Odawara Engineering Co., Ltd. (6149) AI Stock Analysis

• Market Cap: ¥13.09B
• Dividend Yield: 2.13%
• Average Volume (3M): 24.69K
• Price to Earnings (P/E): 5.5
• Beta (1Y): 0.83
• Revenue Growth: 8.09%
• EPS Growth: 109.84%
• Country: JP
• Employees: 416
• Sector: Industrials
• Sector Strength: 72
• Industry: Industrial - Machinery
• EPS (TTM): 167.18
• Shares Outstanding: 6,392,736
• 10 Day Avg. Volume: 14,750
• 30 Day Avg. Volume: 24,690
• PEG Ratio: 0.03
• Price to Book (P/B): 0.68
• Price to Sales (P/S): 0.69
• P/FCF Ratio: -9.33
• 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): N/A
• Revenue Forecast (FY): N/A

• Rating: 73 Outperform
• Price Target: ¥2,321.00 ▼(-6.26% Downside)
• Action: Upgraded Date: 02/18/26
• Date: Action: Upgraded 02/18/26

The score is driven primarily by strong financial strength (minimal leverage and improved margins) and very compelling valuation (low P/E with a ~3.36% yield). These positives are tempered by a key financial risk—sharp 2025 cash-flow deterioration—and bearish technical signals with the stock trading below key moving averages.

Positive Factors

Strong Balance Sheet

Odawara Engineering's zero-debt position enhances its financial stability, providing flexibility for strategic investments and resilience against economic downturns.

Cash Flow Management

Effective cash flow management ensures Odawara can fund operations and growth initiatives without relying on external financing, supporting long-term sustainability.

Revenue Growth

Consistent revenue growth reflects Odawara's ability to capture market opportunities and adapt to industry demands, supporting long-term business expansion.

Negative Factors

Net Profit Margin Decline

A declining net profit margin may indicate rising costs or pricing pressures, potentially impacting long-term profitability if not addressed.

Fluctuating Free Cash Flow

Volatility in free cash flow can affect the company's ability to consistently fund operations and investments, posing a risk to financial stability.

Revenue Drop in 2024

A revenue drop may signal challenges in maintaining growth momentum, requiring strategic adjustments to sustain long-term performance.

Odawara Engineering Co., Ltd. Business Overview & Revenue Model

Company Description

Odawara Engineering Co., Ltd. (6149) is a Japanese company specializing in precision machinery and equipment manufacturing. The company operates primarily in the sectors of semiconductor production equipment, industrial automation, and robotics. Its core products include cutting-edge tools and systems designed for high-precision processing, as well as solutions that enhance productivity and efficiency in various manufacturing processes.

How the Company Makes Money

Odawara Engineering generates revenue primarily through the sale of its precision machinery and equipment to the semiconductor and automation industries. Key revenue streams include direct sales of machinery, service contracts for maintenance and support, and custom engineering solutions tailored to meet specific customer needs. Additionally, the company may engage in partnerships with technology firms and manufacturers to co-develop products, which can also contribute to its earnings. The demand for advanced manufacturing equipment, particularly in rapidly evolving sectors like semiconductors, plays a significant role in driving the company’s revenue growth.

Odawara Engineering Co., Ltd. Financial Statement Overview

Summary

Strong profitability improvement (net margin ~4.0% in 2020 to ~12.7% in 2025; operating margin ~16.7% in 2025) and an exceptionally conservative balance sheet with effectively zero debt support a high score. The main offset is cash-flow weakness in 2025 (free cash flow ~-1.35B and very low cash conversion vs. earnings) alongside two consecutive years of revenue contraction, which raises near-term quality-of-earnings and demand durability risks.

Income Statement

Profitability has strengthened meaningfully over the cycle: annual net margin improved from ~4.0% (2020) to ~10.4% (2023) and further to ~12.7% (2025), with operating profitability also stepping up (operating margin ~16.7% in 2025 vs. ~6.0% in 2020). However, revenue growth has been inconsistent—after growth in 2021–2023, sales contracted in 2024 and again in 2025 (down 3.5%), which raises questions on demand sustainability despite strong margins.

Balance Sheet

The balance sheet is exceptionally conservative. Total debt is effectively zero in 2025 (and de minimis in 2023–2024), driving near-zero leverage and strong financial flexibility. Equity has grown steadily over time, supporting resilience. The main watch item is that returns on equity have been mid-single to high-single digits historically (where provided), which is solid but not standout given the very low leverage profile.

Cash Flow

Cash generation is the key weak spot. While 2021–2024 showed healthy cash creation (free cash flow positive each year, with 2023 particularly strong), 2025 saw a sharp reversal: operating cash flow dropped to ~0.11B and free cash flow turned materially negative (~-1.35B). Cash flow also lagged reported earnings in 2025 (operating cash flow to net income fell to ~0.02x), suggesting elevated working-capital needs and/or heavier investment that could persist if revenue remains soft.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	18.90B	18.24B	13.18B	14.70B	14.09B	13.56B
Gross Profit	5.63B	5.90B	3.86B	4.60B	3.46B	3.71B
EBITDA	3.20B	3.52B	1.72B	2.54B	1.52B	1.72B
Net Income	1.90B	2.32B	865.13M	1.53B	801.53M	925.71M
Balance Sheet
Total Assets	25.63B	24.86B	27.91B	26.73B	24.02B	22.78B
Cash, Cash Equivalents and Short-Term Investments	9.56B	8.73B	10.36B	8.14B	7.69B	6.31B
Total Debt	36.47M	0.00	5.17M	6.75M	3.00B	3.00B
Total Liabilities	8.10B	6.33B	11.47B	11.05B	9.85B	9.28B
Stockholders Equity	17.53B	18.53B	16.44B	15.68B	14.17B	13.51B
Cash Flow
Free Cash Flow	0.00	-1.35B	2.48B	3.58B	1.49B	1.03B
Operating Cash Flow	0.00	108.68M	3.29B	3.81B	1.99B	1.34B
Investing Cash Flow	0.00	-1.97B	-745.93M	-242.27M	-617.18M	-278.59M
Financing Cash Flow	0.00	-286.55M	-284.98M	-3.14B	-172.86M	-760.17M

Odawara Engineering Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 2476.00
• 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:6149, the sentiment is Positive. The current price of 2476 is above the 20-day moving average (MA) of 2187.50, above the 50-day MA of 2195.72, and above the 200-day MA of 2191.95, indicating a bullish trend. The MACD of -9.10 indicates Negative momentum. The RSI at 54.22 is Neutral, neither overbought nor oversold. The STOCH value of 70.73 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:6149.

Odawara Engineering Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
6317	78 Outperform	¥17.86B	6.57	―	3.41%	-3.27%	572.42%
6149	73 Outperform	¥13.09B	5.48	―	2.13%	8.09%	109.84%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
6440	61 Neutral	¥22.56B	16.40	―	―	-2.84%	―
6393	60 Neutral	¥13.62B	11.04	―	6.70%	7.96%	43.37%