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

• Market Cap: ¥7.51B
• Dividend Yield: 0.39%
• Average Volume (3M): 826.00
• Price to Earnings (P/E): 22.5
• Beta (1Y): 0.16
• Revenue Growth: 10.52%
• EPS Growth: -31.01%
• Country: JP
• Employees: 214
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Travel Lodging
• EPS (TTM): -119.65
• Shares Outstanding: 1,181,448
• 10 Day Avg. Volume: 1,830
• 30 Day Avg. Volume: 826
• PEG Ratio: -1.00
• Price to Book (P/B): 1.97
• Price to Sales (P/S): 1.19
• P/FCF Ratio: -11.97
• 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: Hold
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 56 Neutral
• Price Target: ¥7,025.00 ▲(10.46% Upside)

The overall stock score is primarily influenced by financial performance and technical analysis. While the company shows strong revenue growth and improved operational efficiency, it faces challenges in profitability and cash flow management. Technical indicators suggest a bearish trend with weak momentum. Valuation metrics indicate the stock is moderately valued, but the low dividend yield limits income potential.

Positive Factors

Revenue Growth

Strong revenue growth indicates robust demand recovery in the travel and lodging sector, supporting long-term business expansion.

Operational Efficiency

Improved operational efficiency through cost management enhances profitability potential, providing a competitive edge in the hospitality industry.

Equity Position

A stronger equity position enhances financial stability, allowing for better resilience against economic fluctuations and potential for future investments.

Negative Factors

Profitability Challenges

Declining profitability margins suggest challenges in converting revenue into profit, which could hinder long-term financial performance.

Cash Flow Issues

Negative free cash flow indicates potential liquidity constraints, limiting the company's ability to invest in growth opportunities and manage debt.

Declining ROE

A decline in ROE reflects reduced profitability and efficiency in generating returns on shareholders' equity, impacting investor confidence.

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 generates revenue primarily through its hotel operations, which include room bookings, food and beverage sales, and event hosting services. The company earns significant income from both short-term stays by leisure travelers and long-term business contracts with corporate clients. Additional revenue streams may include partnerships with travel agencies and online booking platforms, which help increase visibility and attract a larger customer base. Seasonal promotions, loyalty programs, and special events also play a crucial role in driving occupancy rates and enhancing overall earnings.

HOTEL NEWGRAND CO., LTD. Financial Statement Overview

Summary

The company exhibits strong revenue growth and improved operational efficiency, as seen in higher gross and EBITDA margins. However, challenges in profitability are evident with declining net and EBIT margins. The balance sheet shows moderate leverage and an improved equity position, but a decrease in ROE indicates reduced profitability. Cash flow issues are significant, with negative free cash flow suggesting 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	6.35B	5.86B	5.37B	4.28B	3.20B	3.06B
Gross Profit	4.69B	4.43B	4.05B	3.15B	2.19B	2.13B
EBITDA	603.60M	647.97M	577.25M	-40.11M	1.19B	-787.75M
Net Income	336.01M	303.42M	393.36M	-349.20M	1.32B	-1.10B
Balance Sheet
Total Assets	8.71B	8.47B	7.95B	7.74B	8.07B	7.88B
Cash, Cash Equivalents and Short-Term Investments	2.37B	2.48B	2.42B	2.20B	2.72B	542.43M
Total Debt	2.57B	2.69B	2.34B	2.58B	2.80B	3.54B
Total Liabilities	4.96B	4.94B	4.70B	4.89B	4.88B	6.01B
Stockholders Equity	3.75B	3.54B	3.25B	2.85B	3.20B	1.87B
Cash Flow
Free Cash Flow	170.59M	-581.18M	445.28M	-291.57M	-66.94M	-840.49M
Operating Cash Flow	351.28M	390.54M	609.28M	2.77M	-35.22M	-758.87M
Investing Cash Flow	-190.88M	-656.73M	-141.25M	-294.34M	2.97B	-81.62M
Financing Cash Flow	-104.55M	319.10M	-249.07M	-224.45M	-754.27M	1.00B

HOTEL NEWGRAND CO., LTD. Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 6360.00
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Positive
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:9720, the sentiment is Negative. The current price of 6360 is below the 20-day moving average (MA) of 6431.00, below the 50-day MA of 6585.84, and below the 200-day MA of 6461.90, indicating a bearish trend. The MACD of -64.64 indicates Negative momentum. The RSI at 26.96 is Positive, neither overbought nor oversold. The STOCH value of 25.00 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative 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	80 Outperform	¥21.99B	7.74	―	1.27%	12.08%	17.87%
4691	69 Neutral	¥16.53B	5.54	―	1.47%	19.31%	202.53%
9723	69 Neutral	¥7.36B	9.60	―	0.48%	4.02%	-9.38%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
9713	58 Neutral	¥13.84B	5.31	―	0.55%	35.22%	413.40%
9720	56 Neutral	¥7.51B	22.52	―	0.39%	10.52%	-31.01%
9704	55 Neutral	¥11.68B	7.99	32.34%	―	20.16%	1467.54%

HOTEL NEWGRAND CO., LTD. Corporate Events

HOTEL NEWGRAND Reports Strong Q3 2025 Financial Performance

HOTEL NEWGRAND CO., LTD. reported a positive financial performance for the third quarter of 2025, with net sales increasing by 12.1% and operating profit rising by 24.6% compared to the same period in the previous year. The company’s improved financial results indicate a strong market position and potential growth, benefiting stakeholders and enhancing its competitive standing in the hospitality industry.