Hochiki Corporation (6745) AI Stock Analysis

• Market Cap: ¥159.90B
• Dividend Yield: 2.03%
• Average Volume (3M): 76.24K
• Price to Earnings (P/E): 19.0
• Beta (1Y): 1.01
• Revenue Growth: 6.69%
• EPS Growth: 29.94%
• Country: JP
• Employees: 2,295
• Sector: Industrials
• Sector Strength: 72
• Industry: Construction
• EPS (TTM): 106.60
• Shares Outstanding: 26,400,000
• 10 Day Avg. Volume: 67,050
• 30 Day Avg. Volume: 76,243
• PEG Ratio: 0.23
• Price to Book (P/B): 1.06
• Price to Sales (P/S): 0.62
• P/FCF Ratio: 6.03
• 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): 319.55
• Revenue Forecast (FY): ¥105.00B

• Rating: 79 Outperform
• Price Target: ¥7,065.00 ▲(59.12% Upside)
• Action: Reiterated Date: 02/07/26
• Date: Action: Reiterated 02/07/26

The score is driven primarily by strong and improving financial performance (growth, margins, and cash flow strength) supported by a stable, low-leverage balance sheet. Technicals are constructive due to the clear uptrend, but overbought signals temper the rating. Valuation appears reasonable with a modest dividend yield.

Positive Factors

Stable business model & market position

Hochiki’s core business supplying fire detection, alarm equipment and system solutions targets regulation-driven, specification-led demand. Distribution, installers and project channels create recurring project flows and replacement cycles, producing durable baseline revenue and sticky customer relationships over time.

Improving profitability and margins

Sustained margin improvement across gross, EBIT and net lines indicates better cost control and pricing power in manufacturing. Higher margins support resilience to input cost swings, fund reinvestment in R&D or service capabilities, and underpin sustainable earnings growth even if top-line expansion is gradual.

Strong cash generation & conservative balance sheet

Robust free cash flow and strong cash conversion demonstrate high quality earnings and internal funding capacity for capex, dividends or selective M&A. Very low leverage and a healthy equity ratio reduce financial risk and give strategic optionality without near-term refinancing pressure.

Negative Factors

Conservative capital structure may limit growth

Extremely low leverage preserves stability but can constrain the company’s ability to accelerate growth via debt-funded capex or larger acquisitions. Over months to years this conservative stance may limit ROE expansion and slow scaling compared with peers that judiciously deploy leverage to fund growth.

Modest revenue growth rate

A roughly 5% topline growth rate signals steady but modest expansion in a mature product market. Without faster geographic expansion, new products, or higher recurring service revenue, earnings upside will rely more on margin gains and cost efficiency, limiting long-term growth leverage.

Project-oriented sales create revenue cyclicality

Heavy reliance on project and installation-driven sales makes revenue sensitive to construction cycles, specification timing, and large contract timing. With limited disclosed service recurring revenue, this can produce lumpy cash flows and greater short-to-medium-term volatility in reported revenue and backlog conversion.

Hochiki Corporation Business Overview & Revenue Model

Company Description

Hochiki Corporation engages in the research and development, manufacture, sale, consulting, engineering, design, and maintenance of fire alarm, smoke control, fire extinguishing, network, and security systems in Japan and internationally. The company's fire alarm systems comprise automatic fire alarm systems, emergency alarm systems, apartment house automatic fire alarm systems, dialer to fire stations, high sensitivity aspirating smoke detection systems, smoke control systems, fire and gas leakage alarm device, and residential use smoke alarms. Its information and communication systems include TV master antenna, digital terrestrial broadcasting receiving, BS/110CS receiving, cable TV/optical transmission, public address, intercom, ITV, LAN, and network camera systems, as well as ancillary facilities for radio communication. The company's fire-extinguishing systems comprise sprinkler, apartment house sprinkler, hydrant, foam fire extinguishing, CO2 fire extinguishing, N2 fire extinguishing, water cannon, and tunnel fire prevention system. Its security systems include intruder detection and alarm, access control, and key management systems. The company was formerly known as Tokyo Hochiki Co., Ltd. and changed its name to Hochiki Corporation in July 1972. Hochiki Corporation was incorporated in 1918 and is headquartered in Tokyo, Japan.

How the Company Makes Money

Hochiki Corporation generates revenue primarily through the sale of its fire detection and alarm systems, including hardware and software solutions. Key revenue streams include direct sales of products to end-users, as well as partnerships with distributors and contractors who install these systems in various buildings and facilities. Additionally, the company earns income from maintenance and support services for its systems, which ensures ongoing customer engagement and loyalty. Strategic partnerships with construction firms and safety compliance organizations further enhance their market reach and contribute to their earnings by integrating Hochiki's products into larger safety and infrastructure projects.

