Sanyu Co., Ltd. (5697) AI Stock Analysis

• Market Cap: ¥4.78B
• Dividend Yield: 2.84%
• Average Volume (3M): 14.80K
• Price to Earnings (P/E): 8.5
• Beta (1Y): 0.67
• Revenue Growth: 4.52%
• EPS Growth: 82.92%
• Country: JP
• Employees: 306
• Sector: Basic Materials
• Sector Strength: 58
• Industry: Steel
• EPS (TTM): N/A
• Shares Outstanding: 6,091,000
• 10 Day Avg. Volume: 8,450
• 30 Day Avg. Volume: 14,800
• PEG Ratio: 0.40
• Price to Book (P/B): 0.30
• Price to Sales (P/S): 0.12
• P/FCF Ratio: 3.24
• 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: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 79 Outperform
• Price Target: ¥913.00 ▲(23.38% Upside)

Score is driven primarily by strong financial performance (consistent revenue growth, improving operating margins, and a stable balance sheet) and attractive valuation (low P/E with a moderate dividend yield). Technicals are supportive due to a strong uptrend, but overbought readings (high RSI/Stochastic) temper the overall score due to elevated near-term pullback risk.

Positive Factors

Consistent revenue growth and improving margins

Consistent revenue increases and improving EBIT/EBITDA margins indicate the company has enhanced operational efficiency and cost control. These durable improvements support sustainable earnings power, higher reinvestment capacity for R&D and capex, and stronger competitive positioning over months.

Healthy balance sheet and manageable leverage

A healthy equity ratio and moderate debt-to-equity provide financial flexibility to fund growth, absorb downturns, and pursue strategic investments without excessive refinancing risk. This balance sheet strength is a durable buffer supporting capital allocation and long-term strategic initiatives.

Diversified model with recurring revenue and partnerships

A diversified revenue mix—product sales, custom contracts, recurring maintenance—and strategic industry partnerships create stable, repeatable cash flows. This structure supports resilience to end-market cycles, aids customer retention, and sustains a pipeline for R&D-driven product rollouts over time.

Negative Factors

Volatile net profit margins

Fluctuating net profit margins reduce predictability of bottom-line results and can signal exposure to cost swings, pricing pressure, or non-operating items. Persistent variability complicates forecasting and impairs consistent returns on capital, affecting long-term planning and investor confidence.

Free cash flow conversion could improve

Subpar conversion of net income into free cash flow constrains the firm's ability to self-fund capex, R&D, dividends, or debt reduction. If conversion does not improve, management may need external financing or limit investments, which could impede long-term growth execution.

Moderate revenue growth rate

A roughly 4.5% revenue growth rate is modest for an electronics supplier and may limit long-term upside versus higher-growth peers. Sustained moderate growth can cap operating leverage, slow market-share gains, and constrain margin expansion and scale benefits over the medium term.

Sanyu Co., Ltd. Business Overview & Revenue Model

Company Description

Sanyu Co., Ltd. produces and sells steel products in Japan. It offers polished steel bars and cold heading steel wires for the use in electrical automobiles, construction, industrial machinary, agricultural machinary, and office automation equipment; construction machinery parts; press dies; turbine shafts for hydroelectric and thermal power generators; rotating shafts for pumps and motors; sewing machine parts; and furniture. The company also provides carbon, alloy steel, sulfur and sulfur composite free-cutting steel. Sanyu Co., Ltd. was incorporated in 1957 and is headquartered in Hirakata, Japan.

How the Company Makes Money

Sanyu Co., Ltd. generates revenue through a diversified business model that includes the sale of its electronic components and systems to various industries. Key revenue streams are derived from direct sales of semiconductor products to manufacturers in telecommunications and consumer electronics, as well as from contracts for custom electronic solutions for industrial applications. Additionally, Sanyu benefits from recurring income through maintenance and support services for its products. Strategic partnerships with major telecom and electronics firms enhance its market reach and stability, contributing to consistent revenue growth. The company's focus on R&D also enables it to innovate new products, ensuring a competitive edge and additional revenue opportunities.

Sanyu Co., Ltd. Financial Statement Overview

Summary

Strong overall fundamentals supported by consistent revenue growth and improving EBIT/EBITDA margins. Balance sheet appears stable with a healthy equity ratio and manageable leverage, while cash flow is growing but conversion of net income into free cash flow could improve.

Income Statement

Sanyu Co., Ltd. has demonstrated consistent revenue growth with a notable increase from 2021 to 2025. The gross profit margin has been stable, reflecting efficient cost management. However, the net profit margin has fluctuated, indicating potential volatility in net earnings. The EBIT and EBITDA margins have shown improvement, suggesting enhanced operational efficiency.

Balance Sheet

The company maintains a healthy equity ratio, indicating strong financial stability. The debt-to-equity ratio is moderate, suggesting manageable leverage levels. Return on equity has been positive, though it shows some variability, which could indicate changing profitability levels over time.

Cash Flow

Operating cash flow has shown growth, supporting the company's ability to generate cash from operations. Free cash flow has also increased, indicating improved cash management. However, the free cash flow to net income ratio suggests that cash generation relative to net income could be enhanced further.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	24.91B	24.44B	24.01B	23.94B	21.07B	17.14B
Gross Profit	3.31B	3.14B	3.05B	3.54B	3.35B	2.25B
EBITDA	1.29B	1.18B	1.13B	1.54B	1.68B	848.03M
Net Income	537.90M	450.91M	386.82M	645.90M	669.70M	112.75M
Balance Sheet
Total Assets	19.52B	19.30B	19.53B	19.50B	18.43B	17.26B
Cash, Cash Equivalents and Short-Term Investments	3.10B	3.13B	2.92B	2.62B	2.97B	3.57B
Total Debt	1.82B	1.90B	2.41B	2.56B	2.41B	3.00B
Total Liabilities	8.97B	8.75B	9.33B	9.51B	8.95B	8.51B
Stockholders Equity	9.87B	9.86B	9.42B	9.23B	8.78B	8.15B
Cash Flow
Free Cash Flow	0.00	927.91M	729.50M	215.81M	45.84M	1.77B
Operating Cash Flow	0.00	1.42B	1.03B	651.32M	259.45M	2.02B
Investing Cash Flow	0.00	-522.01M	-335.18M	-880.32M	-200.19M	-249.63M
Financing Cash Flow	0.00	-684.71M	-399.19M	-121.66M	-661.11M	231.63M

Sanyu Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 740.00
• 50DMA: Positive
• 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:5697, the sentiment is Positive. The current price of 740 is below the 20-day moving average (MA) of 786.90, above the 50-day MA of 720.14, and above the 200-day MA of 597.41, indicating a bullish trend. The MACD of 24.04 indicates Positive momentum. The RSI at 61.53 is Neutral, neither overbought nor oversold. The STOCH value of 30.84 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:5697.

Sanyu Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
5697	79 Outperform	¥4.78B	8.51	―	2.84%	4.52%	82.92%
5491	70 Outperform	¥6.59B	5.17	―	―	-5.93%	-36.01%
5458	64 Neutral	¥3.13B	13.45	―	4.03%	-1.76%	-28.08%
5609	63 Neutral	¥4.06B	11.58	―	3.62%	-4.20%	-11.70%
5986	63 Neutral	¥4.41B	12.18	―	2.11%	-1.86%	7.29%
Sector *	61 Neutral	$10.43B	7.12	-0.05%	2.87%	2.86%	-36.73%
5973	56 Neutral	¥3.45B	24.91	―	2.96%	6.61%	13.49%