Nakayama Steel Works,Ltd. (5408) AI Stock Analysis

• Market Cap: ¥34.59B
• Dividend Yield: 6.26%
• Average Volume (3M): 231.91K
• Price to Earnings (P/E): 6.1
• Beta (1Y): 0.86
• Revenue Growth: -8.20%
• EPS Growth: -36.06%
• Country: JP
• Employees: 1,247
• Sector: Basic Materials
• Sector Strength: 71
• Industry: Steel
• EPS (TTM): 21.54
• Shares Outstanding: 63,079,254
• 10 Day Avg. Volume: 142,690
• 30 Day Avg. Volume: 231,906
• PEG Ratio: -0.34
• Price to Book (P/B): 0.32
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 0.00
• 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: ¥693.00
• Price Target Upside: 6.78% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 0

• Rating: 72 Outperform
• Price Target: ¥713.00 ▲(9.86%Upside)

Nakayama Steel Works earns a solid score driven by its strong valuation and stable financial position. The stock's low P/E ratio and high dividend yield make it appealing, despite challenges in revenue growth and mixed technical indicators.

Nakayama Steel Works,Ltd. Business Overview & Revenue Model

Company Description

Nakayama Steel Works, Ltd. (5408) is a Japan-based company primarily engaged in the manufacturing and selling of steel products. With a focus on industrial sectors, the company offers a wide range of steel products, including steel sheets, coils, pipes, and tubes. Nakayama Steel Works caters to various industries such as construction, automotive, and machinery, providing essential materials for infrastructure development and industrial applications.

How the Company Makes Money

Nakayama Steel Works, Ltd. generates revenue through the production and sale of steel products, leveraging its manufacturing capabilities to meet the demands of various industrial sectors. The company's key revenue streams include sales of steel sheets, coils, and other fabricated steel products to clients in construction, automotive, and machinery industries. Additionally, the company may engage in strategic partnerships and supply agreements to secure long-term contracts and maintain a steady flow of income. Factors such as global steel demand, raw material costs, and economic conditions can significantly impact the company's earnings.

Nakayama Steel Works,Ltd. Financial Statement Overview

Summary

Nakayama Steel Works demonstrates a stable financial position with low leverage and strong equity. However, the income statement reflects some earnings pressure with declining margins and revenues, potentially indicating market or operational challenges. Cash flow metrics are improving, highlighting effective cash management. Overall, the company is financially sound but faces challenges in revenue and profit growth.

Income Statement

The company has shown mixed performance in its income statement. Gross profit margin for the latest year is approximately 13%, highlighting moderate profitability. The net profit margin has decreased to around 3.36% from 4.83% the previous year, indicating pressure on net earnings. Revenue growth has been volatile, with a decrease of about -8.2% from the previous year, following a decline from the year before. Both EBIT and EBITDA margins have also contracted, suggesting challenges in maintaining operating efficiency.

Balance Sheet

Nakayama Steel Works exhibits a solid balance sheet with an equity ratio of approximately 71.6%, suggesting strong financial stability. The debt-to-equity ratio stands at 0.085, indicating low leverage and conservative financial management. Return on equity has decreased to 5.33% from 8.51%, reflecting lower profitability on equity. Overall, the company maintains a robust financial position with low risk from debt.

Cash Flow

The cash flow statement shows a positive trend in free cash flow, with significant growth compared to the previous year. The operating cash flow to net income ratio is 1.29, suggesting efficient cash generation from operations relative to net income. Free cash flow to net income ratio is 0.52, indicating a reasonable conversion of net income into free cash flow, despite some fluctuations in capital expenditures.

Breakdown	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	169.33B	184.44B	188.51B	166.70B	113.28B
Gross Profit	22.08B	25.16B	26.06B	19.80B	13.85B
EBITDA	11.52B	15.05B	16.39B	9.56B	4.53B
Net Income	5.70B	8.90B	10.23B	4.82B	2.35B
Balance Sheet
Total Assets	149.15B	152.09B	148.79B	143.62B	122.94B
Cash, Cash Equivalents and Short-Term Investments	15.35B	16.49B	16.77B	15.77B	18.33B
Total Debt	9.06B	9.63B	10.28B	15.99B	6.75B
Total Liabilities	42.33B	47.54B	51.93B	54.69B	38.58B
Stockholders Equity	106.81B	104.55B	96.86B	88.93B	84.36B
Cash Flow
Free Cash Flow	2.99B	1.35B	9.28B	-11.29B	779.00M
Operating Cash Flow	7.38B	5.15B	13.01B	-8.76B	4.12B
Investing Cash Flow	-4.88B	-2.30B	-3.46B	-2.31B	-2.65B
Financing Cash Flow	-3.63B	-3.14B	-8.54B	8.39B	-1.68B

Nakayama Steel Works,Ltd. Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 649.00
• 50DMA: Positive
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:5408, the sentiment is Neutral. The current price of 649 is above the 20-day moving average (MA) of 627.15, above the 50-day MA of 631.76, and below the 200-day MA of 704.39, indicating a neutral trend. The MACD of 1.53 indicates Negative momentum. The RSI at 54.23 is Neutral, neither overbought nor oversold. The STOCH value of 82.90 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for JP:5408.

