SEIKO EPSON CORPORAT

6724
End-of-day quote. End-of-day quote  - 10/29
1127JPY -1.40%

Seiko Epson Corporation : The scenario of a decline should be the first

Nicolas Aleksy
Contributor / Partner

Strategy published on : 10/15/2020 | 05:48

short sell
Target price hit

Entry price : 1141¥
Target : 1050¥
Stop-loss : 1210¥
Potential : 7.98%

The formation of a downward move has been set off, triggered by an increase in trading volume and volatility.
Investors should open a short trade and target the ¥ 1050.

Summary

● The company usually posts poor financials for mid or long term investments.

● For a short-term investment strategy, the company has poor fundamentals.


Strengths

● The current area is a good opportunity for investors interested in buying the stock in a mid or long-term perspective. Indeed, the share is moving closer to its lower bound at JPY 983 JPY in weekly data.

● The company is one of the best yield companies with high dividend expectations.


Weaknesses

● According to Standard & Poor's' forecast, revenue growth prospects are expected to be very low for the next fiscal years.

● The company sustains low margins.

● Prospects from analysts covering the stock are not consistent. Such dispersed sales estimates confirm the poor visibility into the group's activity.

● With an expected P/E ratio at 65.34 and 16.95 respectively for both the current and next fiscal years, the company operates with high earnings multiples.

● The sales outlook for the group was lowered in the last twelve months. This change in forecast points out a decline in activity as well as pessimistic analyses of the company.

● For the last twelve months, sales expectations have been significantly downgraded, which means that less important sales volumes are expected for the current fiscal year over the previous period.

● Analysts covering the stock have recently lowered their earnings forecast.

● For the last four months, earnings estimated by analysts have been revised downwards with respect to the next two years.

● For the last 12 months, analysts have been regularly downgrading their EPS expectations. Analysts predict worse results for the company against their predictions a year ago.

● Most analysts recommend that the stock should be sold or reduced.

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