Kawaden Corporation (6648) AI Stock Analysis

• Market Cap: ¥44.84B
• Dividend Yield: 2.74%
• Average Volume (3M): 19.21K
• Price to Earnings (P/E): 12.7
• Beta (1Y): 0.41
• Revenue Growth: 28.24%
• EPS Growth: 239.81%
• Country: JP
• Employees: 574
• Sector: Industrials
• Sector Strength: 72
• Industry: Industrial - Machinery
• EPS (TTM): 40.59
• Shares Outstanding: 20,960,000
• 10 Day Avg. Volume: 15,060
• 30 Day Avg. Volume: 19,213
• PEG Ratio: <0.01
• Price to Book (P/B): 0.14
• Price to Sales (P/S): 0.11
• P/FCF Ratio: 2.10
• 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: 79 Outperform
• Price Target: ¥2,724.00 ▼(-64.20% Downside)

The score is driven primarily by strong financial performance (growth and profitability improvement with low leverage) and supportive technical momentum (price above key moving averages with positive MACD). Valuation is reasonable with a moderate dividend yield, but not compelling enough to push the score into the top tier.

Positive Factors

Revenue Growth

Sustained 13.5% revenue growth reflects expanding market reach across electronics, industrial machinery and IT segments. Durable top-line expansion signals successful product distribution mix and demand resilience, supporting longer-term scale and reinvestment capacity.

Margin Improvement

Healthy 33.1% gross margin and rising net margin to 8.1%, plus stronger EBIT/EBITDA, indicate improved operational efficiency and pricing/partnering strength. Higher structural margins enhance cash generation and make earnings more resilient through industry cycles.

Conservative Leverage

Very low debt-to-equity and a strong equity ratio provide financial flexibility to weather downturns and fund strategic initiatives without pressuring cash flow. Conservative capital structure reduces refinancing risk and preserves optionality for M&A or capex.

Negative Factors

Underutilized Cash

Material cash reserves on the balance sheet can signal idle capital and weigh on return on equity if not redeployed. Persistently high cash without clear allocation plans may reflect limited growth opportunities or constrained capital allocation discipline over the medium term.

Cash Conversion Weakness

OCF/Net Income below 1.0 and FCF/Net Income at 0.62 indicate earnings are not yet fully converted to cash. Structural working capital variability in distribution businesses can reduce cash available for reinvestment and weaken sustained funding for growth without drawing on cash reserves.

End-market Cyclicality

Concentration in semiconductor and electronics distribution exposes revenue and margins to OEM inventory cycles and semiconductor demand swings. Structural cyclicality in end markets can produce durable volatility in sales and working capital needs over 2-6 month horizons and beyond.

Kawaden Corporation Business Overview & Revenue Model

Company Description

Kawaden Corporation (6648) is a prominent Japanese company specializing in the distribution of electronic components and equipment, primarily focusing on the semiconductor and electronic parts sectors. The company operates in multiple segments, including electronics, industrial machinery, and information technology, providing a wide range of products such as sensors, connectors, and various electronic devices. With a commitment to innovation and quality, Kawaden Corporation serves various industries, including automotive, telecommunications, and consumer electronics.

How the Company Makes Money

Kawaden Corporation generates revenue primarily through the sale of electronic components and related products. Its key revenue streams include the distribution of semiconductors, connectors, and other electronic parts, which are sourced from both domestic and international manufacturers. The company benefits from long-term partnerships with major suppliers, allowing it to offer a diverse product range and competitive pricing. Additionally, Kawaden provides value-added services such as technical support and logistics, enhancing customer satisfaction and loyalty. The company's ability to adapt to technological advancements and market demands plays a crucial role in sustaining its earnings.

Kawaden Corporation Financial Statement Overview

Summary

Kawaden Corporation exhibits strong financial health with robust revenue growth, improved profitability, and a solid balance sheet with low leverage. The cash flow position has strengthened, although there is potential for better capital utilization. The company is well-positioned in its industry, but should consider optimizing its cash reserves to drive further growth.

Income Statement

Kawaden Corporation has demonstrated strong revenue growth with a 13.5% increase in the most recent year. The gross profit margin is healthy at 33.1%, and the net profit margin improved significantly to 8.1%. The company also showed a strong improvement in EBIT and EBITDA margins, reflecting enhanced operational efficiency.

Balance Sheet

The company's debt-to-equity ratio is low at 0.06, indicating conservative leverage. The equity ratio is robust at 69.8%, highlighting a strong equity base. Return on equity improved to 11.1%, suggesting effective use of shareholders' funds. However, the high cash reserves might indicate underutilized capital.

Cash Flow

Kawaden Corporation's free cash flow has turned positive with a strong growth rate, supporting financial flexibility. The operating cash flow to net income ratio of 0.78 suggests a solid cash conversion, though there is room for improvement. The free cash flow to net income ratio is 0.62, indicating good cash generation relative to earnings.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	24.22B	21.33B	19.66B	18.31B	18.62B
Gross Profit	8.02B	5.63B	4.89B	4.91B	5.66B
EBITDA	3.24B	1.71B	1.09B	1.48B	1.91B
Net Income	1.96B	744.40M	320.39M	646.92M	962.10M
Balance Sheet
Total Assets	25.43B	22.41B	21.46B	20.56B	20.82B
Cash, Cash Equivalents and Short-Term Investments	8.12B	7.37B	7.64B	6.68B	9.13B
Total Debt	1.13B	1.06B	945.98M	1.08B	964.41M
Total Liabilities	7.69B	6.37B	6.10B	5.28B	5.95B
Stockholders Equity	17.74B	16.04B	15.36B	15.28B	14.88B
Cash Flow
Free Cash Flow	1.22B	-116.99M	1.38B	-2.39B	762.21M
Operating Cash Flow	1.54B	166.88M	1.71B	-988.75M	2.15B
Investing Cash Flow	-564.11M	-297.13M	-356.27M	-1.32B	-1.42B
Financing Cash Flow	-226.11M	-138.66M	-392.44M	-141.48M	-242.67M

Kawaden Corporation Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 7610.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:6648, the sentiment is Positive. The current price of 7610 is above the 20-day moving average (MA) of 2212.50, above the 50-day MA of 1981.64, and above the 200-day MA of 1300.24, indicating a bullish trend. The MACD of 142.90 indicates Positive momentum. The RSI at 53.55 is Neutral, neither overbought nor oversold. The STOCH value of 17.85 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:6648.

Kawaden Corporation Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
6648	79 Outperform	¥44.84B	12.65	―	2.74%	28.24%	239.81%
6224	72 Outperform	¥18.23B	14.75	―	1.86%	24.02%	8.22%
6264	69 Neutral	¥28.91B	19.29	―	2.04%	140.12%	6842.82%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
6203	53 Neutral	¥16.78B	52.91	―	1.73%	26.09%	―
6293	46 Neutral	¥17.32B	-21.09	―	4.21%	2.79%	-281.15%