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Nalnet Communications, Inc. (JP:5870)
:5870
Japanese Market

Nalnet Communications, Inc. (5870) AI Stock Analysis

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JP

Nalnet Communications, Inc.

(5870)

Rating:75Outperform
Price Target:
¥704.00
▲(5.55%Upside)
Nalnet Communications receives a solid score of 75, driven by strong technical performance and a fair valuation. Financial performance is stable but hindered by profitability and liquidity concerns. These factors combined suggest a balanced outlook with growth opportunities and risks.

Nalnet Communications, Inc. (5870) vs. iShares MSCI Japan ETF (EWJ)

Nalnet Communications, Inc. Business Overview & Revenue Model

Company DescriptionNalnet Communications, Inc. engages in management and maintenance of vehicles. It provides its service to automobile-related companies such as auto leasing companies and individual users. It also offers business process outsourcing (BPO) services and sales of vehicles. The company was founded on July 18, 2019 and is headquartered in Kasugai, Japan.
How the Company Makes Money

Nalnet Communications, Inc. Financial Statement Overview

Summary
Nalnet Communications shows strong revenue growth and operational efficiency with stable gross and EBITDA margins. However, challenges in profitability and liquidity are evident due to declining net profit margin and free cash flow.
Income Statement
75
Positive
Nalnet Communications has shown impressive revenue growth, with a 13.8% increase from 2024 to 2025. The gross profit margin remains stable at 27.8%, reflecting effective cost management. However, the net profit margin has decreased to 2.8% in 2025, indicating reduced profitability. Despite this, the EBITDA margin remains strong at 10.2%, highlighting operational efficiency.
Balance Sheet
70
Positive
The company's balance sheet indicates a healthy equity position, with a debt-to-equity ratio of 0.5, suggesting moderate leverage. The return on equity has decreased to 7.0% in 2025, showing reduced profitability for shareholders. The equity ratio of 34.6% underscores a strong capital structure, with adequate shareholder equity supporting the asset base.
Cash Flow
68
Positive
Nalnet Communications exhibits a decline in free cash flow, with a decrease of 48.0% from 2024 to 2025. The operating cash flow to net income ratio of 1.8 indicates strong cash generation relative to net income. However, the free cash flow to net income ratio of 1.5 suggests that cash flows are still robust despite a decline in net income.
BreakdownMar 2025Mar 2024Mar 2023Mar 2022
Income Statement
Total Revenue8.54B7.67B7.03B6.42B
Gross Profit2.38B2.31B2.18B2.10B
EBITDA874.61M942.50M1.11B793.16M
Net Income238.33M305.14M622.15M199.23M
Balance Sheet
Total Assets9.92B9.57B9.60B9.42B
Cash, Cash Equivalents and Short-Term Investments859.48M1.03B602.22M683.14M
Total Debt1.72B2.13B2.45B2.80B
Total Liabilities6.49B6.46B6.69B6.94B
Stockholders Equity3.43B3.27B2.91B2.48B
Cash Flow
Free Cash Flow348.94M670.34M261.89M606.55M
Operating Cash Flow427.58M827.32M374.12M696.99M
Investing Cash Flow-91.12M-138.20M-112.82M-96.86M
Financing Cash Flow-503.92M-264.41M-342.22M-311.20M

Nalnet Communications, Inc. Technical Analysis

Technical Analysis Sentiment
Positive
Last Price667.00
Price Trends
50DMA
637.00
Positive
100DMA
577.65
Positive
200DMA
551.17
Positive
Market Momentum
MACD
9.85
Positive
RSI
53.41
Neutral
STOCH
15.38
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:5870, the sentiment is Positive. The current price of 667 is above the 20-day moving average (MA) of 663.95, above the 50-day MA of 637.00, and above the 200-day MA of 551.17, indicating a bullish trend. The MACD of 9.85 indicates Positive momentum. The RSI at 53.41 is Neutral, neither overbought nor oversold. The STOCH value of 15.38 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:5870.

Nalnet Communications, Inc. Peers Comparison

Overall Rating
UnderperformOutperform
Sector (54)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
83
Outperform
¥3.84B9.76
3.01%0.82%-33.69%
75
Outperform
¥3.50B14.70
2.25%
74
Outperform
¥3.94B9.28
1.15%1.35%17.94%
54
Neutral
$1.92B-6.516.82%2.76%10.18%-64.59%
48
Neutral
¥3.50B278.94
5.55%-24579.42%
42
Neutral
¥3.35B
1.71%-23.47%-100.94%
41
Neutral
¥2.27B
-21.39%51.35%
* Services Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
JP:5870
Nalnet Communications, Inc.
665.00
-30.68
-4.41%
JP:2424
Brass Corp.
700.00
-5.20
-0.74%
JP:2437
SHINWA WISE HOLDINGS CO. LTD.
297.00
-170.00
-36.40%
JP:6060
Cocolonet Co., Ltd.
1,000.00
-27.48
-2.67%
JP:6181
Tameny, Inc.
133.00
8.00
6.40%
JP:7074
Twenty-four seven, Inc.
260.00
-38.00
-12.75%
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: May 27, 2025