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Nakayama Steel Works,Ltd. (JP:5408)
:5408
Japanese Market
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Nakayama Steel Works,Ltd. (5408) AI Stock Analysis

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JP:5408

Nakayama Steel Works,Ltd.

(5408)

Rating:72Outperform
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. (5408) vs. iShares MSCI Japan ETF (EWJ)

Nakayama Steel Works,Ltd. Business Overview & Revenue Model

Company DescriptionNakayama 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 MoneyNakayama 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
68
Positive
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
75
Positive
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
70
Positive
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.
BreakdownMar 2025Mar 2024Mar 2023Mar 2022Mar 2021
Income Statement
Total Revenue169.33B184.44B188.51B166.70B113.28B
Gross Profit22.08B25.16B26.06B19.80B13.85B
EBITDA11.52B15.05B16.39B9.56B4.53B
Net Income5.70B8.90B10.23B4.82B2.35B
Balance Sheet
Total Assets149.15B152.09B148.79B143.62B122.94B
Cash, Cash Equivalents and Short-Term Investments15.35B16.49B16.77B15.77B18.33B
Total Debt9.06B9.63B10.28B15.99B6.75B
Total Liabilities42.33B47.54B51.93B54.69B38.58B
Stockholders Equity106.81B104.55B96.86B88.93B84.36B
Cash Flow
Free Cash Flow2.99B1.35B9.28B-11.29B779.00M
Operating Cash Flow7.38B5.15B13.01B-8.76B4.12B
Investing Cash Flow-4.88B-2.30B-3.46B-2.31B-2.65B
Financing Cash Flow-3.63B-3.14B-8.54B8.39B-1.68B

Nakayama Steel Works,Ltd. Technical Analysis

Technical Analysis Sentiment
Neutral
Last Price649.00
Price Trends
50DMA
631.76
Positive
100DMA
681.02
Negative
200DMA
704.39
Negative
Market Momentum
MACD
1.53
Negative
RSI
54.23
Neutral
STOCH
82.90
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

Overall Rating
UnderperformOutperform
Sector (63)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
78
Outperform
¥51.63B4.62
5.90%3.74%39.89%
72
Outperform
¥34.59B6.08
6.26%-8.20%-36.06%
71
Outperform
¥98.39B9.12
3.99%0.58%-21.95%
71
Outperform
¥56.97B5.03
6.16%-7.92%-25.47%
68
Neutral
¥114.82B35.58
1.18%-0.60%3.40%
64
Neutral
¥64.12B5.19
2.82%-4.57%-12.17%
63
Neutral
$10.55B10.831.51%2.68%2.24%-33.79%
* Basic Materials Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
JP:5408
Nakayama Steel Works,Ltd.
639.00
-252.72
-28.34%
JP:5410
Godo Steel,Ltd.
3,895.00
-631.30
-13.95%
JP:5440
Kyoei Steel Ltd.
2,255.00
317.19
16.37%
JP:5445
Tokyo Tekko Co., Ltd.
5,680.00
1,264.34
28.63%
JP:5449
OSAKA STEEL CO., LTD.
2,874.00
516.15
21.89%
JP:5480
Nippon Yakin Kogyo Co., Ltd.
4,250.00
-469.16
-9.94%

Nakayama Steel Works,Ltd. Corporate Events

Nakayama Steel Completes Treasury Share Disposal for Executive Remuneration
Jul 25, 2025

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
Jun 26, 2025

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
May 23, 2025

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
May 23, 2025

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
May 16, 2025

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
May 9, 2025

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
May 9, 2025

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
May 9, 2025

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
May 9, 2025

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.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Jul 24, 2025