Kitz (6498) AI Stock Analysis

• Market Cap: ¥174.58B
• Dividend Yield: 2.77%
• Average Volume (3M): 321.75K
• Price to Earnings (P/E): 14.7
• Beta (1Y): 0.99
• Revenue Growth: 2.74%
• EPS Growth: 7.86%
• Country: JP
• Employees: 5,415
• Sector: Industrials
• Sector Strength: 72
• Industry: Industrial - Machinery
• EPS (TTM): 32.43
• Shares Outstanding: 87,565,610
• 10 Day Avg. Volume: 453,540
• 30 Day Avg. Volume: 321,746
• PEG Ratio: 0.70
• Price to Book (P/B): 0.94
• Price to Sales (P/S): 0.59
• P/FCF Ratio: 11.08
• 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: 72 Outperform
• Price Target: ¥2,233.00 ▲(33.47% Upside)

Kitz's strong financial performance is the most significant factor driving its overall score, supported by solid revenue growth and profitability. The valuation is attractive with a reasonable P/E ratio and a good dividend yield. However, technical indicators suggest short-term bearish momentum, which slightly offsets the positive financial and valuation aspects.

Positive Factors

Strong free cash flow generation

Sustained FCF expansion and healthy cash conversion indicate the business consistently converts earnings into cash. That strengthens ability to fund capex, R&D, dividends or buybacks without adding leverage, supporting durable strategic investment and financial flexibility.

Conservative balance sheet

Low leverage and a strong equity base reduce refinancing and solvency risk during downturns. A solid capital structure combined with mid-teens ROE supports steady shareholder returns and provides room for opportunistic investments or M&A while preserving financial resilience.

Consistent profitability and margins

Stable revenue growth with double-digit gross margins and positive net margins demonstrates operational efficiency and pricing power in engineered valve products. Margin durability underpins cash generation and reinvestment capacity across business cycles.

Negative Factors

Modest top-line growth

Low single-digit revenue growth points to slow organic expansion relative to faster-growing industrial segments. Persistently modest top-line momentum can limit scale economies and requires margin improvements or strategic initiatives to drive meaningful long-term EPS growth.

Exposure to cyclical end markets

Heavy exposure to industrial and construction end markets ties revenue to macro and commodity cycles. Durable demand swings in these sectors can cause material order volatility, pressuring utilization, pricing and near-term cash flows across business cycles.

Moderate net margin

A sub-7% net margin provides earnings but leaves less buffer for adverse cost shocks or aggressive reinvestment compared with higher-margin industrial peers. In downturns this margin level could constrain free cash flow resilience and returns to shareholders.

Kitz Business Overview & Revenue Model

Company Description

Kitz (6498) is a Japanese company primarily engaged in the manufacturing and sales of high-quality valves and fittings used in various industries, including oil and gas, water supply, and building construction. The company is known for its innovative designs and commitment to quality, offering products that meet international standards and cater to both domestic and global markets. Kitz operates through different business segments, focusing on the production of industrial valves, plumbing equipment, and other related products, ensuring a diverse portfolio to serve various customer needs.

How the Company Makes Money

Kitz generates revenue primarily through the sale of its industrial valves and fittings, which are essential components in numerous applications across different sectors. The company's revenue model is based on direct sales to industrial clients, distributors, and contractors, as well as exports to international markets. Key revenue streams include the manufacturing of custom products tailored to specific industry requirements, which often command higher prices due to their specialized nature. Additionally, Kitz benefits from strategic partnerships with other manufacturers and distributors to enhance market reach and efficiency. The company also invests in research and development to innovate and improve product offerings, thereby driving sales growth and maintaining a competitive edge in the market.

Kitz Financial Statement Overview

Summary

Kitz demonstrates strong financial performance with consistent revenue growth, solid profitability, and a robust balance sheet. The company effectively manages its leverage and shows strong cash flow generation, positioning it well for future growth and stability.

