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Japan Steel Works Ltd (JP:5631)
:5631
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Japan Steel Works (5631) AI Stock Analysis

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JP:5631

Japan Steel Works

(Frankfurt:5631)

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Neutral 64 (OpenAI - 4o)
Rating:64Neutral
Price Target:
¥9,489.00
▲(6.75% Upside)
Japan Steel Works shows strong financial performance with solid revenue growth and operational efficiency. However, challenges in cash flow management and a high P/E ratio suggest potential overvaluation and financial risks. Technical indicators show a neutral trend, contributing to a moderate overall stock score.

Japan Steel Works (5631) vs. iShares MSCI Japan ETF (EWJ)

Japan Steel Works Business Overview & Revenue Model

Company DescriptionThe Japan Steel Works, Ltd. produces and sells steel and machinery products in Japan, China, and internationally. The company operates through Industrial Machinery Products, Steel and Energy Products, and Other Businesses segments. It offers monobloks rotor shafts for power generators; shell flanges for nuclear reactor pressure vessels; turbine castings for thermal power plants; clad steel plates and pipes; high alloy and stainless steel, and Ni-based alloy products; forged steel rolls for steel mills; forged and cast steel products, steel plates, and pressure vessels for use in chemical and petrochemical industries, and other industrial machineries; and pressure vessels maintenance and inspection services for pressure vehicles. The company also provides plastic production machinery, such as polyolefin pelletizers, twin screw extruders, film and sheet manufacturing equipment, and spinning extruders; injection and blow molding machines; and excimer laser annealing and laser lift-off systems, rolling stock parts, and presses/laminators. In addition, it engages in the design, manufacture, and maintenance of defense equipment from firing systems to missile launchers, as well as R&D on new defense equipment and systems; and offers steel tanks for high-pressure hydrogen storage installed in hydrogen filling stations that are used by fuel cell vehicles. Further, the company is involved in the provision of maintenance concierge, retrofitting, and schooling training services; and provides deposition and crystal, as well as wind power generation equipment. The Japan Steel Works, Ltd. was founded in 1907 and is headquartered in Tokyo, Japan.
How the Company Makes MoneyJapan Steel Works generates revenue through the production and sale of its industrial machinery and steel products. Its key revenue streams include the manufacturing of large steel castings and forgings for power generation and industrial machinery sectors, particularly serving the needs of nuclear and thermal power plants. Additionally, JSW is involved in the production of plastic processing machinery, which caters to the automotive and packaging industries. The company also earns income from its engineering services, providing solutions and maintenance for its machinery and equipment. Strategic partnerships and joint ventures in the steel and machinery sectors further enhance its revenue-generating capabilities by expanding its market reach and technological expertise.

Japan Steel Works Financial Statement Overview

Summary
Japan Steel Works shows strong revenue growth and operational efficiency with solid balance sheet metrics. However, cash flow management poses challenges, with a negative Free Cash Flow in 2025 and difficulties in converting earnings into cash flow.
Income Statement
72
Positive
Japan Steel Works shows a consistent revenue stream with noticeable growth. The Gross Profit Margin is strong at approximately 24.5% for 2025. However, the Net Profit Margin has slightly decreased to 7.2% in 2025 from 5.9% in 2024, reflecting some pressure on net earnings. The EBIT and EBITDA margins have improved to 9.2% and 12.7% respectively, indicating better operational efficiency.
Balance Sheet
80
Positive
The company maintains a solid financial structure with a Debt-to-Equity Ratio of approximately 0.23, showing prudent leverage. The Return on Equity (ROE) is fairly robust, around 9.3%, indicating good profitability from shareholders' equity. The Equity Ratio stands strong at about 48.5%, reflecting a balanced capital structure.
Cash Flow
65
Positive
The Cash Flow statement reveals some challenges, particularly with a negative Free Cash Flow of -20.4 billion yen in 2025, down from 11.4 billion yen in 2024. The Operating Cash Flow to Net Income Ratio has turned negative, indicating difficulties in converting earnings into cash flow. The Free Cash Flow to Net Income Ratio reflects constraints in cash generation relative to net income.
BreakdownTTMDec 2025Dec 2024Dec 2023Dec 2022Dec 2021
Income Statement
Total Revenue248.56B248.56B252.50B238.72B213.79B198.04B
Gross Profit60.99B60.99B56.81B49.38B47.82B42.28B
EBITDA30.60B31.56B27.32B25.46B26.36B19.48B
Net Income17.96B17.96B14.28B11.97B13.95B6.89B
Balance Sheet
Total Assets398.12B398.12B366.77B348.36B339.73B316.25B
Cash, Cash Equivalents and Short-Term Investments75.90B75.90B97.61B87.29B106.24B89.44B
Total Debt43.53B43.53B43.63B43.42B58.44B58.04B
Total Liabilities203.02B203.02B188.16B187.72B188.65B174.26B
Stockholders Equity193.22B193.22B176.98B159.10B149.44B140.40B
Cash Flow
Free Cash Flow0.00-20.40B11.46B-7.09B13.52B6.44B
Operating Cash Flow0.00-4.57B21.71B-986.00M22.32B14.71B
Investing Cash Flow0.00-12.27B-6.84B947.00M-2.98B-3.24B
Financing Cash Flow0.00-5.72B-4.90B-20.11B-2.86B2.77B

