Residual Income – Mid Caps

Following the same methodology as Part 1 of this series, we now look at Residual Income for Mid Caps. As absolute amounts are small, the reviews for mid and small caps will only look at amounts scaled by market cap.

TTM Residual Income Descending % of Market Cap – Mid Cap

The list is dominated by 12 construction, 5 auto-parts and 4 real estate companies. All of the stocks have upside to a no-growth valuation with the average upside being 149%. Of the 10 companies that saw Residual Income decline over the last 12 months, only Seikitoku, Hokuriku Electric. FJ Next, and Ohashi Technia saw double digit stock price gains over the last year. The average one-year change in stock price was 30%. Only Kasai Kogyo and Nichrin are overbought. Japan Analytics preferred stocks from this list are Yachiyo (223% upside) and Aichi Electric (212% upside).

TTM Residual Income Ascending % of Market Cap – Mid Cap

 

The worst 30 list is more diverse. Half of the companies has lost money over the last twelve months and half have seem Residual Income decline. The average stock price for this group has risen by 5% over 12 months with the best returns concentrated on companies that show rising Residual Income. None of the stocks have upside and the average downside to a no-growth valuation is 154%

TTM Residual Income 12-Month Change % of Market Cap Descending – Mid Cap

 

The average gain of stocks on this list over the last year was 55%. Apart from Yachiyo, attractive stocks are Fuji Oil (85% upside), Toho Zinc (71% upside), Hoosiers (87% upside) and Raysum (101% upside).

TTM Residual Income 12-Month Change % of Market Cap Ascending – Mid Cap

 

Of note here are former high-flyers Nichi-iko, Avex and Laox. Yutaka Giken, FJ Next and AT-Group offer substantial upside if they can reverse their Residual Income decline.

 

Part 3 will finish with Small Caps.