Revenues have been growing at an average rate of 4.2% per year with net margins of 1.1%. The company exhibits stable but modest growth characteristics typical of mid-sized wholesale distributors, with a dividend yield of 2.80% and payout ratio of 30.53% reflecting a shareholder-friendly dividend policy.
Cyborg Score Rationale
Earnings growth over the past year (0.3%) is below its 5-year average (6.7% per year) and did not outperform the Retail Distributors industry at 4.4%. The stock is trading significantly below its estimated fair value by more than 20%, suggesting potential undervaluation offset by growth deceleration.
Top Insights
Trading at good value on its Price-To-Earnings Ratio (11.5x) compared to both peer average (12.1x) and industry average (13.5x)
Earnings have grown 6.7% per year over the past 5 years though momentum has decelerated recently
The company has approximately 2,890 employees operating as a lean distribution operation
Most recent quarterly revenue of ¥245.60B exceeded estimates of ¥243.00B, indicating execution capability
Named Competitors
General Distribution Services — Large consolidated distributors with superior growth profiles
Direct-to-Consumer E-commerce — Digital disintermediation reducing wholesale dependency
Specialty Wholesalers — Niche players with vertical integration advantages
Recent Developments
(Oct 2024) Quarterly revenue of ¥245.60B exceeded analyst estimates
(Q2 2024) Net income of ¥3.44B showed 116.77% sequential improvement
(2024) Stock trading at modest discount to fair value estimates
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