Daikoku Denki Co., Ltd. (6430) AI Stock Analysis

• Market Cap: ¥42.07B
• Dividend Yield: 3.79%
• Average Volume (3M): 74.30K
• Price to Earnings (P/E): 6.6
• Beta (1Y): 0.91
• Revenue Growth: -9.87%
• EPS Growth: -30.64%
• Country: JP
• Employees: 644
• Sector: Technology
• Sector Strength: 88
• Industry: Computer Hardware
• EPS (TTM): 158.89
• Shares Outstanding: 14,818,175
• 10 Day Avg. Volume: 37,940
• 30 Day Avg. Volume: 74,300
• PEG Ratio: -0.62
• Price to Book (P/B): 0.85
• Price to Sales (P/S): 0.67
• P/FCF Ratio: 18.45
• 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: 81 Outperform
• Price Target: ¥3,325.00 ▲(20.08% Upside)

The score is driven primarily by strong financial quality (high profitability and a debt-free balance sheet), supported by very attractive valuation (low P/E and solid dividend yield). Technical signals are neutral-to-mildly positive, but the 2025 revenue decline and weaker free-cash-flow conversion temper the overall rating.

Positive Factors

Profitability Expansion

The company's ability to increase operating profit despite declining sales demonstrates strong cost management and operational efficiency, which can sustain profitability in challenging market conditions.

Balance Sheet Health

A debt-free balance sheet provides financial flexibility and reduces solvency risk, allowing the company to navigate economic fluctuations and invest in growth opportunities without financial strain.

Product Innovation

Successful product launches and market adoption of new gaming products indicate strong innovation capabilities, which can drive future revenue growth and strengthen market position.

Negative Factors

Revenue Decline

A significant revenue decline raises concerns about the sustainability of earnings and could indicate challenges in maintaining market share or adapting to industry changes.

Cash Flow Volatility

Weaker cash conversion and reduced free cash flow generation can limit the company's ability to reinvest in growth, pay dividends, or buffer against economic downturns.

Top-line Momentum Volatility

Volatility in revenue growth can signal instability in demand or competitive pressures, potentially impacting long-term growth prospects and market confidence.

Daikoku Denki Co., Ltd. Business Overview & Revenue Model

Company Description

Daikoku Denki Co., Ltd. is a Japanese company primarily engaged in the development, manufacturing, and sales of equipment and systems for the pachinko and pachislot industry. The company operates through two main segments: the Information System Segment, which provides integrated management and control systems for pachinko halls, and the Control System Segment, which focuses on the development and supply of LCDs, circuit boards, and other components for pachinko and pachislot machines. Daikoku Denki aims to enhance the entertainment experience by leveraging technology and innovation in the gaming sector.

How the Company Makes Money

Daikoku Denki generates revenue mainly through its two business segments. The Information System Segment offers comprehensive data management and operational support systems to pachinko halls, allowing them to optimize operations and enhance customer experiences. Revenue from this segment is derived from the sale, installation, and maintenance of these systems. The Control System Segment contributes to the company's earnings by supplying essential components for pachinko and pachislot machines, including LCD displays and circuit boards. This segment's revenue comes from the direct sale of these components to manufacturers of gaming machines. Additionally, the company may engage in strategic partnerships and collaborations within the gaming industry to further its technological advancements and market reach.

Daikoku Denki Co., Ltd. Financial Statement Overview

Summary

Strong profitability expansion and an exceptionally conservative balance sheet (no debt, strong ROE) support a high score. Offsetting this are the sharp revenue decline in 2025 and weaker cash conversion/free cash flow versus earnings, which raise near-term quality and sustainability concerns.

Income Statement

Profitability strengthened materially over the last several years: gross margin improved from ~36.6% (2020) to ~46.5% (2025), while operating profitability rose with EBIT margin expanding from ~4.8% (2020) to ~19.9% (2025). Net margin also improved meaningfully (from ~3.2% in 2020 to ~13.5% in 2025), indicating better cost control and operating leverage. The key weakness is volatility in top-line momentum—after strong growth in 2023–2024, 2025 shows a sharp revenue decline (negative growth rate), which raises questions about sustainability of the recent earnings power.

