Nippon Pallet Pool Co. (4690) AI Stock Analysis

• Market Cap: ¥3.98B
• Dividend Yield: 2.38%
• Average Volume (3M): 8.89K
• Price to Earnings (P/E): 11.0
• Beta (1Y): 0.60
• Revenue Growth: -5.18%
• EPS Growth: 0.36%
• Country: JP
• Employees: 102
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Packaging & Containers
• EPS (TTM): 38.47
• Shares Outstanding: 1,620,000
• 10 Day Avg. Volume: 4,100
• 30 Day Avg. Volume: 8,886
• PEG Ratio: -0.22
• Price to Book (P/B): 0.44
• Price to Sales (P/S): 0.41
• P/FCF Ratio: 3.10
• 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: 70 Outperform
• Price Target: ¥2,750.00 ▲(61.86% Upside)
• Action: Upgraded Date: 02/03/26
• Date: Action: Upgraded 02/03/26

The score is driven primarily by stable financial strength (solid balance sheet and strong EBITDA margin) tempered by declining revenue and weakening free cash flow. Technicals show strong trend strength but are extremely overbought, adding near-term risk. Valuation remains reasonable with a moderate P/E and modest dividend yield.

Positive Factors

Strong EBITDA Margin

A 36.4% EBITDA margin signals durable operating efficiency and pricing power in pallet pooling. High underlying profitability supports reinvestment, covers fixed costs during volume slumps, and sustains long-term cash flow generation despite top-line pressure.

Conservative Leverage and Solid Equity Base

Low leverage and a strong equity ratio provide financial flexibility to fund capex, absorb cyclical revenue shocks, and pursue network investments. Conservative balance sheet reduces refinancing risk and preserves strategic optionality over the medium term.

Recurring, Networked Business Model

Pallet pooling is a recurring, asset-based logistics service with network benefits. Standardized pallet circulation fosters stickiness, predictable demand patterns, and economies of scale, supporting stable revenue streams and competitive positioning over years.

Negative Factors

Declining Revenue

An enduring revenue decline erodes scale economics and can reverse margin benefits from the pooled model. If sustained, lower volumes reduce asset utilization, strain per-unit profitability, and limit capacity to invest in service expansion or efficiency projects.

Sharply Falling Free Cash Flow

A large FCF contraction materially weakens the firm's ability to self-fund capex, pay dividends, or build reserves. Over multiple quarters this increases reliance on external financing, constrains strategic investments, and heightens vulnerability to operational shocks.

Low Return on Equity

A sub-5% ROE indicates limited returns on invested capital and suggests the business may struggle to convert assets into profitable growth. Combined with shrinking revenue and cash flow, low ROE points to structural challenges in value creation for shareholders.

Nippon Pallet Pool Co. Business Overview & Revenue Model

Company Description

Nippon Pallet Pool Co., Ltd. engages in the rental of a pallet pool system that enables corporate activities and supports physical distribution in Japan. Its pallet pool system is used for to transport various consumer and industrial goods, and raw materials. Nippon Pallet Pool Co., Ltd. was incorporated in 1972 and is headquartered in Osaka, Japan.

How the Company Makes Money

Nippon Pallet Pool Co. generates revenue primarily through its pallet rental services, where clients pay for the use of pallets over a specified period. This rental model allows companies to avoid the capital expenditure associated with purchasing pallets outright. Additional revenue streams may include the sale of new pallets, maintenance services, and logistics consulting aimed at optimizing pallet use. The company may also benefit from partnerships with logistics providers and manufacturers, enabling it to expand its reach and enhance service offerings, ultimately contributing to its earnings.

Nippon Pallet Pool Co. Financial Statement Overview

Summary

Stable overall fundamentals supported by conservative leverage (debt-to-equity 0.35) and strong EBITDA margin (36.39%). Offsetting this, revenue declined (-8.54%) and free cash flow fell sharply (-44.2%), indicating growth and cash conversion pressures.

Income Statement

Nippon Pallet Pool Co. shows a mixed performance in its income statement. The company experienced a decline in total revenue from the previous year, indicating a negative revenue growth rate of -8.54%. The gross profit margin stood at 21.3%, and the net profit margin was 4.47%, both reflecting moderate profitability. The EBITDA margin was strong at 36.39%, showcasing operational efficiency. However, the EBIT margin was lower at 5.32%, suggesting potential operational cost pressures.

