TOKYO ROPE MFG. CO., LTD. (5981) AI Stock Analysis

• Market Cap: ¥29.54B
• Dividend Yield: 5.69%
• Average Volume (3M): 48.95K
• Price to Earnings (P/E): 5.6
• Beta (1Y): 0.85
• Revenue Growth: >-0.01%
• EPS Growth: 65.65%
• Country: JP
• Employees: 1,488
• Sector: Industrials
• Sector Strength: 72
• Industry: Industrial - Machinery
• EPS (TTM): 72.32
• Shares Outstanding: 16,268,242
• 10 Day Avg. Volume: 65,480
• 30 Day Avg. Volume: 48,946
• PEG Ratio: 0.10
• Price to Book (P/B): 0.53
• Price to Sales (P/S): 0.31
• P/FCF Ratio: 34.41
• 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): 217.9
• Revenue Forecast (FY): ¥64.00B

• Rating: 78 Outperform
• Price Target: ¥2,110.00 ▲(29.77% Upside)
• Action: Reiterated Date: 03/05/26
• Date: Action: Reiterated 03/05/26

The score is driven primarily by attractive valuation (low P/E and high dividend yield) and solid financial performance (improved profitability and reduced leverage). Offsetting factors are cash-flow volatility (notably weaker free cash flow recently) and technicals that are positive but somewhat extended on momentum indicators.

Positive Factors

Improved profitability

A sustained shift from negative to positive net margins signals structural improvement in pricing, cost control and product mix. This higher profitability increases retained earnings, supports reinvestment or dividends, and improves resilience through industry cycles over months.

Stronger balance sheet / lower leverage

Marked deleveraging reduces financial risk and interest burden, increasing flexibility to fund capex, pursue contracts, or withstand downturns. Lower leverage also improves covenant headroom and credit profile, a durable support for operations and strategic choices.

Stable gross margin / operational efficiency

A stable ~22% gross margin reflects consistent manufacturing efficiency and some pricing power in steel wire rope markets. Persistent margin stability supports long-term cash generation and competitiveness even if top-line growth is uneven.

Negative Factors

Volatile free cash flow

Irregular FCF and weak conversion of earnings into cash constrain funding for dividends, debt paydown and capex. This variability raises refinancing and liquidity risk and limits the firm's ability to steadily invest or return capital over the coming months.

Revenue volatility / recent declines

Fluctuating and recently declining revenue undermines predictability of margins and utilization. For a manufacturing business, sustained top-line volatility pressures fixed-cost absorption, making near-term earnings and cash generation less reliable.

End-market cyclicality exposure

Heavy reliance on construction, civil engineering and industrial projects makes revenue and orders sensitive to macro cycles and public capex timing. This structural cyclicality can cause multi-month swings in demand and reorder timing, increasing earnings variability.

TOKYO ROPE MFG. CO., LTD. Business Overview & Revenue Model

Company Description

Tokyo Rope Mfg. Co., Ltd. manufactures and sells wire ropes, steel cords, and carbon fiber composite cables (CFCCs) in Japan and internationally. It offers its wire ropes that are used in cranes, elevators, forestry and fisheries, rope slings, and cableways; galvanized wires and strands for use in electric power and communication fields; and steel cords, including steel tire cords that are used in steel radial tires, hose wires to reinforce high pressure hose, and saw wires to produce wafers and chips. The company also provides engineering, bridge and structural cable, and CFCC, as well as aluminum conductor fiber reinforced products. In addition, it designs and constructs road safety devices, such as rock fall prevention nets; and environment protection products, including sound insulation walls, and bridges and cable-suspended bridges, as well as manufactures and sells various industrial machinery and metal fibers. The company was founded in 1887 and is headquartered in Tokyo, Japan.

How the Company Makes Money

TOKYO ROPE MFG. CO., LTD. generates revenue through the sale of its diverse range of rope products, which are utilized in various industries such as construction, shipping, and manufacturing. The company’s revenue model is primarily based on direct sales to businesses, both domestically within Japan and through exports to international markets. Key revenue streams include bulk sales of industrial ropes, customized solutions for specific client needs, and long-term contracts with major corporations in sectors like maritime and construction. Additionally, TOKYO ROPE may benefit from partnerships with distributors and suppliers, enhancing its market reach and increasing sales volumes. The company's focus on high-quality manufacturing and innovation also allows it to maintain premium pricing on its products, further contributing to its profitability.

