Japan Steel Works (5631) AI Stock Analysis

• Market Cap: €742.75B
• Dividend Yield: 0.81%
• Average Volume (3M): 946.71K
• Price to Earnings (P/E): 38.1
• Beta (1Y): 1.39
• Revenue Growth: 9.43%
• EPS Growth: 21.15%
• Country: JP
• Employees: 5,115
• Sector: Industrials
• Sector Strength: 72
• Industry: Industrial - Machinery
• EPS (TTM): 59.53
• Shares Outstanding: 74,415,910
• 10 Day Avg. Volume: 1,238,970
• 30 Day Avg. Volume: 946,713
• PEG Ratio: 0.83
• Price to Book (P/B): 1.99
• Price to Sales (P/S): 1.55
• P/FCF Ratio: -18.89
• 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: 7.04% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 2

• Rating: 71 Outperform
• Price Target: ¥10,873.00 ▲(7.76% Upside)

Japan Steel Works shows strong financial performance with robust revenue growth and operational efficiency. Technical analysis supports a bullish trend, enhancing the stock's attractiveness. However, valuation concerns due to a high P/E ratio and modest dividend yield slightly offset these strengths.

Japan Steel Works Business Overview & Revenue Model

Company Description

The 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 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 demonstrates strong revenue growth and operational efficiency with solid balance sheet metrics. However, cash flow management poses challenges, warranting attention to improve cash conversion and free cash flow generation to sustain future growth and financial stability.

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	268.50B	248.56B	252.50B	238.72B	213.79B	198.04B
Gross Profit	63.50B	60.99B	56.81B	49.38B	47.82B	42.28B
EBITDA	32.24B	31.56B	27.32B	25.46B	26.36B	19.48B
Net Income	18.72B	17.96B	14.28B	11.97B	13.95B	6.89B
Balance Sheet
Total Assets	395.64B	398.12B	366.77B	348.36B	339.73B	316.25B
Cash, Cash Equivalents and Short-Term Investments	90.35B	75.90B	97.61B	87.29B	106.24B	89.44B
Total Debt	56.87B	43.53B	43.63B	43.42B	58.44B	58.04B
Total Liabilities	200.44B	203.02B	188.16B	187.72B	188.65B	174.26B
Stockholders Equity	193.94B	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: 10090.00
• 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:5631, the sentiment is Positive. The current price of 10090 is above the 20-day moving average (MA) of 9262.31, above the 50-day MA of 9157.84, and above the 200-day MA of 7119.59, indicating a bullish trend. The MACD of 258.88 indicates Negative momentum. The RSI at 62.11 is Neutral, neither overbought nor oversold. The STOCH value of 55.52 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
5333	72 Outperform	$711.11B	11.69	8.68%	2.44%	7.35%	60.37%
5631	71 Outperform	€742.75B	38.14	10.57%	0.81%	9.43%	21.15%
6113	70 Outperform	¥583.56B	20.53	5.50%	3.43%	-2.30%	-21.04%
6406	65 Neutral	¥427.77B	30.38	―	3.02%	2.84%	-20.37%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
6302	57 Neutral	$445.67B	709.43	-0.47%	3.51%	-4.25%	-110.18%
6481	56 Neutral	¥492.44B	71.80	2.00%	5.89%	0.85%	-46.23%

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.