Tokyu Construction Co., Ltd. (1720) AI Stock Analysis

• Market Cap: ¥139.86B
• Dividend Yield: 2.84%
• Average Volume (3M): 240.02K
• Price to Earnings (P/E): 13.1
• Beta (1Y): 0.56
• Revenue Growth: 20.38%
• EPS Growth: 128.85%
• Country: JP
• Employees: 2,877
• Sector: Industrials
• Sector Strength: 72
• Industry: Engineering & Construction
• EPS (TTM): 25.28
• Shares Outstanding: 106,761,210
• 10 Day Avg. Volume: 210,860
• 30 Day Avg. Volume: 240,016
• PEG Ratio: -1.40
• Price to Book (P/B): 0.83
• Price to Sales (P/S): 0.29
• P/FCF Ratio: 2.19
• 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: Hold
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 69 Neutral
• Price Target: ¥1,398.00 ▲(4.25% Upside)

Tokyu Construction Co., Ltd. demonstrates a strong financial performance with robust cash flow and a stable balance sheet. The technical analysis shows bullish momentum, although caution is advised due to overbought indicators. The valuation is reasonable with a fair P/E ratio and attractive dividend yield.

Positive Factors

Revenue Growth

The company's strong revenue growth indicates an expanding market presence and successful project execution, supporting long-term business sustainability.

Cash Flow Management

Effective cash flow management ensures operational efficiency and financial health, providing the company with the flexibility to invest in growth opportunities.

Balance Sheet Health

A strong balance sheet with controlled debt levels enhances financial stability and reduces risk, supporting long-term strategic initiatives.

Negative Factors

Profit Margins

While profitability is improving, the relatively low net profit margin suggests limited pricing power and potential vulnerability to cost increases.

Industry Competition

The competitive nature of the construction industry may pressure margins and require continuous innovation to maintain market position.

Modest Equity Returns

Moderate return on equity indicates that while the company is profitable, it may not be maximizing shareholder value compared to industry peers.

Tokyu Construction Co., Ltd. Business Overview & Revenue Model

Company Description

Tokyu Construction Co., Ltd. (1720) is a prominent construction company based in Japan, primarily engaged in civil engineering, building construction, and various infrastructure projects. The company operates across several sectors, including residential, commercial, and public works, offering a comprehensive range of services from project planning and design to construction management and maintenance. Tokyu Construction is known for its commitment to quality, innovation, and sustainability in its construction practices.

How the Company Makes Money

Tokyu Construction generates revenue through several key streams, primarily from its construction projects in civil engineering and building construction. The company undertakes contracts for public and private sector projects, which include infrastructure development such as roads, bridges, and urban facilities. Additionally, Tokyu Construction earns income by providing specialized services such as project management, design, and consultation. Significant partnerships with government agencies, real estate developers, and other construction firms also contribute to its revenue, allowing the company to secure large-scale contracts and diversify its project portfolio. Moreover, the firm benefits from the increasing demand for infrastructure development in Japan, driven by urbanization and government investment in public works.

Tokyu Construction Co., Ltd. Financial Statement Overview

Summary

Tokyu Construction Co., Ltd. showcases a solid financial performance with improvements in profitability and cash flow generation. The company has a stable balance sheet with a strong equity position and manageable debt levels.

Income Statement

Tokyu Construction Co., Ltd. shows a positive trajectory in profitability with an improving gross profit margin and net profit margin over the past few years. The company achieved a gross profit margin of 9.80% and a net profit margin of 2.26% in the latest period. Despite a modest revenue growth, the stability in EBIT and EBITDA margins indicates efficient cost management. The company has recovered from a negative EBIT margin in 2022 to a positive one in 2025.

Balance Sheet

The balance sheet reflects a strong equity position with a favorable equity ratio of 37.06%. The debt-to-equity ratio is 0.27, indicating prudent leverage management. Return on equity stands at 6.52%, showing moderate profitability relative to shareholder equity. Overall, the balance sheet portrays a stable financial position with manageable debt levels.