Japan Steel Works Technical Analysis

Technical Analysis Sentiment
Positive
Last Price8889.00
Price Trends
50DMA
9032.92
Negative
100DMA
8121.15
Positive
200DMA
6918.71
Positive
Market Momentum
MACD
-90.38
Positive
RSI
50.80
Neutral
STOCH
50.07
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:5631, the sentiment is Positive. The current price of 8889 is above the 20-day moving average (MA) of 8810.50, below the 50-day MA of 9032.92, and above the 200-day MA of 6918.71, indicating a neutral trend. The MACD of -90.38 indicates Positive momentum. The RSI at 50.80 is Neutral, neither overbought nor oversold. The STOCH value of 50.07 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:5631.

Japan Steel Works Peers Comparison

Overall Rating
UnderperformOutperform
Sector (63)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
79
Outperform
¥586.56B21.026.24%3.35%-2.30%-21.04%
72
Outperform
¥712.96B11.947.62%2.39%7.35%60.37%
66
Neutral
¥431.49B30.649.32%2.90%2.84%-20.37%
64
Neutral
€654.34B34.9510.57%0.84%9.43%21.15%
57
Neutral
¥434.89B-125.911.21%3.52%-4.25%-110.18%
56
Neutral
¥463.66B69.562.15%6.08%0.85%-46.23%
63
Neutral
$10.79B15.437.44%2.01%2.89%-14.66%
* Industrials Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
JP:5631
Japan Steel Works
8,889.00
3,898.25
78.11%
AMDWF
AMADA HOLDINGS CO
12.09
2.09
20.90%
NGKIF
NGK Insulators
17.00
3.71
27.92%
SOHVF
Sumitomo Heavy Industries
23.20
0.21
0.91%
THKLF
THK Co
27.76
11.70
72.85%
JP:6406
Fujitec Co., Ltd.
5,685.00
791.10
16.17%

Japan Steel Works Corporate Events

Japan Steel Works Reports Strong Q1 Financial Results
Aug 4, 2025

Japan Steel Works reported a significant increase in its consolidated financial results for the three months ended June 30, 2025, with net sales rising by 41.9% year-on-year. The company’s strong performance is highlighted by a 23.5% increase in operating profit, reflecting its robust market positioning and effective operational strategies.

The most recent analyst rating on (JP:5631) stock is a Buy with a Yen6200.00 price target. To see the full list of analyst forecasts on Japan Steel Works stock, see the JP:5631 Stock Forecast page.

Japan Steel Works Completes Payment for New Stock Issuance
Jul 22, 2025

Japan Steel Works has completed the payment procedure for issuing new stocks as restricted stock compensation, a move resolved by the Board of Directors on June 23, 2025. This issuance involves 6,924 shares of common stock at 7,861 yen per share, totaling 54,429,564 yen, and is aimed at compensating directors and executive officers, potentially impacting the company’s governance and stakeholder alignment.

The most recent analyst rating on (JP:5631) stock is a Buy with a Yen6200.00 price target. To see the full list of analyst forecasts on Japan Steel Works stock, see the JP:5631 Stock Forecast page.

Japan Steel Works Issues New Stocks for Compensation Plan
Jun 23, 2025

Japan Steel Works has announced the issuance of new stocks as part of a Restricted Stock Compensation Plan aimed at incentivizing directors and executive officers for sustainable corporate growth. This initiative is designed to align the interests of management with shareholders and enhance corporate value over the medium to long term, with a transfer restriction period set for five years.

The most recent analyst rating on (JP:5631) stock is a Buy with a Yen6200.00 price target. To see the full list of analyst forecasts on Japan Steel Works stock, see the JP:5631 Stock Forecast page.

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: Sep 27, 2025