Wakachiku Construction Co., Ltd. (1888) AI Stock Analysis

• Market Cap: ¥65.03B
• Dividend Yield: 2.47%
• Average Volume (3M): 19.95K
• Price to Earnings (P/E): 17.2
• Beta (1Y): 0.53
• Revenue Growth: 1.00%
• EPS Growth: -6.09%
• Country: JP
• Employees: 873
• Sector: Industrials
• Sector Strength: 72
• Industry: Engineering & Construction
• EPS (TTM): 8.21
• Shares Outstanding: 12,964,993
• 10 Day Avg. Volume: 15,020
• 30 Day Avg. Volume: 19,950
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• 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: ¥5,391.00
• Price Target Upside: 5.71% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 1

• Rating: 73 Outperform
• Price Target: ¥5,391.00 ▲(5.71% Upside)

The overall stock score is driven primarily by strong technical analysis indicators, reflecting positive market momentum. Financial performance is stable but hampered by revenue and cash flow challenges. Valuation is fair, with a reasonable P/E ratio and attractive dividend yield providing some support. Earnings call and corporate events were excluded due to lack of data.

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

Company Description

Wakachiku Construction Co., Ltd. engages in the construction, construction consulting, management, and real estate businesses in Japan and internationally. It is also involved in the marine development, regional and urban development, and environmental maintenance and conservation businesses. The company was founded in 1890 and is headquartered in Tokyo, Japan.

How the Company Makes Money

Wakachiku Construction Co., Ltd. generates revenue primarily through its construction contracts in civil engineering, building, and marine sectors. The company secures projects through competitive bidding and direct negotiations, offering comprehensive services from design to construction and maintenance. Revenue streams include contract payments for completed project milestones, consultancy fees for design and planning, and maintenance services for infrastructure projects. Wakachiku Construction also benefits from partnerships with governmental bodies and private sector clients, leveraging its reputation and technical expertise to secure long-term contracts and repeat business.

Wakachiku Construction Co., Ltd. Financial Statement Overview

Summary

Wakachiku Construction Co., Ltd. exhibits stable profitability and a strong equity base, which are positives in the engineering and construction industry. However, revenue growth and cash flow management are areas of concern, with recent years showing declines in sales and negative free cash flow. The company must focus on improving operational efficiency and cash flow generation to enhance financial health.

Income Statement

Wakachiku Construction Co., Ltd. demonstrates a stable gross profit margin around 14-15% over the years, indicating consistent cost management. However, the net profit margin has been fluctuating due to variable net income, with a notable decline in the latest year. The revenue growth rate is volatile, with recent declines, highlighting a challenge in maintaining sales momentum. EBITDA margin has shown resilience despite revenue challenges.

Balance Sheet

The company shows a strong equity position with an equity ratio consistently above 50%, indicating financial stability. However, the debt-to-equity ratio has increased recently due to higher debt levels, which may pose a risk if not managed well. Return on Equity (ROE) has been moderate, reflecting steady but not exceptional profitability.

Cash Flow

Cash flow analysis reveals some concerns, particularly with negative free cash flow in recent years, indicating potential liquidity issues. The operating cash flow to net income ratio shows inconsistency, suggesting challenges in converting profits into cash. However, the company has had periods of strong free cash flow, hinting at potential for recovery.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	86.46B	86.46B	94.92B	84.00B	89.16B	89.82B
Gross Profit	12.73B	12.73B	14.10B	12.73B	12.97B	8.59B
EBITDA	6.27B	6.27B	8.74B	7.50B	7.66B	3.94B
Net Income	3.69B	3.69B	5.09B	5.44B	4.74B	1.81B
Balance Sheet
Total Assets	91.89B	91.89B	90.78B	88.33B	81.48B	91.47B
Cash, Cash Equivalents and Short-Term Investments	13.22B	13.22B	18.89B	27.32B	16.40B	14.38B
Total Debt	12.70B	12.70B	4.43B	4.43B	6.28B	18.21B
Total Liabilities	42.03B	42.03B	43.39B	45.63B	43.13B	57.63B
Stockholders Equity	48.32B	48.32B	45.93B	41.32B	37.09B	32.69B
Cash Flow
Free Cash Flow	0.00	-11.35B	-5.43B	14.24B	14.75B	-5.87B
Operating Cash Flow	0.00	-10.26B	-3.96B	15.14B	16.03B	-5.31B
Investing Cash Flow	0.00	-1.85B	-3.61B	-1.33B	-1.48B	-651.00M
Financing Cash Flow	0.00	6.40B	-1.38B	-2.97B	-12.75B	4.99B

Wakachiku Construction Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 5100.00
• 50DMA: Negative
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:1888, the sentiment is Neutral. The current price of 5100 is below the 20-day moving average (MA) of 5536.25, below the 50-day MA of 5412.20, and above the 200-day MA of 4191.78, indicating a neutral trend. The MACD of -125.71 indicates Positive momentum. The RSI at 36.94 is Neutral, neither overbought nor oversold. The STOCH value of 7.99 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for JP:1888.

Wakachiku Construction Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
1921	81 Outperform	¥60.04B	4.15	23.42%	1.05%	3.22%	390.93%
1884	79 Outperform	¥107.82B	14.93	6.05%	2.39%	4.84%	62.58%
1786	76 Outperform	¥57.89B	15.42	7.25%	3.32%	-4.08%	-29.10%
1888	73 Outperform	¥65.03B	17.23	―	2.47%	1.00%	-6.09%
1898	73 Outperform	¥56.35B	13.68	9.32%	5.74%	9.19%	45.78%
1929	68 Neutral	¥53.89B	19.01	―	3.72%	1.11%	0.17%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%

Wakachiku Construction Co., Ltd. Corporate Events

Wakachiku Construction Reports Strong Q1 2025 Financial Results

Wakachiku Construction Co., Ltd. reported a significant increase in its financial performance for the three months ended June 30, 2025, with net sales rising by 21.2% year-on-year to ¥20,239 million. The company’s operating profit surged by 740.6% to ¥173 million, indicating a strong recovery from the previous year’s downturn. This improvement in financial results reflects positively on the company’s operations and market positioning, suggesting a robust recovery and potential growth opportunities for stakeholders.

Wakachiku Construction’s Parent Company Aso Corporation Finalizes Financial Results

Wakachiku Construction Co., Ltd. announced the finalized financial results of its unlisted parent company, Aso Corporation, for the fiscal year ending March 31, 2025. Aso Corporation holds a significant 38.78% voting rights in Wakachiku, indicating a strong capital relationship, although there are no personnel or business ties. The announcement provides insights into the financial health and shareholder structure of Aso Corporation, which could impact Wakachiku’s strategic decisions and market positioning.

Wakachiku Construction Affirms Independence Amid ASO Corporation’s Shareholding

Wakachiku Construction Co., Ltd. has announced that ASO Corporation, an affiliated company, holds 38.78% of its voting rights and intends to maintain its position as a stable, long-term shareholder. Despite this significant shareholding, Wakachiku Construction maintains its operational independence with minimal business ties to ASO Corporation, ensuring no restrictions on its business activities.

Wakachiku Construction Announces Dividend Payout Aligned with Strategic Plan

Wakachiku Construction Co., Ltd. has announced a dividend payout of ¥126 per share, effective June 6, 2025, based on a record date of March 31, 2025. This decision aligns with the company’s medium-term management plan, which aims for a non-consolidated dividend payout ratio of 40% or more, achieving a 45% payout ratio and a dividend-on-equity ratio of 3.6%. This move reflects the company’s strategic focus on maintaining robust shareholder returns amidst evaluating its business performance and future environment.