Cash Flow

Tokyu Construction Co., Ltd. demonstrates robust cash flow management, with a significant improvement in free cash flow, which increased substantially from previous negative levels. The operating cash flow to net income ratio is 6.14, indicating strong cash generation relative to net income. The improvement in free cash flow and operating cash flow highlights effective operational efficiency and financial health.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	309.84B	293.14B	285.68B	288.87B	258.08B	231.48B
Gross Profit	32.03B	28.72B	26.08B	21.88B	9.72B	18.17B
EBITDA	15.26B	11.49B	11.42B	9.10B	-3.32B	6.17B
Net Income	8.15B	6.63B	7.27B	5.25B	-7.46B	2.65B
Balance Sheet
Total Assets	249.80B	274.31B	264.52B	249.16B	237.81B	226.57B
Cash, Cash Equivalents and Short-Term Investments	37.49B	39.67B	32.12B	58.72B	38.65B	34.17B
Total Debt	22.67B	27.20B	55.02B	22.21B	22.66B	26.92B
Total Liabilities	148.27B	171.64B	163.74B	153.15B	144.75B	123.06B
Stockholders Equity	100.49B	101.64B	99.97B	95.25B	92.49B	102.96B
Cash Flow
Free Cash Flow	0.00	38.53B	-55.69B	19.73B	10.24B	8.28B
Operating Cash Flow	0.00	41.20B	-54.02B	20.39B	12.20B	11.63B
Investing Cash Flow	0.00	-1.59B	-1.40B	2.40B	-476.00M	-3.75B
Financing Cash Flow	0.00	-31.88B	28.52B	-2.76B	-7.53B	-3.31B

Tokyu Construction Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 1341.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:1720, the sentiment is Positive. The current price of 1341 is above the 20-day moving average (MA) of 1282.20, above the 50-day MA of 1160.56, and above the 200-day MA of 1000.46, indicating a bullish trend. The MACD of 54.59 indicates Negative momentum. The RSI at 69.79 is Neutral, neither overbought nor oversold. The STOCH value of 69.53 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:1720.

Tokyu Construction Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
1860	76 Outperform	¥387.36B	12.31	―	2.73%	18.92%	73.08%
1820	75 Outperform	¥227.59B	12.65	―	3.82%	-3.72%	59.02%
1890	75 Outperform	¥163.72B	18.28	―	5.05%	12.80%	34.19%
1835	73 Outperform	¥154.91B	12.09	―	3.44%	11.25%	36.92%
1720	69 Neutral	¥139.86B	13.11	―	2.84%	20.38%	128.85%
1879	67 Neutral	¥118.56B	8.69	―	2.81%	-3.99%	13.29%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%

Tokyu Construction Co., Ltd. Corporate Events

Tokyu Construction Boosts Investment in Guam Subsidiary

Tokyu Construction Co., Ltd. has announced an additional investment in its subsidiary, TC Pacific Construction, LLC, based in Guam. This move aims to stabilize the subsidiary’s financial and operational foundation, classifying it as a specified subsidiary due to the investment now representing 10% or more of Tokyu’s capital. The impact on Tokyu’s consolidated business results is expected to be minimal.

Tokyu Construction Boosts Profitability and Invests in Human Capital

Tokyu Construction Co., Ltd. has reported an improvement in profitability for its domestic construction business, leading to an upward revision of its full-year earnings forecast for FY03/2026. The company is actively involved in the redevelopment project around Shibuya Station, aiming to enhance the area’s value and strengthen its competitive advantage. Additionally, Tokyu Construction is focusing on strengthening its investment in human capital to transform its business portfolio and maximize the potential of its workforce.

Tokyu Construction Revises Earnings Forecast with Mixed Outlook

Tokyu Construction Co., Ltd. has revised its earnings forecast for the fiscal year ending March 31, 2026, reflecting a mixed outlook. While the company anticipates a decrease in net sales due to delays in foreign subsidiaries, it expects significant increases in operating, ordinary, and attributable profits due to improved profitability in domestic projects and reduced interest expenses. The dividend forecast remains unchanged, maintaining a target dividend on equity ratio of 4.0% or more.