Kaneshita Construction Co., Ltd. (1897) AI Stock Analysis

• Market Cap: ¥6.04B
• Dividend Yield: 1.78%
• Average Volume (3M): 440.00
• Price to Earnings (P/E): 30.5
• Beta (1Y): 0.21
• Revenue Growth: -30.79%
• EPS Growth: -51.74%
• Country: JP
• Employees: 179
• Sector: Industrials
• Sector Strength: 90
• Industry: Engineering & Construction
• EPS (TTM): 55.08
• Shares Outstanding: 3,806,660
• 10 Day Avg. Volume: 370
• 30 Day Avg. Volume: 440
• PEG Ratio: -0.79
• Price to Book (P/B): 0.33
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 0.00
• 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: ¥2,919.00
• Price Target Upside: 4.21% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 0

• Rating: 71 Outperform
• Price Target: ¥3,098.00 ▲(10.60%Upside)

The stock is supported by strong technical momentum and a robust balance sheet, but is limited by high valuation and declining revenue and cash flow.

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

Company Description

Kaneshita Construction Co., Ltd. (1897) is a Japanese construction company specializing in the development of infrastructure, commercial properties, and residential buildings. The company operates within the construction industry, providing a wide range of services including project planning, design, engineering, and construction management. Known for its commitment to quality and innovation, Kaneshita Construction has established a strong presence in the Japanese market, contributing to various public and private sector projects.

How the Company Makes Money

Kaneshita Construction Co., Ltd. generates revenue through a diverse portfolio of construction projects. The company makes money primarily by undertaking contracts for building infrastructure such as roads, bridges, and tunnels, as well as commercial and residential properties. Income is derived from project fees, which are agreed upon with clients based on the scope and scale of each project. The company may also engage in long-term partnerships with government entities for public works and infrastructure development, providing a stable source of revenue. Additionally, Kaneshita Construction may generate earnings from maintenance and repair services offered to existing infrastructure, thus ensuring recurring income streams. Strategic alliances and collaborations with other firms in the construction sector can also contribute to its financial performance.

Kaneshita Construction Co., Ltd. Financial Statement Overview

Summary

The company has a strong balance sheet with low leverage and improved net profit margin, but faces challenges with declining revenue and free cash flow.

Income Statement

The company has shown a stable gross profit margin around 12.5% to 14.5% over the years, indicating consistent cost control relative to revenue. The net profit margin improved in 2024 to 3.3% from 2.5% in 2023, reflecting operational efficiency. However, the revenue growth rate has been negative in recent years, indicating a decline in top-line performance.

Balance Sheet

The balance sheet is strong, with a very low debt-to-equity ratio due to minimal debt levels, and a high equity ratio of approximately 84.5% in 2024, reflecting financial stability and low leverage risk. Return on equity improved to 1.7% in 2024 from 1.5% in 2023, which suggests better utilization of equity.

Cash Flow

Free cash flow decreased significantly from 2023 to 2024, indicating potential challenges in cash generation. The operating cash flow to net income ratio is robust at around 2.0 in 2024, showing strong cash flow relative to profitability. However, the decline in free cash flow growth rate indicates a need for better cash management.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	9.74B	10.66B	9.90B	7.63B	10.96B
Gross Profit	1.22B	1.19B	1.07B	833.00M	1.69B
EBITDA	350.00M	485.00M	216.00M	-25.00M	721.00M
Net Income	321.00M	270.00M	190.00M	45.00M	503.00M
Balance Sheet
Total Assets	21.84B	22.20B	19.99B	19.98B	19.99B
Cash, Cash Equivalents and Short-Term Investments	9.13B	8.64B	7.02B	9.33B	9.18B
Total Debt	8.00M	10.00M	12.00M	14.00M	0.00
Total Liabilities	3.03B	4.05B	2.74B	2.88B	2.79B
Stockholders Equity	18.46B	17.81B	16.92B	16.77B	16.86B
Cash Flow
Free Cash Flow	604.00M	1.43B	-1.29B	-816.00M	3.04B
Operating Cash Flow	650.00M	1.55B	-1.25B	-573.00M	3.11B
Investing Cash Flow	-252.00M	679.00M	-454.00M	434.00M	145.00M
Financing Cash Flow	-111.00M	-110.00M	-111.00M	-108.00M	-3.01B

Kaneshita Construction Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 2801.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:1897, the sentiment is Positive. The current price of 2801 is above the 20-day moving average (MA) of 2782.80, above the 50-day MA of 2736.32, and above the 200-day MA of 2726.47, indicating a bullish trend. The MACD of 17.06 indicates Positive momentum. The RSI at 57.72 is Neutral, neither overbought nor oversold. The STOCH value of 99.52 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:1897.

Kaneshita Construction Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
1844	81 Outperform	¥7.93B	15.73		2.35%	7.06%	38.55%
1718	81 Outperform	¥7.11B	7.59		3.03%	-1.44%	40.85%
1841	76 Outperform	¥3.90B	7.34		3.69%	-9.83%	33.02%
1897	71 Outperform	¥6.04B	30.51		1.78%	-30.79%	-51.74%
1768	66 Neutral	¥6.50B	12.98		3.37%	-5.23%	96.32%
Sector *	58 Neutral	HK$14.28B	4.63	-3.01%	6.75%	3.67%	-54.16%