Nakamura Choukou Co., Ltd. (6166) AI Stock Analysis

• Market Cap: ¥10.30B
• Dividend Yield: N/A
• Average Volume (3M): 36.83K
• Price to Earnings (P/E): 63.0
• Beta (1Y): 1.36
• Revenue Growth: -7.98%
• EPS Growth: -52.68%
• Country: JP
• Employees: 145
• Sector: Industrials
• Sector Strength: 72
• Industry: Industrial - Machinery
• EPS (TTM): -0.58
• Shares Outstanding: 11,020,900
• 10 Day Avg. Volume: 54,750
• 30 Day Avg. Volume: 36,830
• PEG Ratio: 0.92
• Price to Book (P/B): 4.50
• Price to Sales (P/S): 1.40
• P/FCF Ratio: 49.98
• 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: 50 Neutral
• Price Target: ¥852.00 ▲(189.80% Upside)
• Action: Reiterated Date: 02/18/26
• Date: Action: Reiterated 02/18/26

The score is held down primarily by unstable financial performance and high leverage, alongside an expensive valuation (high P/E). Strong technical momentum supports the stock, but overbought signals increase near-term downside risk.

Positive Factors

Revenue Growth Trend

Near-20% reported revenue growth indicates meaningful demand momentum and market traction. If sustained, that top-line expansion supports scalable operations, improves bargaining power with suppliers, and underpins longer-term cash generation and reinvestment capacity over the next several quarters.

Recent Cash Flow Improvement

Recent improvement in operating cash flow suggests the company is beginning to convert sales into cash more reliably. Durable cash generation reduces liquidity risk, enables capex or debt servicing without equity raises, and provides flexibility to execute strategic initiatives over a multi-quarter horizon.

Stable Equity Buffer

A reasonable equity ratio and relatively stable shareholders' equity provide a capital buffer against operational shocks. This stability supports borrowing capacity, cushions volatility in earnings, and helps preserve strategic optionality for investments or restructuring when needed over the medium term.

Negative Factors

Elevated Leverage

High debt relative to equity raises interest and refinancing risk and limits financial flexibility. Over the coming quarters elevated leverage can constrain investment, increase vulnerability to margin compression, and force priority of cash to debt service rather than growth or R&D initiatives.

Volatile Profitability and Declining Margins

Recent negative net income and falling gross margins point to operational inefficiencies or pricing pressure. Persistent margin deterioration undermines sustainable profitability, reduces retained earnings for reinvestment, and raises the risk of cyclical earnings swings that impair long-term competitiveness.

Inconsistent Free Cash Flow / Quality

Inconsistent free cash flow and poor alignment between OCF and reported earnings signal earnings quality and working-capital volatility issues. Over time this undermines ability to reliably service debt, fund capex, or support dividends, forcing reactive financing or cost cuts in weaker quarters.

Nakamura Choukou Co., Ltd. Business Overview & Revenue Model

Company Description

Nakamura Choukou Co., Ltd. (6166) is a Japanese company specializing in the manufacturing and distribution of precision measuring instruments and equipment, primarily serving sectors such as manufacturing, construction, and quality control. The company's core products include various types of measuring tools, gauges, and inspection devices that are essential for ensuring accuracy and quality in industrial processes.

How the Company Makes Money

Nakamura Choukou Co., Ltd. generates revenue through the sale of its precision measuring instruments and related services. The primary revenue stream comes from direct sales to manufacturers and construction firms that require high-quality measuring equipment for their operations. In addition to product sales, the company may also offer maintenance and calibration services, which provide a recurring revenue model. Strategic partnerships with industry players and distributors enhance its market reach and contribute to its earnings, allowing the company to tap into various sectors that demand precision tools.

Nakamura Choukou Co., Ltd. Financial Statement Overview

Summary

Underlying fundamentals are mixed: volatile revenue/profitability with recent negative net income and declining gross margins, and elevated leverage (high debt vs. equity). Cash flow has improved recently, but historical inconsistency and weak alignment between operating cash flow and net income temper the outlook.

Income Statement

The company shows volatile performance with fluctuating revenue and profitability. Recent negative net income and declining gross profit margins indicate potential operational inefficiencies. The revenue growth rate fluctuated significantly, with a decline in the latest period. This instability raises concerns about the company's ability to maintain steady growth.

Balance Sheet

The balance sheet reflects high levels of debt relative to equity, which increases financial risk. The debt-to-equity ratio is a concern, although the company maintains a reasonable equity ratio. Stockholders' equity has been relatively stable, but the overall leverage could pose a risk if revenue and profitability do not improve.

Cash Flow

Cash flow analysis shows inconsistent free cash flow, with some improvement recently. The operating cash flow to net income ratio indicates that operational cash generation is not aligned with profitability. Past negative free cash flow periods highlight challenges, although recent positive cash flow is a good sign.

Breakdown	TTM	Mar 2025	Mar 2025	Mar 2024	Mar 2023	Mar 2022
Income Statement
Total Revenue	2.51B	2.64B	2.41B	3.32B	4.04B	3.81B
Gross Profit	662.63M	678.97M	386.42M	999.04M	1.26B	1.21B
EBITDA	486.54M	242.44M	760.27M	31.60M	-41.20M	194.61M
Net Income	198.74M	-32.79M	144.17M	-124.47M	-257.12M	7.52M
Balance Sheet
Total Assets	5.30B	5.36B	6.00B	4.69B	5.87B	6.02B
Cash, Cash Equivalents and Short-Term Investments	1.37B	1.31B	1.50B	2.00B	2.93B	3.03B
Total Debt	2.90B	2.92B	3.18B	2.50B	2.78B	3.13B
Total Liabilities	4.25B	4.54B	5.15B	3.97B	5.03B	5.51B
Stockholders Equity	1.05B	819.76M	854.90M	714.97M	840.03M	515.31M
Cash Flow
Free Cash Flow	0.00	73.88M	-1.13B	-561.70M	-345.30M	248.34M
Operating Cash Flow	0.00	123.40M	642.00M	-81.99M	175.23M	530.80M
Investing Cash Flow	0.00	-45.24M	-1.77B	-470.68M	-520.07M	161.53M
Financing Cash Flow	0.00	-263.40M	609.54M	-378.40M	228.49M	-1.47B

Nakamura Choukou Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 294.00
• 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:6166, the sentiment is Positive. The current price of 294 is below the 20-day moving average (MA) of 764.05, below the 50-day MA of 541.34, and below the 200-day MA of 364.01, indicating a bullish trend. The MACD of 96.01 indicates Positive momentum. The RSI at 66.21 is Neutral, neither overbought nor oversold. The STOCH value of 28.66 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:6166.

Nakamura Choukou Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
6396	79 Outperform	¥5.01B	14.96	―	1.19%	-6.39%	-3.86%
6334	68 Neutral	¥4.68B	27.25	―	1.22%	12.31%	138.05%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
6467	56 Neutral	¥3.29B	-8.59	―	1.81%	-3.20%	-226.19%
6166	50 Neutral	¥10.30B	62.98	―	―	-7.98%	-52.68%
3444	47 Neutral	¥10.20B	19.22	―	1.56%	11.20%	―
6218	47 Neutral	¥3.68B	-2.77	―	1.93%	-14.00%	-216.77%