Shinoken Group engages in the real estate, general contractor, energy, and life care businesses in Japan and internationally. It designs, constructs, purchases, rents, manages, and sells apartments and condominiums; and offers debt guarantee services, as well as short-term insurance for owners and tenants of apartments and condominiums. Shinoken is also involved in the retail sale of LP gas and electricity to apartments and condominiums; and owning and operating of care facilities. This week, I fundamentally analyze Shinoken Group’s stock. I review Shinoken Group’s business, look at its key ratios, and derive the intrinsic value using Discounted Cash Flow (DCF) analysis. Since this is a long video, please feel free to use the time stamps in the video if you only wish to watch certain topics.
I review various key ratios such as Revenue, Net Income, Shares outstanding, Dividends, Payout Ratio, Free Cash Flows (FCF), Financial Leverage, Current Ratio, Debt to Equity Ratio, Return on Equity (ROE), Days Sales Outstanding (DSO), Days Inventory, Payable Period, Cash Conversion Cycle, Inventory Turnover, etc.
After taking into account the 10 year average free cash flow of 3,281 million JPY figure, a 6% growth rate of FCF (growth for the next 10 years), 10% discount rate, 4% long term growth rate (growth from 10 year mark to perpetuity), 35 million shares outstanding, and 19,421 million JPY of long term debt, the DCF analysis yields us an intrinsic value of 1,295.19 JPY per share.
Timeline
0:00 Introduction / Business Overview
1:55 Key Ratios Analysis
13:18 Discounted Cash Flow Analysis / Intrinsic Value
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References:
Shinoken Group’s Website: here
Morningstar Key Ratios Link: here.
Useful Resources here.
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