Okamoto Industries, Inc. (5122) AI Stock Analysis

• Market Cap: ¥100.43B
• Dividend Yield: 2.25%
• Average Volume (3M): 10.99K
• Price to Earnings (P/E): 13.9
• Beta (1Y): 0.48
• Revenue Growth: -1.95%
• EPS Growth: -1.37%
• Country: JP
• Employees: 2,775
• Sector: Basic Materials
• Sector Strength: 58
• Industry: Chemicals - Specialty
• EPS (TTM): 98.16
• Shares Outstanding: 17,699,368
• 10 Day Avg. Volume: 10,500
• 30 Day Avg. Volume: 10,990
• PEG Ratio: -1.50
• Price to Book (P/B): 0.93
• Price to Sales (P/S): 0.81
• P/FCF Ratio: 26.30
• 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: 71 Outperform
• Price Target: ¥6,542.00 ▲(19.60% Upside)
• Action: Reiterated Date: 10/29/25
• Date: Action: Reiterated 10/29/25

Okamoto Industries, Inc. shows strong financial performance with a robust balance sheet and consistent revenue growth, which are the most significant factors contributing to the score. Technical analysis indicates a neutral market sentiment, while valuation metrics suggest the stock is fairly valued. The absence of earnings call data and corporate events limits additional insights.

Positive Factors

Robust balance sheet

A very strong equity ratio and negligible leverage provide durable financial flexibility. Low debt reduces interest burden and bankruptcy risk, enabling the company to fund capex, absorb commodity cycles, maintain dividends or pursue strategic M&A without stressing liquidity over the medium term.

Stable revenue growth and gross margins

A multi-year revenue CAGR and consistent ~22% gross margin signal resilient demand and operational efficiency in core polymer products. This structural revenue and margin base supports predictable operating cash flows, scalable fixed-cost absorption, and investment in higher value-added processing.

Positive cash generation

Operating cash consistently exceeds net income and the company has remained free-cash-flow positive, indicating high-quality earnings and internal funding capacity. Sustained cash generation supports dividends, working capital and reinvestment without relying on external financing.

Negative Factors

Slight net margin erosion

Even modest, persistent declines in net margin evidence cost or pricing pressures (raw materials, energy or SG&A) that can erode returns over time. If trend continues it will constrain retained earnings, reduce ROE expansion potential, and limit reinvestment or payout flexibility.

Recent revenue contraction

A recent negative top-line print suggests near-term demand softness or volume loss that could reverse prior CAGR momentum. If the contraction persists it will reduce operating leverage, hurt margins and cash conversion, and force tougher pricing or cost restructuring decisions.

Volatile free cash flow

Inconsistent free cash flow driven by variable capex or working-capital swings undermines predictability of internally funded initiatives. Even with strong liquidity, volatile FCF complicates planning for growth projects, dividends or acquisitions without dipping into reserves or increasing external funding.

Okamoto Industries, Inc. Business Overview & Revenue Model

Company Description

Okamoto Industries, Inc. manufactures and sells industrial and household products in Japan and internationally. The company's industrial products include plastic films; wallpaper for housing, decorative films, moldable ABS and acrylic sheets, and synthetic leather for furniture; automotive materials; agricultural films/work materials; and food wrapping films, dehydrant/absorbent sheets, gloves, and other food sanitation materials. It also provides adhesive tape and rubber bands; flexible container bags; medical/welfare products comprising wound dressing materials, medical gloves, autoclaves, masks, and other sanitary materials; and industrial products, such as cleanroom gloves, adhesive mats for entrances, partition films, safety shoes, and other products. In addition, the company offers household products consisting of condoms/lubricants, heat patches/heating pads/hot water bags, health goods, portable sanitary products, and gloves; dehumidifiers, cockroach control products, and cleaning agents for living spaces; absorbent/dehydrant sheets, food wrapping films, and sheets for cooking; boots, short boots, and safety shoes for working or outdoor activities; and rainwear for rainy days, as well as windbreakers for use at workplaces. Further, it engages in the solar power generation business. The company was founded in 1934 and is headquartered in Tokyo, Japan.

