Rinnai (5947) AI Stock Analysis

• Market Cap: ¥557.93B
• Dividend Yield: 2.26%
• Average Volume (3M): 271.58K
• Price to Earnings (P/E): 16.8
• Beta (1Y): 0.57
• Revenue Growth: 3.33%
• EPS Growth: 9.57%
• Country: JP
• Employees: 10,837
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Furnishings, Fixtures & Appliances
• EPS (TTM): 66.62
• Shares Outstanding: 141,126,770
• 10 Day Avg. Volume: 269,030
• 30 Day Avg. Volume: 271,580
• PEG Ratio: 1.22
• Price to Book (P/B): 1.21
• Price to Sales (P/S): 1.06
• P/FCF Ratio: 12.04
• 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: ¥3,849.87
• Price Target Upside: -3.46% Downside
• Rating Consensus: Hold
• Number of Analyst Covering: 1
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 76 Outperform
• Price Target: ¥4,216.00 ▲(5.72% Upside)

Rinnai's strong financial performance, characterized by robust revenue growth and a solid balance sheet, is the primary driver of its stock score. The technical analysis suggests a positive trend, though caution is advised due to potential short-term weakness. The valuation is reasonable, with an attractive dividend yield enhancing the stock's appeal.

Positive Factors

Revenue Growth

Consistent revenue growth indicates strong demand for Rinnai's products and effective market strategies, supporting long-term business expansion.

Balance Sheet Health

A strong balance sheet with low leverage provides financial stability and flexibility, enabling Rinnai to invest in growth opportunities and withstand economic downturns.

Profitability Margins

Strong profitability margins reflect efficient operations and cost management, enhancing Rinnai's ability to generate sustainable earnings and reinvest in its business.

Negative Factors

Earnings Growth

Negative earnings per share growth indicates potential challenges in maintaining profitability, which could impact investor confidence and future investment capacity.

Cash Flow Conversion

Suboptimal cash flow conversion may limit Rinnai's ability to fund new projects and return capital to shareholders, affecting long-term financial health.

Revenue Growth Rate

Moderate revenue growth may indicate market saturation or increased competition, potentially limiting Rinnai's ability to rapidly expand its market share.

Rinnai Business Overview & Revenue Model

Company Description

Rinnai Corporation develops, manufactures, and sells heating products in Japan, the United States, Australia, China, South Korea, Indonesia, and internationally. The company offers water heaters, including tankless water heaters and hybrid water heaters, as well as water heaters with bath-filling systems and heating systems, and hot-water units; and kitchen appliances, such as tabletop cookers and stoves, ovens, dishwashers, and a range of hoods and rice cookers, as well as built-in hobs, such as stovetops. It also provides air conditioning appliances comprising fan heaters, fanned flue heaters, fan-forced heaters, and infrared heaters; commercial-use equipment that include ceramic grillers, commercial-use ranges, and rice cookers; and others, which comprise clothes dryers, infrared burners, and components. The company offers its products under the Rinnai brand name. The company was formerly known as Rinnai & Co. and changed its name to Rinnai Corporation in 1971. Rinnai Corporation was founded in 1920 and is headquartered in Nagoya, Japan.

How the Company Makes Money

Rinnai generates revenue primarily through the sale of its heating and cooling products, which include water heaters, boilers, and kitchen appliances. The company operates a diversified revenue model that includes both direct sales to consumers and partnerships with distributors, retailers, and contractors in the construction and home improvement sectors. Key revenue streams include residential products, commercial heating solutions, and maintenance services. Significant partnerships with home improvement retailers and construction firms enhance Rinnai's market reach and distribution capabilities, contributing to its overall earnings. Additionally, the company invests in research and development to innovate and expand its product lines, which helps to maintain a competitive edge and drive future growth.

Rinnai Financial Statement Overview

Summary

Rinnai demonstrates strong financial health with consistent revenue growth and solid profitability margins. The balance sheet is robust with low leverage and a high equity ratio, minimizing financial risk. Cash flow generation is strong, though there is room for improvement in free cash flow conversion.

Income Statement

Rinnai has demonstrated consistent revenue growth, with a notable increase of 1.76% in the latest year. The company maintains strong profitability metrics, with a gross profit margin of 32.94% and a net profit margin of 6.45%. EBIT and EBITDA margins are healthy at 10.86% and 14.15%, respectively, indicating efficient operations and cost management.