Balance Sheet

The balance sheet is exceptionally conservative with essentially no debt (2025 total debt is 0 and debt-to-equity is 0.0), providing high financial flexibility and low solvency risk. Equity remains sizeable versus assets, and returns on equity have been strong in recent years (rising from low single-digits earlier in the period to ~17.1% in 2025, after ~20.8% in 2024). The main drawback is that total assets declined from 2024 to 2025, suggesting some contraction or balance sheet repositioning that bears monitoring alongside the revenue drop.

Cash Flow

Cash generation is positive, with operating cash flow of ~7.7B in 2025; however, cash conversion weakened versus 2024. Operating cash flow is below net income in 2025 (about 70% coverage), and free cash flow fell to ~2.1B with free cash flow equal to only ~27% of net income—down sharply from 2024 when free cash flow closely tracked earnings (~75%). The strength is that the company still produces meaningful free cash flow and has demonstrated periods of strong free cash flow expansion (notably in 2024), but the latest year shows higher volatility and weaker cash realization.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	54.15B	57.42B	53.86B	31.82B	24.39B	23.23B
Gross Profit	24.73B	26.69B	24.98B	14.51B	10.14B	9.50B
EBITDA	11.85B	13.19B	13.67B	5.75B	3.07B	2.96B
Net Income	6.27B	7.73B	8.46B	2.93B	1.23B	612.64M
Balance Sheet
Total Assets	57.72B	57.27B	59.28B	48.30B	41.49B	41.08B
Cash, Cash Equivalents and Short-Term Investments	17.45B	16.96B	20.43B	17.42B	16.58B	16.24B
Total Debt	0.00	0.00	464.00K	2.00B	2.00B	3.00B
Total Liabilities	11.02B	11.98B	18.56B	14.90B	10.35B	10.42B
Stockholders Equity	46.70B	45.29B	40.72B	33.40B	31.14B	30.66B
Cash Flow
Free Cash Flow	0.00	2.08B	6.30B	1.94B	2.28B	2.22B
Operating Cash Flow	0.00	7.67B	8.43B	2.98B	3.22B	3.40B
Investing Cash Flow	0.00	-7.85B	-1.73B	-1.98B	-564.73M	-2.24B
Financing Cash Flow	0.00	-3.30B	-3.18B	-666.28M	-1.81B	-891.66M

Daikoku Denki Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 2769.00
• 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:6430, the sentiment is Neutral. The current price of 2769 is below the 20-day moving average (MA) of 2881.15, below the 50-day MA of 2900.02, and above the 200-day MA of 2544.54, indicating a neutral trend. The MACD of -13.34 indicates Positive momentum. The RSI at 45.55 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:6430.

Daikoku Denki Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
6430	81 Outperform	¥42.07B	6.60	―	3.79%	-9.87%	-30.64%
6676	77 Outperform	¥54.22B	7.31	―	2.03%	-13.53%	173.43%
7739	76 Outperform	¥148.12B	22.80	―	1.92%	7.46%	-8.01%
6737	69 Neutral	¥88.43B	17.73	―	4.76%	1.81%	9.07%
6413	66 Neutral	¥73.86B	19.12	―	4.01%	0.31%	-11.70%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
6918	56 Neutral	¥16.06B	22.76	―	2.91%	-17.73%	-83.81%

Daikoku Denki Co., Ltd. Corporate Events

Daikoku Denki Reports Increased Profit Despite Sales Decline

Daikoku Denki Co., Ltd. reported its consolidated financial results for the six months ended September 30, 2025, showing a decline in net sales by 12% compared to the previous year. Despite the decrease in sales, the company managed to achieve an operating profit of 6,985 million yen, marking a 23.3% year-on-year increase. The company’s strategic adjustments and cost management appear to have positively impacted its profitability, indicating a resilient operational performance amidst challenging market conditions.

Daikoku Denki Revises Earnings Forecast and Increases Dividend

Daikoku Denki Co., Ltd. has revised its earnings forecast for the fiscal year ending March 2026, citing strong sales of its card unit ‘VEGASIA’ and new gaming products. The company announced an increase in its year-end dividend forecast, reflecting improved financial performance and a commitment to enhancing shareholder returns. The revised forecast indicates a significant increase in net sales and profits, driven by successful product launches and market adoption.