Income Statement

Kitz has demonstrated consistent revenue growth with a 3.06% increase in the latest year, alongside improving profitability metrics. The gross profit margin stands at 26.14%, and the net profit margin is 6.87%, indicating strong operational efficiency. The EBIT and EBITDA margins are also healthy, reflecting effective cost management and operational leverage.

Balance Sheet

The company's balance sheet is robust with a debt-to-equity ratio of 0.32, showcasing a conservative leverage position. Return on equity is strong at 10.91%, indicating efficient use of shareholder funds. The equity ratio is 62.87%, reflecting a solid capital structure with a significant portion of assets financed by equity.

Cash Flow

Kitz has shown impressive free cash flow growth of 28.49%, highlighting strong cash generation capabilities. The operating cash flow to net income ratio is 1.57, indicating excellent cash conversion. The free cash flow to net income ratio of 0.77 further underscores the company's ability to generate cash relative to its earnings.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	175.56B	172.04B	166.94B	159.91B	135.79B	117.25B
Gross Profit	46.71B	44.97B	42.42B	38.82B	34.46B	30.50B
EBITDA	23.70B	23.84B	21.07B	19.22B	16.25B	12.69B
Net Income	11.60B	11.82B	10.59B	8.55B	4.95B	3.56B
Balance Sheet
Total Assets	175.43B	172.41B	166.69B	152.57B	143.42B	140.68B
Cash, Cash Equivalents and Short-Term Investments	24.91B	30.73B	29.00B	24.37B	27.94B	33.72B
Total Debt	33.40B	34.78B	37.94B	36.92B	38.87B	0.00
Total Liabilities	61.86B	62.60B	64.48B	61.53B	62.17B	65.51B
Stockholders Equity	112.11B	108.39B	100.87B	89.96B	80.37B	69.13B
Cash Flow
Free Cash Flow	3.45B	9.15B	7.12B	1.13B	4.58B	13.21B
Operating Cash Flow	13.78B	18.56B	16.01B	8.54B	8.28B	16.98B
Investing Cash Flow	-10.12B	-7.84B	-7.41B	-7.47B	-3.24B	-3.36B
Financing Cash Flow	-10.46B	-9.91B	-5.19B	-5.57B	-11.53B	8.96B

Kitz Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 1673.00
• 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:6498, the sentiment is Positive. The current price of 1673 is below the 20-day moving average (MA) of 1915.00, below the 50-day MA of 1779.74, and above the 200-day MA of 1459.33, indicating a bullish trend. The MACD of 61.50 indicates Positive momentum. The RSI at 68.47 is Neutral, neither overbought nor oversold. The STOCH value of 70.02 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:6498.

Kitz Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
6490	79 Outperform	¥152.50B	17.40	―	2.50%	-2.46%	-10.72%
6498	72 Outperform	¥174.58B	14.68	10.44%	2.77%	2.74%	7.86%
6486	70 Outperform	¥152.04B	19.95	―	3.88%	1.70%	18.50%
6496	69 Neutral	¥23.50B	14.54	―	1.82%	34.70%	-8.44%
6492	65 Neutral	¥11.64B	11.32	―	0.72%	6.51%	3.68%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
6495	54 Neutral	¥8.06B	130.03	―	1.65%	3.96%	―

Kitz Corporate Events

Kitz Corporation Reports Mixed Financial Results for Nine Months Ending September 2025

Kitz Corporation reported its consolidated financial results for the nine months ending September 30, 2025, showing a slight increase in net sales and operating profit compared to the previous year. Despite these gains, the profit attributable to owners of the parent decreased by 2.5%, indicating challenges in maintaining profitability. The company forecasts continued growth in net sales and operating profit for the full fiscal year, although profit attributable to owners is expected to decline by 5.3%. This financial performance highlights the company’s stable position in the market but also underscores the pressure on its profit margins.