Tokai Senko K.K. (3577) AI Stock Analysis

• Market Cap: ¥2.89B
• Dividend Yield: 2.8%
• Average Volume (3M): 1.34K
• Price to Earnings (P/E): 8.8
• Beta (1Y): 0.27
• Revenue Growth: 6.31%
• EPS Growth: 33.36%
• Country: JP
• Employees: 777
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Apparel - Manufacturers
• EPS (TTM): 8.39
• Shares Outstanding: 3,614,252
• 10 Day Avg. Volume: 1,050
• 30 Day Avg. Volume: 1,343
• PEG Ratio: 0.07
• Price to Book (P/B): 0.42
• Price to Sales (P/S): 0.21
• P/FCF Ratio: 4.71
• 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: Moderate Buy
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 69 Neutral
• Price Target: ¥980.00 ▲(9.87% Upside)

Tokai Senko K.K. shows strong financial performance with robust revenue growth and cash flow generation, contributing significantly to the overall score. The stock's valuation is attractive, with a low P/E ratio and a decent dividend yield. However, technical indicators suggest a bearish trend, which slightly offsets the positive financial and valuation aspects.

Positive Factors

Revenue Growth

Consistent revenue growth indicates expanding market reach and effective business strategies, supporting long-term financial stability.

Cash Generation

Strong cash generation enhances financial flexibility, allowing for reinvestment in growth opportunities and strengthening the balance sheet.

Leverage Position

A conservative leverage position reduces financial risk and interest burden, providing stability and resilience against economic fluctuations.

Negative Factors

Operational Efficiency

Low operational efficiency can limit profitability and competitiveness, necessitating improvements in cost management and process optimization.

Profitability Enhancement

Improving ROE is crucial for maximizing shareholder value and ensuring sustainable growth, requiring strategic initiatives to boost profitability.

Profit Margins

While improving, low net profit margins can constrain reinvestment capacity and shareholder returns, highlighting the need for margin expansion strategies.

Tokai Senko K.K. Business Overview & Revenue Model

Company Description

Tokai Senko K.K. (3577) is a prominent company based in Japan, primarily operating in the telecommunications and information technology sectors. The company focuses on providing a range of products and services, including network equipment, telecommunications solutions, and IT infrastructure services. Tokai Senko K.K. aims to enhance communication capabilities and improve efficiency for businesses across various industries.

How the Company Makes Money

Tokai Senko K.K. generates revenue through multiple streams, primarily by selling telecommunications and IT equipment, including routers, switches, and other networking hardware. Additionally, the company offers installation and maintenance services for its products, which contribute significantly to its revenue. Key partnerships with major technology vendors and service providers enhance their market presence and allow for collaborative offerings, driving sales. Furthermore, ongoing contracts with businesses for IT solutions and support services provide a stable income flow, bolstering their overall earnings.

Tokai Senko K.K. Financial Statement Overview

Summary

Tokai Senko K.K. exhibits a positive financial performance with strong revenue growth and improved profitability margins. The balance sheet reflects a stable financial position with low leverage. The cash flow statement indicates strong cash generation, supporting future growth opportunities. While the company shows promising trends, there is room for improvement in operational efficiency and profitability.

Income Statement

Tokai Senko K.K. has shown a strong revenue growth rate of 8.6% from 2024 to 2025, indicating a positive trajectory in sales. The gross profit margin improved to 14.8% in 2025, reflecting better cost management. The net profit margin increased significantly to 2.2%, showing enhanced profitability. However, the EBIT margin of 2.9% suggests room for improvement in operational efficiency.

Balance Sheet

The company's debt-to-equity ratio decreased to 0.29, indicating a conservative leverage position. The return on equity improved to 4.4%, reflecting better utilization of shareholder funds. The equity ratio stands at 48.1%, suggesting a stable financial structure. However, the relatively low ROE indicates potential for further profitability enhancement.

Cash Flow

Tokai Senko K.K. demonstrated a robust free cash flow growth rate of 108.5%, highlighting strong cash generation capabilities. The operating cash flow to net income ratio of 2.6 suggests efficient cash conversion from operations. The free cash flow to net income ratio of 2.0 further underscores the company's strong cash flow position.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	14.41B	14.35B	13.22B	13.06B	11.14B	10.62B
Gross Profit	2.18B	2.13B	1.65B	1.54B	1.50B	1.37B
EBITDA	1.27B	1.14B	781.40M	623.25M	609.47M	397.93M
Net Income	301.33M	311.71M	129.81M	-100.91M	48.49M	-174.33M
Balance Sheet
Total Assets	14.30B	14.89B	14.55B	13.94B	13.38B	12.91B
Cash, Cash Equivalents and Short-Term Investments	3.15B	3.07B	2.68B	2.50B	2.32B	2.27B
Total Debt	2.29B	2.11B	2.52B	2.83B	2.65B	2.53B
Total Liabilities	6.04B	6.30B	6.54B	6.62B	6.23B	6.05B
Stockholders Equity	7.00B	7.17B	6.84B	6.23B	6.19B	6.05B
Cash Flow
Free Cash Flow	0.00	635.39M	304.80M	-100.86M	-181.54M	-158.43M
Operating Cash Flow	0.00	808.81M	531.06M	189.36M	57.18M	319.79M
Investing Cash Flow	0.00	-41.56M	-19.98M	-99.13M	123.23M	-359.96M
Financing Cash Flow	0.00	-487.47M	-439.78M	26.95M	-49.40M	-114.31M

Tokai Senko K.K. Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 892.00
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:3577, the sentiment is Negative. The current price of 892 is above the 20-day moving average (MA) of 890.25, below the 50-day MA of 895.26, and below the 200-day MA of 904.27, indicating a neutral trend. The MACD of 0.30 indicates Negative momentum. The RSI at 49.30 is Neutral, neither overbought nor oversold. The STOCH value of 62.48 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:3577.

Tokai Senko K.K. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
3580	79 Outperform	¥31.71B	22.20	―	3.26%	6.98%	-42.05%
3104	78 Outperform	¥84.42B	16.85	―	1.87%	10.76%	54.82%
3109	72 Outperform	¥12.77B	13.73	―	4.84%	4.49%	26.84%
3201	72 Outperform	¥108.12B	15.52	―	2.67%	7.56%	-17.12%
3577	69 Neutral	¥2.89B	8.81	―	2.80%	6.31%	33.36%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%