Amazing Cash Flow Generator: MatsumotoKiyoshi Holdings

Market has rewarded MatsumotoKiyoshi Holdings aplenty

1

Stock: MatsumotoKiyoshi Holdings Co Ltd  (3088.T)

MatsumotoKiyoshi Holdings, a ¥452.9 billion chain stores, and a retail business operator has provided an impressive 45.7% total return so far this year while trades at PE ratio 21x, PB ratio 2.3x, and PS ratio 0.8x.

According to its website, the 85-year-old has acquired 19% of the population in terms of customer baseline.

As of June, MatsumotoKiyoshi had ¥40.7 billion in cash and ¥0 debt. Its equity also has risen ¥14.5 billion to ¥188.5 billion.

In the past three years, the chain store operator allocated ¥16.9 billion in capital expenditures, reduced its overall debt by ¥5.6 billion, generated an impressive ¥47 billion in free cash flow and provided ¥18.6 billion in dividends and share repurchases.

Using historical revenue growth multiplied with recent PS averages followed with a 10% margin indicated a per share figure of ¥4,823.72 compared to ¥8,290 per share at the time of writing.

In summary, MatsumotoKiyoshi certainly is a great cash flow generator. Knowing that chain stores operate at the narrow margin, the company has maintained steady business growth and $0 debt in recent years.

Nonetheless, the company is wonderfully priced at the moment and is, therefore, a pass.

Disclosure: No shares in MatsumotoKiyoshi.

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