Okamoto Machine Tool Works,Ltd. (6125) AI Stock Analysis

• Market Cap: ¥29.61B
• Dividend Yield: 3.52%
• Average Volume (3M): 20.98K
• Price to Earnings (P/E): 13.5
• Beta (1Y): 1.16
• Revenue Growth: -3.85%
• EPS Growth: -45.64%
• Country: JP
• Employees: 2,283
• Sector: Industrials
• Sector Strength: 72
• Industry: Industrial - Machinery
• EPS (TTM): 66.91
• Shares Outstanding: 6,703,795
• 10 Day Avg. Volume: 26,660
• 30 Day Avg. Volume: 20,976
• PEG Ratio: -0.17
• Price to Book (P/B): 0.57
• Price to Sales (P/S): 0.53
• P/FCF Ratio: -3.92
• 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: 62 Neutral
• Price Target: ¥4,653.00 ▲(5.03% Upside)

The stock's overall score is driven by a mixed financial performance with strong margins but declining profitability and cash flow issues. Technical indicators suggest a bearish trend, while the valuation is attractive with a low P/E ratio and high dividend yield. The absence of earnings call and corporate events data limits further insights.

Positive Factors

Strong Gross Profit Margins

Strong gross profit margins indicate efficient production processes and cost management, providing a buffer against market fluctuations and supporting long-term profitability.

Solid Equity Position

A solid equity position with an improving equity ratio suggests financial stability and the ability to fund future growth initiatives without excessive reliance on debt.

Substantial Cash Reserves

Substantial cash reserves provide a cushion to manage short-term liquidity needs and invest in strategic opportunities, enhancing the company's resilience and operational flexibility.

Negative Factors

Declining Net Profit Margins

Declining net profit margins can erode profitability and indicate challenges in maintaining pricing power or controlling costs, potentially impacting long-term financial health.

Negative Revenue Growth

Negative revenue growth suggests difficulties in market expansion or product demand, which could hinder the company's ability to scale and compete effectively over time.

Negative Free Cash Flow Growth

Negative free cash flow growth indicates potential cash management issues, which can strain liquidity and limit the company's capacity to invest in growth or weather economic downturns.

Okamoto Machine Tool Works,Ltd. Business Overview & Revenue Model

Company Description

Okamoto Machine Tool Works, Ltd. (6125) is a leading Japanese manufacturer specializing in precision grinding machines and related equipment. The company operates in the machine tool sector, focusing on the production of high-performance grinding machines, including surface grinders, cylindrical grinders, and internal grinders. Okamoto prides itself on innovation and quality, providing advanced technology solutions that cater to a diverse range of industries such as automotive, aerospace, and electronics.

How the Company Makes Money

Okamoto Machine Tool Works, Ltd. generates revenue primarily through the sale of its precision grinding machines and equipment. The company's revenue model includes direct sales to manufacturers and distributors, as well as offering maintenance and repair services for its machines. Key revenue streams include new machine sales, aftermarket services, and spare parts sales. Additionally, Okamoto has established strategic partnerships with various industries, enhancing its market reach and providing tailored solutions that meet specific customer needs, thereby contributing to its overall earnings.

Okamoto Machine Tool Works,Ltd. Financial Statement Overview

Summary

The company shows strong gross profit margins and a solid equity position, but faces challenges with declining net profit margins, negative revenue growth, and cash flow pressures. Operational efficiency is healthy but has declined, indicating increased costs or reduced pricing power.

Income Statement

The company's income statement shows strong gross profit margins consistently above 20%, indicating efficient production. However, the net profit margin has declined significantly from the previous year, primarily due to decreased revenues and increased expenses. Revenue growth has been negative in the past year, reflecting a challenging market environment. EBIT and EBITDA margins show a healthy operational efficiency but experienced a decline, suggesting increased operational costs or reduced pricing power.

Balance Sheet

The balance sheet reflects a solid equity position with an improving equity ratio, indicating financial stability. The debt-to-equity ratio is relatively moderate, showing a balanced leverage approach. However, the return on equity has decreased, suggesting lower profitability from shareholder investments. The company's asset base has grown, supporting potential for future expansion.

Cash Flow

Cash flow analysis reveals challenges with negative free cash flow growth, indicating cash management issues. Operating cash flow has turned negative, which could stress liquidity if persistent. The operating cash flow to net income ratio has deteriorated, suggesting inefficiencies in converting income into cash. However, the company has substantial cash reserves to support operations in the short term.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	44.81B	43.73B	50.20B	45.52B	37.55B	30.37B
Gross Profit	13.45B	12.53B	15.53B	14.37B	11.93B	8.49B
EBITDA	5.71B	5.04B	8.59B	7.15B	5.71B	3.38B
Net Income	2.43B	2.02B	4.56B	4.03B	2.89B	1.46B
Balance Sheet
Total Assets	62.96B	66.80B	60.16B	55.10B	47.51B	35.05B
Cash, Cash Equivalents and Short-Term Investments	12.08B	16.40B	11.89B	12.65B	12.33B	4.92B
Total Debt	8.29B	11.82B	9.36B	6.38B	5.48B	10.25B
Total Liabilities	22.92B	26.24B	30.19B	30.24B	27.18B	19.97B
Stockholders Equity	40.03B	40.56B	29.98B	24.86B	20.33B	15.08B
Cash Flow
Free Cash Flow	0.00	-5.92B	-2.09B	-486.00M	10.50B	5.07B
Operating Cash Flow	0.00	-2.11B	929.00M	2.68B	11.67B	5.92B
Investing Cash Flow	0.00	-5.09B	-3.63B	-3.08B	-1.55B	-919.00M
Financing Cash Flow	0.00	10.49B	1.24B	406.00M	-3.15B	-3.69B

Okamoto Machine Tool Works,Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 4430.00
• 50DMA: Positive
• 100DMA: Negative
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:6125, the sentiment is Positive. The current price of 4430 is above the 20-day moving average (MA) of 4327.25, below the 50-day MA of 4504.50, and above the 200-day MA of 4226.96, indicating a bullish trend. The MACD of 3.91 indicates Negative momentum. The RSI at 59.09 is Neutral, neither overbought nor oversold. The STOCH value of 66.67 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:6125.

Okamoto Machine Tool Works,Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
6137	81 Outperform	¥34.81B	12.42	―	2.73%	0.25%	-18.79%
6159	76 Outperform	¥13.72B	14.07	―	0.89%	23.05%	89.17%
6144	75 Outperform	¥42.00B	12.77	―	2.95%	12.75%	96.71%
6149	68 Neutral	¥13.55B	7.42	―	2.16%	8.09%	109.84%
6158	68 Neutral	¥5.57B	18.46	―	4.06%	-11.74%	-46.96%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
6125	62 Neutral	¥29.61B	13.50	―	3.52%	-3.85%	-45.64%