NIHON DENGI CO., LTD. (1723) AI Stock Analysis

• Market Cap: ¥168.38B
• Dividend Yield: 1.83%
• Average Volume (3M): 39.50K
• Price to Earnings (P/E): 11.7
• Beta (1Y): 0.78
• Revenue Growth: 22.05%
• EPS Growth: 52.10%
• Country: JP
• Employees: 897
• Sector: Technology
• Sector Strength: 88
• Industry: Hardware, Equipment & Parts
• EPS (TTM): 169.46
• Shares Outstanding: 16,395,000
• 10 Day Avg. Volume: 54,040
• 30 Day Avg. Volume: 39,500
• PEG Ratio: 0.25
• Price to Book (P/B): 1.53
• Price to Sales (P/S): 1.40
• P/FCF Ratio: 7.52
• 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): 502.1
• Revenue Forecast (FY): ¥48.00B

• Rating: 78 Outperform
• Price Target: ¥11,605.00 ▲(130.72% Upside)
• Action: Reiterated Date: 02/13/26
• Date: Action: Reiterated 02/13/26

The score is driven primarily by strong financial performance (profitability, growth, low leverage, and excellent cash flow). Technicals are supportive but tempered by overbought signals (high RSI/Stoch). Valuation is the main constraint given a mid-20s P/E and a modest dividend yield.

Positive Factors

High profitability margins

Sustained high gross and net margins signal durable pricing power and operational efficiency in the core hardware business. Margins at these levels support reinvestment, buffer downturns, and enable consistent profitability even if top-line growth moderates over the medium term.

Excellent cash generation

Very strong FCF growth and cash conversion ratios show the company converts earnings to cash reliably. This underpins capital allocation flexibility for capex, dividends, or buybacks, reduces reliance on external financing, and supports sustainable investment in growth initiatives.

Very low leverage and strong equity base

Minimal financial leverage and a high equity ratio materially reduce balance-sheet risk and interest burden. Combined with a healthy ROE, this capital structure supports resilience through cycles, capacity for opportunistic M&A, and long-term strategic flexibility.

Negative Factors

Limited forward guidance

Absence of formal guidance or substantive earnings-call disclosures reduces visibility into management's near-term outlook and strategic priorities. For investors and planners, this makes forecasting harder and can delay market recognition of medium-term operational changes or new initiatives.

Modest dividend income support

A low dividend yield means the stock provides limited recurring cash return to yield-focused investors. Over the medium term, this can constrain the investor base to growth-focused holders and reduces the company's ability to attract income-oriented capital without raising payout or buyback activity.

Few disclosed strategic corporate events

Lack of announced M&A, major partnerships, or strategic product launches suggests limited visible catalysts to accelerate structural growth. Over a 2–6 month horizon this can mean slower expansion of addressable markets or missed opportunities to lock in competitive advantages.

NIHON DENGI CO., LTD. Business Overview & Revenue Model

Company Description

Nihon Dengi Co., Ltd. engages in the automatic control system business in Japan. It operates through two segments, Air Conditioning Instrumentation Related Business and Industrial System Related Business. The Air Conditioning Instrumentation Related Business segment is involved in the design and construction of automatic air conditioning control system for non-residential buildings, including office buildings, factories, hospitals, laboratories, schools, and commercial facilities, as well as maintenance and inspection after construction. This segment sells equipment for automatic control of air conditioning, such as automatic control panels, sensors, and thermostats. The Industrial System Related Business segment handles instrumentation work and automatic control work for factories and transport lines, including food factories, installation, maintenance, and production management of various FA machines centered on industrial robots. This segment also sells control equipment, such as regulators, flow meters, and industrial valves. Nihon Dengi Co., Ltd. was incorporated in 1959 and is headquartered in Tokyo, Japan.

How the Company Makes Money

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NIHON DENGI CO., LTD. Financial Statement Overview

Summary

Strong overall fundamentals: rising profitability (2025 gross margin 43.3%, net margin 14.9%), solid growth (revenue +10.7% YoY), very low leverage (debt-to-equity 0.01), and excellent cash generation (free cash flow +98.4% YoY; strong cash conversion with OCF/NI 1.27 and FCF/NI 1.25).

