Orix Corp Ads (NYSE:IX) Issues Earnings Results

Key Points

• ORIX reported record first-quarter net income of JPY 280.8 billion, reaching 53% of its unchanged JPY 530 billion full-year forecast. Core earnings improved across asset management, transportation and insurance, while capital recycling generated about JPY 300 billion in cash inflows.
• U.S.-listed ADS earnings were $1.57 per share, surpassing the $1.16 consensus estimate, although quarterly revenue of $7.06 billion fell short of the $7.37 billion forecast.
• Results remain vulnerable to Kioxia’s share price, which contributed substantially to forecast gains and could create valuation losses in the third quarter. ORIX revised its dividend policy to exclude Kioxia-related gains and losses from adjusted profit and continued its JPY 250 billion buyback plan.

Orix Corp Ads (NYSE:IX - Get Free Report) announced its quarterly earnings results on Thursday. The real estate investment trust reported $1.57 EPS for the quarter, beating analysts' consensus estimates of $1.16 by $0.41, Zacks reports. Orix Corp Ads had a net margin of 18.02% and a return on equity of 13.08%. The firm had revenue of $7.06 billion during the quarter, compared to analysts' expectations of $7.37 billion.

Here are the key takeaways from Orix Corp Ads' conference call:

• Record first-quarter net income reached JPY 280.8 billion, up JPY 173.5 billion year over year and representing 53% of the unchanged JPY 530 billion full-year forecast.
• Core earnings improved across asset management, transportation and insurance, while capital recycling generated approximately JPY 300 billion of cash inflows. ORIX also completed the ORIX Bank transfer and agreed to acquire aircraft-parts company AerFin to expand its aviation value chain.
• Results remain highly exposed to Kioxia’s share price; JPY 540 billion of the JPY 840 billion first-half forecast is non-cash Kioxia-related gains. Management noted that the share-price decline since June could result in Kioxia-related valuation losses in the third quarter.
• ORIX changed its dividend policy to base shareholder distributions on adjusted profit excluding Kioxia-related gains and losses, while maintaining the higher-of-39%-payout-ratio or prior-year dividend framework. The interim dividend is forecast at JPY 107.27 per share, and JPY 78.4 billion of the planned JPY 250 billion buyback had been completed by the end of July.

Orix Corp Ads Price Performance

Orix Corp Ads stock traded down $1.20 during trading hours on Friday, reaching $40.09. 204,047 shares of the stock were exchanged, compared to its average volume of 198,606. The stock has a 50 day moving average of $39.44 and a two-hundred day moving average of $35.20. The company has a current ratio of 1.77, a quick ratio of 1.73 and a debt-to-equity ratio of 1.30. Orix Corp Ads has a twelve month low of $24.19 and a twelve month high of $42.39. The company has a market cap of $44.51 billion, a P/E ratio of 11.07, a price-to-earnings-growth ratio of 0.89 and a beta of 0.88.

Institutional Inflows and Outflows

Several institutional investors have recently modified their holdings of IX. Sivia Capital Partners LLC bought a new stake in shares of Orix Corp Ads in the second quarter worth $247,000. Elevation Point Wealth Partners LLC bought a new stake in Orix Corp Ads during the fourth quarter valued at $205,000. Bank of Montreal Can bought a new position in shares of Orix Corp Ads during the 4th quarter worth approximately $207,000. PharVision Advisers LLC acquired a new position in shares of Orix Corp Ads during the third quarter valued at about $250,000. Finally, United Capital Financial Advisors LLC acquired a new position in shares of Orix Corp Ads during the third quarter valued at about $214,000. 1.73% of the stock is currently owned by institutional investors and hedge funds.

Analysts Set New Price Targets

Several research analysts have recently commented on IX shares. Weiss Ratings upgraded Orix Corp Ads from a "hold (c)" rating to a "hold (c+)" rating in a research note on Wednesday, July 29th. Wall Street Zen cut Orix Corp Ads from a "buy" rating to a "hold" rating in a research note on Sunday, June 7th. Finally, Zacks Research cut shares of Orix Corp Ads from a "strong-buy" rating to a "hold" rating in a report on Monday, July 27th. Two investment analysts have rated the stock with a Hold rating, According to MarketBeat, the company presently has a consensus rating of "Hold".

Orix Corp Ads Company Profile

ORIX Corporation ADS NYSE: IX is the American depositary share listing of ORIX Corporation, a diversified financial services group headquartered in Tokyo, Japan. The company operates across multiple business lines that include leasing and lending, real estate, investment and asset management, and a range of retail and corporate financial services. ORIX's ADS program allows U.S. investors to access ownership in the Tokyo-based group through shares traded on the New York Stock Exchange.

Core activities include equipment leasing and installment financing for corporate customers, corporate lending and structured finance, and real estate development and property management.

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