NIPPON RIETEC CO., LTD. (1938) AI Stock Analysis

• Market Cap: ¥49.02B
• Dividend Yield: 3.08%
• Average Volume (3M): 51.00K
• Price to Earnings (P/E): 10.2
• Beta (1Y): 0.75
• Revenue Growth: 17.30%
• EPS Growth: 70.96%
• Country: JP
• Employees: 1,551
• Sector: Technology
• Sector Strength: 89
• Industry: Hardware, Equipment & Parts
• EPS (TTM): 125.26
• Shares Outstanding: 25,617,716
• 10 Day Avg. Volume: 61,530
• 30 Day Avg. Volume: 51,000
• PEG Ratio: -1.00
• Price to Book (P/B): 0.41
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 18.80
• 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: ¥1,928.00
• Price Target Upside: -0.92% Downside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 1

• Rating: 73 Outperform
• Price Target: ¥2,054.00 ▲(5.55%Upside)

NIPPON RIETEC CO., LTD. benefits from strong financial performance and attractive valuation metrics, positioning it well for future growth. While technical indicators show bullish momentum, caution is advised due to overbought conditions. The absence of earnings call data limits insight into management's outlook and recent developments.

NIPPON RIETEC CO., LTD. Business Overview & Revenue Model

Company Description

NIPPON RIETEC CO., LTD. (1938) is a Japanese company that specializes in the engineering and construction of electrical facilities. The company operates in various sectors, including infrastructure, telecommunications, and power generation, offering comprehensive services such as design, installation, and maintenance of electrical systems. Its core products and services are focused on providing reliable and efficient solutions for complex electrical projects, ensuring the integration and enhancement of infrastructural capabilities.

How the Company Makes Money

NIPPON RIETEC CO., LTD. generates revenue through a diversified model centered around engineering and construction services for electrical facilities. Key revenue streams include project contracts with government agencies, private corporations, and utility companies for the design and installation of electrical systems. The company also earns from maintenance and after-sales services, ensuring long-term operational efficiency for its clients. Significant partnerships with technology providers and equipment manufacturers enhance its service offerings, while its reputation for reliable and high-quality service delivery contributes to consistent business from repeat clients and referrals.

NIPPON RIETEC CO., LTD. Financial Statement Overview

Summary

NIPPON RIETEC CO., LTD. displays strong financial health with consistent revenue and profit growth. The company's low leverage and high equity ratio highlight financial stability. While cash flow management is improving, there is potential for further optimization.

Income Statement

The company demonstrates strong financial performance with consistent revenue growth. The revenue has increased by approximately 17% from 2024 to 2025, indicating solid growth. Gross profit margin and net profit margin are strong at 15.8% and 6.9% respectively for 2025, showcasing efficient cost management and profitability. EBIT and EBITDA margins of 7.6% and 11.7% respectively indicate robust operational performance.

Balance Sheet

The balance sheet is stable with a low debt-to-equity ratio of 0.03, reflecting low leverage and financial risk. The equity ratio is high at 67.4%, suggesting a strong capital structure. Return on equity is reasonable at 7.4%, indicating effective use of equity. Overall, the financial position is solid, but the company could benefit from improved asset utilization.

Cash Flow

The cash flow position shows some stability but with room for improvement. Operating cash flow to net income ratio is 0.43, indicating good cash conversion. Free cash flow has grown by 72% from 2024 to 2025, showing enhanced cash management. However, the free cash flow to net income ratio is relatively low, suggesting potential inefficiencies in cash generation.

Breakdown	TTM	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	65.34B	68.67B	58.54B	53.75B	53.23B	55.20B
Gross Profit	10.63B	10.84B	8.79B	7.70B	7.71B	8.84B
EBITDA	6.06B	8.05B	5.39B	4.51B	4.85B	5.83B
Net Income	3.91B	4.73B	2.77B	2.14B	2.40B	3.28B
Balance Sheet
Total Assets	95.84B	94.63B	87.32B	82.85B	79.86B	80.62B
Cash, Cash Equivalents and Short-Term Investments	7.56B	8.31B	8.91B	7.85B	7.84B	6.76B
Total Debt	10.00B	1.76B	2.13B	1.79B	1.49B	1.32B
Total Liabilities	35.48B	30.90B	27.54B	26.07B	24.35B	25.98B
Stockholders Equity	60.36B	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

• Technical Analysis Sentiment: Positive
• Last Price: 1946.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