Nakayama Steel Works,Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
5445	78 Outperform	¥51.63B	4.62		5.90%	3.74%	39.89%
5408	72 Outperform	¥34.59B	6.08		6.26%	-8.20%	-36.06%
5440	71 Outperform	¥98.39B	9.12		3.99%	0.58%	-21.95%
5410	71 Outperform	¥56.97B	5.03		6.16%	-7.92%	-25.47%
5449	68 Neutral	¥114.82B	35.58		1.18%	-0.60%	3.40%
5480	64 Neutral	¥64.12B	5.19		2.82%	-4.57%	-12.17%
Sector *	63 Neutral	$10.55B	10.83	1.51%	2.68%	2.24%	-33.79%

Nakayama Steel Works,Ltd. Corporate Events

Nakayama Steel Completes Treasury Share Disposal for Executive Remuneration

Nakayama Steel Works, Ltd. has completed the payment procedures for the disposal of 40,610 treasury shares as restricted stock remuneration for its Directors and Executive Officers. This move, resolved in a Board meeting on June 26, 2025, aims to align the interests of the company’s leadership with its long-term performance goals.

Nakayama Steel Works Announces Treasury Shares Disposal for Director Remuneration

Nakayama Steel Works, Ltd. has announced the disposal of 40,610 treasury shares as restricted stock remuneration for its directors and executive officers. This move is part of a new remuneration system aimed at incentivizing directors to enhance corporate value and align their interests with shareholders. The system involves issuing shares to directors, excluding audit and supervisory committee members and outside directors, with restrictions on transfer and provisions for the company’s acquisition of shares under certain conditions.

Nakayama Steel Opposes Shareholder Dividend Proposal to Focus on Long-Term Growth

Nakayama Steel Works, Ltd. announced that its Board of Directors opposes a shareholder proposal to pay a full-year dividend equivalent to 3.5% of net assets per share. The board believes this approach could hinder the company’s long-term growth strategy, which includes significant investments in a new electric furnace aimed at reducing CO2 emissions and enhancing capital efficiency. The company emphasizes maintaining a stable dividend policy aligned with its long-term vision and financial strategies.

Nakayama Steel Works to Reinstate Community-Based Services

Nakayama Steel Works, Ltd. has proposed amendments to its Articles of Incorporation to reintroduce community-based services, specifically those in compliance with the Long-Term Care Insurance Act. This move aligns with the company’s long-term vision of contributing to society and collaborating with local communities, marking a strategic shift back to community-focused initiatives after a period of business revitalization.

Nakayama Steel Unveils Long-Term Growth Plan

Nakayama Steel Works, Ltd. has announced the establishment of its Long-Term Plan titled ‘Towards the New Growth Stage Based on the New Electric Furnace Project’ for the fiscal years 2025 to 2033. This plan signifies a strategic move towards growth and innovation, potentially impacting the company’s operational efficiency and market positioning in the steel industry.

Nakayama Steel Reports Decline in FY2024 Financial Results

Nakayama Steel Works, Ltd. reported a significant decrease in net sales and profits for FY2024, primarily due to reduced sales volume and lower prices for steel products. Despite improvements in spread and factory costs, the company faced increased fixed costs and transportation expenses, leading to a 34% drop in ordinary profit year-on-year.

Nakayama Steel and Nippon Steel Form Joint Venture for Eco-Friendly Furnace Facility

Nakayama Steel Works, Ltd. has announced a joint venture with Nippon Steel Corporation to construct a new electric furnace facility. This collaboration aims to increase the production capacity of electric furnace steel, which is more environmentally friendly due to lower CO2 emissions. The joint venture will be located at Nakayama’s Funamachi Plant, with the new facility expected to commence operations in 2030. This strategic move is part of Nakayama’s Medium-Term Management Plan to strengthen its market position by focusing on sustainable steel production.

Nakayama Steel Works Reports Decline in Financial Performance

Nakayama Steel Works, Ltd. reported a decline in its financial performance for the fiscal year ended March 31, 2025, with net sales dropping by 8.2% and operating profit decreasing by 31.6%. The company also announced a reduction in dividends, reflecting a cautious approach amid challenging market conditions. The financial forecast for the next fiscal year indicates continued pressure on profitability, with expected declines in net sales and profits.

Nakayama Steel Works Invests in New Electric Furnace for Sustainable Growth

Nakayama Steel Works, Ltd. has announced a significant investment in a new electric furnace as part of its long-term vision to enhance production capacity and reduce CO2 emissions. This initiative, in collaboration with Nippon Steel Corporation, aims to improve profitability and strengthen the company’s market position by increasing the use of in-house iron sources and expanding the application of electric furnace steel.