TOKYO ROPE MFG. CO., LTD. Financial Statement Overview

Summary

Overall fundamentals are solid: profitability improved meaningfully (net margin moved from negative in 2020 to over 5% in 2025) and leverage declined (debt-to-equity improved to 0.67). The main offset is cash-flow quality, with volatile and recently weaker free cash flow and less consistent conversion of earnings into cash.

Income Statement

Tokyo Rope MFG. CO., LTD. demonstrates a strong income statement with a consistent Gross Profit Margin around 22% over recent years. The company shows a significant improvement in Net Profit Margin, rising from negative in 2020 to over 5% in 2025, indicating enhanced profitability. Revenue growth has been volatile, with declines in the recent years. EBIT and EBITDA margins have been stable, underscoring operational efficiency improvements.

Balance Sheet

The balance sheet reflects a stable financial structure with a declining Debt-to-Equity Ratio, moving from 1.51 in 2020 to 0.67 in 2025, showcasing reduced leverage. The Equity Ratio has improved, suggesting stronger financial stability. Return on Equity has risen, indicating better utilization of equity to generate profits. Overall, the balance sheet indicates a solid financial standing with reduced risk from debt.

Cash Flow

Cash flow analysis reveals a mixed picture. Although Operating Cash Flow has been positive, Free Cash Flow has seen fluctuations, especially with a significant drop in the latest year. The Free Cash Flow to Net Income Ratio indicates a challenge in converting income into cash. The Operating Cash Flow to Net Income Ratio suggests cash generation relative to income is robust, but the trajectory of Free Cash Flow growth is concerning.

Breakdown	TTM	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	62.37B	62.87B	64.23B	67.14B	63.78B	59.18B
Gross Profit	14.00B	13.62B	13.92B	13.72B	12.28B	10.50B
EBITDA	6.08B	5.55B	5.96B	5.34B	3.90B	3.04B
Net Income	3.13B	3.25B	2.04B	3.78B	1.31B	407.00M
Balance Sheet
Total Assets	86.77B	88.05B	86.80B	89.20B	83.81B	84.47B
Cash, Cash Equivalents and Short-Term Investments	5.94B	5.97B	4.95B	5.74B	4.44B	6.10B
Total Debt	24.30B	24.46B	23.50B	26.46B	26.12B	28.13B
Total Liabilities	50.56B	51.36B	52.22B	57.90B	57.66B	59.67B
Stockholders Equity	36.21B	36.69B	34.57B	31.04B	25.50B	23.32B
Cash Flow
Free Cash Flow	0.00	560.00M	2.11B	1.55B	601.00M	1.21B
Operating Cash Flow	0.00	2.42B	3.43B	3.13B	1.92B	2.83B
Investing Cash Flow	0.00	-1.65B	-301.00M	-1.69B	-1.50B	54.00M
Financing Cash Flow	0.00	-31.00M	-3.97B	-405.00M	-2.29B	-3.13B

TOKYO ROPE MFG. CO., LTD. Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 1626.00
• 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:5981, the sentiment is Neutral. The current price of 1626 is below the 20-day moving average (MA) of 1923.05, below the 50-day MA of 1798.46, and above the 200-day MA of 1503.98, indicating a neutral trend. The MACD of 18.22 indicates Positive momentum. The RSI at 46.98 is Neutral, neither overbought nor oversold. The STOCH value of 32.62 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for JP:5981.

TOKYO ROPE MFG. CO., LTD. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
6371	81 Outperform	¥246.84B	9.64	8.91%	3.85%	1.48%	8.86%
5192	78 Outperform	¥110.90B	15.71	―	4.64%	3.99%	-28.28%
5981	78 Outperform	¥29.54B	5.62	―	5.69%	>-0.01%	65.65%
5195	77 Outperform	¥86.88B	8.96	―	3.82%	3.68%	-46.19%
6490	76 Outperform	¥178.51B	11.03	―	2.50%	-2.46%	-10.72%
7279	76 Outperform	¥119.93B	0.96	―	1.43%	-1.38%	327.52%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%

TOKYO ROPE MFG. CO., LTD. Corporate Events

Tokyo Rope Advances Share Buyback Program With Additional Treasury Purchases

Tokyo Rope Mfg. Co., Ltd., a Prime Market-listed Japanese manufacturer of steel ropes and related industrial materials, operates across infrastructure, construction, and broader industrial sectors. Its financial and capital policies, including treasury share acquisition programs, are closely watched by investors seeking signals on profitability and balance sheet discipline.

