Obayashi (1802) AI Stock Analysis

• Market Cap: $1.54T
• Dividend Yield: 3.72%
• Average Volume (3M): 2.18M
• Price to Earnings (P/E): 10.6
• Beta (1Y): 0.68
• Revenue Growth: 12.68%
• EPS Growth: 94.75%
• Country: JP
• Employees: 16,986
• Sector: Industrials
• Sector Strength: 86
• Industry: Engineering & Construction
• EPS (TTM): 70.61
• Shares Outstanding: 721,509,640
• 10 Day Avg. Volume: 2,095,310
• 30 Day Avg. Volume: 2,184,973
• PEG Ratio: -5.08
• Price to Book (P/B): 1.12
• Price to Sales (P/S): 0.00
• P/FCF Ratio: -45.90
• 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: $2,556.83
• Price Target Upside: 19.17% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 3

• Rating: 78 Outperform
• Price Target: ¥2,521.00 ▲(17.50%Upside)

Obayashi Corporation's stock demonstrates strong financial performance with consistent revenue growth and solid profitability. The technical indicators support a positive trend, enhancing the stock's appeal. The valuation is attractive due to a reasonable P/E ratio and robust dividend yield. These factors collectively suggest a well-positioned stock in the Engineering & Construction industry.

Obayashi Business Overview & Revenue Model

Company Description

Obayashi Corporation engages in the construction business in Japan, North America, Asia, the Middle East, Europe, and Oceania. The company constructs buildings, including offices, condominiums, commercial facilities, factories, hospitals, and schools; and civil engineering projects, such as tunnels, bridges, dams, riverbanks, railroads, and expressways. It is also involved in the development and leasing of real estate properties in various locations, primarily in metropolitan areas, as well as property management activities; solar, biomass, hydropower, geothermal, and wind power generation business; and PPP and agriculture business. In addition, the company sells materials and equipment for construction; develops and sells computer software; sells and leases electronic equipment; offers finance-related services; and operates golf clubs. Further, it engages in the provision of urban development, contracted engineering, management, consultancy services, etc.; and is involved in the M&E design and construction activities. The company was founded in 1892 and is headquartered in Tokyo, Japan.

How the Company Makes Money

Obayashi Corporation generates its revenue primarily through its construction and engineering services. The company takes on contracts for large-scale building and infrastructure projects, which include commercial and residential buildings, transportation systems, and industrial facilities. Revenue is earned through project contracts, which are often secured through competitive bidding processes. Additionally, Obayashi engages in real estate development, where it invests in, develops, and sells or leases properties, further contributing to its income. The company also forms strategic partnerships and joint ventures to expand its project portfolio and enhance its capabilities, which can lead to additional revenue streams.

Obayashi Financial Statement Overview

Summary

Obayashi's financial statements reveal a strong financial position with consistent revenue growth, solid profitability, and improved cash flow generation. The conservative use of debt enhances financial stability, while robust equity returns highlight efficient management. Although there are areas for improvement in cash flow conversion, the overall financial health of the company is commendable.

Income Statement

The company has shown robust revenue growth of 12.69% from 2024 to 2025. Gross profit margin remains stable at 11.36% for 2025, with a net profit margin of 5.57%. EBIT and EBITDA margins are healthy at 5.47% and 9.48% respectively, indicating strong operational efficiency and profitability. The consistent upward trend in revenue and profitability metrics suggests solid performance in the income statement.

Balance Sheet

The debt-to-equity ratio is 0.32, indicating a conservative leverage strategy. The return on equity (ROE) stands at 12.61%, reflecting good profitability relative to equity. The equity ratio is 38.05%, suggesting a balanced capital structure. Overall, the balance sheet portrays financial stability with efficient leverage usage and solid equity returns.

Cash Flow

The company achieved significant improvement in free cash flow from a deficit in 2024 to a positive 35.45 billion Yen in 2025. The operating cash flow to net income ratio is 0.59, indicating adequate cash generation relative to net income. The free cash flow to net income ratio is 0.24, reflecting moderate conversion of profits to free cash flow. This positive trend in cash flow metrics shows improved liquidity and cash management.

