The average target price of 4681.T is 1814 and suggests 21% upside potential. Usually, this means a BUY recommendation among investment firms, or a recommendation to increase one's position in this instrument in the next 12 months. The most optimistic analyst has a target price of 1950.0. This translates into 30% upside potential in the best case. On the other hand, the most pessimistic analyst has a target price of 1600.0. This suggests 7% upside potential. Even the most pessimistic analyst believes there will be stock growth. 

Resorttrust, Inc. engages in the membership sale and administration; and operation of hotels and restaurants, and golf clubs. It is also involved in the medical and other businesses. The company's resort and city hotels portfolio includes 50 locations in Japan and 1 location in Hawaii. It also operates 13 golf courses. The company was founded in 1973 and is headquartered in Nagoya, Japan.

Japan

Resorttrust, Inc.

Consumer Cyclical

The company has a track record of regular dividend payments. It has paid dividends in each of the past ten years. Dividend per share (DPS) has grown yearly, but the dynamics are unclear. In the past 12 months, the dividend yield has been moderate and on par with its peers. On average, the company pays dividends twice a year. 

4681.T reported revenue of JPY 263 647mn in the last 12 months, up 49% from FY23. At the same time, the dynamics of cash flow, as measured by free cash flow (FCF), were drastically different. EPS grew 44% from FY23 to JPY 156.89. Market expects EPS to reach JPY 71.44 in FY25.

Over the last six months, the stock performance has varied, with an increase following a drop. The stock's price trend wasn't definitive when matched against its global counterparts from the same sector and industry (as depicted above). Within the past six months, its performance has trailed this peer group's by 39ppts and its growth accelerated by 3ppts in the past month. This is equally valid for peers from the same country and industry. Given the stock's valuation versus its peers, its total price movement is slightly unfavourable.

The company has reported modest EBITDA margins compared to its global peers in recent years. EBITDA margin amounted to 16.7% in the last 12 months, up from 14.8% in FY23. 

Historically, 4681.T has reported average net margins compared to its global peers. Specifically, in the last 12 months, this metric equalled 9.3%, a growth from 6.5% in FY23. 

In the last 12 months, the return on capital employed (RoCE) grew to 8.2%, above the peers. The consensus estimate for FY24 for RoCE is 6.1%, however, this time below its peers. 

Another important profitability metric, return on assets (RoA), amounted to 5.2% in the last 12 months, an increase from 2.6% in FY23. The market analysts predict that RoA will be 2.5% in FY24, again weaker than its peers. 

Resorttrust, Inc. reported a return on equity (RoE) of 18.6% in the last 12 months, up from 9.6% in FY23. The market consensus projects an RoE of 9.7% in FY24, however, this time below its peers. 

The ratio of return on invested capital (RoIC) to the weighted average cost of capital (WACC) has been 2.0 in the past several years. This ratio implies a strong shareholder value creation. 

The institutional, legal, and compliance risks associated with the company's country are minimal. In combination with stringent business standards, shareholder rights are very highly protected.

4681.T boasts high trading liquidity. The average private investor can sell his common position in the stock almost immediately. Liquidity is usually very stable and remains mildly favourable on the days with the lowest activity. The trading volume mostly stays the same even under highly turbulent market conditions. 

No other major risks have been identified.

The risk of default is minimal. We note resilient historical revenue growth, strong debt servicing capacity, adequate interest coverage, solid cash flow generation, and an favourable capital structure, among the positive credit factors. Among the negative credit factors and we point to weak positions in its industry, poor working capital management.

In highly turbulent market conditions, 4681.T is highly volatile. In other words, the stock will fall substantially more than the index in times of extreme market volatility or shocking company news. Standalone, the worst-day losses (less than 1% of the time) will likely be significant. 

In normal market circumstances, 4681.T is not overly volatile. Put differently, without outstanding market volatility or shocking company news, the stock's price will remain relatively stable. The stock's losses on its worst days (less than 1-5% of the time) will range from very low to mild. 

From both historical and forecast perspectives, the stock is fairly priced compared to similar stocks. In particular, the stock is reasonably priced on P/E, of fair value on EV/EBITD. 

Resorttrust, Inc.

¥ 1507

5

Resorttrust, Inc.

¥ 1507

5

Risk factor

Profitability factor

Risk / Profitability

Risk factor

Profitability factor

¥ 1507

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