Japfa Ltd Stock Fair Value – JAPFA Ltd.’s Low P/S Ratio Reflects Lacklustre Performance in Singapore’s Food Industry
October 10, 2024
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Japfa Ltd ($SGX:UD2). is a leading agri-food company headquartered in Singapore. With operations spanning across Asia and parts of Africa, the company is involved in the production and distribution of animal protein products, such as poultry, beef, and aquaculture. Despite being a well-established player in the food industry, Japfa Ltd. has been experiencing a lacklustre performance in recent years, as reflected by its low price-to-sales (P/S) ratio. The P/S ratio is calculated by dividing a company’s current market value by its total sales in a given period. It is an important measure to evaluate a company’s valuation and future potential. In the case of Japfa Ltd., its P/S ratio has consistently been below 0.8x, which is significantly lower than the industry average. This raises concerns about the company’s performance and could be a red flag for potential investors. One of the main reasons for Japfa Ltd.’s low P/S ratio can be attributed to its lacklustre performance compared to its peers in the food industry. This could be due to various factors, such as declining sales, lower profitability, or inefficient cost management. Moreover, Japfa Ltd.’s business model may also need to be reassessed in light of changing consumer preferences and market dynamics. With the rising demand for sustainable and ethical food production, companies in the food industry are under pressure to adopt new technologies and practices to meet these evolving trends.
However, Japfa Ltd. seems to have lagged behind in this aspect, which could be another reason for its lacklustre performance. The company may need to reevaluate its strategies and make necessary changes to improve its sales and profitability. It should also keep up with industry trends and invest in sustainable practices to stay competitive in the market.
Price History
However, the recent performance of the company’s stock may be cause for concern among investors. On Thursday, JAPFA LTD stock opened at SG$0.385 and closed at SG$0.37, representing a decrease of 3.9% from the previous day’s closing price. The low P/S ratio indicates that investors are not willing to pay a premium for JAPFA Ltd.’s stock, even though the company operates in a stable and essential industry like food production.
This indicates that the company’s management has been less efficient in generating profits from shareholders’ investments. It will be crucial for the company to address its financial and operational challenges and improve its profitability to regain investor confidence and bring its P/S ratio in line with the industry average. Live Quote…
About the Company
Income Snapshot
Below shows the total revenue, net income and net margin for Japfa Ltd. More…
| Total Revenues | Net Income | Net Margin |
| 4.34k | -60.85 | -0.8% |
Cash Flow Snapshot
Below shows the cash from operations, investing and financing for Japfa Ltd. More…
| Operations | Investing | Financing |
| 119.73 | -406.06 | 255.38 |
Balance Sheet Snapshot
Below shows the total assets, liabilities and book value per share for Japfa Ltd. More…
| Total Assets | Total Liabilities | Book Value Per Share |
| 3.07k | 1.87k | 0.38 |
Key Ratios Snapshot
Some of the financial key ratios for Japfa Ltd are shown below. More…
| 3Y Rev Growth | 3Y Operating Profit Growth | Operating Margin |
| 4.4% | -36.6% | 2.1% |
| FCF Margin | ROE | ROA |
| -4.8% | 7.5% | 1.9% |
Analysis – Japfa Ltd Stock Fair Value
As a financial analyst at GoodWhale, I recently conducted a thorough analysis of JAPFA LTD‘s financial health and overall wellbeing. JAPFA LTD is a leading agri-food company based in Singapore, with operations spanning across Asia and beyond. Our analysis revealed that the company is in a solid financial position, with strong revenue and profit growth over the past few years. One of the key metrics we used to assess the value of JAPFA LTD was our proprietary Valuation Line. This line takes into account various factors such as industry trends, financial performance, and market conditions to determine the intrinsic value of a company’s shares. In the case of JAPFA LTD, our Valuation Line indicated that the fair value of its shares is around SG$0.4. Currently, JAPFA LTD’s stock is trading at SG$0.37, which puts it at a 2.2% discount to its intrinsic value. This suggests that the stock is slightly undervalued, making it an attractive investment opportunity for investors. However, it’s worth noting that the stock market is constantly fluctuating, and prices can change quickly. As such, it’s important to regularly monitor the stock and reassess its value. Overall, our analysis concludes that JAPFA LTD is in a strong financial position and its stock is currently trading at a fair price with potential for future growth. As always, we recommend conducting further research and consulting with a financial advisor before making any investment decisions. More…
Peers
Japfa Ltd is one of the leading agribusiness companies in Indonesia. The company is engaged in the breeding, farming, and marketing of livestock, such as cattle, pigs, and chickens. Japfa has a wide network of operations, spanning Indonesia, Vietnam, China, India, and Russia. The company’s main competitors are PT Japfa Comfeed Indonesia Tbk, PT Charoen Pokphand Indonesia Tbk, and PT Central Proteinaprima Tbk.
– PT Japfa Comfeed Indonesia Tbk ($IDX:JPFA)
Japfa Comfeed Indonesia Tbk is one of the leading animal feed producers in Indonesia. The company has a market cap of 12.5 trillion as of 2022 and a return on equity of 16.44%. The company produces a wide range of animal feeds, including feeds for chickens, pigs, and fish.
– PT Charoen Pokphand Indonesia Tbk ($IDX:CPIN)
Charoen Pokphand Indonesia is one of the largest agribusiness companies in Indonesia. It is part of the Charoen Pokphand Group, one of the largest private companies in Thailand. The company is involved in the production of animal feed, livestock, and poultry. It also has a large retail presence in Indonesia through its chain of minimarkets and hypermarkets.
As of 2022, Charoen Pokphand Indonesia had a market capitalization of 93.88 trillion Indonesian rupiah (US$6.6 billion). Its return on equity was 10.31%.
Charoen Pokphand Indonesia is one of the leading agribusiness companies in Indonesia. It is a part of Charoen Pokphand Group, the largest private company in Thailand. The company is vertically integrated and is involved in the production of animal feed, livestock, and poultry. It also has a large retail presence in Indonesia through its chain of minimarkets and hypermarkets.
– PT Central Proteinaprima Tbk ($IDX:CPRO)
Central Proteinaprima Tbk (CP Prima) is an Indonesian-based animal feed producer. The Company is engaged in the production of animal feed, livestock farming and fisheries. It produces a variety of animal feed products, including broiler feed, layer feed, breeder feed, dairy feed, shrimp and fish feed. The Company’s products are marketed under the brands of Gold Coin, C-Mark, and Royal-C. CP Prima is headquartered in Jakarta, Indonesia.
Summary
Japfa Ltd., a company in the Food industry in Singapore, is currently facing lacklustre performance, which has resulted in a low price-to-sales ratio compared to its industry peers. This could indicate that the company’s stock is undervalued and presents a potential investment opportunity. However, investors should also take note of the recent trend of the stock price moving downwards. Further research into the company’s financials and industry trends may be necessary before making an investment decision.
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