TANAKEN (1450) AI Stock Analysis

• Market Cap: ¥13.75B
• Dividend Yield: 3.91%
• Average Volume (3M): 6.06K
• Price to Earnings (P/E): 7.7
• Beta (1Y): 0.48
• Revenue Growth: 12.31%
• EPS Growth: 1.81%
• Country: JP
• Employees: 105
• Sector: Industrials
• Sector Strength: 72
• Industry: Engineering & Construction
• EPS (TTM): 46.13
• Shares Outstanding: 8,699,600
• 10 Day Avg. Volume: 5,380
• 30 Day Avg. Volume: 6,063
• PEG Ratio: 0.17
• Price to Book (P/B): 1.42
• Price to Sales (P/S): 0.95
• P/FCF Ratio: 5.51
• 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): N/A
• Revenue Forecast (FY): N/A

• Rating: 84 Outperform
• Price Target: ¥1,850.00 ▲(34.16% Upside)
• Action: Upgraded Date: 12/30/25
• Date: Action: Upgraded 12/30/25

The score is driven primarily by strong financial quality (high profitability and a debt-free balance sheet) and supportive valuation (low P/E with a solid dividend yield). Technicals are steady but not strongly directional, while historical cash-flow volatility remains the key risk despite the latest-year rebound.

Positive Factors

Debt-free balance sheet

Zero reported debt across 2022–2025 materially reduces financial risk and interest expense, giving the company durable flexibility to fund capex, dividends or opportunistic investments from equity and cash. This conservative structure supports resilience through downturns and strategic optionality.

Margin expansion and profitability

Sustained margin expansion to mid-to-high teens on EBIT and double-digit net margin reflects structural pricing power, operational efficiency and project profitability. Higher margins strengthen long-term earnings sustainability and ROE, enabling reinvestment and stable shareholder distributions.

Improved free cash flow conversion

Near‑one-to-one FCF-to-net-income in 2025 indicates much stronger cash conversion, improving cash available for dividends, maintenance capex and strategic spending. If sustained, this reduces reliance on external financing and signals higher earnings quality over the medium term.

Negative Factors

Cash-flow volatility

Large year-to-year swings in operating cash flow point to working-capital and project timing sensitivity. This variability complicates capital allocation, dividend predictability and reinvestment planning; a recurrence could strain liquidity despite a debt-free balance sheet.

Revenue cyclicality / top-line inconsistency

Intermittent revenue declines reflect cycle and project-timing exposure in engineering & construction. Persistent top-line unevenness makes forecasting and margin planning harder, increasing execution risk and potentially amplifying cash-flow swings during weak demand periods.

Limited scale and market liquidity

Small employee base and low average trading volume signal limited operational scale and market liquidity. This can constrain ability to bid large projects, invest in capacity, and access capital efficiently, raising idiosyncratic execution and financing risks over the medium term.

TANAKEN Business Overview & Revenue Model

Company Description

TANAKEN (1450) is a company engaged in the construction and civil engineering industry. It specializes in providing comprehensive construction services, including planning, designing, and executing various infrastructure projects. The company's core services encompass residential, commercial, and industrial construction, as well as renovation and maintenance services.

How the Company Makes Money

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TANAKEN Financial Statement Overview

Summary

Strong overall fundamentals: profitability expanded meaningfully (2025 gross margin ~26.7%, net margin ~12.8%, EBIT margin ~19.0%) and the balance sheet is exceptionally conservative with zero reported debt in 2022–2025. The main offset is cash-flow variability (notably negative/weak operating cash flow in 2021 and 2023), despite a strong rebound in 2025.

Income Statement

Profitability strengthened meaningfully: annual revenue rose from 6.7B (2020) to 12.3B (2025), and margins expanded with 2025 gross margin at ~26.7% and net margin at ~12.8% (both above prior years). Operating profitability also improved (2025 EBIT margin ~19.0%). The main weakness is top-line consistency—revenue dipped in 2024 (about -5.1%) before rebounding in 2025 (+3.1%), suggesting some cyclicality in demand.

Balance Sheet

Balance sheet is very conservative with zero reported debt in 2022–2025 (and low debt even in 2021), reducing financial risk and interest burden. Equity and assets have grown steadily (equity ~3.95B in 2020 to ~8.22B in 2025), and returns on equity are strong (mid-teens to ~19% in 2025). A key watch item is that the debt-free profile can’t fully offset operating/cash volatility if working capital swings sharply (seen in cash flow history).

Cash Flow

Cash generation is improving but has been volatile: operating cash flow swung from strongly positive (2022 ~1.90B) to negative (2023 ~-0.22B), then recovered (2024 ~0.51B) and surged in 2025 (~2.14B). Free cash flow also rebounded to ~2.12B in 2025 and is roughly in line with net income that year (free cash flow to net income ~0.99), which is a clear strength. The weakness is the uneven conversion of earnings into operating cash flow across years (notably weak/negative in 2021 and 2023), which raises execution and working-capital timing risk.

Breakdown	TTM	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	13.08B	12.29B	10.68B	11.25B	9.82B	9.01B
Gross Profit	3.36B	3.27B	2.46B	2.31B	2.11B	2.06B
EBITDA	2.39B	2.38B	1.66B	1.59B	1.45B	1.46B
Net Income	1.59B	1.58B	1.09B	1.09B	967.39M	982.27M
Balance Sheet
Total Assets	10.73B	11.42B	9.16B	8.04B	7.07B	7.03B
Cash, Cash Equivalents and Short-Term Investments	5.02B	4.12B	2.40B	2.28B	2.98B	1.71B
Total Debt	0.00	0.00	0.00	0.00	0.00	300.00M
Total Liabilities	2.65B	3.20B	2.17B	1.82B	1.63B	2.25B
Stockholders Equity	8.07B	8.22B	6.99B	6.22B	5.44B	4.78B
Cash Flow
Free Cash Flow	0.00	2.12B	405.68M	-263.51M	1.88B	-12.44M
Operating Cash Flow	0.00	2.14B	510.81M	-222.20M	1.90B	23.69M
Investing Cash Flow	0.00	-78.29M	-43.94M	-154.21M	-41.94M	-64.45M
Financing Cash Flow	0.00	-348.44M	-348.02M	-317.36M	-595.55M	125.87M

TANAKEN Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 1379.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:1450, the sentiment is Positive. The current price of 1379 is below the 20-day moving average (MA) of 1590.70, below the 50-day MA of 1514.98, and below the 200-day MA of 1438.10, indicating a neutral trend. The MACD of 19.20 indicates Positive momentum. The RSI at 52.90 is Neutral, neither overbought nor oversold. The STOCH value of 23.97 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:1450.

TANAKEN Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
1450	84 Outperform	¥13.75B	7.69	―	3.91%	12.31%	1.81%
1966	77 Outperform	¥13.50B	34.60	―	3.97%	5.33%	-27.53%
1807	71 Outperform	¥11.94B	8.32	―	4.39%	2.65%	45.12%
1434	70 Outperform	¥13.60B	6.39	―	2.65%	28.80%	5.92%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
1844	62 Neutral	¥11.25B	11.79	―	2.74%	4.36%	17.63%
1848	46 Neutral	¥10.19B	190.24	―	2.33%	7.66%	562.50%