Breakdown	TTM	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	1.90T	2.62T	2.33T	1.98T	1.92T	1.77T
Gross Profit	232.77B	297.83B	219.60B	216.57B	154.34B	225.78B
EBITDA	140.30B	248.22B	138.49B	140.30B	78.61B	156.60B
Net Income	91.61B	146.05B	75.06B	77.67B	39.13B	98.78B
Balance Sheet
Total Assets	3.06T	3.04T	3.02T	2.61T	2.42T	2.27T
Cash, Cash Equivalents and Short-Term Investments	279.15B	406.14B	347.62B	426.69B	271.03B	262.95B
Total Debt	449.09B	373.63B	332.90B	344.36B	280.87B	266.99B
Total Liabilities	1.87T	1.83T	1.82T	1.57T	1.43T	1.31T
Stockholders Equity	1.14T	1.16T	1.15T	997.11B	955.69B	931.01B
Cash Flow
Free Cash Flow	0.00	35.45B	-27.99B	131.87B	11.67B	-32.63B
Operating Cash Flow	0.00	85.63B	50.40B	228.46B	69.70B	24.80B
Investing Cash Flow	0.00	10.78B	-84.47B	-101.61B	-49.83B	-79.08B
Financing Cash Flow	0.00	-51.77B	-51.92B	22.12B	-12.46B	-8.48B

Obayashi Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 2145.50
• 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:1802, the sentiment is Neutral. The current price of 2145.5 is below the 20-day moving average (MA) of 2191.82, below the 50-day MA of 2188.16, and above the 200-day MA of 2015.90, indicating a neutral trend. The MACD of -3.83 indicates Positive momentum. The RSI at 42.69 is Neutral, neither overbought nor oversold. The STOCH value of 23.39 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for JP:1802.

Obayashi Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
1802	78 Outperform	$1.54T	10.56	12.49%	3.72%	12.68%	94.75%
Sector *	58 Neutral	$1.34B	4.24	-2.93%	7.38%	3.67%	-51.13%
2PW		€1.56B	8.29	16.30%	5.42%	―	―
KAJMF		$12.58B	15.23	10.06%	0.02%	―	―
SHMUF		$7.30B	17.68	7.47%	2.44%	―	―
TISCF		$10.67B	13.10	13.61%	3.23%	―	―
1860	75 Outperform	¥283.30B	11.05		3.14%	12.29%	59.92%

Obayashi Corporate Events

Obayashi Completes Share Buyback to Enhance Shareholder Value

Obayashi Corporation announced the completion of its acquisition of 1,939,400 of its own common shares, valued at approximately ¥4.25 billion, as part of a broader plan to acquire up to 20 million shares. This move is part of a strategic initiative to manage its capital structure and enhance shareholder value, reflecting the company’s commitment to optimizing its financial operations.

The most recent analyst rating on (JP:1802) stock is a Buy with a Yen2400.00 price target. To see the full list of analyst forecasts on Obayashi stock, see the JP:1802 Stock Forecast page.

Obayashi Corporation Advances Share Buyback Program

Obayashi Corporation announced the acquisition of 2,368,100 of its own common shares, totaling approximately ¥5.2 billion, as part of a larger buyback program authorized by its Board of Directors. This move is part of a strategic initiative to enhance shareholder value and optimize capital structure, reflecting the company’s commitment to its investors.

The most recent analyst rating on (JP:1802) stock is a Buy with a Yen2250.00 price target. To see the full list of analyst forecasts on Obayashi stock, see the JP:1802 Stock Forecast page.

Obayashi Corporation Proposes Increased Year-End Dividend

Obayashi Corporation announced a proposal to increase its year-end dividend to 41 yen per share, up from the previously forecasted 40 yen, as part of its commitment to stable dividends. This decision reflects a consolidated dividend payout ratio of 39.7%, indicating a strategic focus on rewarding shareholders while maintaining financial stability.

The most recent analyst rating on (JP:1802) stock is a Buy with a Yen2250.00 price target. To see the full list of analyst forecasts on Obayashi stock, see the JP:1802 Stock Forecast page.

Obayashi Corporation Reports Strong Financial Performance for Fiscal Year 2025

Obayashi Corporation reported a strong financial performance for the fiscal year ended March 31, 2025, with net sales increasing by 12.7% and profit attributable to owners of the parent rising by 94.6% year-on-year. This robust growth reflects positively on the company’s operational efficiency and market positioning, indicating a solid return on equity and a stable financial position, which could have favorable implications for stakeholders.

The most recent analyst rating on (JP:1802) stock is a Buy with a Yen2250.00 price target. To see the full list of analyst forecasts on Obayashi stock, see the JP:1802 Stock Forecast page.

Obayashi Corporation Updates on Share Buyback Progress

Obayashi Corporation announced the status of its share buyback program, acquiring 4,362,700 common shares for approximately ¥8.6 billion between April 1 and April 30, 2025. This move is part of a larger plan authorized by the Board of Directors to acquire up to 20 million shares, aiming to enhance shareholder value and optimize capital structure.

Obayashi Corporation Revises Financial Forecasts Upward for FY 2025

Obayashi Corporation has revised its financial forecasts for the fiscal year ended March 31, 2025, showing an increase in net sales, operating income, and profit attributable to owners of the parent. The revisions are attributed to improved profitability in construction projects and better-than-expected progress in the sale of cross-shareholdings, impacting both domestic and international subsidiaries positively.