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Yahagi Construction Co., Ltd. (JP:1870)
:1870
Japanese Market

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

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JP

Yahagi Construction Co., Ltd.

(1870)

Rating:78Outperform
Price Target:
¥1,885.00
▲(10.11%Upside)
Yahagi Construction's stock is rated as favorable due to its strong technical momentum and fair valuation, complemented by a high dividend yield. However, financial performance poses risks due to declining net profit margins and negative cash flow trends.

Yahagi Construction Co., Ltd. (1870) vs. iShares MSCI Japan ETF (EWJ)

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

Company DescriptionYahagi Construction Co., Ltd. (1870) is a prominent Japanese construction company involved in various sectors including civil engineering, building construction, and environmental projects. The company is known for its expertise in infrastructure development, providing comprehensive services from planning and design to execution and maintenance. Yahagi Construction is committed to delivering innovative and sustainable solutions in the construction industry.
How the Company Makes MoneyYahagi Construction Co., Ltd. generates revenue primarily through its construction services, which include civil engineering and building construction projects. The company undertakes a wide range of projects such as roads, bridges, tunnels, commercial buildings, and residential complexes. Revenue is earned through contracts awarded by government entities, private sector clients, and public-private partnerships. Additionally, Yahagi Construction may engage in environmental projects and other related services that contribute to its income. Key factors contributing to its earnings include its reputation for quality, strategic partnerships, and its ability to secure large-scale infrastructure projects.

Yahagi Construction Co., Ltd. Financial Statement Overview

Summary
Yahagi Construction Co., Ltd. displays strong revenue growth and a stable balance sheet, yet faces challenges in operational efficiency and cash flow management. The company's increasing leverage and inconsistent cash flow generation highlight areas for improvement. Overall, the financial health is solid but requires strategic focus on enhancing operational efficiency and cash flow stability.
Income Statement
75
Positive
Yahagi Construction shows strong revenue growth with a 7.1% increase year-over-year and a consistent upward trajectory in net income. The TTM data reflects a healthy gross profit margin of 11% and net profit margin of 2%. However, EBIT and EBITDA margins have seen a decline, indicating potential cost pressures. Overall, the revenue growth and profitability are commendable, but attention is needed on operational efficiency.
Balance Sheet
70
Positive
The company maintains a solid equity base, with an equity ratio of 47.4%, indicating financial stability. However, the debt-to-equity ratio has increased to 0.62 from the previous year, suggesting increased leverage. Return on equity stands at 3.8%, reflecting modest profitability on shareholders' capital. While the balance sheet is generally stable, rising debt levels warrant monitoring.
Cash Flow
65
Positive
Cash flow analysis shows potential concerns, with a lack of reported free cash flow and operating cash flow for the TTM period. Historically, the company has demonstrated variability in free cash flow generation, with a noticeable drop in operating cash flow compared to previous years. This inconsistency suggests potential liquidity risks that need addressing.
Breakdown
TTMMar 2024Mar 2023Mar 2022Mar 2021Mar 2020
Income StatementTotal Revenue
126.11B119.82B111.11B93.09B106.61B90.13B
Gross Profit
13.89B19.80B16.59B14.94B15.70B16.30B
EBIT
3.79B9.51B7.21B6.17B7.36B7.76B
EBITDA
4.42B10.57B8.16B7.03B8.19B8.56B
Net Income Common Stockholders
2.52B6.46B4.51B4.84B3.29B5.16B
Balance SheetCash, Cash Equivalents and Short-Term Investments
16.71B19.99B22.82B22.01B22.09B13.78B
Total Assets
138.68B126.00B129.99B116.42B129.84B107.19B
Total Debt
40.60B22.40B31.90B30.40B42.94B26.06B
Net Debt
23.89B2.41B9.08B8.39B20.85B12.28B
Total Liabilities
72.89B59.46B69.56B58.89B75.20B55.14B
Stockholders Equity
65.78B66.53B60.43B57.53B54.64B52.04B
Cash FlowFree Cash Flow
0.007.83B1.47B13.24B-7.50B-1.14B
Operating Cash Flow
0.0010.23B4.15B15.84B-6.76B631.00M
Investing Cash Flow
0.00-1.18B-3.07B-1.55B-220.00M-1.64B
Financing Cash Flow
0.00-11.86B-253.00M-14.35B15.36B918.00M

