Seikitokyu Kogyo Co., Ltd. (1898) AI Stock Analysis

• Market Cap: ¥60.06B
• Dividend Yield: 4.9%
• Average Volume (3M): 123.23K
• Price to Earnings (P/E): 13.7
• Beta (1Y): 0.64
• Revenue Growth: 4.91%
• EPS Growth: 57.89%
• Country: JP
• Employees: 1,149
• Sector: Industrials
• Sector Strength: 72
• Industry: Engineering & Construction
• EPS (TTM): 29.52
• Shares Outstanding: 37,424,507
• 10 Day Avg. Volume: 107,930
• 30 Day Avg. Volume: 123,230
• PEG Ratio: 0.34
• Price to Book (P/B): 1.33
• Price to Sales (P/S): 0.56
• P/FCF Ratio: -23.95
• 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: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 73 Outperform
• Price Target: ¥1,858.00 ▲(12.67% Upside)

Seikitokyu Kogyo Co., Ltd. scores well due to its strong financial performance and attractive valuation, with a solid dividend yield enhancing its appeal. However, technical indicators suggest a neutral to slightly bearish trend, which tempers the overall score. The lack of earnings call and corporate events data means these factors do not influence the score.

Positive Factors

Low leverage and solid capital structure

Very low leverage and a 50.5% equity ratio provide durable solvency and financial flexibility. This strength reduces refinancing risk, supports competitive bidding on large infrastructure projects and cushions the company against cyclical slowdowns, aiding long-term stability.

Sustained revenue growth and improving gross margin

Double-digit revenue growth paired with rising gross margins signals the company is capturing market share and managing direct costs better. Over a multi-month horizon this supports operating scale, better contract pricing leverage and potential to translate top-line gains into durable profit improvements.

Stable infrastructure contracting business model

A business built on public and private infrastructure contracts provides recurring opportunity from maintenance and new works. This structural demand for road paving, earthworks and public-works creates a steady market footprint and predictable bidding pipeline over medium-term cycles.

Negative Factors

Weak cash conversion and negative free cash flow

Declining operating cash flow and negative free cash flow undermine the firm’s ability to fund capex, pay dividends or absorb project overruns without external financing. Over several months this strains liquidity, limits reinvestment and increases reliance on debt or equity raises.

Thin net profitability margins

Low net and operating margins leave limited buffer against cost inflation, contract disputes or competitive bid pressure. Across economic cycles small margin headroom increases earnings volatility and constrains internal cash generation needed for growth and shareholder returns.

Revenue cyclicality tied to project awards and public spending

Dependence on the timing and mix of awarded projects ties results to public capex cycles and private investment. This makes revenues lumpy and planning difficult; in downturns fewer awards reduce utilization and backlog, weakening multi-month visibility and growth sustainability.

Seikitokyu Kogyo Co., Ltd. Business Overview & Revenue Model

Company Description

Seikitokyu Kogyo Co., Ltd. operates as an infrastructure building company in Japan. The company is involved in paving various roads, such as expressways and bridges. It also undertakes civil engineering, landscape projects, and other general construction works; and manufactures and sells pavement materials, such as asphalt mixtures. The company was incorporated in 1950 and is headquartered in Tokyo, Japan.

How the Company Makes Money

Seikitokyu Kogyo generates revenue through multiple streams, primarily by producing and selling a diverse range of chemical products tailored for industrial applications. The company earns money from both domestic and international markets, leveraging its extensive distribution network and partnerships with key industry players. Revenue is driven by long-term contracts with large manufacturers in sectors such as automotive and electronics, allowing for stable cash flow. Additionally, the company invests in research and development to innovate and expand its product offerings, which contributes to its competitive advantage and growth in revenue. Strategic collaborations and joint ventures with other firms also play a significant role in enhancing its market presence and generating additional income.

Seikitokyu Kogyo Co., Ltd. Financial Statement Overview

Summary

Seikitokyu Kogyo Co., Ltd. demonstrates strong revenue growth and a solid balance sheet with low leverage. Profitability metrics suggest potential for improvement, particularly in net profit margins. Cash flow management appears to be a challenge, necessitating a focus on liquidity and cash generation strategies. Overall, the company is positioned well financially but must address cash flow concerns to sustain growth.

Income Statement

Seikitokyu Kogyo Co., Ltd. has shown strong revenue growth of 12.85% in the most recent year, reflecting its ability to capture market opportunities. The gross profit margin improved to 12.12%, indicating effective cost management. However, the net profit margin of 3.91% suggests room for enhancing profitability. The EBIT margin of 5.88% shows operational efficiency but also highlights potential for improvement. EBITDA margin at 7.59% is decent, reflecting healthy operating cash flow generation.

