Penta-Ocean Construction Co (1893) AI Stock Analysis

• Market Cap: $338.67B
• Dividend Yield: 2.02%
• Average Volume (3M): 1.40M
• Price to Earnings (P/E): 23.6
• Beta (1Y): 0.64
• Revenue Growth: 15.90%
• EPS Growth: -21.82%
• Country: JP
• Employees: 3,824
• Sector: Industrials
• Sector Strength: 72
• Industry: Engineering & Construction
• EPS (TTM): 24.63
• Shares Outstanding: 286,013,920
• 10 Day Avg. Volume: 1,469,110
• 30 Day Avg. Volume: 1,401,890
• 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: 1.24
• Enterprise Value/Revenue: 0.58
• Enterprise Value/Gross Profit: 8.82
• Enterprise Value/Ebitda: 13.75
• 1Y Price Target: $1,040.98
• Price Target Upside: -12.38% Downside
• Rating Consensus: Hold
• Number of Analyst Covering: 1

• Rating: 65 Neutral
• Price Target: ¥1,041.00 ▼(-12.37% Downside)

The overall stock score is significantly impacted by financial performance issues, including declining margins and negative cash flows. Technical analysis provides a positive outlook with strong momentum, but caution is warranted due to overbought signals. The stock's valuation appears stretched, limiting its attractiveness despite a decent dividend yield.

Penta-Ocean Construction Co Business Overview & Revenue Model

Company Description

Penta-Ocean Construction Co., Ltd. engages in the civil engineering and building construction activities in Japan, Southeast Asia, and internationally. The company operates through three segments: Domestic Civil Engineering, Domestic Building Construction, and Overseas. It constructs ports and harbors, airports, power stations, bridges, offices, commercial buildings and lodges, and residential and education buildings, as well as undertakes water supply and sewerage, railway, environmental facility, recreational, and dam and river work projects. The company is also involved in the development of real estate properties; and shipbuilding, leasing, insurance, and environment businesses. Penta-Ocean Construction Co., Ltd. was founded in 1896 and is headquartered in Tokyo, Japan.

How the Company Makes Money

Penta-Ocean Construction Co. makes money primarily through its comprehensive suite of construction and engineering services. The company's revenue model is driven by project contracts obtained from both public and private sectors, focusing on infrastructure and marine engineering projects. Key revenue streams include contracts for constructing ports, harbors, bridges, and roads, as well as land reclamation and coastal protection projects. Additionally, Penta-Ocean engages in building construction, contributing to its earnings. The company also benefits from strategic partnerships and joint ventures that enhance its capabilities and market reach, facilitating entry into new projects and regions.

Penta-Ocean Construction Co Financial Statement Overview

Summary

Penta-Ocean Construction Co demonstrates revenue growth but faces significant profitability and cash flow challenges. The increase in leverage could pose risks, despite a solid equity base. Declining margins and negative cash flows are critical issues that need addressing for long-term stability.

Income Statement

Penta-Ocean Construction Co has shown a consistent revenue growth trend over the past years, with a significant increase of 17.76% in 2025. However, the gross profit margin has decreased from 2024 to 2025, indicating rising costs. The net profit margin also declined, suggesting profitability challenges. Despite these issues, the company maintains positive EBIT and EBITDA margins, although both have seen a downward trend.

Balance Sheet

The company maintains a solid equity base with an equity ratio of 26.06% in 2025, showing a strong reliance on equity financing. However, the increasing debt-to-equity ratio, which reached 0.97 in 2025, points to a rising leverage risk. Return on equity has declined, reflecting reduced profitability relative to equity. Overall, the balance sheet shows solid equity but increasing leverage concerns.

Cash Flow

Penta-Ocean Construction Co faced severe cash flow challenges in 2025, with a negative free cash flow of ¥61.48 billion. The operating cash flow to net income ratio is negative, indicating that the company's operations are not generating enough cash to cover the costs, exacerbated by high capital expenditures. Free cash flow to net income ratio also indicates cash flow strain.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	727.49B	727.49B	617.71B	502.20B	458.23B	471.06B
Gross Profit	47.58B	47.58B	53.33B	26.42B	37.23B	50.04B
EBITDA	30.52B	30.52B	37.30B	10.16B	23.46B	38.12B
Net Income	12.46B	12.46B	17.88B	684.00M	10.75B	20.99B
Balance Sheet
Total Assets	660.13B	660.13B	566.03B	508.18B	467.36B	452.25B
Cash, Cash Equivalents and Short-Term Investments	57.27B	57.27B	60.19B	50.50B	44.86B	59.79B
Total Debt	166.47B	166.47B	110.32B	93.69B	92.56B	82.21B
Total Liabilities	488.00B	488.00B	392.97B	351.23B	307.58B	293.85B
Stockholders Equity	172.06B	172.06B	173.01B	156.84B	159.60B	158.28B
Cash Flow
Free Cash Flow	0.00	-61.48B	-1.75B	9.57B	-16.34B	19.65B
Operating Cash Flow	0.00	-23.33B	9.14B	19.69B	-7.69B	30.69B
Investing Cash Flow	0.00	-23.22B	-6.41B	-11.70B	-11.82B	-12.80B
Financing Cash Flow	0.00	43.88B	6.71B	-6.96B	1.36B	-3.11B

Penta-Ocean Construction Co Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 1188.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:1893, the sentiment is Positive. The current price of 1188 is above the 20-day moving average (MA) of 1106.30, above the 50-day MA of 1047.87, and above the 200-day MA of 819.64, indicating a bullish trend. The MACD of 34.88 indicates Negative momentum. The RSI at 77.28 is Negative, neither overbought nor oversold. The STOCH value of 90.24 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:1893.

Penta-Ocean Construction Co Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
1719	78 Outperform	310.70B	9.89	15.45%	4.06%	9.82%	92.67%
1860	75 Outperform	322.34B	12.61	7.36%	2.76%	16.62%	42.69%
5076	75 Outperform	384.16B	10.20	6.24%	3.87%	―	―
1820	71 Outperform	209.87B	13.15	10.19%	4.14%	-8.97%	9.14%
1720	69 Neutral	120.60B	14.97	6.52%	3.30%	11.42%	26.72%
1893	65 Neutral	$338.67B	23.61	8.52%	2.02%	15.90%	-21.82%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%