Yahagi Construction Co., Ltd. (1870) AI Stock Analysis

• Market Cap: ¥94.73B
• Dividend Yield: 3.66%
• Average Volume (3M): 121.46K
• Price to Earnings (P/E): 12.4
• Beta (1Y): 0.71
• Revenue Growth: 35.73%
• EPS Growth: 62.37%
• Country: JP
• Employees: 1,324
• Sector: Industrials
• Sector Strength: 72
• Industry: Engineering & Construction
• EPS (TTM): 73.82
• Shares Outstanding: 44,607,456
• 10 Day Avg. Volume: 128,820
• 30 Day Avg. Volume: 121,456
• PEG Ratio: -0.77
• Price to Book (P/B): 0.80
• Price to Sales (P/S): 0.39
• P/FCF Ratio: -3.06
• 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: Moderate Buy
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 79 Outperform
• Price Target: ¥2,662.00 ▲(15.44% Upside)

Yahagi Construction's strong technical indicators and attractive valuation are the primary drivers of its overall score. The company's robust revenue growth and stable gross profitability further support its positive outlook. However, declining net profit margins and negative cash flow trends present potential risks that investors should monitor.

Positive Factors

Revenue Growth

The company's strong revenue growth trajectory indicates a robust market position and effective execution of its business model, enhancing its competitive edge in the construction industry.

Stable Gross Profitability

Consistent gross profitability suggests effective cost management and pricing strategies, which are crucial for maintaining long-term financial health and competitiveness.

Balanced Debt-to-Equity Ratio

A balanced debt-to-equity ratio indicates a stable capital structure, providing financial flexibility and reducing risk associated with excessive leverage.

Negative Factors

Declining Net Profit Margins

The decline in net profit margins suggests rising operational or interest costs, which could impact profitability and require strategic adjustments to improve efficiency.

Increased Leverage

Increased leverage can strain financial resources and limit the company's ability to invest in growth opportunities, potentially affecting long-term stability.

Negative Cash Flow Trends

Negative cash flow trends highlight challenges in converting profits into cash, which may impact the company's ability to fund operations and future investments.

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

Company Description

Yahagi Construction Co., Ltd., established in 1870, is a prominent player in the Japanese construction industry, specializing in civil engineering, infrastructure development, and building construction. The company has a long-standing history of executing large-scale projects in sectors such as transportation, urban development, and environmental engineering. With a commitment to quality and innovation, Yahagi Construction also emphasizes sustainable practices and technological advancements in its construction processes.

How the Company Makes Money

Yahagi Construction Co., Ltd. generates revenue primarily through its construction contracts, which include public works projects, private sector developments, and infrastructure improvements. The company's revenue model is based on a mix of fixed-price contracts and cost-plus contracts, allowing for flexibility in pricing based on project scope and client requirements. Key revenue streams include government contracts for transportation infrastructure, such as roads and bridges, as well as residential and commercial building projects. Additionally, Yahagi Construction often partners with local governments and private developers, leveraging these relationships to secure large-scale projects and maintain a steady flow of contracts, contributing significantly to its earnings.

Yahagi Construction Co., Ltd. Financial Statement Overview

Summary

Yahagi Construction shows strong revenue growth and stable gross profitability, indicating a robust business model. However, declining net profit margins and increased leverage highlight potential risks in operational efficiency and financial stability. Negative cash flow trends are concerning, as they may impact future investments and financial flexibility.

Income Statement

Yahagi Construction has demonstrated solid revenue growth, increasing from ¥93 billion in 2022 to ¥141 billion in 2025, reflecting a positive growth trajectory. Gross profit margin has remained stable, averaging around 14% over the years, indicating effective cost management. However, the decline in net profit margin from 5.5% in 2022 to 4.0% in 2025 suggests rising operational or interest costs. The EBIT and EBITDA margins have slightly decreased, pointing to potential efficiency issues in operating expenses.

Balance Sheet

The company maintains a balanced debt-to-equity ratio, which has increased to 0.56 in 2025, reflecting a moderate leverage level. The equity ratio of around 48% indicates a stable capital structure. However, the increase in total debt to ¥38.6 billion in 2025 signals potential risk if revenue growth does not keep pace. The return on equity (ROE) has been steady, suggesting effective use of shareholder funds, albeit with a slight decrease in recent years.

Cash Flow

Yahagi Construction's cash flow performance has been volatile, with negative free cash flow in recent years due to significant capital expenditures and reduced operating cash flow. The free cash flow to net income ratio turned negative in 2025, indicating challenges in converting profits into cash. The operating cash flow to net income ratio has also declined, suggesting potential inefficiencies in cash-generating activities.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	155.22B	140.70B	119.82B	111.11B	93.09B	106.61B
Gross Profit	22.60B	19.42B	19.80B	16.59B	14.94B	15.70B
EBITDA	12.45B	9.50B	10.57B	7.41B	8.00B	6.57B
Net Income	7.62B	5.64B	6.46B	4.51B	4.84B	3.29B
Balance Sheet
Total Assets	153.18B	144.22B	126.00B	129.99B	116.42B	129.84B
Cash, Cash Equivalents and Short-Term Investments	16.36B	15.67B	19.99B	22.82B	22.01B	22.09B
Total Debt	42.10B	38.60B	22.40B	31.90B	30.40B	42.94B
Total Liabilities	83.56B	75.38B	59.46B	69.56B	58.89B	75.20B
Stockholders Equity	69.61B	68.83B	66.53B	60.43B	57.53B	54.64B
Cash Flow
Free Cash Flow	0.00	-18.04B	7.83B	1.47B	13.24B	-7.50B
Operating Cash Flow	0.00	-17.19B	10.23B	4.15B	15.84B	-6.76B
Investing Cash Flow	0.00	-255.00M	-1.18B	-3.07B	-1.55B	-220.00M
Financing Cash Flow	0.00	13.15B	-11.86B	-253.00M	-14.35B	15.36B

Yahagi Construction Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 2306.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:1870, the sentiment is Positive. The current price of 2306 is above the 20-day moving average (MA) of 2171.45, above the 50-day MA of 2190.09, and above the 200-day MA of 1774.96, indicating a bullish trend. The MACD of 26.79 indicates Negative momentum. The RSI at 65.92 is Neutral, neither overbought nor oversold. The STOCH value of 91.64 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:1870.

Yahagi Construction Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
1871	79 Outperform	¥85.80B	10.63	―	4.22%	5.39%	33.02%
1870	79 Outperform	¥94.73B	12.42	―	3.66%	35.73%	62.37%
1882	70 Outperform	¥78.65B	16.32	―	8.85%	2.51%	4.02%
1879	67 Neutral	¥113.12B	8.29	―	3.02%	-3.99%	13.29%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
1822	63 Neutral	¥70.93B	20.38	―	3.77%	-8.79%	―
1888	59 Neutral	¥61.66B	16.33	―	2.54%	15.45%	43.95%

Yahagi Construction Co., Ltd. Corporate Events

Yahagi Construction Reports Strong Q1 Financial Performance

Yahagi Construction Co., Ltd. reported a significant increase in its financial performance for the three months ending June 30, 2025, with net sales rising by 54.5% and operating profit surging by 401.8% compared to the same period last year. This robust growth reflects the company’s strong market positioning and operational efficiency, potentially enhancing its attractiveness to investors and stakeholders.