company Description

Echo Trading Co., Ltd. trades in pet food and supplies in Japan. The company also operates specialty stores for pets; offers education services for students and companies; and organizes events for pet lovers. In addition, it operates PETPET, a pet information site for pet owners and pets for searching pet-related facilities, including animal hospitals and trimming salons, and tips on pets. The company was formerly known as echo Sales Co., Ltd. and changed its name to Echo Trading Co., Ltd. in 1992. Echo Trading Co., Ltd. was founded in 1971 and is based in Nishinomiya, Japan.

How the Company Makes Money

Echo Trading Co., Ltd. generates revenue primarily through the trading of goods, including electronics, household items, and industrial supplies. The company's revenue model includes direct sales to retailers and wholesalers, as well as online sales through e-commerce platforms. Key revenue streams include bulk sales to businesses, retail sales through partnered outlets, and commissions from logistics services provided to third parties. Additionally, strategic partnerships with manufacturers and suppliers allow Echo Trading to negotiate favorable purchase terms, enhancing profit margins. The company also benefits from market trends favoring online shopping, which increases its sales volume and improves overall profitability.

Echo Trading Co., Ltd. Financial Statement Overview

Summary

Echo Trading Co., Ltd. exhibits strong revenue growth and a stable balance sheet, which are positive indicators of financial health. However, declining profitability margins and volatile cash flows present challenges that need to be addressed to ensure sustainable growth and financial stability.

Income Statement

Echo Trading Co., Ltd. has demonstrated consistent revenue growth over the past years, with a notable increase in revenue from 2020 to 2024. The gross profit margin has remained stable, indicating effective cost management. However, there is a decline in net profit margin and EBIT margin in the latest year, reflecting potential challenges in maintaining profitability.

Balance Sheet

The company maintains a strong equity base with a favorable debt-to-equity ratio, suggesting prudent financial management. The equity ratio is healthy, indicating a solid financial structure. The return on equity has shown improvement, reflecting efficient use of shareholders' funds.

Cash Flow

Cash flow from operations has been volatile, with a significant drop in the latest year. Free cash flow has also shown a decline, which could impact future investments and financial flexibility. The operating cash flow to net income ratio indicates challenges in converting profits into cash.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	105.89B	106.39B	107.41B	96.96B	91.93B	85.65B
Gross Profit	11.91B	11.96B	12.43B	11.19B	10.78B	10.14B
EBITDA	1.27B	1.65B	1.76B	974.80M	570.62M	421.51M
Net Income	747.58M	1.00B	1.21B	590.41M	288.17M	242.69M
Balance Sheet
Total Assets	39.88B	34.07B	33.52B	31.67B	29.38B	30.41B
Cash, Cash Equivalents and Short-Term Investments	6.14B	4.22B	4.06B	3.69B	3.63B	4.45B
Total Debt	1.65B	3.25B	3.20B	3.70B	4.20B	2.50B
Total Liabilities	27.97B	22.59B	22.88B	22.08B	20.24B	21.47B
Stockholders Equity	11.91B	11.46B	10.62B	9.55B	9.10B	8.91B
Cash Flow
Free Cash Flow	0.00	-72.88M	1.15B	719.61M	-2.37B	510.09M
Operating Cash Flow	0.00	-46.95M	1.20B	756.04M	-2.31B	535.59M
Investing Cash Flow	0.00	384.32M	-59.51M	-47.17M	-65.61M	-29.15M
Financing Cash Flow	0.00	-176.13M	-764.32M	-653.69M	1.56B	-35.35M

Echo Trading Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 930.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:7427, the sentiment is Positive. The current price of 930 is above the 20-day moving average (MA) of 918.05, above the 50-day MA of 913.34, and above the 200-day MA of 882.93, indicating a bullish trend. The MACD of 5.88 indicates Negative momentum. The RSI at 70.08 is Negative, neither overbought nor oversold. The STOCH value of 91.70 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:7427.

Echo Trading Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
2286	76 Outperform	¥6.52B	4.05	―	3.10%	-2.78%	331.41%
7427	73 Outperform	¥5.74B	7.61	―	3.31%	-1.22%	-36.92%
2911	68 Neutral	¥4.15B	15.59	―	1.55%	-1.00%	31.15%
2894	66 Neutral	¥5.57B	13.64	―	1.22%	1.52%	28.70%
Sector *	62 Neutral	$20.33B	14.63	-3.31%	3.23%	1.93%	-12.26%
2654	56 Neutral	¥5.37B	18.74	―	2.54%	0.17%	-18.14%
2293	47 Neutral	¥5.80B	-13.44	―	―	-3.27%	-108.33%