Nippon Aqua Co., Ltd. (1429) AI Stock Analysis

• Market Cap: ¥23.46B
• Dividend Yield: 3.79%
• Average Volume (3M): 68.25K
• Price to Earnings (P/E): 14.5
• Beta (1Y): 0.43
• Revenue Growth: 16.35%
• EPS Growth: 27.66%
• Country: JP
• Employees: 612
• Sector: Industrials
• Sector Strength: 72
• Industry: Construction Materials
• EPS (TTM): 22.23
• Shares Outstanding: 34,760,000
• 10 Day Avg. Volume: 63,090
• 30 Day Avg. Volume: 68,246
• PEG Ratio: 9.77
• Price to Book (P/B): 2.37
• Price to Sales (P/S): 0.82
• P/FCF Ratio: 26.52
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): 79.9
• Revenue Forecast (FY): ¥37.80B

• Rating: 66 Neutral
• Price Target: ¥784.00 ▼(-9.15% Downside)
• Action: Reiterated Date: 02/18/26
• Date: Action: Reiterated 02/18/26

The score is led by solid financial performance (strong 2025 growth, acceptable leverage) but held back by inconsistent cash flow conversion and softer margins. Valuation is supportive due to a reasonable P/E and attractive dividend, while technicals remain weaker with the stock below key moving averages and negative momentum indicators.

Positive Factors

Nationwide installation/service network

A nationwide installation and service network is a durable competitive asset for building-related services. It supports reliable project execution, strong local relationships with homebuilders, lower acquisition friction, and scaleable service delivery that sustains recurring installation demand over multiple years.

Strong recent revenue acceleration

A material acceleration in revenue demonstrates validated demand and successful scaling of the business model. Sustained top-line expansion increases fixed-cost leverage, funds operational investments, and can enhance negotiating power with suppliers and builders, supporting longer-term growth execution.

Manageable leverage with healthy ROE

Moderate leverage combined with a healthy ROE indicates efficient capital deployment and financial flexibility. This balance sheet profile supports reinvestment, dividend capacity or selective M&A while still leaving room to absorb cyclical shocks if operational performance softens.

Negative Factors

Volatile cash generation and FCF conversion

Inconsistent operating cash flow and intermittent negative free cash flow indicate working-capital and project timing volatility. Irregular cash conversion undermines the reliability of internal funding for capex, dividends or debt servicing, increasing execution and refinancing risk over the medium term.

Margin compression since 2023

Falling margins point to rising input or labour costs and/or pricing pressure in the core markets. Reduced profitability limits cash flow available for reinvestment and debt reduction, and lowers resilience against cost inflation or volume downturns over the coming months.

Step-up in absolute debt levels

A significant increase in absolute debt, even with manageable ratios, heightens interest and refinancing obligations. If profitability or cash conversion weakens, elevated debt hampers strategic optionality and increases vulnerability to higher funding costs or constrained capital allocation decisions.

Nippon Aqua Co., Ltd. Business Overview & Revenue Model

Company Description

Nippon Aqua Co., Ltd. manufactures and sells building materials in Japan. It offers energy-saving products, such as AQUA FOAM, an on-site spray polyurethane foam insulation material; heat insulating sheets; spacers; A1 and B type for buildings; and AQUA FOAM NEO materials. The company also develops, manufactures, and sells merchandise related for energy saving housing. It offers its products for detached houses and buildings. The company was incorporated in 2004 and is headquartered in Tokyo, Japan. Nippon Aqua Co., Ltd. operates as a subsidiary of Hinokiya Group Co.,Ltd.

How the Company Makes Money

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Nippon Aqua Co., Ltd. Financial Statement Overview

Summary

Strong revenue acceleration in 2025 and solid sector profitability support the score, but margin compression versus 2023 and notably volatile operating/free cash flow reduce confidence in earnings quality. Leverage is manageable, though rising absolute debt since 2023 is a watch item.

Income Statement

Revenue has grown consistently over the last several years, accelerating in 2025 (annual revenue growth of ~162% vs. mid-to-high single digits in prior years). Profitability is solid for the sector, with 2025 gross margin ~23% and operating margin ~8%. That said, margins have compressed from 2023 highs (net margin ~7.1% in 2023 vs. ~5.6% in 2025), indicating higher costs and/or pricing pressure despite the strong top-line expansion.

Balance Sheet

Leverage looks manageable with debt-to-equity around ~0.41 in 2025, and equity has grown steadily alongside assets. Returns on equity remain healthy (~16% in 2025), though down from peak levels in 2023 (~21.5%), consistent with the recent margin softening. A key watch item is the step-up in absolute debt since 2023 (from ~2.45B to ~4.81B), which reduces balance-sheet flexibility if profitability weakens.

