Environmental Control Center Co., Ltd. (4657) AI Stock Analysis

• Market Cap: ¥2.16B
• Dividend Yield: 1.93%
• Average Volume (3M): 7.82K
• Price to Earnings (P/E): 104.5
• Beta (1Y): 0.73
• Revenue Growth: -1.19%
• EPS Growth: -89.91%
• Country: JP
• Employees: 305
• Sector: Industrials
• Sector Strength: 72
• Industry: Waste Management
• EPS (TTM): N/A
• Shares Outstanding: 4,789,041
• 10 Day Avg. Volume: 12,210
• 30 Day Avg. Volume: 7,816
• PEG Ratio: -2.56
• Price to Book (P/B): 0.83
• Price to Sales (P/S): 0.32
• P/FCF Ratio: 47.25
• 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: 56 Neutral
• Price Target: ¥495.00 ▲(18.71% Upside)
• Action: Reiterated Date: 10/30/25
• Date: Action: Reiterated 10/30/25

The overall stock score is primarily influenced by the company's stable financial foundation, despite mixed profitability and liquidity challenges. Technical indicators suggest bearish momentum, and the high P/E ratio raises valuation concerns. The dividend yield provides some support but is not sufficient to counterbalance the high valuation.

Positive Factors

Balance sheet health

A moderate debt-to-equity ratio and healthy equity ratio indicate durable financial flexibility. This balance reduces refinancing risk, supports capital spending for infrastructure in waste management, and allows the company to absorb cyclical shocks without over-relying on external finance, aiding multi-month resilience.

Gross margin stability

A steady gross profit margin points to stable core economics—either resilient pricing power or controlled direct costs. For a services-oriented waste management operator, consistent gross margins support long-term operating viability and capacity to cover SG&A and invest in service capabilities even if top-line growth ebbs.

Operating cash generation

Consistent ability to convert earnings into operating cash supports internal funding of working capital and maintenance capex, reducing dependence on new debt or equity. Over 2-6 months this capability underpins liquidity management and the ability to sustain essential service delivery and modest shareholder distributions.

Negative Factors

Revenue decline

Almost 8% recent revenue contraction signals structural pressure on demand, pricing, or contract retention. For a waste management firm, revenue declines reduce scale benefits and strain fixed-cost absorption, making it harder to sustain margins and invest in long-cycle infrastructure or service expansion over the medium term.

Earnings volatility

A roughly 75% drop in EPS growth reflects pronounced earnings volatility that can stem from margin swings, one-offs, or operational disruptions. Such volatility undermines predictable cash available for reinvestment or dividends and complicates long-term planning for customers and suppliers in a business that benefits from stable contracting.

Free cash flow inconsistency

Inconsistent free cash flow relative to net income raises durable liquidity concerns: it can limit capacity to fund growth, service debt, or withstand demand shocks. For capital-intensive or contract-driven waste services, unpredictable FCF reduces financial runway and may force reliance on external financing in adverse periods.

Environmental Control Center Co., Ltd. Business Overview & Revenue Model

Company Description

Environmental Control Center Co.,Ltd. operates as an environmental consulting company in Japan. The company provides monitoring and consulting services for air, water, and soil in the general environment and workplaces. It also provides strange odor surveys, qualification tests on deodorizing equipment/deodorants, odor control in factories/workplaces, odor quality control of products, and odor assessment for product development. In addition, the company offers soil contamination surveys and analysis services; and consulting services for soil contamination control projects, regulatory affairs, information disclosure, and others. Further, it provides environmental impact assessment services, which include preliminary discussions with regulatory authorities, environmental surveys, preparation of environmental assessment statements, post hoc surveys, and discussions with the regulatory authorities for follow-up. The company was incorporated in 1971 and is headquartered in Hachioji, Japan.

