WARABEYA NICHIYO HOLDINGS Co., Ltd. (2918) AI Stock Analysis

• Market Cap: ¥55.97B
• Dividend Yield: 3.2%
• Average Volume (3M): 60.86K
• Price to Earnings (P/E): 11.6
• Beta (1Y): 0.45
• Revenue Growth: 4.98%
• EPS Growth: -10.23%
• Country: JP
• Employees: 1,948
• Sector: Consumer Defensive
• Sector Strength: 42
• Industry: Packaged Foods
• EPS (TTM): 102.91
• Shares Outstanding: 17,625,660
• 10 Day Avg. Volume: 81,240
• 30 Day Avg. Volume: 60,860
• PEG Ratio: -0.36
• Price to Book (P/B): 0.63
• Price to Sales (P/S): 0.16
• P/FCF Ratio: -6.78
• 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): 313.3
• Revenue Forecast (FY): ¥241.20B

• Rating: 73 Outperform
• Price Target: ¥4,031.00 ▲(21.42% Upside)
• Action: Reiterated Date: 11/13/25
• Date: Action: Reiterated 11/13/25

The overall stock score is driven primarily by strong technical analysis and reasonable valuation. The stock's positive momentum and attractive dividend yield are significant strengths. However, financial performance is a concern due to declining net margins and increased leverage, which could pose risks if not managed effectively.

Positive Factors

Revenue Growth

Consistent 7.5% revenue growth in 2025 signals expanding retailer demand and effective production scaling. For a prepared-food supplier that depends on high-frequency replenishment and contract supply, steady top-line gains improve plant utilization, support fixed-cost absorption, and give clearer visibility for medium-term planning.

Stable Gross Margins

Stable gross margins indicate the company manages ingredient procurement and production costs effectively. In a volume-driven ready-to-eat foods industry, sustained gross margin performance preserves unit economics, provides pricing flexibility, and helps absorb commodity swings, supporting margin durability over the medium term.

Operating Cash Generation

A strong operating cash flow to net income ratio shows core operations convert earnings into cash reliably, critical for working-capital intensive fresh-food manufacturing. Durable cash generation supports daily distribution cycles, supplier payments and targeted reinvestment without overreliance on external financing in normal conditions.

Negative Factors

Declining Net Margins

Declining net profit margins indicate rising SG&A, distribution, or other operating costs are eroding bottom-line returns despite stable gross margins. Over time, compressed net margins reduce retained earnings for reinvestment or dividends and leave less buffer against input-cost inflation or demand softness.

Rising Leverage

An increased debt-to-equity ratio signals higher financial leverage, which raises fixed interest obligations and reduces balance-sheet flexibility. For a perishable-goods manufacturer with capex and working-capital needs, greater leverage heightens refinancing and interest-rate vulnerability and limits strategic options in downturns.

Negative Free Cash Flow

Negative free cash flow driven by elevated capital spending suggests investments outpaced cash generation. If sustained, this pressures liquidity, may necessitate additional external financing, and amplifies the impact of rising leverage and margin pressure, constraining the company's ability to fund growth or absorb shocks.

WARABEYA NICHIYO HOLDINGS Co., Ltd. Business Overview & Revenue Model

Company Description

WARABEYA NICHIYO HOLDINGS Co., Ltd. (2918) is a prominent Japanese company primarily engaged in the food and beverage sector, specializing in the production and distribution of a diverse range of products, including confectionery, snacks, and prepared foods. The company operates through various subsidiaries, leveraging its established brand reputation to cater to both domestic and international markets. WARABEYA NICHIYO is known for its commitment to quality and innovation, offering products that meet the evolving tastes and preferences of consumers.

How the Company Makes Money

WARABEYA NICHIYO HOLDINGS generates revenue through multiple streams, primarily by selling its food products to retailers, wholesalers, and food service companies. Key revenue sources include the sale of packaged snacks, confectionery items, and ready-to-eat meals. The company benefits from strong brand recognition and customer loyalty, which drives repeat purchases. Additionally, partnerships with retailers and distributors enhance its market reach and visibility. Seasonal promotions and product launches contribute to spikes in sales, while cost management strategies help maintain profitability. The company's focus on expanding its product line and entering new markets also plays a crucial role in sustaining its revenue growth.

WARABEYA NICHIYO HOLDINGS Co., Ltd. Financial Statement Overview

Summary

The company shows robust revenue growth and stable gross margins but faces challenges with declining net margins and rising leverage. The balance sheet is solid with a healthy equity base, but increasing debt levels could pose future risks. Cash flow management appears strained due to significant capital expenditures, resulting in negative free cash flow.

