What is East Japan Railway Co Financial Strength?
East Japan Railway Co has the Financial Strength Rank of 2. It displays poor financial strength and is likely in financial distress. Usually this is caused by too much debt for the company.
Warning Sign:
East Japan Railway Co displays poor financial strength. Usually, this is caused by too much debt for the company.
GuruFocus Financial Strength Rank measures how strong a company's financial situation is. It is based on these factors:
1. The debt burden that the company has as measured by its
Interest Coverage (current year). The higher, the better.
2. Debt to revenue ratio. The lower, the better.
3.
Altman Z-Score.
East Japan Railway Co's Interest Coverage for the quarter that ended in Dec. 2023 was 5.90.
East Japan Railway Co's debt to revenue ratio for the quarter that ended in Dec. 2023 was 1.64.
As of today, East Japan Railway Co's Altman Z-Score is 1.01.
Competitive Comparison of East Japan Railway Co's Financial Strength
For the Railroads subindustry, East Japan Railway Co's Financial Strength, along with its competitors' market caps and Financial Strength data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
East Japan Railway Co's Financial Strength Distribution in the Transportation Industry
For the Transportation industry and Industrials sector, East Japan Railway Co's Financial Strength distribution charts can be found below:
* The bar in red indicates where East Japan Railway Co's Financial Strength falls into.
East Japan Railway Co Financial Strength Calculation
GuruFocus Financial Strength Rank measures how strong a company's financial situation is. It is based on these factors
A company ranks high with financial strength is likely to withstand any business slowdowns and recessions.
1. The debt burden that the company has as measured by its Interest Coverage (current year). The higher, the better.
Note: If both Interest Expense and Interest Income are empty, while Net Interest Income is negative, then use Net Interest Income as Interest Expense.
Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company's Operating Income (EBIT) by its Interest Expense:
East Japan Railway Co's Interest Expense for the
months ended in Dec. 2023 was 円-18,092 Mil. Its Operating Income for the
months ended in Dec. 2023 was 円106,713 Mil. And its Long-Term Debt & Capital Lease Obligation for the quarter that ended in Dec. 2023 was 円4,257,503 Mil.
East Japan Railway Co's Interest Coverage for the quarter that ended in Dec. 2023 is
The higher the ratio, the stronger the company's financial strength is.
Warning Sign:
Ben Graham prefers companies' interest coverage to be at least 5. East Japan Railway Co interest coverage is 4.8, which is low.
2. Debt to revenue ratio. The lower, the better.
East Japan Railway Co's Debt to Revenue Ratio for the quarter that ended in Dec. 2023 is
3. Altman Z-Score.
Z-Score model is an accurate forecaster of failure up to two years prior to distress. It can be considered the assessment of the distress of industrial corporations.
The zones of discrimination were as such:
When Z-Score is less than 1.81, it is in Distress Zones.
When Z-Score is greater than 2.99, it is in Safe Zones.
When Z-Score is between 1.81 and 2.99, it is in Grey Zones.
East Japan Railway Co has a Z-score of 1.01, indicating it is in Distress Zones. This implies bankrupcy possibility in the next two years.
Warning Sign:
Altman Z-score of 1.01 is in distress zone. This implies bankruptcy possibility in the next two years.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
East Japan Railway Co (TSE:9020) Business Description
Traded in Other Exchanges
Address
2-2, Yoyogi 2-chome, Shibuya-ku, Tokyo, JPN, 151-8578
East Japan Railway Company, or JR East, is the largest railway operator in Japan. It was originally established when the government-owned nationwide railway operator underwent a six-way territorial split in 1987, though it wasn't fully privatized until 2002. It runs both long distance bullet trains, known as Shinkansen, and shorter municipal train routes around and from Tokyo. Its 7,400 kilometers of rail track covers half of Japan's population and a third of the country's land area. Two thirds of revenue is from transportation, with most of the rest from retail operations and real estate investments.
East Japan Railway Co (TSE:9020) Headlines
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