How the Company Makes Money

Environmental Control Center Co., Ltd. generates revenue through multiple streams, primarily from the sale of its environmental control systems and services. The company earns money by selling its proprietary air quality and water treatment products to businesses and government entities. Additionally, the company provides installation services and ongoing maintenance contracts, which create a recurring revenue model. Strategic partnerships with governmental agencies and other corporations enhance their market reach and lead to joint projects, contributing significantly to their revenue. Furthermore, the company may also benefit from grants and incentives related to environmental initiatives, which can further bolster its earnings.

Environmental Control Center Co., Ltd. Financial Statement Overview

Summary

The company demonstrates a stable financial foundation with mixed profitability trends. The income statement shows variability in net profit margins, and the balance sheet indicates a balanced leverage strategy. However, cash flow analysis highlights potential liquidity challenges.

Income Statement

The company shows a mixed performance in its income statement. While there is a slight decline in revenue growth rate recently, the company has maintained a consistent gross profit margin over the years. However, the net profit margin has seen fluctuations, indicating potential volatility in profitability. The EBIT and EBITDA margins have also shown variability, suggesting some instability in operational efficiency.

Balance Sheet

The balance sheet reflects a stable financial position with a moderate debt-to-equity ratio, indicating a balanced approach to leveraging. The equity ratio is healthy, suggesting that the company is not overly reliant on debt. Return on equity has been positive, although it has shown some decline, which may indicate challenges in generating returns for shareholders.

Cash Flow

Cash flow analysis reveals some concerns, particularly with the volatility in free cash flow growth. The operating cash flow to net income ratio suggests that the company is generating sufficient cash from operations relative to its net income, but the free cash flow to net income ratio has been inconsistent, indicating potential challenges in maintaining liquidity.

Breakdown	Jun 2024	Jun 2023	Jun 2022	Jun 2021	Jun 2020
Income Statement
Total Revenue	6.10B	5.59B	5.34B	4.75B	4.39B
Gross Profit	1.30B	1.43B	1.16B	1.01B	1.10B
EBITDA	365.03M	594.11M	326.77M	356.64M	498.42M
Net Income	7.90M	218.41M	-41.60M	222.99M	231.25M
Balance Sheet
Total Assets	5.44B	5.62B	5.26B	5.75B	4.74B
Cash, Cash Equivalents and Short-Term Investments	828.18M	675.55M	651.23M	542.77M	476.63M
Total Debt	1.75B	1.48B	1.74B	1.89B	1.19B
Total Liabilities	2.99B	3.18B	3.02B	3.46B	2.67B
Stockholders Equity	2.34B	2.36B	2.16B	2.23B	2.01B
Cash Flow
Free Cash Flow	41.20M	378.03M	371.80M	-219.60M	593.80M
Operating Cash Flow	189.28M	479.61M	570.55M	54.94M	730.02M
Investing Cash Flow	-189.06M	-139.88M	-272.84M	-307.38M	-160.91M
Financing Cash Flow	156.63M	-314.45M	-188.47M	320.59M	-452.32M

Environmental Control Center Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 417.00
• 50DMA: Negative
• 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:4657, the sentiment is Positive. The current price of 417 is below the 20-day moving average (MA) of 451.90, below the 50-day MA of 453.88, and below the 200-day MA of 433.25, indicating a neutral trend. The MACD of -2.57 indicates Negative momentum. The RSI at 50.54 is Neutral, neither overbought nor oversold. The STOCH value of 84.90 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:4657.

Environmental Control Center Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
6403	75 Outperform	¥17.37B	20.96	―	1.79%	23.19%	-37.04%
9793	73 Outperform	¥186.47B	17.31	11.00%	2.20%	6.63%	-3.05%
5698	73 Outperform	¥28.89B	7.02	―	2.62%	-9.37%	590.66%
9336	73 Outperform	¥387.08B	25.33	―	1.30%	8.33%	1.73%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
4657	56 Neutral	¥2.16B	104.52	―	1.93%	-1.19%	-89.91%
2195	56 Neutral	¥5.76B	16.59	―	1.36%	3.68%	-24.83%