Hochiki Corporation Financial Statement Overview

Summary

Strong fundamentals: revenue grew to 100.9B yen, profitability improved (gross margin 36.8%, net margin 7.6%, EBIT margin 9.5%), and cash generation strengthened with free cash flow rising to 10.37B yen and strong cash conversion (operating cash flow/net income 1.57). Balance sheet is conservative with very low leverage (debt-to-equity 0.02) and a healthy equity ratio (65.9%), supporting stability.

Income Statement

Hochiki Corporation demonstrates strong financial growth with a consistent increase in total revenue over the years, particularly a notable rise from 93.5 billion to 100.9 billion yen in the last fiscal year. Gross profit margin has improved to 36.8%, reflecting efficient cost management. The net profit margin also improved to 7.6%, indicating robust profitability. The company benefits from a healthy EBIT margin of 9.5% and an EBITDA margin of 11.6%, showcasing operational efficiency.

Balance Sheet

The balance sheet shows a solid financial position with a low debt-to-equity ratio of 0.02, suggesting low financial risk. Return on equity has strengthened to 12.9%, indicating effective use of shareholders' equity to generate profits. The equity ratio stands at a healthy 65.9%, showcasing financial stability. However, the company's reliance on equity might limit potential leverage opportunities.

Cash Flow

Hochiki Corporation exhibits strong cash flow generation with a significant increase in free cash flow from negative to 10.37 billion yen. The operating cash flow to net income ratio of 1.57 indicates efficient cash conversion from profits. The free cash flow to net income ratio at 1.36 further supports the company's strong cash management capabilities, highlighting its capacity to cover capital expenditures and possibly reinvest in growth.

Breakdown	TTM	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	102.38B	100.90B	93.48B	85.46B	81.25B	76.57B
Gross Profit	38.12B	37.15B	32.25B	27.83B	26.22B	24.88B
EBITDA	11.38B	11.66B	8.88B	7.00B	6.92B	6.68B
Net Income	7.88B	7.65B	5.66B	4.42B	4.12B	3.83B
Balance Sheet
Total Assets	83.11B	89.66B	85.23B	77.82B	73.91B	67.63B
Cash, Cash Equivalents and Short-Term Investments	20.13B	21.16B	11.63B	15.31B	18.62B	12.51B
Total Debt	1.94B	1.27B	1.14B	666.00M	513.00M	576.00M
Total Liabilities	23.92B	30.33B	32.32B	31.48B	31.06B	28.61B
Stockholders Equity	59.01B	59.12B	52.74B	46.17B	42.69B	38.86B
Cash Flow
Free Cash Flow	0.00	10.37B	-1.04B	-1.88B	7.11B	3.01B
Operating Cash Flow	0.00	11.87B	775.00M	415.00M	7.79B	4.05B
Investing Cash Flow	0.00	-636.00M	-2.54B	-2.20B	-669.00M	-950.00M
Financing Cash Flow	0.00	-1.74B	-2.51B	-1.62B	-1.22B	-1.17B

Hochiki Corporation Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 4440.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:6745, the sentiment is Positive. The current price of 4440 is below the 20-day moving average (MA) of 5534.00, below the 50-day MA of 4977.40, and above the 200-day MA of 3881.57, indicating a bullish trend. The MACD of 348.17 indicates Negative momentum. The RSI at 81.08 is Negative, neither overbought nor oversold. The STOCH value of 90.23 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:6745.

Hochiki Corporation Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
6745	79 Outperform	¥159.90B	18.98	―	2.03%	6.69%	29.94%
1969	79 Outperform	¥727.12B	16.31	―	2.13%	15.98%	82.99%
6458	79 Outperform	¥101.79B	14.93	―	3.65%	8.96%	-0.82%
1979	76 Outperform	¥245.18B	18.03	8.53%	2.45%	5.14%	-10.92%
5929	72 Outperform	¥872.01B	15.17	18.61%	2.94%	2.90%	36.64%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
5938	50 Neutral	¥527.50B	55.39	1.44%	4.80%	0.68%	―

Hochiki Corporation Corporate Events

Hochiki Lifts Nine-Month Profits and Holds FY2026 Guidance Steady

The company posted nine-month revenue of ¥75.8 billion, up 4.9% year on year, with operating profit jumping 22.7% to ¥7.9 billion and net profit climbing 15.8% to ¥5.7 billion, while balance-sheet strength improved as the equity ratio rose to 71.7% and net assets per share reached ¥2,587.85. Management kept its full-year guidance unchanged at ¥100.9 billion in sales and ¥7.2 billion in net income despite forecasting a flat top line and lower earnings versus last year, and it reaffirmed a stable ¥80 dividend per share, signaling confidence in cash generation even as growth momentum moderates.

The most recent analyst rating on (JP:6745) stock is a Buy with a Yen5406.00 price target. To see the full list of analyst forecasts on Hochiki Corporation stock, see the JP:6745 Stock Forecast page.