NIPPON RIETEC CO., LTD. (JP:1938)
:1938
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NIPPON RIETEC CO., LTD.
(1938)
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Rating:74Outperform
Price Target:
¥3,534.00
▲(55.34% Upside)
Action:ReiteratedDate:02/15/26
The score is driven primarily by strong financial performance (growth, solid margins, and very low leverage). Technicals are positive but tempered by overbought signals (high RSI and Stoch), while reasonable valuation (P/E ~12 and ~2.19% yield) provides additional support.
Positive Factors
Revenue Growth
Nippon Rietec’s ~17% revenue expansion year-over-year reflects durable demand for contracted engineering and construction services, particularly in rail and telecom infrastructure. Sustained top-line growth suggests consistent project wins and scaling of recurring maintenance work, supporting longer-term reinvestment capacity and a broader contract footprint that can underpin multi-quarter organic growth.
Negative Factors
Cash Conversion Efficiency
Operating cash flow of only ~0.43x net income and relatively low FCF-to-net income point to cash conversion challenges despite FCF growth. In project-based construction, weak cash conversion can create timing squeezes on payables and receivables, constrain the ability to fund new contract mobilization from internal cash, and increase dependence on external financing for working capital even with low headline leverage.
Read all positive and negative factors
Positive Factors
Negative Factors
Revenue Growth
Nippon Rietec’s ~17% revenue expansion year-over-year reflects durable demand for contracted engineering and construction services, particularly in rail and telecom infrastructure. Sustained top-line growth suggests consistent project wins and scaling of recurring maintenance work, supporting longer-term reinvestment capacity and a broader contract footprint that can underpin multi-quarter organic growth.
Read all positive factors
NIPPON RIETEC CO., LTD. (1938) vs. iShares MSCI Japan ETF (EWJ)
Market Cap
¥63.50B
Dividend Yield2.61%
Average Volume (3M)38.85K
Price to Earnings (P/E)9.4
Beta (1Y)0.94
Revenue Growth10.18%
EPS Growth38.26%
CountryJP
Employees1,551
SectorIndustrials
Sector Strength72
IndustryHardware, Equipment & Parts
Share Statistics
EPS (TTM)60.38
Shares Outstanding25,117,718
10 Day Avg. Volume41,980
30 Day Avg. Volume38,853
Financial Highlights & Ratios
PEG Ratio0.11
Price to Book (P/B)0.58
Price to Sales (P/S)0.54
P/FCF Ratio119.09
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
EPS Forecast (FY)N/A
Revenue Forecast (FY)N/A
NIPPON RIETEC CO., LTD. Business Overview & Revenue Model
Company Description
Nippon Rietec Co.,Ltd. engages in the railway electrical equipment construction business in Japan. The company's railway electrical equipment includes signal, power generation and transformation, optical communication cable, and transmission line ...
How the Company Makes Money
NIPPON RIETEC generates revenue through multiple streams, primarily by selling its industrial machinery and equipment to various sectors, including automotive, electronics, and healthcare. The company earns money through direct sales of its produc...
