Nichireki Co., Ltd. (5011) AI Stock Analysis

• Market Cap: ¥66.18B
• Dividend Yield: 3.31%
• Average Volume (3M): 30.33K
• Price to Earnings (P/E): 9.3
• Beta (1Y): 0.57
• Revenue Growth: 3.24%
• EPS Growth: 26.38%
• Country: JP
• Employees: 977
• Sector: Industrials
• Sector Strength: 72
• Industry: Construction Materials
• EPS (TTM): 65.10
• Shares Outstanding: 31,685,955
• 10 Day Avg. Volume: 27,400
• 30 Day Avg. Volume: 30,326
• PEG Ratio: 1.66
• Price to Book (P/B): 0.83
• Price to Sales (P/S): 0.85
• P/FCF Ratio: -8.79
• 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): 172.1
• Revenue Forecast (FY): ¥78.00B

• Rating: 64 Neutral
• Price Target: ¥2,315.00 ▼(-5.28% Downside)
• Action: Reiterated Date: 10/29/25
• Date: Action: Reiterated 10/29/25

Nichireki Co., Ltd. has a stable financial foundation with consistent revenue growth and a strong balance sheet. However, technical indicators suggest bearish market momentum, which is a significant risk. The stock's valuation is attractive, with a reasonable P/E ratio and a solid dividend yield, providing some support to the overall score.

Positive Factors

Stable business model

Nichireki's core business combines materials manufacturing (asphalt mixtures) with construction and engineering services, creating diversified project-driven revenue. That integrated model captures both product sales and service margins, aligning long-term cash flows with recurring public works and maintenance cycles.

Strong balance sheet

Low leverage and a high equity ratio provide financial flexibility to fund projects, absorb downturns, and pursue capital investments without excessive refinancing risk. This conservative capital structure supports stable operations and long-term project commitments in infrastructure markets.

Healthy gross margins & operational efficiency

A near-23% gross margin and stable operating margins show durable production efficiency and pricing capacity in materials supply. Consistent cost control and margin stability support sustainable profitability across projects, cushioning against moderate demand swings over the medium term.

Negative Factors

High capital expenditures

Elevated capex materially reduced free cash flow, creating a negative FCF-to-net-income ratio. Persistent high investment needs can constrain cash available for dividends, debt reduction, or strategic moves, and may require ongoing external funding if capex remains elevated.

Modest profitability metrics

Net margin around 6.4% and a mid-single-digit ROE indicate limited earnings conversion and return on equity relative to capital invested. This modest profitability constrains reinvestment capacity and leaves less buffer against cost inflation or competitive pricing pressure over the medium term.

Exposure to input cost volatility

Asphalt and aggregate inputs tie costs to petroleum and commodity cycles. Structural volatility in those input markets can compress margins and require frequent price adjustments in contracts, increasing earnings variability and complicating long-term margin planning for infrastructure projects.

Nichireki Co., Ltd. Business Overview & Revenue Model

Company Description

Nichireki Co., Ltd. manufactures and sells various paving materials primarily in Japan. Its primary products include various types of asphalt emulsions used in constructing and recycling road paving; and various modified asphalts. The company also offers bridge waterproofing materials, crack sealing materials, pothole filling materials, surface level correcting materials, landscape materials, waterproof materials for bridge decks, cement concrete materials, crack repairing materials, mixtures for pavement, and pavement supplementary materials. In addition, it provides special materials, such as airfield aprons, railway tracks primarily for high speed trains, agricultural watercourses, dams, rivers, sewers, reservoirs, and tank base foundations, as well as offers jointing and grouting materials. Further, the company provides roads and paving maintenance and management services. Nichireki Co., Ltd. was founded in 1943 and is based in Tokyo, Japan.

How the Company Makes Money

Nichireki makes money primarily by selling road paving and infrastructure materials and by earning fees from construction-related services. Key revenue streams typically include: (1) Materials sales: revenue from manufacturing and supplying asphalt mixtures and other pavement-related materials used by public-works contractors and private-sector projects; pricing and volumes are influenced by infrastructure spending, project demand, and input costs (e.g., petroleum-derived materials and aggregates). (2) Construction/engineering services: income from undertaking pavement and road maintenance work (or providing related engineering services) where Nichireki is paid through project-based contracts. (3) Related products/services: additional sales from ancillary road-safety or pavement-related products and services tied to road building and upkeep. Significant partnerships or customer relationships are generally project-driven (e.g., contractors and public entities procuring materials and services), but specific named partnerships and segment-level revenue breakdowns are null.

Nichireki Co., Ltd. Financial Statement Overview

Summary

Nichireki Co., Ltd. demonstrates stable financial performance with consistent revenue growth and a strong balance sheet. Effective cost controls and operational efficiency are evident, although net profit margins suggest room for improvement. High capital expenditures impact free cash flow, indicating a need to optimize cash flow for sustained growth.