Income Statement

The company shows a steady revenue growth with a 7.5% increase in 2025 compared to 2024. Gross profit margin remains relatively stable, indicating effective cost management. However, net profit margin has declined, suggesting increased expenses or other profitability challenges. EBIT and EBITDA margins are solid but have decreased compared to previous years, potentially indicating rising operational costs.

Balance Sheet

The company's debt-to-equity ratio increased in 2025, indicating higher leverage, which could pose a risk if market conditions worsen. Return on Equity (ROE) is moderate, showing that the company is generating fair returns on its equity. The equity ratio is healthy, suggesting a strong financial foundation, though the increase in debt levels warrants attention.

Cash Flow

The company experienced negative free cash flow in 2025, primarily due to high capital expenditures outpacing operating cash flow. The operating cash flow to net income ratio remains strong, indicating good cash generation from operations. However, the free cash flow to net income ratio is negative, highlighting the challenge of maintaining cash reserves amidst high investment activities.

Breakdown	TTM	Feb 2025	Feb 2024	Feb 2023	Feb 2022	Feb 2021
Income Statement
Total Revenue	228.47B	222.47B	207.01B	194.42B	192.33B	194.31B
Gross Profit	40.26B	37.84B	36.95B	33.51B	32.11B	31.32B
EBITDA	11.03B	11.68B	11.01B	9.07B	10.09B	7.00B
Net Income	3.87B	2.68B	4.27B	2.81B	3.26B	682.00M
Balance Sheet
Total Assets	128.97B	120.92B	101.96B	92.68B	82.18B	82.27B
Cash, Cash Equivalents and Short-Term Investments	8.80B	8.45B	8.12B	11.19B	9.67B	8.95B
Total Debt	35.39B	34.24B	21.66B	15.15B	9.31B	11.21B
Total Liabilities	68.87B	61.80B	47.65B	41.16B	34.28B	37.90B
Stockholders Equity	57.70B	56.67B	53.30B	50.50B	47.56B	44.16B
Cash Flow
Free Cash Flow	0.00	-5.28B	-3.70B	332.00M	4.28B	2.88B
Operating Cash Flow	0.00	12.48B	9.37B	7.43B	8.11B	8.34B
Investing Cash Flow	0.00	-20.67B	-13.54B	-7.54B	-3.96B	-5.23B
Financing Cash Flow	0.00	8.26B	845.00M	692.00M	-3.55B	-1.92B

WARABEYA NICHIYO HOLDINGS Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 3320.00
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:2918, the sentiment is Negative. The current price of 3320 is below the 20-day moving average (MA) of 3502.17, below the 50-day MA of 3364.47, and above the 200-day MA of 2898.40, indicating a neutral trend. The MACD of -10.62 indicates Positive momentum. The RSI at 34.86 is Neutral, neither overbought nor oversold. The STOCH value of 6.79 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:2918.

WARABEYA NICHIYO HOLDINGS Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
3392	78 Outperform	¥13.52B	8.76	―	1.43%	10.77%	131.68%
2918	73 Outperform	¥55.97B	11.55	―	3.20%	4.98%	-10.23%
2871	72 Outperform	¥529.80B	20.14	9.86%	2.58%	1.08%	2.71%
2296	64 Neutral	¥333.98B	21.26	―	2.61%	6.54%	15.08%
Sector *	62 Neutral	$20.33B	14.63	-3.31%	3.23%	1.93%	-12.26%
2802	61 Neutral	¥4.58T	59.23	9.46%	1.32%	1.99%	-18.79%
2910	46 Neutral	¥37.07B	306.06	―	1.65%	-1.17%	-84.81%

WARABEYA NICHIYO HOLDINGS Co., Ltd. Corporate Events

Warabeya Nichiyo Reports Fire at Subsidiary’s Sapporo Food Plant

Warabeya Nichiyo Holdings has reported a fire at the Sapporo Plant of its consolidated subsidiary, Warabeya Nichiyo Foods, in Sapporo, Hokkaido. The incident occurred on the afternoon of February 16, 2026, and was brought under control by late evening after emergency services responded.

One person sustained a minor injury, and the interior of the building along with some facilities suffered fire damage, the extent of which is still under investigation. The company is working with authorities to determine the cause, implement measures to prevent a recurrence, and is currently assessing the potential impact on its business performance, promising further disclosure if the effects prove significant.

