Modec (6269) AI Stock Analysis

• Market Cap: ¥937.08B
• Dividend Yield: 0.73%
• Average Volume (3M): 3.74M
• Price to Earnings (P/E): 17.0
• Beta (1Y): 1.18
• Revenue Growth: 10.13%
• EPS Growth: 25.50%
• Country: JP
• Employees: 5,962
• Sector: Energy
• Sector Strength: 52
• Industry: Oil & Gas Equipment & Services
• EPS (TTM): 291.51
• Shares Outstanding: 68,345,300
• 10 Day Avg. Volume: 2,347,940
• 30 Day Avg. Volume: 3,737,503
• PEG Ratio: 0.27
• Price to Book (P/B): 3.57
• Price to Sales (P/S): 1.19
• P/FCF Ratio: 22.96
• 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): 878.75
• Revenue Forecast (FY): ¥672.86B

• Rating: 62 Neutral
• Price Target: ¥14,543.00 ▼(-3.50% Downside)
• Action: Downgraded Date: 02/18/26
• Date: Action: Downgraded 02/18/26

The score is driven primarily by improved profitability and balance-sheet repair, tempered by volatility in revenue and a sharp 2025 free-cash-flow pullback. Technicals are moderately supportive over the medium/long term but not strong in the near term, while valuation is average with a low dividend yield.

Positive Factors

Balance sheet repair

Modec's declining debt and rising equity through 2023–2025 strengthen its capital base and reduce refinancing risk. A healthier balance sheet improves resilience to offshore project cycles, supports bidding for large EPCI contracts and funds asset-backed charters or capex without immediate external stress.

Durable charter & O&M revenue

The firm's business model of leasing FPSOs/FSOs and providing multi-year O&M creates recurring, contractually-backed cash flows. These long-duration revenues give predictability to cash generation, support lifecycle services margins and reduce dependence on one-off project recognitions over the medium term.

Profitability turnaround

A sustained return to profitability after earlier losses indicates operational improvement and better project execution. Higher earnings enable reinvestment into fleet, reduce reliance on external funding, and support sustained returns on equity—important for long-term capacity to win and operate new projects.

Negative Factors

Free cash flow volatility

A large FCF drop in 2025 highlights sensitivity to project timing and working capital swings. Persistent cash volatility can constrain investments in newbuilds or fleet upgrades, force external financing during downturns, and reduce the firm's ability to smooth payouts or fund backlog organically.

Revenue cyclicality

Top-line swings reflect project award timing and capital spending cycles in offshore oil & gas. Modest 2025 revenue decline shows backlog and booking variability; sustained cyclicality can pressure margins and utilization of owned FPSOs, reducing predictability of multi-year earnings and free cash flow.

Historical leverage & cyclic risk

Past episodes of very high leverage show the firm's balance sheet is susceptible in stress periods. Given large upfront capex for FPSOs and EPCI work, another industry downturn or delayed charters could strain liquidity, raise refinancing needs, and amplify operational risk despite recent repair.

Modec Business Overview & Revenue Model

Company Description

MODEC, Inc., a general contractor, engages in the engineering, procurement, construction, and installation of floating production systems worldwide. The company provides floating production storage and offloading vessels; floating storage and offloading vessels; floating LNGs; floating storage regasification water-desalination and power generation; tension leg platforms; production semi-submersibles; mooring systems; and other technologies. It also offers operation and maintenance services. The company was founded in 1968 and is headquartered in Tokyo, Japan. MODEC, Inc. is a subsidiary of Mitsui E&S Holdings Co., Ltd.

How the Company Makes Money

Modec generates revenue primarily through long-term contracts with oil and gas companies for the leasing and operation of its FPSO units. The company earns money from the day rates charged for the use of its production units, as well as from additional services such as maintenance and technical support. Key revenue streams include fixed contracts with established clients in the oil and gas industry, which provide stable income over several years. Modec also benefits from partnerships with major oil companies, which can lead to further opportunities for contracts and joint ventures in new projects. Additionally, the company may see revenue from project financing and construction services linked to the development of new FPSO units.

Modec Financial Statement Overview

Summary

Financials show a clear turnaround with solid profitability in 2023–2025 and a repaired balance sheet (declining debt, rising equity). Offsetting this, revenue was slightly down in 2025 and cash flow is volatile, with free cash flow dropping sharply in 2025—typical cyclicality for the sector but a visibility risk.

Income Statement

Profitability has improved materially versus earlier loss years (2020–2021), with solid positive earnings in 2023–2025 and a sharp step-up in net income in 2025. However, top-line momentum is mixed: revenue rebounded strongly in 2023–2024 but slipped modestly in 2025 (annual revenue growth -3.4%), and margins appear volatile across the cycle (from negative in 2020–2021 to positive thereafter). Overall, the business is back to profitability but still shows cyclical/unstable revenue and margin behavior.

Balance Sheet

Leverage looks manageable and improving in the most recent years: total debt declined from 2023 to 2025 while equity increased, supporting a stronger capital base. Historical risk is notable (very high leverage in 2020), but the balance sheet has since been repaired, and profitability in 2023–2024 translated into healthy returns on equity. Key watch-out is that the company operates in a cyclical industry where balance-sheet strength can be tested during downturns.

