Nippon Air Conditioning Services Co., Ltd. (4658) AI Stock Analysis

• Market Cap: ¥59.00B
• Dividend Yield: 3.33%
• Average Volume (3M): 105.50K
• Price to Earnings (P/E): 17.4
• Beta (1Y): 0.81
• Revenue Growth: 9.63%
• EPS Growth: 11.40%
• Country: JP
• Employees: 2,154
• Sector: Industrials
• Sector Strength: 72
• Industry: Specialty Business Services
• EPS (TTM): 15.62
• Shares Outstanding: 35,784,000
• 10 Day Avg. Volume: 58,030
• 30 Day Avg. Volume: 105,499
• PEG Ratio: 0.83
• Price to Book (P/B): 1.32
• Price to Sales (P/S): 0.53
• P/FCF Ratio: 20.87
• 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: 78 Outperform
• Price Target: ¥1,891.00 ▲(46.59% Upside)
• Action: Reiterated Date: 02/26/26
• Date: Action: Reiterated 02/26/26

The score is driven primarily by strong financial performance (growth, improving margins, solid cash flow, and low leverage). Technicals support an uptrend, but overbought indicators (RSI and Stoch) temper the rating. Valuation is reasonable with a supportive dividend yield.

Positive Factors

Recurring Maintenance Revenue

The company's core revenue mix includes recurring maintenance and inspection contracts, which create predictable, repeatable cash flows and high customer retention. Over 2-6 months this durability supports stable revenue visibility, easier capacity planning, and lower customer acquisition cost versus one-off sales.

Revenue & Margin Improvement

Double-digit top-line growth coupled with expanding gross and net margins indicates improving operational leverage and pricing or cost control. These trends suggest the business is scaling services efficiently and can sustain cash generation and reinvestment capacity across upcoming quarters.

Strong Cash Generation

Very strong free cash flow growth and an OCF to net income well above 1 indicate high cash conversion quality. This durable cash generation supports working capital, modest capital expenditures, dividends, or selective reinvestment without relying on external financing over the medium term.

Negative Factors

Modest Net Margin

A sub-5% net margin leaves limited buffer against cost inflation, wage pressure, or pricing compression in a labor- and service-intensive industry. Even with recent improvement, limited absolute margin scope constrains retained earnings and reduces resilience to adverse cost shocks over the next several months.

Rising Total Debt

Although current leverage is low (D/E 0.14), the noted increase in total debt warrants attention. Continued debt accumulation could erode financial flexibility, raise interest expense sensitivity, and limit capacity for opportunistic investment if revenue growth slows or margins compress.

Project Revenue Lumps

A meaningful portion of revenue is project-based renovation and upgrade work, which is inherently lumpy and tied to customers' capex cycles. This structural mix can amplify cash and revenue volatility quarter-to-quarter and complicate short-term forecasting despite steady recurring contracts.

Nippon Air Conditioning Services Co., Ltd. Business Overview & Revenue Model

Company Description

Nippon Air conditioning Services Co., Ltd. provides construction support services in Japan and internationally. It offers maintenance services, including inspection, servicing, repair, and replacement for air conditioning; and facilities management, reform and construction, and facility/environmental diagnosis services, as well as measuring services. The company was incorporated in 1964 and is headquartered in Nagoya, Japan.

How the Company Makes Money

Nippon Air Conditioning Services generates revenue primarily through the sale and installation of air conditioning systems, as well as ongoing maintenance and repair services. Key revenue streams include new system installations for residential and commercial properties, service contracts for regular maintenance, and emergency repair services. The company may also benefit from partnerships with HVAC manufacturers, allowing it to offer a range of products and exclusive deals. Additionally, as energy efficiency becomes increasingly important, Nippon Air Conditioning Services capitalizes on the growing demand for eco-friendly and energy-efficient air conditioning solutions, which can command higher pricing and attract environmentally conscious customers.

Nippon Air Conditioning Services Co., Ltd. Financial Statement Overview

Summary

Strong overall fundamentals: revenue grew 10.7% (2024→2025), profitability improved (gross margin 20.1%, net margin 4.8%) with solid EBIT/EBITDA margins (6.5%/7.5%), and cash generation is strong (FCF up 118.8%, OCF/NI 1.60). Balance sheet leverage is low (D/E 0.14) and equity ratio is healthy (53.4%), though rising total debt bears monitoring.

