Otani Kogyo Co., Ltd. (5939) AI Stock Analysis

• Market Cap: ¥4.25B
• Dividend Yield: 0.55%
• Average Volume (3M): 1.13K
• Price to Earnings (P/E): 13.0
• Beta (1Y): 0.46
• Revenue Growth: 0.31%
• EPS Growth: -13.69%
• Country: JP
• Employees: 177
• Sector: Industrials
• Sector Strength: 72
• Industry: Electrical Equipment & Parts
• EPS (TTM): 108.91
• Shares Outstanding: 780,000
• 10 Day Avg. Volume: 1,330
• 30 Day Avg. Volume: 1,126
• 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: ¥6,042.00
• Price Target Upside: 10.86% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 1

• Rating: 71 Outperform
• Price Target: ¥6,042.00 ▲(10.86% Upside)

Otani Kogyo Co., Ltd. demonstrates strong financial performance with robust revenue growth and profitability, supported by a solid balance sheet. However, cash flow challenges present a risk. Technical indicators suggest neutral momentum, and the stock is reasonably valued with a modest dividend yield.

Otani Kogyo Co., Ltd. Business Overview & Revenue Model

Company Description

Otani Kogyo Co.,Ltd. engages in the manufacture and sale of overhead wire hardware for power distribution and communication lines, and public hearing and CATV in Japan. Its catenary hardware includes a range of products necessary for the mounting of distribution and communication lines, such as lightweight cross arms that support electric wires on utility poles, scaffolding bolts for raising and lowering utility poles, and hardware for attaching various devices to utility poles, as well as handles various bolts and nuts, metal fittings for CATV for TV sharing, and metal fittings for disaster prevention radio. The company also designs, manufactures, and sells power transmission towers that support transmission lines, radio towers, and outdoor steel structures for substations under an integrated system; wireless towers for mobile communications, solar panel mounts, and steel fences; and provides support maintenance and renewal services for aging equipment. In addition, it manufactures, sells, and installs headed studs for use in steel and concrete structures, such as buildings and bridges; and seismic isolation base plates, as well as engages in hot-dip galvanizing activities. The company was founded in 1946 and is headquartered in Tokyo, Japan.

How the Company Makes Money

Otani Kogyo Co., Ltd. generates revenue through the production and sale of metal products such as building materials and metal fittings. The company's key revenue streams include direct sales to construction companies and industrial firms that require durable and reliable components for their projects. Additionally, Otani Kogyo may engage in partnerships with distributors and retailers to expand its market reach. The company's focus on high-quality materials and innovative product designs helps it maintain a competitive edge, contributing to its earnings. Furthermore, any significant economic developments or trends in the construction industry can influence the company's financial performance.

Otani Kogyo Co., Ltd. Financial Statement Overview

Summary

Otani Kogyo Co., Ltd. demonstrates strong revenue growth and profitability with a solid balance sheet. However, cash flow challenges, particularly in free cash flow, suggest areas for improvement in financial management.

Income Statement

Otani Kogyo Co., Ltd. demonstrates strong revenue growth with a TTM increase of 68%. The company maintains healthy gross and net profit margins of 21.8% and 4.7%, respectively. EBIT and EBITDA margins are stable at 6.1% and 7.7%, indicating efficient operational management. However, the slight decline in gross profit from the previous annual report suggests potential cost pressures.

Balance Sheet

The company has a solid balance sheet with a low debt-to-equity ratio of 0.12, indicating low leverage. Return on equity is robust at 9.3%, reflecting effective use of shareholder funds. The equity ratio stands at 55.8%, showcasing a strong capital structure. However, the slight increase in debt over the past year could be a point to monitor.

Cash Flow

Cash flow analysis reveals challenges, with a negative free cash flow growth rate of -223.7% in the TTM period. The operating cash flow to net income ratio is moderate at 0.32, suggesting adequate cash generation relative to earnings. However, the negative free cash flow indicates potential issues with capital expenditure or working capital management.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	7.95B	7.90B	7.91B	7.19B	6.41B	6.06B
Gross Profit	1.65B	1.72B	1.55B	1.29B	1.23B	1.33B
EBITDA	541.80M	606.68M	587.22M	402.64M	352.84M	482.74M
Net Income	325.45M	369.16M	334.57M	173.88M	127.00M	206.57M
Balance Sheet
Total Assets	7.43B	7.56B	7.19B	6.23B	5.49B	5.34B
Cash, Cash Equivalents and Short-Term Investments	1.17B	1.91B	1.56B	1.16B	1.23B	1.52B
Total Debt	478.17M	478.52M	525.77M	48.00M	48.00M	48.00M
Total Liabilities	3.29B	3.49B	3.46B	2.84B	2.26B	2.21B
Stockholders Equity	4.14B	4.08B	3.73B	3.38B	3.23B	3.13B
Cash Flow
Free Cash Flow	-530.65M	428.38M	-70.72M	-42.59M	-273.54M	116.09M
Operating Cash Flow	170.99M	783.41M	183.99M	112.25M	56.95M	336.18M
Investing Cash Flow	-702.02M	-356.69M	-241.34M	-150.96M	-325.00M	-217.00M
Financing Cash Flow	-75.55M	-74.36M	451.09M	-23.39M	-28.92M	-32.63M

Otani Kogyo Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 5450.00
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:5939, the sentiment is Negative. The current price of 5450 is below the 20-day moving average (MA) of 5465.00, below the 50-day MA of 5458.00, and below the 200-day MA of 5807.50, indicating a bearish trend. The MACD of 1.66 indicates Positive momentum. The RSI at 47.96 is Neutral, neither overbought nor oversold. The STOCH value of 16.99 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:5939.

Otani Kogyo Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
6894	76 Outperform	2.76B	8.14	9.21%	3.98%	-10.78%	1.10%
5939	71 Outperform	¥4.25B	13.04		0.55%	0.31%	-13.69%
6654	68 Neutral	5.95B	29.42	2.31%	2.97%	-1.14%	-30.39%
5820	64 Neutral	2.63B	14.93	2.54%	2.38%	2.89%	94.76%
6943	51 Neutral	3.74B	-8.46	-3.18%	1.53%	-16.30%	-281.92%
6993	40 Underperform	8.63B	-5.71	-228.37%	―	-6.70%	-17.49%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%