Kairikiya Co.,Ltd. (5891) AI Stock Analysis

• Market Cap: ¥9.07B
• Dividend Yield: 1.08%
• Average Volume (3M): 22.83K
• Price to Earnings (P/E): 30.5
• Beta (1Y): 0.50
• Revenue Growth: 16.95%
• EPS Growth: -14.59%
• Country: JP
• Employees: 287
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Restaurants
• EPS (TTM): 11.35
• Shares Outstanding: 5,658,200
• 10 Day Avg. Volume: 22,230
• 30 Day Avg. Volume: 22,833
• PEG Ratio: -0.67
• Price to Book (P/B): 1.76
• Price to Sales (P/S): 0.62
• P/FCF Ratio: -52.86
• 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): 120.3
• Revenue Forecast (FY): ¥17.60B

• Rating: 52 Neutral
• Price Target: ¥1,581.00 ▼(-14.91% Downside)
• Action: Reiterated Date: 02/18/26
• Date: Action: Reiterated 02/18/26

The score is primarily constrained by weakened 2025 profitability and a notable decline in cash flow (negative free cash flow), despite strong revenue growth and a generally serviceable balance sheet. Technicals add pressure as the stock remains in a downtrend with weak momentum, and valuation looks demanding given the elevated P/E and only modest dividend yield.

Positive Factors

Strong revenue growth momentum

Sustained top-line growth near 20% supports long-term market penetration and product adoption in core markets. Durable revenue momentum increases scale, spreads fixed costs, and creates a platform for margin recovery and reinvestment into distribution and after-sales services.

High gross profitability

Consistently high gross margins indicate structural product-level pricing power or cost advantage in manufacturing. This provides a lasting buffer against SG&A and cyclical headwinds, enabling the company to sustain investments in R&D, service networks, and product quality over the medium term.

Reasonable leverage and stronger equity base

Low net leverage and a strengthened equity base give the company financial flexibility to fund working capital, capex or absorb temporary cash setbacks. This structural balance-sheet resilience reduces refinancing risk and supports steady execution of strategic initiatives.

Negative Factors

Margin deterioration in 2025

A meaningful decline in operating and net margins signals lasting pressures (cost inflation, mix shifts, or pricing weakness). If margins remain compressed, the company's ability to convert revenue growth into sustainable earnings and returns will be impaired, limiting reinvestment capacity.

Negative free cash flow in latest year

A shift to negative free cash flow suggests weaker cash conversion or higher investments; if persistent it increases reliance on external funding, constrains dividends or buybacks, and pressures liquidity, making capital allocation and long-term growth plans more vulnerable.

Rising debt and weaker returns on equity

Higher borrowing combined with falling ROE signals deteriorating capital efficiency. Continued debt buildup would raise interest burden and reduce strategic optionality, while lower returns make it harder to justify reinvestment without improving operating performance.

Kairikiya Co.,Ltd. Business Overview & Revenue Model

Company Description

Kairikiya Co., Ltd. engages in the management of restaurant chains. It operates Japanese Ramen Shop Kairikiya whose main product is Kyoto Seabura Special Shoyu Ramen. The company was founded by Tsukasa Fujita on February 25, 2003 and is headquartered in Tokyo, Japan.

How the Company Makes Money

Kairikiya Co., Ltd. generates revenue through the sale of its agricultural machinery and equipment, which are sold both domestically and internationally. The company has established a robust distribution network, enabling it to reach a wide customer base in various markets. Key revenue streams include direct sales to farmers, partnerships with agricultural cooperatives, and collaborations with distributors. Additionally, Kairikiya may benefit from after-sales services, maintenance contracts, and parts sales, contributing to recurring revenue. Strategic alliances with agricultural research institutions and participation in government programs aimed at enhancing agricultural efficiency also play a significant role in driving sales and expanding market presence.

Kairikiya Co.,Ltd. Financial Statement Overview

Summary

Strong revenue growth and high gross profitability are positives, but 2025 showed clear deterioration in net/operating margins and a sharp setback in cash generation with negative free cash flow. Debt also rose materially, increasing dependence on a margin and cash-flow rebound.

Income Statement

Revenue has grown strongly over the last several years (up ~20% in 2025 and ~16% in 2024), supported by consistently high gross profit levels. However, profitability weakened in 2025: net margin fell to ~2.0% (from ~4.4% in 2024) and operating margin also declined, indicating higher costs or weaker pricing/traffic mix. Overall, solid top-line momentum but earnings quality is currently under pressure.

Balance Sheet

Leverage remains reasonable with debt at ~0.36x equity in 2025, and equity has built up meaningfully versus earlier years, supporting balance-sheet resilience. That said, debt increased sharply in 2025 versus 2024, and returns to shareholders have moderated (ROE ~5.8% in 2025 vs ~10.8% in 2024), reflecting the profitability step-down. Overall, a generally healthy balance sheet with a watch item on rising borrowing.

Cash Flow

Cash generation deteriorated in 2025: operating cash flow fell materially and free cash flow turned negative (from positive in 2024), suggesting heavier investment and/or weaker cash conversion. Free cash flow was negative relative to net income in 2025, which raises near-term funding dependence if the pattern persists. Earlier years show the business can produce strong cash flow, but the latest year is a clear setback.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	14.72B	12.27B	10.58B	8.82B	7.09B
Gross Profit	10.03B	8.74B	7.51B	6.44B	5.19B
EBITDA	1.09B	1.09B	867.67M	625.15M	525.52M
Net Income	297.44M	535.59M	390.49M	314.20M	234.48M
Balance Sheet
Total Assets	9.68B	8.05B	7.47B	5.55B	4.82B
Cash, Cash Equivalents and Short-Term Investments	3.45B	3.40B	3.59B	2.08B	1.58B
Total Debt	1.84B	669.43M	959.94M	1.26B	1.34B
Total Liabilities	4.52B	3.10B	3.07B	3.09B	2.67B
Stockholders Equity	5.16B	4.94B	4.40B	2.46B	2.15B
Cash Flow
Free Cash Flow	-171.52M	446.62M	239.31M	745.57M	-17.31M
Operating Cash Flow	496.94M	943.36M	622.11M	1.05B	482.55M
Investing Cash Flow	-1.24B	-739.93M	-359.57M	-463.05M	-542.87M
Financing Cash Flow	505.10M	-319.04M	1.24B	-80.74M	63.27M

Kairikiya Co.,Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 1858.00
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:5891, the sentiment is Positive. The current price of 1858 is above the 20-day moving average (MA) of 1591.00, above the 50-day MA of 1611.92, and above the 200-day MA of 1775.68, indicating a neutral trend. The MACD of -4.14 indicates Negative momentum. The RSI at 52.91 is Neutral, neither overbought nor oversold. The STOCH value of 73.51 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:5891.

Kairikiya Co.,Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
3077	72 Outperform	¥3.87B	11.04	―	―	6.16%	86.76%
2789	70 Neutral	¥2.78B	9.03	―	1.01%	5.70%	-12.36%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
3358	57 Neutral	¥3.55B	50.80	―	―	3.85%	-59.79%
5891	52 Neutral	¥9.07B	30.46	―	1.08%	16.95%	-14.59%
7585	48 Neutral	¥1.56B	-7.37	―	―	7.82%	-14.63%
2762	46 Neutral	¥3.94B	-4.43	―	―	3.26%	4.62%