Sakai Heavy Industries, Ltd. (6358) AI Stock Analysis

• Market Cap: ¥17.08B
• Dividend Yield: 5.32%
• Average Volume (3M): 15.48K
• Price to Earnings (P/E): 11.7
• Beta (1Y): 0.96
• Revenue Growth: -15.65%
• EPS Growth: -41.34%
• Country: JP
• Employees: 618
• Sector: Industrials
• Sector Strength: 92
• Industry: Agricultural - Machinery
• EPS (TTM): -0.06
• Shares Outstanding: 8,845,634
• 10 Day Avg. Volume: 19,220
• 30 Day Avg. Volume: 15,483
• PEG Ratio: -0.40
• Price to Book (P/B): 0.59
• Price to Sales (P/S): 0.00
• P/FCF Ratio: -71.97
• 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

• Rating: 72 Outperform
• Price Target: ¥2,150.00 ▲(9.41%Upside)

Overall, Sakai Heavy Industries scores well due to its strong valuation and financial performance. The low P/E ratio and high dividend yield are significant positives, indicating potential undervaluation. However, technical indicators reveal bearish momentum that could hinder short-term performance. The financial position remains solid, although recent cash flow and margin challenges need monitoring.

Sakai Heavy Industries, Ltd. Business Overview & Revenue Model

Company Description

Sakai Heavy Industries, Ltd. (6358) is a Japanese company specializing in the manufacturing of construction equipment. Established in 1918, the company is renowned for its production of road construction machinery, including vibratory rollers, rammers, and other compacting equipment. Sakai Heavy Industries operates within the broader industrial machinery sector, serving both domestic and international markets with a focus on innovation and quality in its equipment offerings.

How the Company Makes Money

Sakai Heavy Industries makes money primarily through the sale of its construction equipment products. The company's revenue streams are largely driven by the manufacturing and distribution of road construction machinery, such as vibratory rollers and compactors. These products are sold to construction firms, government agencies, and other entities involved in infrastructure development. Additionally, Sakai Heavy Industries may engage in service contracts and after-sales support, which provide supplementary income. The company's earnings are influenced by factors such as global infrastructure investment trends, technological advancements in construction machinery, and its strategic partnerships or distribution agreements with other companies in the industry.

Sakai Heavy Industries, Ltd. Financial Statement Overview

Summary

Sakai Heavy Industries has a strong income statement with efficient operations and profitability, supported by a stable balance sheet with low leverage and high equity ratios. However, cash flow challenges in the recent TTM period pose risks to liquidity and financial flexibility. Addressing these inefficiencies is crucial to sustaining financial health and supporting future expansion.

Income Statement

Sakai Heavy Industries shows robust financial performance with strong gross and net profit margins. The TTM data indicates a gross profit margin of approximately 28.37% and a net profit margin of 6.66%, highlighting efficient cost management. The company has experienced significant revenue growth over the years, with a notable increase from 2022 to 2023. However, the latest TTM revenue shows a decline from the previous annual period, which poses a potential concern for future growth. EBITDA and EBIT margins are healthy, indicating strong operational efficiency.

Balance Sheet

The balance sheet reflects a solid financial position with a low debt-to-equity ratio of approximately 0.17 in the TTM period, suggesting conservative leverage. The equity ratio stands at a robust 67.76%, indicating financial stability and strong equity backing. Return on equity is impressive at 6.50% for TTM, although slightly lower than the previous year. Overall, the company's balance sheet demonstrates strong financial health, but the slight decrease in total assets and stockholders' equity warrants monitoring.

Cash Flow

The cash flow statement reveals challenges in cash generation during the TTM period, with negative operating and free cash flows, indicating potential liquidity issues. The operating cash flow to net income ratio is negative, highlighting inefficiencies in converting income into cash flow. Free cash flow has decreased significantly compared to previous periods, which could impact future investments and financial flexibility. Despite historical strengths in cash flow, recent trends suggest a need for improved cash management.

Breakdown
TTM	Mar 2024	Mar 2023	Mar 2022	Mar 2021	Mar 2020
Income Statement		Total Revenue
28.96B	33.02B	31.46B	26.60B	21.62B	22.74B
	Gross Profit
8.21B	9.37B	8.17B	6.41B	5.41B	6.03B
	EBIT
2.11B	3.32B	2.51B	1.38B	701.25M	959.92M
	EBITDA
2.81B	4.30B	3.33B	2.34B	1.53B	1.68B
	Net Income Common Stockholders
1.93B	2.44B	1.69B	1.43B	4.00M	470.29M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
8.38B	8.38B	7.48B	7.99B	6.98B	6.76B
	Total Assets
44.24B	44.24B	40.80B	37.86B	35.10B	35.45B
	Total Debt
5.17B	5.05B	5.12B	6.04B	5.85B	6.16B
	Net Debt
-3.07B	-3.33B	-2.37B	-1.95B	-1.14B	-591.64M
	Total Liabilities
15.07B	15.07B	15.51B	14.70B	13.06B	13.53B
	Stockholders Equity
29.09B	29.09B	25.23B	23.11B	22.00B	21.88B
Cash Flow		Free Cash Flow
-241.22M	2.13B	1.50B	2.07B	946.41M	2.55B
	Operating Cash Flow
-195.94M	2.48B	1.89B	2.36B	1.53B	3.45B
	Investing Cash Flow
95.36M	-353.70M	-399.43M	-263.60M	-508.90M	-825.88M
	Financing Cash Flow
-888.04M	-1.42B	-2.24B	-1.23B	-812.50M	-226.64M

Sakai Heavy Industries, Ltd. Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 1965.00
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:6358, the sentiment is Neutral. The current price of 1965 is below the 20-day moving average (MA) of 1983.95, below the 50-day MA of 2019.81, and below the 200-day MA of 2224.16, indicating a bearish trend. The MACD of -21.03 indicates Positive momentum. The RSI at 47.81 is Neutral, neither overbought nor oversold. The STOCH value of 26.66 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for JP:6358.

Sakai Heavy Industries, Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
6306	74 Outperform	¥25.88B	12.95		4.71%	11.49%	52.75%
6358	72 Outperform	¥17.08B	11.66		5.32%	-15.65%	-41.34%
6294	65 Neutral	¥15.05B	10.24		4.01%	-1.89%	-21.96%
Sector *	65 Neutral	$4.41B	12.06	5.22%	249.80%	4.09%	-12.16%
6316	64 Neutral	¥9.06B	14.09		3.78%	2.51%	-5.08%
6310	52 Neutral	¥25.25B	―		2.68%	1.56%	-720.36%
6390	51 Neutral	¥15.15B	―		5.49%	-7.94%	-242.37%

Sakai Heavy Industries, Ltd. Corporate Events

Sakai Heavy Industries Faces Financial Decline Amid Market Challenges

Sakai Heavy Industries reported a significant decline in its financial performance for the fiscal year ended March 31, 2025, with net sales dropping by 15.6% and operating profit decreasing by 52.3% compared to the previous year. The company also announced a reduction in dividends, reflecting the challenging market conditions and its strategic adjustments to improve future profitability.

Sakai Heavy Industries Renews Anti-Takeover Measures

Sakai Heavy Industries, Ltd. has announced the renewal of its anti-takeover measures for another three years, following a resolution by its Board of Directors. This decision reflects the company’s strategy to protect its corporate value and shareholder interests, ensuring that any large-scale share acquisitions align with its long-term goals and specialized market position. The renewal, pending shareholder approval, aims to safeguard against potential hostile takeovers that could disrupt the company’s strategic direction.