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 1946 is above the 20-day moving average (MA) of 1809.85, above the 50-day MA of 1718.94, and above the 200-day MA of 1362.74, indicating a bullish trend. The MACD of 65.26 indicates Negative momentum. The RSI at 61.80 is Neutral, neither overbought nor oversold. The STOCH value of 80.28 is Negative, 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

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
7715	79 Outperform	¥36.53B	6.05		2.29%	2.37%	11.78%
7723	79 Outperform	¥35.31B	9.97		3.49%	5.98%	11.06%
7500	77 Outperform	¥34.32B	12.74		3.04%	5.47%	15.88%
6644	74 Outperform	¥47.08B	12.96		2.45%	2.05%	46.96%
1938	73 Outperform	¥49.02B	10.19		3.08%	17.30%	70.96%
6817	63 Neutral	¥30.59B	37.22		5.58%	-3.62%	-81.77%
Sector *	62 Neutral	CHF2.68B	-73.78	-3.96%	2.14%	-26.92%	-138.40%

NIPPON RIETEC CO., LTD. Corporate Events

NIPPON RIETEC Affirms Independence Amid Strong Ties with East Japan Railway

NIPPON RIETEC CO., LTD. announced its relationship with East Japan Railway Company, which holds 19.6% of its voting rights, positioning it as an ‘other affiliated company.’ Despite this significant shareholding, NIPPON RIETEC maintains operational independence, conducting transactions on an arm’s-length basis. The company is a key partner within the JR East Group, contributing to a substantial portion of its sales through electric facility construction for railway operations.

NIPPON RIETEC Announces Leadership Change to Drive Growth

NIPPON RIETEC CO., LTD. announced a change in its leadership, appointing Kimito Kubo as the new Representative Director and President, effective June 25, 2025. This change is part of the company’s strategy to enhance its management system and drive sustainable growth, aligning with its new Medium-Term Management Plan.

NIPPON RIETEC Introduces Stock Compensation System to Align Director Interests

NIPPON RIETEC CO., LTD. has announced the introduction of a transfer-restricted stock compensation system aimed at incentivizing directors to continuously improve corporate value and align their interests with shareholders. This new system, subject to shareholder approval, will allow eligible directors to receive common shares under specific conditions, promoting long-term value sharing and potentially impacting the company’s governance and stakeholder relations.

NIPPON RIETEC Unveils NR 2027 Medium-Term Management Plan

NIPPON RIETEC CO., LTD. has announced its NR 2027 Medium-Term Management Plan, marking the first step towards its NR 2035 Vision. The plan emphasizes improving profitability, securing human resources, enhancing productivity through digital transformation, and contributing to a sustainable society. The company aims to maintain strong governance and become a trusted entity for stakeholders by focusing on safety, quality, and technological advancements.

NIPPON RIETEC Adopts New Shareholder Return Policy

NIPPON RIETEC CO., LTD. has announced a new basic policy on shareholder returns, emphasizing stable and progressive dividends with a DOE target of 3.2%. This shift from a total return ratio to DOE aims to clarify long-term shareholder return strategies and aligns with the company’s 2027 Medium-Term Management Plan, which targets an ROE of 8%.

NIPPON RIETEC Boosts Year-End Dividend to Enhance Shareholder Returns

NIPPON RIETEC CO., LTD. announced an increase in its year-end dividend for the fiscal year ending March 31, 2025, from a previously forecasted 60 yen per share to 77 yen per share. This decision reflects the company’s strong operating performance and financial condition, aiming to enhance shareholder returns and support sustainable growth.

Nippon Rietec Achieves Record Sales and Profit Growth in FY2025

Nippon Rietec Co., Ltd. reported an increase in net sales and profits for the fiscal year ended March 31, 2025, despite a decrease in orders received. The company achieved record-high net sales of ¥68.6 billion, driven by significant progress and completion of construction projects, particularly in the power transmission line facility division. Operating profit rose to ¥5.1 billion due to increased sales and cost reduction measures, while profit attributable to owners of the parent increased to ¥4.7 billion, aided by gains from the sale of investment securities.

NIPPON RIETEC Revises Earnings Forecast with Positive Outlook

NIPPON RIETEC CO., LTD. has revised its earnings forecast for the fiscal year ending March 31, 2025, projecting increased net sales and profits due to steady progress in construction projects and improved cost management. This revision suggests a positive outlook for the company’s financial performance, potentially enhancing its market position and benefiting stakeholders.