Cash Flow

Cash generation is volatile. Operating cash flow swung from negative in 2022 and 2024 to strongly positive in 2023 and back to positive in 2025, suggesting working-capital or project-timing noise. In 2025, free cash flow (~1.04B) covered about ~69% of net income, which is decent, but the lack of consistency (including negative free cash flow in 2022 and 2024) raises execution and cash conversion risk.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	33.14B	33.67B	30.27B	28.34B	25.67B	23.90B
Gross Profit	7.45B	7.72B	6.66B	6.72B	5.59B	4.56B
EBITDA	3.04B	2.99B	2.90B	3.12B	2.55B	1.62B
Net Income	2.01B	1.90B	1.84B	2.00B	1.55B	953.80M
Balance Sheet
Total Assets	23.28B	25.81B	24.08B	20.40B	21.98B	18.29B
Cash, Cash Equivalents and Short-Term Investments	1.78B	2.42B	2.26B	2.03B	2.68B	1.93B
Total Debt	4.42B	4.81B	4.58B	2.45B	6.11B	3.28B
Total Liabilities	13.07B	14.18B	13.53B	11.10B	14.01B	10.34B
Stockholders Equity	10.21B	11.63B	10.55B	9.30B	7.97B	7.95B
Cash Flow
Free Cash Flow	0.00	1.04B	-698.84M	3.73B	-569.13M	192.58M
Operating Cash Flow	0.00	1.51B	-516.52M	4.02B	-297.74M	520.50M
Investing Cash Flow	0.00	-603.12M	-338.41M	-385.20M	-293.25M	-355.36M
Financing Cash Flow	0.00	-755.49M	1.08B	-4.28B	1.34B	109.78M

Nippon Aqua Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 863.00
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Positive
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:1429, the sentiment is Negative. The current price of 863 is above the 20-day moving average (MA) of 796.25, above the 50-day MA of 847.14, and above the 200-day MA of 835.21, indicating a bearish trend. The MACD of -30.23 indicates Positive momentum. The RSI at 27.54 is Positive, neither overbought nor oversold. The STOCH value of 8.69 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:1429.

Nippon Aqua Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
5288	80 Outperform	¥54.32B	7.15	―	3.25%	9.50%	77.72%
3157	77 Outperform	¥21.57B	10.16	―	3.07%	13.22%	28.90%
5268	69 Neutral	¥12.29B	18.59	―	1.24%	-2.82%	-44.93%
1429	66 Neutral	¥23.46B	14.52	22.09%	3.79%	16.35%	27.66%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
5269	49 Neutral	¥18.18B	743.26	―	3.24%	-3.73%	-143.19%
6173	41 Neutral	¥1.50B	-4.30	―	―	-41.75%	-116.16%

Nippon Aqua Co., Ltd. Corporate Events

Nippon Aqua Updates Capital-Efficient Management Strategy as ROE Remains Well Above Cost of Equity

Nippon Aqua reported that its price-to-book ratio has stayed between 2.3 and 3.3 times over the past six years, reaching 2.4 times in 2025 as higher valuation multiples offset a slight decline in return on equity. Despite this moderation, ROE has consistently far exceeded the company’s roughly 5% cost of equity, supporting management’s emphasis on capital efficiency and shareholder value.

Under its medium-term plan through fiscal 2026, the company targets a sustainable growth rate of 10%, ROE of 20%, an operating margin of 10%, and a 50% dividend payout ratio, but 2025 results fell short amid strategic pricing, market changes, and project mix effects. Management argues these moves, along with continued dialogue with investors and a focus on maintaining ROE above the cost of equity, should bolster profitability and corporate value over the medium to long term.

The most recent analyst rating on (JP:1429) stock is a Buy with a Yen825.00 price target. To see the full list of analyst forecasts on Nippon Aqua Co., Ltd. stock, see the JP:1429 Stock Forecast page.

Nippon Aqua Announces Changes to Audit and Supervisory Committee Directors

Nippon Aqua Co., Ltd. has announced changes to its Audit and Supervisory Committee membership, with External Director and full-time Audit and Supervisory Committee Member Noriyuki Utsumi set to resign for personal reasons at the close of the regular shareholders’ meeting on March 30, 2026. The company has nominated Shosaku Shimomura as the new External Director and Audit and Supervisory Committee Member, with plans to register him as an independent officer under Tokyo Stock Exchange rules for the remainder of his predecessor’s term, signaling continuity in its governance and oversight framework.