The most recent analyst rating on (JP:2918) stock is a Buy with a Yen4225.00 price target. To see the full list of analyst forecasts on WARABEYA NICHIYO HOLDINGS Co., Ltd. stock, see the JP:2918 Stock Forecast page.

Warabeya Nichiyo Reshapes Management to Bolster Overseas and Financial Strategy

Warabeya Nichiyo Holdings has announced a reshuffle of key management roles effective March 1, 2026, as it adjusts its leadership structure to support its strategic priorities. Director and Executive Officer Masahide Ebata will shift from overseeing corporate planning and sustainability to becoming Director, Executive Officer in charge of Overseas Business, while retaining his role as Representative Director and President of Warabeya Nichiyo International.

Atsushi Inoue will assume the role of Director, Executive Officer and General Manager of the Corporate Planning Department, taking charge of finance and sustainability to strengthen centralized planning and financial oversight. In addition, Mizuki Sugimoto will be promoted to General Manager of the Financial Planning Department, indicating a focus on bolstering the company’s financial management framework as it pursues overseas expansion and sustainability initiatives.

The most recent analyst rating on (JP:2918) stock is a Buy with a Yen4128.00 price target. To see the full list of analyst forecasts on WARABEYA NICHIYO HOLDINGS Co., Ltd. stock, see the JP:2918 Stock Forecast page.

Warabeya Nichiyo to Close Murayama Plant No.2 in Production Restructuring

Warabeya Nichiyo Holdings will close its Murayama Plant No.2 in Musashimurayama, Tokyo, at the end of February 2027 as part of a broader effort to rebuild its domestic production structure and adapt to changes in the external business environment. Production from the plant, which currently manufactures prepared foods for convenience stores and employs 248 workers, will be transferred to other group facilities to maintain output while improving overall productivity, with affected employees reassigned within the group. The company expects higher depreciation expenses due to shortened useful lives of fixed assets from the fiscal years ending February 2026 to February 2027, but it is maintaining its earnings forecast for the fiscal year ending February 2026.

The most recent analyst rating on (JP:2918) stock is a Buy with a Yen3646.00 price target. To see the full list of analyst forecasts on WARABEYA NICHIYO HOLDINGS Co., Ltd. stock, see the JP:2918 Stock Forecast page.

Warabeya Nichiyo Exceeds Full-Year Profit Targets in Q3 but Warns of Q4 Losses on Maintenance Costs

Warabeya Nichiyo Holdings reported that in the third quarter of FY2/2026, consolidated operating profit, ordinary profit, and quarterly net profit all exceeded its full-year forecasts, reflecting solid progress against plan. However, the company expects all profit lines to show planned losses in the fourth quarter due to higher-than-expected plant maintenance costs for the full fiscal year, while its overseas business has seen profit decline amid a challenging sales environment in North America and price revision impacts, with management projecting a profit recovery in the fourth quarter.

The most recent analyst rating on (JP:2918) stock is a Buy with a Yen3646.00 price target. To see the full list of analyst forecasts on WARABEYA NICHIYO HOLDINGS Co., Ltd. stock, see the JP:2918 Stock Forecast page.

Warabeya Nichiyo Posts Strong Profit Surge and Lifts Dividend Outlook for FY2025

For the nine months ended November 30, 2025, Warabeya Nichiyo Holdings reported solid top-line and strong profit growth, with net sales rising 5.0% year on year to ¥177.7 billion, operating profit jumping 41.6% to ¥7.6 billion, and profit attributable to owners of parent surging 58.9% to ¥5.8 billion. Earnings per share climbed to ¥332.44, while total assets increased to ¥130.7 billion and equity capital to ¥58.5 billion, though the equity ratio edged down to 44.8%. The group maintained stable corporate structure with no changes in significant subsidiaries and implemented certain accounting policy changes due to revisions in standards. For the full year ending February 28, 2026, the company projects continued revenue growth and sharply higher earnings, forecasting net sales of ¥234.5 billion and profit attributable to owners of parent of ¥5.45 billion, more than doubling year on year, and plans a higher annual dividend of ¥120 per share, signaling management’s confidence in earnings momentum and shareholder returns.

The most recent analyst rating on (JP:2918) stock is a Buy with a Yen3646.00 price target. To see the full list of analyst forecasts on WARABEYA NICHIYO HOLDINGS Co., Ltd. stock, see the JP:2918 Stock Forecast page.