Balance Sheet

The company maintains a solid balance sheet with a debt-to-equity ratio of 0.16, indicating low leverage and financial stability. The return on equity (ROE) of 9.32% is moderate, showing effective use of equity. An equity ratio of 50.50% confirms a healthy capital structure, supporting long-term solvency.

Cash Flow

Operating cash flow has declined, resulting in negative free cash flow, raising concerns about liquidity. The operating cash flow to net income ratio has turned negative, highlighting challenges in converting earnings to cash. However, historical free cash flow trends indicate potential for recovery.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	99.11B	99.36B	88.04B	92.41B	85.13B	90.02B
Gross Profit	12.56B	12.03B	9.95B	8.80B	10.23B	14.11B
EBITDA	7.80B	7.54B	6.20B	4.82B	6.36B	10.31B
Net Income	4.19B	3.89B	2.74B	1.13B	3.30B	5.18B
Balance Sheet
Total Assets	77.58B	82.56B	76.04B	78.76B	78.30B	79.41B
Cash, Cash Equivalents and Short-Term Investments	15.06B	7.75B	13.44B	8.17B	12.81B	14.04B
Total Debt	6.78B	6.71B	6.81B	6.91B	7.01B	5.01B
Total Liabilities	37.13B	40.86B	35.51B	39.10B	37.80B	38.62B
Stockholders Equity	40.45B	41.69B	40.53B	39.66B	40.50B	40.79B
Cash Flow
Free Cash Flow	1.15B	-2.31B	8.02B	-2.67B	945.00M	-2.59B
Operating Cash Flow	1.44B	-971.00M	10.95B	2.38B	4.65B	1.14B
Investing Cash Flow	-304.00M	-1.34B	-2.87B	-5.03B	-3.67B	-3.62B
Financing Cash Flow	-795.00M	-3.38B	-2.82B	-2.02B	-2.23B	2.34B

Seikitokyu Kogyo Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 1649.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:1898, the sentiment is Neutral. The current price of 1649 is below the 20-day moving average (MA) of 1681.90, above the 50-day MA of 1642.50, and above the 200-day MA of 1513.16, indicating a neutral trend. The MACD of 8.17 indicates Positive momentum. The RSI at 50.76 is Neutral, neither overbought nor oversold. The STOCH value of 32.30 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for JP:1898.

Seikitokyu Kogyo Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
1921	80 Outperform	¥80.27B	33.73	―	0.79%	-8.53%	-83.61%
1899	79 Outperform	¥66.47B	11.11	―	2.56%	1.71%	14.20%
1929	75 Outperform	¥54.43B	16.22	―	3.78%	11.81%	52.35%
1898	73 Outperform	¥60.06B	13.71	―	4.90%	4.91%	57.89%
1786	70 Outperform	¥54.32B	14.82	―	3.53%	-2.95%	-35.66%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
1888	59 Neutral	¥58.60B	13.29	―	2.84%	15.45%	43.95%

Seikitokyu Kogyo Co., Ltd. Corporate Events

Seikitokyu Kogyo Co., Ltd. Revises Financial Forecasts Upward

Seikitokyu Kogyo Co., Ltd. has revised its financial forecasts for the fiscal year ending March 31, 2026, showing an increase in expected profits due to improved profitability in its Pavement Materials Manufacturing and Sales business. The revisions indicate a positive outlook with net sales and profits expected to exceed previous forecasts, reflecting the company’s strategic cost reduction efforts.

The most recent analyst rating on (JP:1898) stock is a Buy with a Yen1651.00 price target. To see the full list of analyst forecasts on Seikitokyu Kogyo Co., Ltd. stock, see the JP:1898 Stock Forecast page.

Seikitokyu Kogyo Reports Strong Profit Growth Despite Sales Decline

Seikitokyu Kogyo Co., Ltd. reported its consolidated financial results for the six months ending September 30, 2025, showing a decrease in net sales by 3.8% compared to the previous year. However, the company achieved significant growth in operating profit, ordinary profit, and profit attributable to owners of the parent, with increases of 47.3%, 50.8%, and 60.7% respectively. This performance indicates a strong operational efficiency despite a decline in sales. The company also announced a revision to its financial result forecast for the fiscal year ending March 31, 2026, projecting a 2.0% increase in net sales and a substantial rise in profits, reflecting a positive outlook for future growth.

The most recent analyst rating on (JP:1898) stock is a Buy with a Yen1651.00 price target. To see the full list of analyst forecasts on Seikitokyu Kogyo Co., Ltd. stock, see the JP:1898 Stock Forecast page.