Balance Sheet

Rinnai's balance sheet is robust, characterized by a very low debt-to-equity ratio of 0.87%, suggesting minimal leverage and financial risk. The return on equity is solid at 7.32%, reflecting effective use of shareholder funds. The equity ratio stands at 66.91%, indicating a strong capital structure with significant equity financing.

Cash Flow

The company shows strong cash flow generation, with a significant increase in free cash flow. The operating cash flow to net income ratio of 0.53 indicates good cash conversion efficiency. However, the free cash flow to net income ratio of 0.71 suggests room for improvement in translating profits into free cash flow.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	464.88B	460.32B	430.19B	425.23B	366.19B	344.36B
Gross Profit	158.72B	151.61B	137.84B	138.40B	116.56B	115.33B
EBITDA	62.45B	65.13B	60.88B	58.00B	50.96B	55.47B
Net Income	29.50B	29.69B	26.67B	26.10B	23.75B	27.58B
Balance Sheet
Total Assets	574.59B	606.59B	577.09B	547.11B	512.87B	497.29B
Cash, Cash Equivalents and Short-Term Investments	166.97B	176.81B	155.67B	158.62B	185.49B	204.93B
Total Debt	23.82B	3.53B	3.76B	2.69B	2.06B	1.73B
Total Liabilities	130.84B	144.87B	139.65B	139.92B	134.01B	125.97B
Stockholders Equity	396.86B	405.85B	387.77B	364.15B	343.12B	342.33B
Cash Flow
Free Cash Flow	0.00	40.66B	5.99B	-7.32B	7.86B	36.21B
Operating Cash Flow	0.00	57.50B	43.35B	19.39B	28.70B	49.49B
Investing Cash Flow	0.00	-22.68B	-19.97B	-30.09B	-25.49B	-15.82B
Financing Cash Flow	0.00	-26.50B	-23.66B	-21.31B	-27.11B	-7.27B

Rinnai Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 3988.00
• 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:5947, the sentiment is Positive. The current price of 3988 is above the 20-day moving average (MA) of 3941.95, above the 50-day MA of 3716.46, and above the 200-day MA of 3567.79, indicating a bullish trend. The MACD of 68.56 indicates Positive momentum. The RSI at 60.42 is Neutral, neither overbought nor oversold. The STOCH value of 57.40 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:5947.

Rinnai Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
7981	79 Outperform	¥194.11B	13.84	―	3.42%	6.17%	61.39%
7955	78 Outperform	¥32.13B	12.73	―	3.56%	3.03%	160.39%
5947	76 Outperform	¥557.93B	16.77	8.08%	2.26%	3.33%	9.57%
5941	70 Outperform	¥15.42B	8.76	―	2.70%	8.62%	11.21%
5946	69 Neutral	¥66.26B	32.04	1.51%	2.29%	1.82%	-32.79%
5909	67 Neutral	¥28.31B	40.46	―	2.88%	0.41%	-51.02%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%

Rinnai Corporate Events

Rinnai Completes Share Buyback and Announces Share Cancellation

Rinnai Corporation has completed a share buyback program, acquiring a total of 2,761,800 shares valued at approximately ¥9.999 billion. The company plans to cancel these shares on December 15, 2025, which represents 1.92% of its total shares issued and outstanding before cancellation. This move is part of Rinnai’s strategic financial management to optimize its capital structure and potentially enhance shareholder value.

Rinnai Corporation Reports Strong Financial Performance in First Half of Fiscal Year 2026

Rinnai Corporation reported a positive financial performance for the first half of the fiscal year ending March 31, 2026, with notable increases in net sales, operating income, ordinary income, and net income attributable to owners. The company anticipates continued growth with a forecasted increase in net sales and income for the full fiscal year, reflecting a strong market position and potential benefits for stakeholders.

Rinnai Completes Treasury Stock Disposal for Employee Incentive

Rinnai Corporation has completed the payment procedures for the disposal of treasury stock as a restricted stock incentive for its Employee Shareholding Association. The number of shares and total disposition value differed from initial expectations due to a partial loss of rights, impacting the company’s stock management strategy.

Rinnai Corporation Updates on Share Buyback Progress

Rinnai Corporation has announced the status of its share buyback program, which was approved by the Board of Directors in May 2025. As of September 30, 2025, the company has acquired 1,994,900 shares worth approximately ¥7.35 billion, as part of a larger plan to buy back up to 4 million shares by November 2025. This move is likely aimed at enhancing shareholder value and optimizing the company’s capital structure.