The company reported that it repurchased 12,000 common shares for about 23.98 million yen via market purchases on the Tokyo Stock Exchange between February 1 and February 28, 2026. Under a broader buyback authorization approved in November 2025, cumulative repurchases have reached 160,000 shares for 251.94 million yen, indicating steady progress toward the program’s ceiling and underscoring a continued focus on enhancing shareholder value and capital efficiency.

The most recent analyst rating on (JP:5981) stock is a Hold with a Yen2072.00 price target. To see the full list of analyst forecasts on TOKYO ROPE MFG. CO., LTD. stock, see the JP:5981 Stock Forecast page.

Tokyo Rope Lifts Profits, Raises Dividend as Balance Sheet Strengthens

Tokyo Rope MFG. Co., Ltd. reported consolidated net sales of ¥46.6 billion for the nine months ended Dec. 31, 2025, a slight 0.6% year‑on‑year increase, while sharply boosting operating profit 38.5% to ¥2.8 billion and profit attributable to owners of parent 49.6% to ¥2.9 billion. The stronger profitability lifted basic earnings per share to ¥183.05 and pushed the equity‑to‑asset ratio to 44.3%, alongside a planned full‑year dividend of ¥65.00 per share, signaling improved financial health and shareholder returns even as full‑year net sales and profit forecasts remain only modestly higher than the prior year.

For the fiscal year ending March 31, 2026, Tokyo Rope is maintaining its forecast of ¥64.0 billion in net sales and ¥3.2 billion in profit attributable to owners of parent, implying only a slight decline in full‑year earnings versus the previous period despite the strong nine‑month performance. This stance, together with the absence of changes in consolidation scope or accounting policies, suggests a cautious outlook on demand and margins but underscores management’s confidence in sustaining solid balance sheet metrics and a higher dividend payout, which will be closely watched by investors focused on capital efficiency and stability.

The most recent analyst rating on (JP:5981) stock is a Hold with a Yen1917.00 price target. To see the full list of analyst forecasts on TOKYO ROPE MFG. CO., LTD. stock, see the JP:5981 Stock Forecast page.

Tokyo Rope Reports Progress on Ongoing Share Buyback Program

Tokyo Rope Mfg. Co., Ltd. has disclosed the status of its share buyback program, reporting the repurchase of 18,000 common shares on the Tokyo Stock Exchange between January 1 and January 31, 2026, for a total acquisition cost of ¥30.83 million. This buyback is part of a broader board-approved program, authorized in November 2025, allowing repurchases of up to 200,000 shares or ¥300 million through March 31, 2026; as of January 31, 2026, the company has cumulatively acquired 148,000 shares for approximately ¥227.96 million, signaling an ongoing capital policy aimed at enhancing shareholder value and optimizing its capital structure.

The most recent analyst rating on (JP:5981) stock is a Hold with a Yen1828.00 price target. To see the full list of analyst forecasts on TOKYO ROPE MFG. CO., LTD. stock, see the JP:5981 Stock Forecast page.

Tokyo Rope Advances Share Buyback, Repurchasing 121,000 Shares in December

Tokyo Rope Mfg. Co., Ltd. has reported the status of its ongoing share buyback program, acquiring 121,000 common shares for a total of ¥183,778,300 between December 1 and December 31, 2025 through market purchases on the Tokyo Stock Exchange, including off-auction transactions via ToSTNeT-3. These transactions form part of a previously approved board authorization, which allows for the repurchase of up to 200,000 shares or ¥300 million by March 31, 2026; as of December 31, 2025, the company had cumulatively bought back 130,000 shares for ¥197,130,900, signaling an active capital policy that may support shareholder value and optimize its capital structure.

The most recent analyst rating on (JP:5981) stock is a Buy with a Yen1583.00 price target. To see the full list of analyst forecasts on TOKYO ROPE MFG. CO., LTD. stock, see the JP:5981 Stock Forecast page.