Japan Steel Works (5631) AI Stock Analysis

• Market Cap: ¥649.55B
• Dividend Yield: 0.85%
• Average Volume (3M): 887.32K
• Price to Earnings (P/E): 34.7
• Beta (1Y): 1.37
• Revenue Growth: 9.43%
• EPS Growth: 21.15%
• Country: JP
• Employees: 5,115
• Sector: Industrials
• Sector Strength: 74
• Industry: Industrial - Machinery
• EPS (TTM): 59.53
• Shares Outstanding: 74,415,910
• 10 Day Avg. Volume: 611,870
• 30 Day Avg. Volume: 887,323
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• 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: ¥10,799.93
• Price Target Upside: 21.65% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 2

• Rating: 72 Outperform
• Price Target: ¥9,888.00 ▲(11.38% Upside)

The stock is supported by strong financial performance and bullish technical indicators, indicating potential for growth. However, challenges in cash flow management and a high P/E ratio suggest caution. The lack of earnings call and corporate events data was not factored into the score.

Japan Steel Works Business Overview & Revenue Model

Company Description

Japan Steel Works Ltd. (JSW) is a leading Japanese company specializing in the manufacturing of industrial machinery and steel products. The company operates in several sectors including machinery, materials, and engineering. JSW is renowned for its high-quality steel castings and forgings, plastics processing machinery, and power generation equipment. It serves a diverse range of industries such as energy, automotive, construction, and defense.

How the Company Makes Money

Japan 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

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

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

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.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	248.56B	248.56B	252.50B	238.72B	213.79B	198.04B
Gross Profit	60.99B	60.99B	56.81B	49.38B	47.82B	42.28B
EBITDA	30.60B	31.56B	27.32B	25.46B	26.36B	19.48B
Net Income	17.96B	17.96B	14.28B	11.97B	13.95B	6.89B
Balance Sheet
Total Assets	398.12B	398.12B	366.77B	348.36B	339.73B	316.25B
Cash, Cash Equivalents and Short-Term Investments	75.90B	75.90B	97.61B	87.29B	106.24B	89.44B
Total Debt	43.53B	43.53B	43.63B	43.42B	58.44B	58.04B
Total Liabilities	203.02B	203.02B	188.16B	187.72B	188.65B	174.26B
Stockholders Equity	193.22B	193.22B	176.98B	159.10B	149.44B	140.40B
Cash Flow
Free Cash Flow	0.00	-20.40B	11.46B	-7.09B	13.52B	6.44B
Operating Cash Flow	0.00	-4.57B	21.71B	-986.00M	22.32B	14.71B
Investing Cash Flow	0.00	-12.27B	-6.84B	947.00M	-2.98B	-3.24B
Financing Cash Flow	0.00	-5.72B	-4.90B	-20.11B	-2.86B	2.77B

Japan Steel Works Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 8878.00
• 50DMA: Negative
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: 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 8878 is below the 20-day moving average (MA) of 9184.35, below the 50-day MA of 8882.30, and above the 200-day MA of 6751.39, indicating a neutral trend. The MACD of -49.64 indicates Positive momentum. The RSI at 46.20 is Neutral, neither overbought nor oversold. The STOCH value of 26.44 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

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
5631	72 Outperform	¥649.55B	34.70	10.57%	0.85%	9.43%	21.15%
Sector *	64 Neutral	$10.73B	15.74	7.56%	2.01%	2.76%	-15.10%
AMDWF	―	$4.02B	21.36	5.50%	3.35%	―	―
NGKIF	―	$4.51B	9.80	8.68%	2.94%	―	―
SOHVF	―	$2.78B	1,101.46	-0.47%	4.91%	―	―
THKLF	―	$3.02B	67.44	2.00%	11.27%	―	―
6406	66 Neutral	¥427.85B	30.34		2.92%	2.84%	-20.37%

Japan Steel Works Corporate Events

Japan Steel Works Reports Strong Q1 Financial Results

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

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

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.

Japan Steel Works Considers Investment Unit Reduction

Japan Steel Works, Ltd. is considering reducing its investment unit to less than 500,000 yen to stimulate an active equity market and increase share liquidity. The company plans to carefully evaluate stock market trends and its stock price level to decide on the timing and appropriateness of this reduction, potentially impacting its market positioning and investor engagement.

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 Reports Profit Growth Despite Sales Decline

Japan Steel Works reported a decrease in net sales by 1.6% for the fiscal year ending March 31, 2025, but saw significant increases in operating profit and profit attributable to owners of parent by 26.7% and 25.8% respectively. The company anticipates a positive outlook for the next fiscal year, forecasting a 16.7% increase in net sales and continued growth in operating and ordinary profits, indicating a strong recovery and strategic positioning in the market.

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 Announces Increased Year-End Dividend

Japan Steel Works has announced a decision to increase its year-end dividend to 48 yen per share, resulting in a total annual dividend of 86 yen per share for the fiscal year ending March 2025. This decision reflects the company’s strategy to provide stable and improved dividends, aligning with its Medium-Term Management Plan JGP2028, which targets a dividend payout ratio of 35% or higher.

The most recent analyst rating on (JP:5631) stock is a Buy with a Yen5000.00 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 Reports Profit Growth Despite Sales Dip

Japan Steel Works reported a slight decline in net sales for the fiscal year ending March 31, 2025, but saw significant increases in operating and ordinary profits. The company experienced a notable rise in profit attributable to owners, reflecting improved operational efficiency. Despite a decrease in cash flows from operating activities, the company increased its annual dividends per share, indicating confidence in future performance. The forecast for the fiscal year ending March 31, 2026, suggests a positive outlook with expected growth in net sales and profits.

The most recent analyst rating on (JP:5631) stock is a Buy with a Yen5000.00 price target. To see the full list of analyst forecasts on Japan Steel Works stock, see the JP:5631 Stock Forecast page.