Income Statement

Nichireki Co., Ltd. has shown a stable revenue growth trend with a revenue increase from ¥73.8 billion to ¥75.7 billion in the last year. The gross profit margin remains healthy at approximately 22.9%, indicating strong cost management. However, the net profit margin is moderate at 6.4%, reflecting potential areas for profitability improvement. EBIT and EBITDA margins are also stable, suggesting efficient operational performance.

Balance Sheet

The company's balance sheet shows a solid equity position with a debt-to-equity ratio of approximately 0.26, indicating moderate leverage. The return on equity is commendable at 6.3%, reflecting effective utilization of shareholders' funds. The equity ratio stands at 68.8%, suggesting financial stability. However, the presence of considerable cash and cash equivalents indicates a conservative approach to liquidity management.

Cash Flow

Operating cash flow remains positive, although there is a significant drop in free cash flow, reflecting high capital expenditures. The free cash flow to net income ratio is negative, implying cash flow challenges despite profitability. The operating cash flow to net income ratio is reasonable, indicating adequate cash generation from operations relative to net income.

Breakdown	TTM	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	75.92B	75.75B	73.83B	78.40B	78.00B	71.47B
Gross Profit	17.19B	17.34B	16.46B	17.46B	18.32B	18.44B
EBITDA	9.20B	9.70B	9.08B	11.41B	11.95B	11.27B
Net Income	4.80B	4.85B	4.49B	6.28B	6.81B	6.36B
Balance Sheet
Total Assets	107.92B	112.37B	95.09B	91.47B	88.42B	82.73B
Cash, Cash Equivalents and Short-Term Investments	29.22B	31.62B	25.75B	27.32B	29.00B	25.92B
Total Debt	20.54B	19.97B	1.56B	1.53B	1.60B	2.22B
Total Liabilities	32.48B	35.05B	20.26B	19.01B	20.35B	20.73B
Stockholders Equity	75.43B	77.32B	74.84B	72.47B	68.07B	62.01B
Cash Flow
Free Cash Flow	0.00	-7.29B	3.05B	3.38B	4.36B	2.17B
Operating Cash Flow	0.00	4.89B	7.39B	6.56B	7.74B	9.10B
Investing Cash Flow	0.00	-12.46B	-3.85B	-5.83B	-2.36B	-5.69B
Financing Cash Flow	0.00	13.73B	-2.82B	-3.12B	-1.43B	2.51B

Nichireki Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 2444.00
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Positive
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:5011, the sentiment is Negative. The current price of 2444 is above the 20-day moving average (MA) of 2334.40, above the 50-day MA of 2417.94, and below the 200-day MA of 2522.10, indicating a bearish trend. The MACD of -70.76 indicates Positive momentum. The RSI at 28.34 is Positive, neither overbought nor oversold. The STOCH value of 21.27 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:5011.

Nichireki Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
5352	76 Outperform	¥149.50B	11.95	―	2.77%	1.43%	91.97%
5357	73 Outperform	¥27.67B	9.01	―	5.04%	-2.29%	-41.92%
5233	67 Neutral	¥418.27B	-16.12	7.93%	2.32%	-2.26%	-10.86%
5011	64 Neutral	¥66.18B	9.31	―	3.31%	3.24%	26.38%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
5232	61 Neutral	¥127.25B	45.55	6.98%	3.13%	-2.13%	37.10%
4044	55 Neutral	¥100.98B	5.97	―	4.87%	-4.44%	-47.54%

Nichireki Co., Ltd. Corporate Events

Nichireki Nine-Month Profit Slides but Full-Year Outlook and Dividend Plan Held Steady

Nichireki Group reported consolidated net sales of ¥54.85 billion for the nine months ended December 31, 2025, down 2.6% year on year, with operating profit falling 15.7% to ¥3.84 billion as ordinary profit and profit attributable to owners also declined. Despite weaker earnings, the balance sheet remained solid with an equity ratio of 68.9%, and comprehensive income rose sharply, indicating valuation gains or other non-operating improvements.

The company kept its full-year forecast unchanged, targeting ¥80 billion in net sales and ¥7 billion in operating profit, implying a rebound in profitability in the final quarter compared with the nine-month trend. Nichireki also maintained its dividend outlook, projecting a full-year payout of ¥80 per share, up from ¥75 in the previous fiscal year, signaling management’s confidence in cash flow stability and a continued commitment to shareholder returns.

The most recent analyst rating on (JP:5011) stock is a Hold with a Yen2576.00 price target. To see the full list of analyst forecasts on Nichireki Co., Ltd. stock, see the JP:5011 Stock Forecast page.