Molitec Steel Co., Ltd. (5986) AI Stock Analysis

• Market Cap: ¥4.21B
• Dividend Yield: 2.13%
• Average Volume (3M): 21.91K
• Price to Earnings (P/E): 11.7
• Beta (1Y): 0.67
• Revenue Growth: -1.86%
• EPS Growth: 7.29%
• Country: JP
• Employees: 734
• Sector: Basic Materials
• Sector Strength: 58
• Industry: Steel
• EPS (TTM): 2.92
• Shares Outstanding: 22,558,064
• 10 Day Avg. Volume: 21,070
• 30 Day Avg. Volume: 21,906
• PEG Ratio: 2.18
• Price to Book (P/B): 0.27
• Price to Sales (P/S): 0.08
• P/FCF Ratio: -1.70
• 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: Hold
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 63 Neutral
• Price Target: ¥217.00 ▲(15.43% Upside)

Molitec Steel Co., Ltd. has a stable financial base but faces challenges in profitability and cash flow, impacting its overall financial performance. Technical indicators suggest weak momentum, while valuation metrics show reasonable pricing with moderate income potential. The absence of significant earnings call insights or corporate events leaves the focus on financial and technical aspects.

Positive Factors

Business Model Strength

Molitec's diversified product offerings and industry reach provide a stable revenue base, supporting long-term business resilience.

Balance Sheet Health

A strong balance sheet with manageable debt enhances financial stability and supports future growth initiatives.

Production Efficiency

Efficient production processes contribute to maintaining competitive margins and operational effectiveness over time.

Negative Factors

Profitability Challenges

Struggles with profitability may limit reinvestment capabilities and long-term financial performance.

Cash Flow Concerns

Inconsistent cash generation could impact operational flexibility and necessitate reliance on external funding.

Revenue Growth Decline

Declining revenue growth may signal market challenges or competitive pressures, affecting future expansion.

Molitec Steel Co., Ltd. Business Overview & Revenue Model

Company Description

Molitec Steel Co., Ltd. processes and sells steel strips primarily in Japan. It offers press worked products, including automotive parts, household electrical appliances, agricultural machine parts, dies fabrication products, integrated drive plates, power springs, combine augers, and oil level gauges. The company also provides heat-treated products, such as hardened and tempered carbon steel strips and sheets; and metal materials comprising cold and hot rolled steel strips and sheets, spring and cold-rolled stainless steel strips, cold-rolled carbon steel strips and sheets, hot rolled mild steel sheets and strips, electrolytic zinc-coated steel sheets, and color coated steel sheets. In addition, it manufactures and sells various machinery tools, steel parts, and plastic products and parts, as well as imports and exports various merchandise. The company was formerly known as Mori&Co. and changed its name to Molitec Steel Co., Ltd. in January 1990. Molitec Steel Co., Ltd. was founded in 1943 and is headquartered in Osaka, Japan.

How the Company Makes Money

Molitec Steel Co., Ltd. generates revenue primarily through the sale of its steel products to various industries. The company's key revenue streams include the manufacturing and distribution of rolled steel, wire products, and structural components, which are sold to construction firms, automotive manufacturers, and other industrial clients. Additionally, Molitec may engage in value-added services such as custom fabrication and processing, which further enhance its revenue potential. Strategic partnerships with suppliers and clients, along with a focus on quality and customer satisfaction, also play a significant role in securing contracts and maintaining steady cash flow. The company's emphasis on innovation and efficiency contributes to cost management, thus improving profitability.

Molitec Steel Co., Ltd. Financial Statement Overview

Summary

Molitec Steel Co., Ltd. shows stable production efficiency and solid financial health, but faces challenges with profitability and cash flow management. The company needs to address its operational cost structure and enhance cash generation capabilities to improve financial resilience.

Income Statement

Molitec Steel Co., Ltd. has seen fluctuating revenue growth rates over the years, with a most recent annual decline. Despite this, the company has consistently maintained a positive gross profit margin, reflecting efficiency in production. However, the net profit and EBIT margins are relatively low, indicating challenges in controlling other operational costs. The EBITDA margin suggests some stability in operating performance.

Balance Sheet

The balance sheet of Molitec Steel Co., Ltd. shows a moderate debt-to-equity ratio, indicating manageable leverage levels, which is crucial for financial stability. The equity ratio remains strong, signifying solid financial health and asset base. Return on Equity (ROE) is modest, suggesting room for improvement in generating returns for shareholders.

Cash Flow

Cash flow analysis reveals a concerning trend with negative free cash flow in recent years, indicating potential liquidity issues. The operating cash flow to net income ratio suggests inconsistencies in converting profits to cash, potentially impacting operational flexibility. Positive financing cash flow hints at reliance on external funding.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	50.12B	50.50B	50.77B	36.33B	27.56B	22.29B
Gross Profit	4.83B	4.78B	4.49B	3.14B	3.15B	2.17B
EBITDA	1.18B	1.40B	1.29B	274.59M	1.32B	611.38M
Net Income	323.90M	329.37M	312.33M	-704.78M	254.30M	-329.74M
Balance Sheet
Total Assets	35.56B	36.53B	37.23B	36.49B	23.83B	22.59B
Cash, Cash Equivalents and Short-Term Investments	5.42B	4.87B	5.71B	4.84B	2.67B	3.48B
Total Debt	6.28B	6.39B	5.51B	5.67B	1.43B	1.48B
Total Liabilities	21.18B	21.91B	23.05B	23.57B	10.58B	9.70B
Stockholders Equity	14.31B	14.54B	14.11B	12.86B	13.18B	12.83B
Cash Flow
Free Cash Flow	0.00	-2.31B	1.26B	-972.85M	-980.21M	-81.64M
Operating Cash Flow	0.00	-1.76B	1.84B	-316.85M	-502.21M	774.36M
Investing Cash Flow	0.00	31.47M	-602.67M	-587.92M	-118.10M	-381.37M
Financing Cash Flow	0.00	696.85M	-357.39M	2.96B	-238.00M	-85.44M

Molitec Steel Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 188.00
• 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:5986, the sentiment is Negative. The current price of 188 is below the 20-day moving average (MA) of 192.25, below the 50-day MA of 197.24, and below the 200-day MA of 192.62, indicating a bearish trend. The MACD of -2.61 indicates Positive momentum. The RSI at 36.95 is Neutral, neither overbought nor oversold. The STOCH value of 9.52 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:5986.

Molitec Steel Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
5491	70 Outperform	¥5.60B	4.48	―	―	-5.93%	-36.01%
5542	69 Neutral	¥4.96B	7.96	―	2.76%	-3.45%	34.97%
5446	64 Neutral	¥4.73B	12.25	―	3.16%	-20.10%	-14.13%
5986	63 Neutral	¥4.21B	11.75	―	2.13%	-1.86%	7.29%
5609	63 Neutral	¥3.99B	7.79	―	3.63%	-4.20%	-11.70%
Sector *	61 Neutral	$10.43B	7.12	-0.05%	2.87%	2.86%	-36.73%
5476	56 Neutral	¥7.56B	-1.08	―	―	3.22%	-451.22%