Yahagi Construction Co., Ltd. Technical Analysis

Technical Analysis Sentiment
Positive
Last Price1712.00
Price Trends
50DMA
1501.82
Positive
100DMA
1429.98
Positive
200DMA
1458.81
Positive
Market Momentum
MACD
54.49
Positive
RSI
65.42
Neutral
STOCH
59.22
Neutral
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 1712 is above the 20-day moving average (MA) of 1672.80, above the 50-day MA of 1501.82, and above the 200-day MA of 1458.81, indicating a bullish trend. The MACD of 54.49 indicates Positive momentum. The RSI at 65.42 is Neutral, neither overbought nor oversold. The STOCH value of 59.22 is Neutral, 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

Overall Rating
UnderperformOutperform
Sector (66)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
84
Outperform
¥83.69B10.18
4.02%4.90%62.07%
78
Outperform
¥73.75B13.05
4.67%17.42%-12.68%
77
Outperform
¥75.44B16.89
5.97%7.21%11.23%
75
Outperform
¥72.35B3.88
3.62%-12.15%
69
Neutral
¥52.16B14.11
3.08%-8.91%-27.30%
67
Neutral
¥93.83B7.32
3.49%10.43%-0.74%
66
Neutral
$4.50B12.295.40%248.66%4.13%-12.33%
* Industrials Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
JP:1870
Yahagi Construction Co., Ltd.
1,712.00
239.45
16.26%
JP:1822
Daiho Corporation
813.00
179.32
28.30%
JP:1871
P.S. Mitsubishi Construction Co., Ltd.
1,784.00
830.72
87.14%
JP:1879
Shinnihon Corporation
1,609.00
72.36
4.71%
JP:1882
Toa Road Corporation
1,500.00
397.44
36.05%
JP:1888
Wakachiku Construction Co., Ltd.
4,070.00
743.61
22.35%

Yahagi Construction Co., Ltd. Corporate Events

Yahagi Construction Reports Increased Sales but Declining Profits
May 7, 2025

Yahagi Construction Co., Ltd. reported a significant 20.2% increase in net sales for the fiscal year ending March 31, 2025, driven by progress in constructing large-scale logistics facilities. However, profits declined across all levels due to the absence of the previous year’s gains from the sale of internally developed industrial land, impacting the company’s financial performance.

Yahagi Construction Reports Increased Sales but Declining Profits; Announces Dividend Hike
May 7, 2025

Yahagi Construction Co., Ltd. reported a significant increase in net sales for the fiscal year ending March 31, 2025, with a 17.4% rise compared to the previous year. However, the company experienced declines in operating profit, ordinary profit, and profit attributable to owners of the parent, with decreases of 9.0%, 10.1%, and 12.7% respectively. The company also announced an increase in annual dividends per share from 60 yen to 80 yen, indicating a commitment to returning value to shareholders despite the profit declines. The financial forecast for the fiscal year ending March 31, 2026, shows expected growth in net sales and profits, suggesting a positive outlook for the company’s future performance.

Yahagi Construction Co., Ltd. Revises Dividend Policy to Enhance Shareholder Returns
May 7, 2025

Yahagi Construction Co., Ltd. has announced a change in its dividend policy to enhance shareholder returns, transitioning to a dividend on equity (DOE) ratio of 5% or more and adopting a progressive dividend approach. This shift aims to provide stable returns to long-term shareholders and improve the company’s stock market rating by focusing on capital efficiency, with the new policy taking effect from the fiscal year ending March 31, 2026.

Yahagi Construction’s Strategic Role within Nagoya Railroad Group
May 7, 2025

Yahagi Construction Co., Ltd. has a significant relationship with Nagoya Railroad Co., Ltd., which holds a 19.3% voting rights stake. The construction company is a key player within the Nagoya Railroad Group, performing essential railway track maintenance and other construction projects. The company’s operations are closely tied to the Nagoya Railroad Group, yet it maintains contractual independence, ensuring standard terms and conditions. This relationship is crucial for Yahagi’s business, as it accounts for a substantial portion of its sales.

Yahagi Construction Announces Year-End Dividend Distribution
May 7, 2025

Yahagi Construction Co., Ltd. announced a resolution for the distribution of dividends from retained earnings, with a record date of March 31, 2025. The company will distribute a year-end dividend of 40.00 yen per share, which includes an ordinary dividend of 30.00 yen and a commemorative dividend of 10.00 yen, reflecting its commitment to consistent shareholder returns and enhancing corporate value.

Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.