NIPPON RIETEC CO., LTD. Financial Statement Overview
Summary
Income Statement
82
Very Positive
Balance Sheet
78
Positive
Cash Flow
70
Positive
| Breakdown | TTM | Mar 2025 | Mar 2024 | Mar 2023 | Mar 2022 | Mar 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 69.59B | 68.67B | 58.54B | 53.75B | 53.23B | 55.20B |
| Gross Profit | 11.14B | 10.84B | 8.79B | 7.70B | 7.71B | 8.84B |
| EBITDA | 7.68B | 8.05B | 5.39B | 4.51B | 4.85B | 5.83B |
| Net Income | 4.94B | 4.73B | 2.77B | 2.14B | 2.40B | 3.28B |
Balance Sheet | ||||||
| Total Assets | 89.74B | 96.70B | 87.32B | 82.85B | 79.86B | 80.62B |
| Cash, Cash Equivalents and Short-Term Investments | 7.77B | 8.31B | 8.91B | 7.85B | 7.84B | 6.76B |
| Total Debt | 3.55B | 2.26B | 2.13B | 1.79B | 1.49B | 1.32B |
| Total Liabilities | 27.64B | 32.97B | 27.54B | 26.07B | 24.35B | 25.98B |
| Stockholders Equity | 62.10B | 63.73B | 59.78B | 56.78B | 55.50B | 54.64B |
Cash Flow | ||||||
| Free Cash Flow | 0.00 | 309.04M | 1.80B | 1.25B | 1.76B | 1.50B |
| Operating Cash Flow | 0.00 | 2.04B | 3.86B | 2.17B | 2.63B | 3.07B |
| Investing Cash Flow | 0.00 | -1.19B | -1.85B | -830.85M | -455.04M | -1.52B |
| Financing Cash Flow | 0.00 | -1.44B | -960.44M | -1.33B | -1.09B | -2.02B |
NIPPON RIETEC CO., LTD. Technical Analysis
Positive
2275.00
Price Trends
2598.64
Negative
2364.55
Positive
2132.17
Positive
Market Momentum
-29.59
Positive
48.54
Neutral
38.88
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:1938, the sentiment is Positive. The current price of 2275 is below the 20-day moving average (MA) of 2570.57, below the 50-day MA of 2598.64, and above the 200-day MA of 2132.17, indicating a neutral trend. The MACD of -29.59 indicates Positive momentum. The RSI at 48.54 is Neutral, neither overbought nor oversold. The STOCH value of 38.88 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:1938.
NIPPON RIETEC CO., LTD. Peers Comparison
UnderperformOutperform
Sector (63)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
78 Outperform | ¥676.50B | 15.50 | 8.07% | 2.85% | 11.18% | -0.75% | |
74 Outperform | ¥63.50B | 9.42 | ― | 2.61% | 10.18% | 38.26% | |
69 Neutral | ¥51.75B | 33.92 | 3.63% | 2.25% | 11.74% | -30.96% | |
67 Neutral | ¥3.94T | 15.03 | ― | 1.41% | 7.73% | -1.93% | |
64 Neutral | ¥164.28B | 29.59 | 5.91% | 2.39% | -3.24% | -25.21% | |
63 Neutral | $10.79B | 15.43 | 7.44% | 2.01% | 2.89% | -14.66% | |
56 Neutral | ¥58.65B | 59.15 | 0.90% | 4.00% | 0.12% | -105.94% |
* Industrials Sector Average
JP:1938
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NIPPON RIETEC CO., LTD. Corporate Events
Nippon Rietec Sets Pricing for Multi-Billion Yen Secondary Share Offering
Mar 3, 2026
Nippon Rietec has set the terms for a secondary offering of its common stock, following a February 20, 2026 board resolution, establishing a selling price of 2,934 yen per share for shares to be purchased and underwritten by securities firms. Unde...
NIPPON RIETEC to Cancel 500,000 Treasury Shares, Tightening Share Float
Feb 20, 2026
NIPPON RIETEC announced that its Board of Directors has resolved to cancel 500,000 shares of its common stock, representing 1.95% of the total issued shares, under Article 178 of the Companies Act. Following the cancellation, scheduled for March 1...
Nippon Rietec Announces Secondary Share Offering by Major Shareholders
Feb 20, 2026
Nippon Rietec’s board has approved a secondary offering of 1,494,800 existing common shares to be sold by several major shareholders, including MUFG Bank, Mizuho Bank, Sumitomo Mitsui Trust Bank, Sumitomo Electric Industries and Kyosan Elect...
Nippon Rietec Lifts Full-Year Profit Outlook on Strong Project Backlog
Feb 12, 2026
Nippon Rietec Co., Ltd. is a Japan-based construction and engineering company listed on the Tokyo Stock Exchange Prime Market, focusing on infrastructure-related projects and leveraging a substantial backlog to support recurring revenues. Its oper...
NIPPON RIETEC Posts Strong Nine-Month Earnings and Raises Full-Year Forecast
Feb 12, 2026
NIPPON RIETEC reported strong consolidated results for the nine months ended December 31, 2025, with net sales rising 10.5% year on year to ¥48.49 billion and operating profit surging 84.2% to ¥3.37 billion. Ordinary profit climbed 66.5%...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
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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.