Cash Flow

Cash generation is positive in 2023–2025, with free cash flow closely tracking reported earnings in 2023–2024, which is a quality signal. The main weakness is volatility: cash flow turned negative in 2022 and free cash flow fell sharply in 2025 (down ~70.7% year over year), indicating sensitivity to working capital or project timing. Overall cash flow is supportive but less consistent than earnings.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	4.37B	4.19B	3.57B	2.77B	3.90B
Gross Profit	533.31M	392.81M	250.38M	69.01M	-225.53M
EBITDA	328.14M	207.69M	324.46M	-12.04M	-220.93M
Net Income	344.30M	220.40M	96.54M	37.38M	-363.98M
Balance Sheet
Total Assets	4.76B	4.50B	3.89B	3.14B	3.43B
Cash, Cash Equivalents and Short-Term Investments	1.33B	1.31B	1.07B	529.91M	824.30M
Total Debt	420.36M	514.43M	570.75M	393.38M	426.92M
Total Liabilities	3.29B	3.30B	2.85B	2.30B	2.87B
Stockholders Equity	1.45B	1.18B	992.82M	811.64M	532.54M
Cash Flow
Free Cash Flow	225.94M	548.61M	478.42M	-215.78M	122.88M
Operating Cash Flow	232.95M	560.89M	485.89M	-208.90M	152.24M
Investing Cash Flow	5.28M	-122.58M	-210.54M	-56.85M	-220.54M
Financing Cash Flow	-185.42M	-186.27M	241.15M	-49.01M	265.96M

Modec Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 15070.00
• 50DMA: Negative
• 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:6269, the sentiment is Neutral. The current price of 15070 is above the 20-day moving average (MA) of 14626.00, above the 50-day MA of 14023.91, and above the 200-day MA of 9664.32, indicating a neutral trend. The MACD of -229.08 indicates Positive momentum. The RSI at 45.16 is Neutral, neither overbought nor oversold. The STOCH value of 20.57 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for JP:6269.

Modec Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
1662	81 Outperform	¥682.10B	13.13	16.04%	2.95%	4.14%	91.38%
1605	78 Outperform	¥4.83T	11.49	9.52%	2.91%	-11.79%	18.12%
5021	73 Outperform	¥810.71B	16.12	―	3.93%	2.57%	-4.79%
5019	68 Neutral	¥1.96T	62.58	2.23%	3.07%	-7.68%	-73.03%
Sector *	65 Neutral	$15.17B	7.61	4.09%	5.20%	3.87%	-62.32%
5020	64 Neutral	¥4.17T	21.74	-0.15%	2.74%	-14.13%	33.18%
6269	62 Neutral	¥937.08B	17.01	24.31%	0.73%	10.13%	25.50%

Modec Corporate Events

Modec to Shift Head Office to Tokyo’s Marunouchi Business District

Modec, Inc. plans to relocate its head office to the Tekko Building in the Marunouchi district of Chiyoda-ku, Tokyo, pending shareholder approval of amendments to its Articles of Incorporation at the 40th Annual General Meeting in March 2026. The move is intended to support more comfortable and efficient work styles while positioning the company in a central Tokyo business hub.

The relocation aims to enhance cross-departmental collaboration, strengthen engagement with external partners, and foster an innovation-oriented environment within the organization. Modec expects the financial impact of the relocation to be immaterial, suggesting limited short-term effect on earnings while potentially improving its long-term operational efficiency and corporate culture.

The most recent analyst rating on (JP:6269) stock is a Buy with a Yen15762.00 price target. To see the full list of analyst forecasts on Modec stock, see the JP:6269 Stock Forecast page.

MODEC Weighs Cutting Investment Unit to Broaden Investor Base

MODEC has outlined its view that reducing the minimum investment unit for its shares is an effective way to broaden its investor base and enhance liquidity in its stock. The company explicitly links a potential reduction in the trading lot size to improved market accessibility for a wider range of shareholders.

In its policy statement, MODEC says it will continue to study a possible cut in the investment unit, weighing factors such as the prevailing share price, current liquidity conditions, and the cost-effectiveness of such a move. The approach signals an openness to capital market reforms that could support trading volume and potentially make the stock more attractive to individual investors.

The most recent analyst rating on (JP:6269) stock is a Buy with a Yen15762.00 price target. To see the full list of analyst forecasts on Modec stock, see the JP:6269 Stock Forecast page.

MODEC Lifts Profit, Strengthens Balance Sheet and Raises Dividends on 2025 Results

MODEC reported solid growth for the year ended December 31, 2025, with revenue rising 9.4% to $4.58 billion and operating profit jumping 35.5% as profitability and margins improved. Profit attributable to owners of the parent climbed 63.6%, return on equity strengthened to 27.4%, and the company’s equity ratio and cash position also improved, underscoring a healthier balance sheet.

Shareholder returns are set to increase, with the annual dividend for 2025 raised to ¥140 per share and a further hike to ¥200 forecast for 2026, reflecting confidence in earnings sustainability. For 2026, MODEC forecasts broadly flat revenue but higher operating profit and modest growth in profit attributable to owners, signaling a focus on reinforcing profitability and capital efficiency in a stable demand environment for offshore production services.

The most recent analyst rating on (JP:6269) stock is a Buy with a Yen15762.00 price target. To see the full list of analyst forecasts on Modec stock, see the JP:6269 Stock Forecast page.