Fenwal Controls of Japan, Ltd. (6870) AI Stock Analysis

• Market Cap: ¥9.63B
• Dividend Yield: 4.34%
• Average Volume (3M): 2.76K
• Price to Earnings (P/E): 8.7
• Beta (1Y): 0.07
• Revenue Growth: -0.57%
• EPS Growth: 6.94%
• Country: JP
• Employees: 275
• Sector: Industrials
• Sector Strength: 74
• Industry: Security & Protection Services
• EPS (TTM): 28.52
• Shares Outstanding: 5,893,000
• 10 Day Avg. Volume: 4,610
• 30 Day Avg. Volume: 2,760
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• 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: ¥1,930.00
• Price Target Upside: 13.13% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 1

• Rating: 77 Outperform
• Price Target: ¥1,930.00 ▲(13.13% Upside)

Fenwal Controls of Japan, Ltd. receives a strong overall score, primarily driven by its robust financial performance, particularly its solid balance sheet and strong profitability margins. The stock is also attractively valued, with a low P/E ratio and high dividend yield. Technical analysis shows some caution with bearish momentum indicators, but overall, the stock presents a compelling value proposition.

Fenwal Controls of Japan, Ltd. Business Overview & Revenue Model

Company Description

Fenwal Controls of Japan, Ltd. (6870) operates in the field of manufacturing and supplying control devices for heating, ventilation, air conditioning, and refrigeration systems. The company provides a range of products including flame safeguard controls, gas ignition systems, and temperature sensors, catering primarily to the needs of industries focused on climate control and safety systems.

How the Company Makes Money

Fenwal Controls of Japan, Ltd. generates revenue through the sale of its control devices and systems to manufacturers and suppliers within the HVAC and refrigeration sectors. The company's key revenue streams include direct sales of its proprietary products, as well as potential after-sales services and maintenance contracts. Significant partnerships with OEMs (Original Equipment Manufacturers) and distributors also play a crucial role in expanding its market reach and boosting sales, thereby contributing to its earnings.

Fenwal Controls of Japan, Ltd. Financial Statement Overview

Summary

Fenwal Controls of Japan, Ltd. demonstrates a strong financial position overall, with high profitability margins, low leverage, and robust shareholder returns. While revenue growth has been modest, the company maintains efficient cost management and operational stability. The balance sheet is particularly strong, with low debt levels and a solid equity base. Cash flow management, although adequate, presents an opportunity for enhancement to ensure stronger liquidity and financial flexibility.

Income Statement

Fenwal Controls of Japan, Ltd. shows a solid performance in its income statement with a strong gross profit margin of approximately 33.04% for 2024, indicating efficient cost management. The net profit margin has significantly improved to approximately 8.91% from 3.06% in 2023, showing enhanced profitability. However, revenue growth has been stagnant, with a slight decline observed in 2024. The EBIT margin stands at 9.43%, and the EBITDA margin is at 12.65%, reflecting stable operating performance.

Balance Sheet

The balance sheet of Fenwal Controls of Japan, Ltd. is robust, with a low debt-to-equity ratio of approximately 0.09, showcasing financial stability and low leverage. The return on equity (ROE) is impressive at approximately 8.20%, indicating strong shareholder returns. The equity ratio is high at about 69.59%, suggesting a strong equity base relative to total assets. Overall, the balance sheet reflects a healthy financial position with minimal reliance on debt.

Cash Flow

Cash flow performance shows a mixed picture with a free cash flow of 316 million yen in 2024, which is a decline from the previous year. The operating cash flow to net income ratio is approximately 0.85, indicating solid cash generation relative to net income. However, the free cash flow to net income ratio is lower at 0.28, suggesting a potential area for improvement in cash management.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	12.72B	12.52B	12.60B	12.40B	12.37B	9.13B
Gross Profit	4.17B	4.14B	4.01B	4.05B	3.90B	2.69B
EBITDA	2.21B	1.58B	929.57M	1.45B	1.07B	1.03B
Net Income	1.31B	1.12B	385.00M	826.57M	387.57M	585.24M
Balance Sheet
Total Assets	19.17B	19.52B	19.07B	18.81B	18.69B	15.67B
Cash, Cash Equivalents and Short-Term Investments	6.23B	6.29B	7.32B	6.32B	6.89B	7.07B
Total Debt	1.27B	1.24B	1.53B	1.78B	2.11B	568.00M
Total Liabilities	5.67B	5.94B	6.40B	6.50B	6.76B	4.05B
Stockholders Equity	13.50B	13.59B	12.68B	12.31B	11.92B	11.62B
Cash Flow
Free Cash Flow	0.00	293.62M	936.00M	55.01M	859.69M	1.62B
Operating Cash Flow	0.00	949.44M	1.11B	401.18M	1.20B	1.76B
Investing Cash Flow	0.00	-659.28M	940.68M	-80.91M	-1.27B	-944.38M
Financing Cash Flow	0.00	-920.32M	-646.00M	-714.24M	226.09M	-460.97M

Fenwal Controls of Japan, Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 1706.00
• 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:6870, the sentiment is Positive. The current price of 1706 is below the 20-day moving average (MA) of 1712.60, above the 50-day MA of 1697.66, and above the 200-day MA of 1672.58, indicating a neutral trend. The MACD of 2.30 indicates Positive momentum. The RSI at 49.37 is Neutral, neither overbought nor oversold. The STOCH value of 18.78 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:6870.

Fenwal Controls of Japan, Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
2331	79 Outperform	¥593.70B	19.28		2.12%	6.66%	17.57%
6870	77 Outperform	¥9.63B	8.70		4.34%	-0.57%	6.94%
6809	77 Outperform	¥37.26B	13.96		3.47%	2.16%	35.53%
6744	74 Outperform	¥236.69B	21.74		1.95%	11.91%	21.70%
1909	73 Outperform	¥52.23B	11.83		0.76%	4.95%	20.09%
Sector *	64 Neutral	$10.75B	15.58	7.24%	2.01%	2.80%	-14.32%
7734	63 Neutral	¥145.04B	18.12		1.29%	13.27%	-1.75%