Value
9.5/10data confidence 83%| Component | Sub-score |
|---|---|
| P/E | 7.8 |
| P/S | 10.0 |
| EV/EBITDA | 8.8 |
| Fwd P/E | 10.0 |
| PEG | 10.0 |
- ▸Forward P/E: 3.3x
- ▸PEG: 0.01
- ▸Attractively valued
IX · Why this verdict
Why ORIX (IX) is rated HOLD
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
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VerdictHOLD
Overall score6.8/10
ConfidenceMEDIUM
MacroNEUTRAL
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
At a forward P/E of 3.3x and a PEG ratio effectively at zero, the stock offers one of the most attractive multiples in its peer group relative to earnings growth — implying that substantial earnings power is not yet reflected in the share price. Valuation breakdown | Forward P/E expands above 6x over the next 12 months as the market recognizes the earnings trajectory. | →Stable |
| CounterExtremely low multiples in diversified financial conglomerates often reflect opacity, leverage risk, or earnings quality concerns; the negative free cash flow relative to net income may indicate reported earnings are not as reliable as the multiple suggests. | ||
Revenue grew 28% year over year, placing the company among the highest-growth names in the peer group and suggesting meaningful expansion across its operating segments. Growth breakdown | Revenue growth sustains above 15% year over year for 2 consecutive quarters over the next 12 months. | →Stable |
| CounterThe most recent quarter posted an outsized 264% earnings surprise that may not be repeatable, and the prior quarter was a miss — the underlying growth may be lumpy or driven by non-recurring items rather than steady compounding. | ||
Despite solid reported profitability and a Piotroski F-Score of 8 out of 9, free cash flow is deeply negative relative to net income at -368% — meaning the business is not converting earnings into cash, which is a material risk for a financial conglomerate carrying leverage. Quality breakdown | Free cash flow turns positive and the FCF-to-net-income ratio rises above 50% for 2 consecutive quarters, demonstrating genuine cash earnings conversion. | →Stable |
| CounterFor diversified financial conglomerates, large investment deployments, working capital movements, or mark-to-market adjustments can temporarily drive reported free cash flow below zero without indicating impaired underlying economics. | ||
Price momentum has fallen below the minimum threshold required for a clean entry, accompanied by falling on-balance volume that signals active distribution — sellers are outweighing buyers even as the stock holds above its long-term moving average. Momentum breakdown | On-balance volume turns from a declining to a rising trend, sustained for 60 consecutive days, with price momentum recovering above 4.5. | →Stable |
| CounterThe momentum notes characterize the current weakness as a pullback within a longer uptrend with an RSI of 40 that may represent an entry opportunity, and the stock remains above the 200-day moving average — the downtrend in momentum is not yet confirmed as a structural reversal. | ||
At a forward P/E of 3.3x and a PEG ratio effectively at zero, the stock offers one of the most attractive multiples in its peer group relative to earnings growth — implying that substantial earnings power is not yet reflected in the share price.
→StableValuation breakdown
- Expectation
- Forward P/E expands above 6x over the next 12 months as the market recognizes the earnings trajectory.
CounterExtremely low multiples in diversified financial conglomerates often reflect opacity, leverage risk, or earnings quality concerns; the negative free cash flow relative to net income may indicate reported earnings are not as reliable as the multiple suggests.
Revenue grew 28% year over year, placing the company among the highest-growth names in the peer group and suggesting meaningful expansion across its operating segments.
→StableGrowth breakdown
- Expectation
- Revenue growth sustains above 15% year over year for 2 consecutive quarters over the next 12 months.
CounterThe most recent quarter posted an outsized 264% earnings surprise that may not be repeatable, and the prior quarter was a miss — the underlying growth may be lumpy or driven by non-recurring items rather than steady compounding.
Despite solid reported profitability and a Piotroski F-Score of 8 out of 9, free cash flow is deeply negative relative to net income at -368% — meaning the business is not converting earnings into cash, which is a material risk for a financial conglomerate carrying leverage.
→StableQuality breakdown
- Expectation
- Free cash flow turns positive and the FCF-to-net-income ratio rises above 50% for 2 consecutive quarters, demonstrating genuine cash earnings conversion.
CounterFor diversified financial conglomerates, large investment deployments, working capital movements, or mark-to-market adjustments can temporarily drive reported free cash flow below zero without indicating impaired underlying economics.
Price momentum has fallen below the minimum threshold required for a clean entry, accompanied by falling on-balance volume that signals active distribution — sellers are outweighing buyers even as the stock holds above its long-term moving average.
→StableMomentum breakdown
- Expectation
- On-balance volume turns from a declining to a rising trend, sustained for 60 consecutive days, with price momentum recovering above 4.5.
