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Tokyo Century (TSE:8439) has drawn fresh attention after a recent one day share gain of 2.6%. This has prompted investors to reassess how its share performance lines up with its current earnings profile and valuation metrics.
See our latest analysis for Tokyo Century.
That 2.6% one day share price return comes on top of a 16.2% 90 day share price return and a 51.3% total shareholder return over the past year, which suggests momentum has been building rather than fading recently.
If Tokyo Century’s recent move has you thinking more broadly about financials, this could be a good moment to check out fast growing stocks with high insider ownership for other ideas that are catching investors’ attention.
With Tokyo Century trading slightly above analyst price targets and modelled intrinsic value, yet posting a 51.3% total return over the past year, you have to ask yourself whether there is still a buying opportunity here or if the market is already pricing in future growth.
On a simple earnings yardstick, Tokyo Century’s current share price of ¥2,164 sits on a P/E of 7.8x, which screens as low against several benchmarks.
The P/E ratio tells you how much you are paying for each unit of current earnings, and it is a common shorthand for how the market is weighing a company’s profit power. For Tokyo Century, that 7.8x figure is described as good value compared to the broader JP market P/E of 14.9x and the JP Diversified Financial industry average of 13x.
It is also flagged as good value both relative to peers, where the average P/E sits at 20.2x, and against an estimated fair P/E of 14.3x that our fair ratio work suggests the share could trade towards. Taken together, those comparison points indicate the market is putting a lower price on Tokyo Century’s earnings than on many similar companies, even though the company has reported 69.4% earnings growth over the past year and 20.5% per year over 5 years.
Explore the SWS fair ratio for Tokyo Century
Result: Price-to-Earnings of 7.8x (UNDERVALUED)
However, you still need to consider the recent annual net income decline of 4.5% and the share price, which is trading about 2% above analyst targets.
Find out about the key risks to this Tokyo Century narrative.
While the P/E work suggests Tokyo Century looks inexpensive, our DCF model points the other way. With the share price at ¥2,164 versus an estimated future cash flow value of ¥1,993.2, the stock screens as overvalued on this method. This raises the question of which yardstick you trust more.
Look into how the SWS DCF model arrives at its fair value.
8439 Discounted Cash Flow as at Jan 2026
Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out Tokyo Century for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover 878 undervalued stocks based on their cash flows. If you save a screener we even alert you when new companies match – so you never miss a potential opportunity.
If this view does not quite fit how you see Tokyo Century, or you prefer to work from your own data checks, you can build a custom thesis in just a few minutes with Do it your way.
A great starting point for your Tokyo Century research is our analysis highlighting 5 key rewards and 3 important warning signs that could impact your investment decision.
If Tokyo Century has sharpened your focus, do not stop here. Use the Screener to surface fresh ideas that might fit your plan before the crowd catches on.
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
Companies discussed in this article include 8439.T.
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