How the Company Makes Money

Okamoto Industries makes money by manufacturing and selling polymer-based materials and finished goods to corporate and consumer markets. Its revenue model is primarily product-sales driven: (1) sales of plastic films/sheets and other resin-based materials used as inputs for packaging and industrial applications, and (2) sales of processed/converted products where the company adds value through formulation, coating, laminating, or other secondary processing before shipment. Earnings are influenced by sales volume, product mix (commodity vs. higher value-added processed products), and the spread between selling prices and raw-material/energy costs (e.g., petrochemical feedstocks). Specific breakdowns by segment, major customer/partner disclosures, and contract structures are null.

Okamoto Industries, Inc. Financial Statement Overview

Summary

Okamoto Industries, Inc. has demonstrated steady revenue growth and maintains a healthy gross profit margin. The balance sheet is robust with a strong equity base and low leverage, indicating financial stability. However, there is a slight decline in net profit margin and fluctuating free cash flow, suggesting some pressure on profitability and cash management.

Income Statement

Okamoto Industries, Inc. has demonstrated a steady revenue growth over the years, with a compound annual growth rate of approximately 4.1% from 2020 to 2025. The gross profit margin remains healthy, averaging around 22%, indicating efficient cost management. However, the net profit margin has slightly declined from 6.3% in 2020 to 6.1% in 2025, reflecting some pressure on bottom-line profitability. The EBIT and EBITDA margins have shown resilience, although EBIT has faced slight fluctuations.

Balance Sheet

The company's balance sheet is robust with a strong equity base, as evidenced by an increasing equity ratio reaching 64.7% in 2025. The debt-to-equity ratio has consistently remained low, at about 0.035, indicating prudent financial leverage. Return on Equity (ROE) has been stable around 7%, reflecting efficient use of shareholders' equity. The high levels of cash and cash equivalents further strengthen the company's financial position.

Cash Flow

Okamoto Industries has shown fluctuating free cash flow due to varying capital expenditures, but maintains positive free cash flow. The operating cash flow to net income ratio has been over 1x, indicating healthy cash generation relative to net income. However, the decline in free cash flow from 2024 to 2025 may indicate potential challenges in managing capital investments versus cash generation.

Breakdown	TTM	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	109.97B	109.11B	106.12B	99.08B	89.58B	86.36B
Gross Profit	22.30B	23.91B	24.47B	21.32B	21.56B	22.85B
EBITDA	10.08B	12.15B	12.19B	10.10B	10.13B	10.74B
Net Income	4.94B	6.67B	7.39B	4.89B	5.58B	5.70B
Balance Sheet
Total Assets	145.78B	146.52B	143.86B	127.18B	117.56B	112.07B
Cash, Cash Equivalents and Short-Term Investments	35.89B	41.34B	39.87B	34.22B	33.45B	29.69B
Total Debt	3.33B	3.34B	3.35B	3.42B	3.70B	3.72B
Total Liabilities	52.36B	51.67B	52.28B	48.08B	42.65B	41.76B
Stockholders Equity	93.32B	94.74B	88.66B	75.99B	71.96B	67.52B
Cash Flow
Free Cash Flow	0.00	3.35B	7.29B	4.53B	8.04B	5.50B
Operating Cash Flow	0.00	7.24B	12.96B	8.32B	10.64B	8.18B
Investing Cash Flow	0.00	-2.00B	-5.95B	-2.89B	-3.75B	-3.24B
Financing Cash Flow	0.00	-5.44B	-2.54B	-5.61B	-3.83B	-2.24B

Okamoto Industries, Inc. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 5470.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:5122, the sentiment is Positive. The current price of 5470 is below the 20-day moving average (MA) of 5807.50, below the 50-day MA of 5683.60, and above the 200-day MA of 5242.26, indicating a bullish trend. The MACD of 88.37 indicates Negative momentum. The RSI at 53.86 is Neutral, neither overbought nor oversold. The STOCH value of 66.12 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:5122.