CounterThe momentum notes characterize the current weakness as a pullback within a longer uptrend with an RSI of 40 that may represent an entry opportunity, and the stock remains above the 200-day moving average — the downtrend in momentum is not yet confirmed as a structural reversal.
TrendMatrix Research · core thesis
Engine thesis — one sentence
ORIX screens as exceptionally cheap at a forward P/E of 3.3x and PEG near zero, with 28% revenue growth placing it among the highest-growth names in the peer group, but free cash flow is deeply negative relative to net income — a severe earnings quality red flag for a leveraged financial conglomerate — and weakening price momentum with active distribution makes the timing unfavorable despite the compelling valuation.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Per-dimension breakdown
Quality
6.4/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 3.5 |
| ROA | 1.7 |
| Gross margin | 4.6 |
| Op margin | 9.0 |
| Net margin | 6.7 |
| Current ratio | 7.2 |
| FCF quality | 10.0 |
| Moat | 5.6 |
| Piotroski F | 8.9 |
- ▸Excellent cash conversion: 155% FCF/NI
- ▸Strong Piotroski F-Score: 8/9
Growth
9.5/10data confidence 33%| Component | Sub-score |
|---|---|
| Rev growth | 9.5 |
- ▸Strong growth: 28% YoY
Momentum
5.0/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 5.5 |
| MACD | 0.0 |
| OBV | 10.0 |
| MA position | 9.0 |
| Volume | 0.6 |
- ▸Volume accumulation (rising OBV)
- ▸Above 200-day MA
Sentiment
5.0/10data confidence 100%| Component | Sub-score |
|---|---|
| Analyst rating | 5.0 |
| Price target | 4.9 |
| erm sentiment | 5.0 |
Insider
5.0/10data confidence 50%| Component | Sub-score |
|---|---|
| materiality | 5.0 |
| holder change | 5.0 |
- ▸Negligible insider buying — $2,418 (0.000% of mkt cap)
Peer rank
4.9/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 5.2 |
| quality rank | 4.3 |
| growth rank | 5.0 |
Technical
6.0/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 4.2 |
| support resistance | 5.4 |
| 52w position | 9.2 |
| gap | 5.0 |
Risk (lower is worse)
7.8/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 10.0 |
| days to cover | 8.7 |
| volatility | 7.5 |
| beta | 8.7 |
| debt equity | 4.0 |
Catalyst
6.2/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 5.6 |
| earnings timing | 5.0 |
| surprise avg | 10.0 |
| dividend safety | 5.2 |
- ▸Dividend: 253.0%
How the verdict was assembled
Engine trigger
Maintain position. Not compelling to add more.
Engine technical detail
verdict_path:
L4:PATH_F_HOLDPassed (7)
- MOMENTUM:5.0>=4.5
- INSIDER:OK
- 8K:CLEAN
- NEWS_EVENTS:NONE_RECENT
- EARNINGS_PROXIMITY:34d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (1)
- ASYMMETRY:-3.1=NEGATIVE
Warning (1)
- MOMENTUM:5.0<5.5 (soft — BUY_NOW allowed but watch)
Reward-to-Risk
-3.08
Upside
-15.4%
Downside
5.0%
Sizing output
AVOID
SetupRange Bound — RSI 53 mid-range, Bollinger mid-band
EdgeNo clear edge — No clear edge identified
SuitabilityModerate — Balanced profile
Investment implication
None of the engine's positive-conviction paths (C-quality, D-momentum) triggered — the F-path HOLD reflects balanced signals. Strongest-cleared gate: MOMENTUM:5.0>=4.5. Top dim: Value at 9.5; weakest: Peer rank at 4.9. No conviction either direction.
The strongest dimensions are Value at 9.5, Growth at 9.5, and Risk (lower is worse) at 7.8; the weakest are Peer rank at 4.9, Insider at 5.0, and Sentiment at 5.0. The V9 engine flagged 1 failed gate with 1 warning, producing an asymmetric reward-to-risk of -3.08 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Exceptional Valuation At Low Multiple
Trip ifForward P/E expands above 8x, indicating the valuation re-rating has largely run its course.
- P2Strong Revenue Growth Trajectory
Trip ifRevenue growth falls below 15% year over year for 2 consecutive quarters.
- P3Negative Free Cash Flow Quality
Trip ifFree cash flow turns positive and FCF-to-net-income ratio rises above 50% for 2 consecutive quarters.
- P4Momentum Deterioration And Distribution
Trip ifOn-balance volume trend turns positive and sustains for 60 consecutive days, with momentum score rising above 4.5.