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

• Market Cap: ¥8.84B
• Dividend Yield: N/A
• Average Volume (3M): 36.83K
• Price to Earnings (P/E): 55.2
• Beta (1Y): 1.31
• 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: ¥802.00 ▲(172.79% 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

Nearly 20% reported revenue growth indicates underlying demand and market penetration. Sustained top-line expansion can enable operating leverage, support reinvestment in capacity or R&D, and provide a foundation for margin recovery if the company stabilizes execution and controls costs.

Improving Operating Cash Flow

Recent improvement in operating cash flow suggests better cash conversion and working capital management. If maintained, stronger OCF reduces reliance on external funding, enables debt repayment and capex, and enhances financial flexibility over the coming months to support operations.

Stable Equity Base

A relatively stable equity base and reasonable equity ratio provide a capital buffer against cyclical revenue swings. This stability supports borrowing capacity, cushions losses during downturns, and preserves optionality for strategic investment or restructuring when needed.

Negative Factors

High Leverage

Elevated debt relative to equity raises financial risk: interest burden and covenant pressure can constrain capital allocation, limit ability to invest, and increase bankruptcy risk if revenue or margins deteriorate. High leverage reduces resilience to industry cycles.

Volatile Profitability & Declining Margins

Volatile profits and falling gross margins point to operational or pricing pressures that erode earnings durability. Persistent margin decline limits retained earnings, weakens competitiveness, and makes it harder to cover fixed costs, undermining medium-term profitability prospects.

Inconsistent Free Cash Flow

Historical negative and inconsistent free cash flow, plus weak OCF-to-net-income alignment, indicate earnings quality issues and unstable cash generation. This undermines the firm's ability to service debt, fund capex, or pursue strategic initiatives without external financing.

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 734.45, below the 50-day MA of 516.02, and below the 200-day MA of 358.20, indicating a bullish trend. The MACD of 96.00 indicates Positive momentum. The RSI at 59.64 is Neutral, neither overbought nor oversold. The STOCH value of 24.72 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	¥5.08B	15.18	―	1.19%	-6.39%	-3.86%
6334	68 Neutral	¥4.58B	26.66	―	1.22%	12.31%	138.05%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
6467	56 Neutral	¥3.25B	-8.59	―	1.81%	-3.20%	-226.19%
6166	50 Neutral	¥8.84B	55.24	―	―	-7.98%	-52.68%
3444	47 Neutral	¥9.42B	17.76	―	1.56%	11.20%	―
6218	47 Neutral	¥3.59B	-2.74	―	1.93%	-14.00%	-216.77%