Income Statement

The company demonstrates strong profitability with a consistent increase in gross profit and net profit margins over the past five years. Notably, the gross profit margin is 43.3% and the net profit margin is 14.9% for 2025. Revenue growth is substantial at 10.7% from 2024 to 2025, indicating robust business expansion. EBIT and EBITDA margins are healthy, reflecting efficient operational management.

Balance Sheet

The balance sheet is stable with a low debt-to-equity ratio of 0.01, indicating minimal leverage and a strong equity base. The return on equity (ROE) is impressive at 16.2%, showcasing effective use of equity to generate profits. The equity ratio is 74.7%, underscoring the company's strong capital structure and low financial risk.

Cash Flow

The cash flow statement reflects excellent cash generation, with a significant increase in free cash flow by 98.4% from 2024 to 2025. The operating cash flow to net income ratio of 1.27 and the free cash flow to net income ratio of 1.25 indicate strong cash conversion and effective cash management.

Breakdown	TTM	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	44.93B	43.06B	38.89B	34.31B	31.67B	34.08B
Gross Profit	19.65B	18.27B	14.19B	11.28B	10.40B	11.13B
EBITDA	10.06B	9.57B	6.66B	4.89B	4.47B	4.82B
Net Income	6.78B	6.41B	4.67B	3.17B	3.03B	3.32B
Balance Sheet
Total Assets	48.55B	53.57B	46.63B	43.59B	38.90B	38.00B
Cash, Cash Equivalents and Short-Term Investments	14.00B	15.54B	11.83B	11.48B	11.55B	12.51B
Total Debt	752.00M	644.00M	755.00M	425.00M	382.00M	450.00M
Total Liabilities	8.81B	14.07B	12.16B	12.51B	10.03B	11.34B
Stockholders Equity	39.74B	39.49B	34.46B	31.08B	28.86B	26.66B
Cash Flow
Free Cash Flow	0.00	8.01B	4.17B	3.44B	1.26B	3.94B
Operating Cash Flow	0.00	8.13B	4.27B	3.52B	1.36B	4.10B
Investing Cash Flow	0.00	-4.28B	-2.12B	-2.20B	-1.44B	-2.38B
Financing Cash Flow	0.00	-1.64B	-2.11B	-989.00M	-1.07B	-1.02B

NIHON DENGI CO., LTD. Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 5030.00
• 50DMA: Negative
• 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:1723, the sentiment is Neutral. The current price of 5030 is below the 20-day moving average (MA) of 11097.00, below the 50-day MA of 10717.60, and below the 200-day MA of 6824.91, indicating a neutral trend. The MACD of -135.20 indicates Positive momentum. The RSI at 44.21 is Neutral, neither overbought nor oversold. The STOCH value of 37.70 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for JP:1723.

NIHON DENGI CO., LTD. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
6850	80 Outperform	¥27.43B	13.32	―	2.89%	6.15%	2.98%
7745	80 Outperform	¥70.08B	8.26	―	2.31%	6.50%	30.54%
6866	79 Outperform	¥101.26B	15.13	―	3.23%	7.28%	4.16%
1723	78 Outperform	¥168.38B	11.67	―	1.83%	22.05%	52.10%
6874	72 Outperform	¥23.12B	7.24	―	2.84%	8.78%	16.25%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
6858	59 Neutral	¥9.23B	16.72	―	2.45%	15.66%	-69.17%

NIHON DENGI CO., LTD. Corporate Events

Nihon Dengi Lifts Earnings and Dividend Outlook on Strong Nine-Month Results

Nihon Dengi Co., Ltd. reported robust results for the nine months ended 31 December 2025, with net sales rising 14.1% year on year to ¥29.87 billion and profit attributable to owners of the parent jumping 45.4% to ¥5.67 billion, driving basic earnings per share to ¥355.81 after a 2-for-1 stock split. The company also strengthened its balance sheet, lifting its equity ratio to 80.6%, and revised upward both its full‑year earnings and dividend forecasts for the year ending 31 March 2026, now targeting ¥46.0 billion in net sales and ¥8.07 billion in profit attributable to owners of the parent while planning a total annual dividend of ¥152 per share, signalling confidence in sustained earnings growth and an increasing return of profits to shareholders.

The most recent analyst rating on (JP:1723) stock is a Buy with a Yen10294.00 price target. To see the full list of analyst forecasts on NIHON DENGI CO., LTD. stock, see the JP:1723 Stock Forecast page.