Okamoto Industries, Inc. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
4202	80 Outperform	¥368.41B	5.46	9.34%	4.27%	-0.48%	-35.29%
4205	79 Outperform	$356.53B	14.16	9.59%	3.91%	0.87%	16.71%
5122	71 Outperform	¥100.43B	13.88	―	2.25%	-1.95%	-1.37%
5199	64 Neutral	¥2.60B	10.71	―	4.05%	-4.09%	59.57%
3101	62 Neutral	¥128.99B	13.27	―	3.21%	-1.68%	1262.84%
Sector *	61 Neutral	$10.43B	7.12	-0.05%	2.87%	2.86%	-36.73%
4023	60 Neutral	¥170.81B	9.97	4.24%	3.76%	-7.81%	25.04%

Okamoto Industries, Inc. Corporate Events

Okamoto Industries Reports Progress on Ongoing Share Buyback Program

Okamoto Industries has disclosed the latest progress of its share repurchase program conducted under the provisions of Japan’s Companies Act. Between February 1 and February 28, 2026, the company bought back 3,000 common shares for a total of ¥16.49 million.

These purchases form part of a broader buyback framework approved by the board in November 2025, which authorizes repurchases of up to 190,000 shares or ¥1 billion through September 30, 2026. As of the end of February 2026, only a small portion of the authorized capacity has been used, indicating the company retains significant room to continue buybacks that could enhance shareholder returns and adjust its capital structure over time.

The most recent analyst rating on (JP:5122) stock is a Hold with a Yen6395.00 price target. To see the full list of analyst forecasts on Okamoto Industries, Inc. stock, see the JP:5122 Stock Forecast page.

Okamoto Industries Posts Profit Decline but Maintains Dividend as Assets Grow

Okamoto Industries reported a decline in performance for the nine months ended December 31, 2025, with net sales falling 2.9% year on year to ¥80.68 billion and operating income dropping 39.5%. Ordinary income decreased 26.3% to ¥6.22 billion, while profit attributable to owners of parent slid 28.6% to ¥3.63 billion, pushing earnings per share down to ¥210.99.

Despite the profit decline, the company’s financial position strengthened, as total assets rose to ¥158.54 billion and net assets to ¥103.49 billion, lifting the equity ratio to 65.2%. For the full year ending March 31, 2026, Okamoto forecasts virtually flat sales at ¥109 billion and sharp year-on-year drops in operating and ordinary income, but plans to maintain an annual dividend of ¥120 per share, signaling a continued commitment to shareholder returns amid profit pressure.

The most recent analyst rating on (JP:5122) stock is a Hold with a Yen5946.00 price target. To see the full list of analyst forecasts on Okamoto Industries, Inc. stock, see the JP:5122 Stock Forecast page.

Okamoto Industries Reports No Share Buybacks During January Silent Period

Okamoto Industries, Inc. announced that it did not repurchase any of its own common shares during the period from January 1 to January 31, 2026, under its ongoing share buyback program authorized by the Board on November 7, 2025. The company cited its internal policy of treating the period between the end of a quarter and the announcement of financial results as a silent period, during which it refrains from market purchases of its own stock, resulting in cumulative repurchases remaining at zero shares and zero yen as of January 31, 2026, despite an authorization of up to 190,000 shares and 1 billion yen through September 30, 2026.

The most recent analyst rating on (JP:5122) stock is a Hold with a Yen5800.00 price target. To see the full list of analyst forecasts on Okamoto Industries, Inc. stock, see the JP:5122 Stock Forecast page.

Okamoto Industries Reports No Share Buybacks to Date Under Approved Repurchase Program

Okamoto Industries, Inc. reported that it did not repurchase any of its own common shares during the period from December 1 to December 31, 2025, resulting in a total repurchase amount of zero yen for that month. This update comes under a previously authorized share buyback program, approved by the board on November 7, 2025, which permits repurchases of up to 190,000 shares, or 1.11% of outstanding shares, for a maximum of 1 billion yen through September 30, 2026; as of December 31, 2025, no shares had yet been acquired under this authorization, indicating that the capital allocation move remains entirely unused so far and leaving future buyback activity as a potential lever for shareholder returns and balance sheet management.

The most recent analyst rating on (JP:5122) stock is a Buy with a Yen5602.00 price target. To see the full list of analyst forecasts on Okamoto Industries, Inc. stock, see the JP:5122 Stock Forecast page.