HOTEL NEWGRAND CO., LTD. (9720) AI Stock Analysis

• Market Cap: ¥8.46B
• Dividend Yield: 0.35%
• Average Volume (3M): 350.00
• Price to Earnings (P/E): 29.5
• Beta (1Y): 0.18
• Revenue Growth: 9.47%
• EPS Growth: -57.17%
• Country: JP
• Employees: 214
• Sector: Consumer Cyclical
• Sector Strength: 83
• Industry: Travel Lodging
• EPS (TTM): 154.97
• Shares Outstanding: 1,181,448
• 10 Day Avg. Volume: 280
• 30 Day Avg. Volume: 350
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• 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: ¥6,810.00
• Price Target Upside: -4.89% Downside
• Rating Consensus: Hold
• Number of Analyst Covering: 1

• Rating: 57 Neutral
• Price Target: ¥6,810.00 ▼(-4.89% Downside)

The overall stock score of 57 reflects the company's strong revenue growth and operational efficiency, which are offset by challenges in profitability and cash flow management. Technical indicators show mixed signals, with positive price trends but potential bearish momentum. The valuation suggests the stock may be overvalued with a low dividend yield, offering limited appeal to income-focused investors.

HOTEL NEWGRAND CO., LTD. Business Overview & Revenue Model

Company Description

Hotel Newgrand Co.,Ltd. opeates hotels and resorts in Japan. It operates the Hotel New Grand in Yokohama. The company was incorporated in 1926 and is based in Yokohama, Japan.

How the Company Makes Money

HOTEL NEWGRAND CO., LTD. primarily generates revenue through its hotel operations, which include room bookings, food and beverage services, and event hosting. The company earns money from room rates paid by guests, which vary based on the type of accommodation and seasonality. Additionally, the hotel offers dining experiences in its restaurants and cafes, contributing to its revenue. Hosting events such as weddings, conferences, and meetings also represents a significant income stream. Partnerships with travel agencies and online booking platforms enhance its market reach and occupancy rates, thereby supporting its financial performance.

HOTEL NEWGRAND CO., LTD. Financial Statement Overview

Summary

The company exhibits robust revenue growth and improved operational efficiency with higher gross and EBITDA margins, yet faces profitability challenges with declining net and EBIT margins. The balance sheet shows moderate leverage and improved equity position, but reduced profitability is indicated by a decrease in ROE. Significant pressure from negative free cash flow suggests potential liquidity constraints.

Income Statement

The company showed a positive revenue growth rate of 9% from 2023 to 2024, primarily driven by the travel and lodging sector's recovery. Gross profit margin improved to 75.6%, indicating efficient cost management. However, the net profit margin decreased to 5.2% from 7.3% the previous year, highlighting a challenge in converting revenue into profit. The EBIT margin also decreased slightly to 4.4%, while the EBITDA margin improved to 11.1%, reflecting better operational efficiency despite lower EBIT.

Balance Sheet

The debt-to-equity ratio stands at 0.76, suggesting a moderate level of leverage. Return on Equity (ROE) decreased to 8.6% from 12.1%, indicating a decline in profitability. The equity ratio improved to 41.7%, showcasing a stronger equity position relative to assets. The company's financial stability remains moderate, with manageable debt levels but declining profitability metrics.

Cash Flow

The free cash flow declined significantly, resulting in a negative trajectory, which could impact future investment capabilities. Operating cash flow to net income ratio decreased, highlighting potential challenges in converting income into cash. The free cash flow to net income ratio also turned negative, underlining cash flow management issues despite positive operating cash flow.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	6.08B	5.86B	5.37B	4.28B	3.20B	3.06B
Gross Profit	4.34B	4.43B	4.05B	3.15B	2.19B	2.13B
EBITDA	620.81M	647.97M	577.25M	-40.11M	1.19B	-787.75M
Net Income	355.21M	303.42M	393.36M	-349.20M	1.32B	-1.10B
Balance Sheet
Total Assets	8.34B	8.47B	7.95B	7.74B	8.07B	7.88B
Cash, Cash Equivalents and Short-Term Investments	2.44B	2.48B	2.42B	2.20B	2.72B	542.43M
Total Debt	2.65B	2.69B	2.34B	2.58B	2.80B	3.54B
Total Liabilities	4.64B	4.94B	4.70B	4.89B	4.88B	6.01B
Stockholders Equity	3.69B	3.54B	3.25B	2.85B	3.20B	1.87B
Cash Flow
Free Cash Flow	0.00	-581.18M	445.28M	-291.57M	-66.94M	-840.49M
Operating Cash Flow	0.00	390.54M	609.28M	2.77M	-35.22M	-758.87M
Investing Cash Flow	0.00	-656.73M	-141.25M	-294.34M	2.97B	-81.62M
Financing Cash Flow	0.00	319.10M	-249.07M	-224.45M	-754.27M	1.00B

HOTEL NEWGRAND CO., LTD. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 7160.00
• 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:9720, the sentiment is Positive. The current price of 7160 is above the 20-day moving average (MA) of 6910.50, above the 50-day MA of 6697.00, and above the 200-day MA of 6158.90, indicating a bullish trend. The MACD of 148.86 indicates Negative momentum. The RSI at 76.93 is Negative, neither overbought nor oversold. The STOCH value of 100.00 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:9720.

HOTEL NEWGRAND CO., LTD. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
6565	77 Outperform	¥23.42B	8.65		1.21%	10.08%	15.90%
4691	72 Outperform	¥18.08B	6.77		1.33%	20.01%	290.10%
9723	72 Outperform	¥7.71B	9.35		0.47%	3.63%	-7.07%
Sector *	61 Neutral	$17.99B	12.87	-3.58%	2.97%	1.27%	-14.28%
9720	57 Neutral	¥8.46B	29.49		0.35%	9.47%	-57.17%
3R8	―	€94.05M	60.34	6.59%	―	―	―
9713	61 Neutral	¥15.78B	6.65		0.49%	28.56%	213.63%

HOTEL NEWGRAND CO., LTD. Corporate Events

HOTEL NEWGRAND Reports Strong Q2 Financial Performance

HOTEL NEWGRAND CO., LTD. reported a 12.7% increase in net sales and a 40.8% increase in operating profit for the second quarter of 2025 compared to the same period in 2024. Despite a slight decrease in profit, the company’s financial position has strengthened with an increase in total assets and net assets, indicating a positive outlook for stakeholders.