Income Statement

The company demonstrates strong financial performance with consistent revenue growth, evidenced by a 10.7% increase from 2024 to 2025. The gross profit margin improved to 20.1%, and net profit margin grew to 4.8%, suggesting efficient cost management. EBIT and EBITDA margins are healthy, at 6.5% and 7.5% respectively, indicating sound operational efficiency. Overall, the income statement reflects robust revenue growth and solid profitability.

Balance Sheet

The balance sheet is strong, with a manageable debt-to-equity ratio of 0.14, highlighting low financial leverage. The equity ratio stands at 53.4%, indicating a well-capitalized company with ample shareholder equity. Return on equity is decent at 12.0%, reflecting effective use of equity to generate profits. However, the increase in total debt needs monitoring to ensure it does not escalate.

Cash Flow

The cash flow statement reflects positive trends, with a significant free cash flow growth of 118.8% from 2024 to 2025. Operating cash flow to net income ratio is strong at 1.60, demonstrating efficient cash generation relative to net income. The free cash flow to net income ratio at 0.53 suggests a healthy conversion of profits into free cash. Overall, cash flow management remains a strength, supporting the company's operational and financial flexibility.

Breakdown	TTM	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	65.58B	64.44B	58.23B	52.89B	49.89B	49.15B
Gross Profit	13.45B	12.96B	10.97B	9.33B	8.81B	9.12B
EBITDA	5.01B	4.86B	4.27B	3.36B	4.64B	3.60B
Net Income	3.26B	3.10B	2.73B	1.94B	2.82B	2.00B
Balance Sheet
Total Assets	45.64B	48.57B	42.95B	37.56B	35.14B	34.91B
Cash, Cash Equivalents and Short-Term Investments	10.64B	9.00B	6.99B	6.58B	7.25B	6.69B
Total Debt	3.60B	3.60B	1.71B	997.00M	853.00M	1.19B
Total Liabilities	19.43B	22.44B	18.74B	15.86B	14.66B	14.52B
Stockholders Equity	26.01B	25.93B	24.03B	21.54B	20.33B	20.26B
Cash Flow
Free Cash Flow	0.00	1.64B	751.00M	335.00M	1.47B	2.54B
Operating Cash Flow	0.00	4.96B	2.42B	921.00M	1.78B	2.73B
Investing Cash Flow	0.00	-3.47B	-1.80B	-697.00M	971.00M	-267.00M
Financing Cash Flow	0.00	378.00M	-287.00M	-1.02B	-2.37B	-1.81B

Nippon Air Conditioning Services Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 1290.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:4658, the sentiment is Positive. The current price of 1290 is below the 20-day moving average (MA) of 1504.65, below the 50-day MA of 1413.80, and above the 200-day MA of 1234.92, indicating a bullish trend. The MACD of 59.85 indicates Negative momentum. The RSI at 78.63 is Negative, neither overbought nor oversold. The STOCH value of 86.87 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:4658.

Nippon Air Conditioning Services Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
4658	78 Outperform	¥59.00B	17.38	―	3.33%	9.63%	11.40%
4659	75 Outperform	¥37.33B	14.63	8.56%	3.21%	6.55%	5.32%
6044	71 Outperform	¥12.05B	14.34	―	1.08%	18.17%	191.50%
8876	68 Neutral	¥294.46B	14.01	30.73%	2.20%	4.52%	―
6086	67 Neutral	¥26.69B	19.06	―	1.34%	16.06%	31.24%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
6544	61 Neutral	¥290.04B	43.42	―	0.87%	16.30%	23.34%

Nippon Air Conditioning Services Co., Ltd. Corporate Events

Nippon Air Conditioning Services Overhauls Executive and Regional Management Structure

Nippon Air Conditioning Services announced a series of senior executive and management personnel changes, effective April 1, 2026, aimed at strengthening oversight of its key regional offices and technical divisions. Senior Executive Officer Tadashi Matsui will take on additional responsibility as General Manager of the Tokyo Office and Technology 1st Group, while Senior Executive Officer Takahiro Shibata will similarly oversee the Nagoya Office and its Technology 2nd Group.