These board changes underscore Nippon Aqua’s effort to maintain compliance with exchange regulations and preserve an independent audit function, which is important for investor confidence and regulatory transparency. While the shift is framed as a routine personnel change, it may be watched by stakeholders as an indicator of how the company manages succession in key governance roles and sustains robust supervisory structures in line with Japan’s evolving corporate governance norms.

The most recent analyst rating on (JP:1429) stock is a Buy with a Yen916.00 price target. To see the full list of analyst forecasts on Nippon Aqua Co., Ltd. stock, see the JP:1429 Stock Forecast page.

Nippon Aqua Corrects Ordinary Profit Comparison in 2026 Forecast

Nippon Aqua Co., Ltd. has issued a correction to its previously announced business results for the fiscal year ended December 2025, after discovering that a key comparison in its financial forecast used the wrong base year. The company clarified that ordinary profit projections for the fiscal year ending December 2026 should have been compared with actual results for 2025 rather than 2024, and adjusted the referenced prior-year ordinary profit figure from 2,604 million yen to 2,794 million yen, revising the indicated year-on-year change to plus 4.1%.

The most recent analyst rating on (JP:1429) stock is a Hold with a Yen933.00 price target. To see the full list of analyst forecasts on Nippon Aqua Co., Ltd. stock, see the JP:1429 Stock Forecast page.

Nippon Aqua Lifts FY2025 Sales 11% on Strong Housing and Waterproofing Demand

Nippon Aqua reported net sales of 33.67 billion yen for the fiscal year ended December 2025, an 11.3% year-on-year increase driven by strong demand across its core divisions and successful market share expansion. The Single-family Homes Division benefited from higher orders from wide-area and major builders, while growing interest in higher performance housing classes supported new orders.

The Buildings Division maintained stable performance despite delays in some large projects, with expectations that construction start delays will ease in the second half of fiscal 2026 as the order pipeline remains solid. The Waterproofing Division more than doubled sales on the back of large-scale projects, increasing repeat non-residential renovation work and new apartment construction, underscoring progress in diversifying the company’s revenue base and strengthening its positioning in the construction and renovation market.

The most recent analyst rating on (JP:1429) stock is a Hold with a Yen933.00 price target. To see the full list of analyst forecasts on Nippon Aqua Co., Ltd. stock, see the JP:1429 Stock Forecast page.

Nippon Aqua Lifts Sales, Strengthens Balance Sheet and Keeps Dividend as 2026 Growth Slows

Nippon Aqua Co., Ltd. reported non-consolidated results for the year ended December 31, 2025, with net sales rising 11.3% to ¥33.67 billion and operating profit up 7.7% to ¥2.77 billion, while profit grew 3.1% to ¥1.89 billion, indicating moderated but continued earnings expansion. Financial position also strengthened, as total assets increased to ¥25.81 billion, shareholders’ equity ratio improved to 45.1%, operating cash flow swung to a positive ¥1.51 billion, and the annual dividend was raised to ¥35 per share, even as profitability ratios eased slightly.

For 2026, the company forecasts net sales of ¥37.0 billion and profit of ¥1.97 billion, implying further top-line growth of 9.9% and modest profit expansion of about 4%, though it anticipates a weaker first half with double-digit declines in interim profits before recovery later in the year. The maintained dividend forecast of ¥35 per share, together with a payout ratio projected in the mid-50% range and a reduction in treasury shares, underscores a shareholder-return focus, while improved cash generation and a stronger balance sheet may give the company more flexibility to navigate market conditions in the construction-related sector.

The most recent analyst rating on (JP:1429) stock is a Hold with a Yen933.00 price target. To see the full list of analyst forecasts on Nippon Aqua Co., Ltd. stock, see the JP:1429 Stock Forecast page.

Nippon Aqua Completes Restricted Stock Treasury Share Disposal with Reduced Allottees

Nippon Aqua has completed the payment process for a disposal of treasury shares used as restricted stock compensation for employees, a move aimed at strengthening its stock-based remuneration framework and employee incentives. Due to 33 employees no longer meeting eligibility requirements at the time of allocation, the number of shares to be disposed of was reduced from 350,000 to 323,000, cutting the total disposal value from ¥299.95 million to ¥276.81 million and narrowing the number of allottees from 200 to 167, with the company stating that the impact on current-term performance is not material.

The most recent analyst rating on (JP:1429) stock is a Hold with a Yen945.00 price target. To see the full list of analyst forecasts on Nippon Aqua Co., Ltd. stock, see the JP:1429 Stock Forecast page.