Balance Sheet

The balance sheet of Nippon Pallet Pool Co. is relatively stable, with a debt-to-equity ratio of 0.35, indicating conservative leverage. The return on equity (ROE) was 4.8%, which is moderate, and the equity ratio was 63.6%, reflecting strong equity financing and financial stability. The company maintains a healthy balance between debt and equity, with a focus on equity financing.

Cash Flow

Cash flow analysis reveals some challenges with a significant decline in free cash flow growth rate of -44.2%. The operating cash flow to net income ratio was favorable at 7.32, indicating strong cash generation relative to net income. However, the free cash flow to net income ratio was lower at 2.92, suggesting potential issues with capital expenditure management.

Breakdown	TTM	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	6.92B	6.94B	7.58B	7.39B	7.09B	6.97B
Gross Profit	-570.10M	-676.88M	-618.02M	-202.66M	-1.04B	-934.92M
EBITDA	2.62B	2.66B	3.23B	3.36B	2.88B	3.16B
Net Income	317.16M	310.01M	527.49M	833.29M	272.85M	452.91M
Balance Sheet
Total Assets	9.89B	10.20B	11.24B	12.13B	10.38B	10.25B
Cash, Cash Equivalents and Short-Term Investments	1.25B	1.30B	1.61B	897.49M	898.84M	1.01B
Total Debt	2.11B	2.26B	3.35B	4.29B	3.80B	3.97B
Total Liabilities	3.44B	3.75B	4.90B	6.29B	5.32B	5.34B
Stockholders Equity	6.45B	6.46B	6.34B	5.84B	5.06B	4.91B
Cash Flow
Free Cash Flow	0.00	906.29M	1.63B	-474.31M	193.04M	1.26B
Operating Cash Flow	0.00	2.27B	3.21B	3.17B	2.75B	2.95B
Investing Cash Flow	0.00	-1.38B	-1.42B	-3.61B	-2.72B	-1.75B
Financing Cash Flow	0.00	-1.20B	-1.08B	446.28M	-141.66M	-931.75M

Nippon Pallet Pool Co. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 1699.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Negative
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:4690, the sentiment is Positive. The current price of 1699 is below the 20-day moving average (MA) of 2495.65, below the 50-day MA of 2243.86, and below the 200-day MA of 1957.12, indicating a neutral trend. The MACD of 50.58 indicates Positive momentum. The RSI at 70.99 is Negative, neither overbought nor oversold. The STOCH value of 18.64 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:4690.

Nippon Pallet Pool Co. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
5901	79 Outperform	¥496.44B	10.13	6.90%	2.71%	-0.06%	137.47%
7917	77 Outperform	¥100.64B	7.99	7.53%	3.01%	5.44%	45.99%
3950	76 Outperform	¥78.14B	12.05	―	6.64%	2.85%	-9.13%
7942	73 Outperform	¥59.96B	5.78	―	3.31%	0.83%	-9.16%
4690	70 Outperform	¥3.98B	11.04	―	2.38%	-5.18%	0.36%
7864	70 Outperform	¥145.80B	4.25	10.46%	2.35%	4.56%	49.23%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%

Nippon Pallet Pool Co. Corporate Events

Nippon Pallet Pool Posts Profit Decline, Cancels Year-End Dividend but Maintains Full-Year Outlook

Nippon Pallet Pool reported a slight 1.0% year-on-year increase in net sales to ¥5.3 billion for the nine months ended December 31, 2025, but saw double-digit declines in profitability, with operating profit down 17.5% to ¥260 million and profit down 19.7% to ¥212 million, reflecting pressure on margins despite stable top-line performance. The company’s equity ratio slipped from 63.6% to 60.6% as total assets rose, and it has cancelled its previously planned year-end dividend for the fiscal year ending March 31, 2026, revising the dividend forecast to zero, a move that conserves cash but may disappoint income-focused shareholders; nevertheless, Nippon Pallet Pool is maintaining its full-year forecast, projecting modest sales growth and a recovery in operating profit, even as it anticipates continued weakness in ordinary profit and bottom-line earnings.

The most recent analyst rating on (JP:4690) stock is a Hold with a Yen1808.00 price target. To see the full list of analyst forecasts on Nippon Pallet Pool Co. stock, see the JP:4690 Stock Forecast page.