The company also newly appointed Yutaka Hirozawa as Executive Officer while retaining his role as General Manager of the FM Control Division, highlighting the strategic importance of facility management controls. Further shifts include multiple promotions and reassignments of general managers across the Hokkaido, Kanto, Chu-shikoku, Osaka, Nagoya, Tokyo, and Kyushu offices, signaling a broad organizational realignment intended to optimize regional management and technical leadership structures.

The most recent analyst rating on (JP:4658) stock is a Buy with a Yen1667.00 price target. To see the full list of analyst forecasts on Nippon Air Conditioning Services Co., Ltd. stock, see the JP:4658 Stock Forecast page.

Nippon Air Conditioning Services Lifts Full-Year Earnings and Sales Forecasts on Strong Renovation Demand

Nippon Air Conditioning Services has raised its full-year consolidated and non-consolidated forecasts for the fiscal year ending March 31, 2026, projecting higher net sales and profits than previously expected, with consolidated net sales now seen at ¥68.2 billion and profit attributable to owners of parent at ¥3.55 billion. The company cited sustained strong demand for renovation of air conditioning systems to improve plant work environments, as well as explicit and latent customer needs for energy and cost savings, as key drivers of the upward revision, noting that even after implementing an average 5.7% salary increase to enhance human capital, tighter supply-demand conditions and appropriate pricing for high-quality services are expected to support improved profitability, benefiting shareholders and reinforcing its competitive position in the capital investment and building-renovation market.

The most recent analyst rating on (JP:4658) stock is a Buy with a Yen1655.00 price target. To see the full list of analyst forecasts on Nippon Air Conditioning Services Co., Ltd. stock, see the JP:4658 Stock Forecast page.

Nippon Air Conditioning Services Lifts Earnings and Dividend Outlook on Strong Nine-Month Results

Nippon Air Conditioning Services reported steady growth for the nine months ended 31 December 2025, with net sales up 5.7% to ¥46.7 billion and profit attributable to owners of the parent rising 15.0% to ¥2.1 billion, while comprehensive income nearly doubled. Profitability improved across operating and ordinary profit, basic earnings per share increased to ¥61.29, and the equity ratio strengthened to 58.4% as net assets expanded, underscoring a solid financial base. Reflecting this performance, the company revised its full-year forecasts, now projecting FY2025/26 net sales of ¥68.2 billion and a 14.4% increase in full-year profit to ¥3.55 billion, and it also raised its annual dividend forecast to ¥52 per share, signalling confidence in ongoing earnings growth and a stronger shareholder return policy.

The most recent analyst rating on (JP:4658) stock is a Buy with a Yen1655.00 price target. To see the full list of analyst forecasts on Nippon Air Conditioning Services Co., Ltd. stock, see the JP:4658 Stock Forecast page.

Nippon Air Conditioning Services Announces Secondary Offering Details

Nippon Air Conditioning Services Co., Ltd. announced the selling price and other details for a secondary offering of its common stock, resolved by the Board of Directors. The offering includes a selling price of 1,150 yen per share, with a total selling price amounting to 4,096,070,000 yen, and is set for delivery on December 22, 2025. This move is likely to impact the company’s financial structure and market positioning by potentially increasing its capital base.

The most recent analyst rating on (JP:4658) stock is a Buy with a Yen1239.00 price target. To see the full list of analyst forecasts on Nippon Air Conditioning Services Co., Ltd. stock, see the JP:4658 Stock Forecast page.

Nippon Air Conditioning Services Announces Secondary Share Offering

Nippon Air Conditioning Services Co., Ltd. announced a secondary offering of its common stock, involving 3,561,800 shares. The offering will be conducted through purchase and underwriting by underwriters, with shares sold by several banks, including Aichi Bank, MUFG Bank, and others. The pricing will be determined based on market demand and conditions. This move is likely aimed at enhancing liquidity and potentially expanding the shareholder base.

The most recent analyst rating on (JP:4658) stock is a Buy with a Yen1239.00 price target. To see the full list of analyst forecasts on Nippon Air Conditioning Services Co., Ltd. stock, see the JP:4658 Stock Forecast page.