Nitchitsu Co., Ltd. (7021) AI Stock Analysis

• Market Cap: ¥4.64B
• Dividend Yield: 1.64%
• Average Volume (3M): 1.65K
• Price to Earnings (P/E): 162.5
• Beta (1Y): 0.46
• Revenue Growth: 11.40%
• EPS Growth: -67.55%
• Country: JP
• Employees: 276
• Sector: Industrials
• Sector Strength: 72
• Industry: Industrial - Machinery
• EPS (TTM): 3.46
• Shares Outstanding: 2,130,000
• 10 Day Avg. Volume: 1,540
• 30 Day Avg. Volume: 1,653
• PEG Ratio: 9.41
• Price to Book (P/B): 0.30
• Price to Sales (P/S): 0.34
• P/FCF Ratio: -23.43
• 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: 66 Neutral
• Price Target: ¥2,544.00 ▲(12.97% Upside)
• Action: Downgraded Date: 11/18/25
• Date: Action: Downgraded 11/18/25

Nitchitsu Co., Ltd. shows a solid financial foundation with strong revenue growth and a stable balance sheet, which are the most significant factors in its score. Technical analysis indicates a positive trend but lacks strong momentum. Valuation metrics suggest the stock may be overvalued, which slightly offsets the positive financial performance.

Positive Factors

Balance Sheet Strength

A high equity ratio (69.61%) combined with a very low debt-to-equity (0.11) provides durable financial flexibility. This minimizes refinancing and interest-rate risk, supports capex or strategic investment, and helps the company withstand cyclical industry downturns over months.

Sustained Revenue Growth

Consistent top-line increases and an 18.85% year growth rate indicate sustained demand or market share gains. Durable revenue growth allows the company to scale fixed costs, invest in product/service improvements, and build competitive advantage over a multi-month horizon.

Operating Cash Generation Quality

A strong operating cash flow to net income ratio (3.58) and improving OCF point to high quality earnings and reliable cash conversion. Robust operating cash generation supports working capital, selective capex, and reduces dependency on external financing medium-term.

Negative Factors

Negative Free Cash Flow

Persistently negative free cash flow signals constrained post-investment cash availability. Over several months this limits ability to fund dividends, buybacks, deleverage, or make growth investments unless operational cash conversion persistently improves or capex is scaled back.

Low Profitability Margins

A low net profit margin (2.46%) indicates limited ability to convert sales into retained earnings. Coupled with modest returns on equity noted elsewhere, this constrains long-term shareholder returns and leaves the company vulnerable to cost inflation or price competition over the next several months.

Earnings Volatility

A steep EPS decline (-72.81%) signals significant earnings volatility or non-recurring hits that reduced profitability. Such volatility can reflect structural margin pressure, inconsistent order flow, or one-offs that undermine confidence in stable earnings generation over a multi‑month timeframe.

Nitchitsu Co., Ltd. Business Overview & Revenue Model

Company Description

Nitchitsu Co., Ltd. manufactures and sells industrial machinery in Japan. The company designs and manufactures marine equipment, air preheating machines, and other general industrial machinery; installs, constructs, and supervises machinery; and manufactures plant-related equipment. It also purchases and sells silica sand, gravel, sand, and crushed stone; and manufactures and sells purified silica powder, etc. In addition, the company engages in the leasing of office buildings; and manufacture and sale of heat-resistant paints; and processing and sale of natural rubber products. Nitchitsu Co., Ltd. was incorporated in 1950 and is headquartered in Tokyo, Japan.

How the Company Makes Money

Nitchitsu Co., Ltd. generates revenue through the production and sale of its electronic components and materials. The company's primary revenue streams include the sale of semiconductors, which are essential for various electronic devices, as well as specialized materials used in industrial applications. Nitchitsu has established significant partnerships with major technology firms and manufacturers, which help to facilitate steady demand for its products. Additionally, the company invests in research and development to create innovative solutions that meet emerging market needs, further enhancing its revenue potential.

Nitchitsu Co., Ltd. Financial Statement Overview

Summary

Nitchitsu Co., Ltd. demonstrates a solid financial foundation with steady revenue growth and strong equity. While profitability metrics suggest room for improvement, the company effectively manages its debt levels. Cash flow challenges are evident, but operational cash generation remains strong. Overall, the company is well-positioned but should focus on enhancing profitability and cash flow stability.

Income Statement

Nitchitsu Co., Ltd. has shown a consistent increase in revenue over the past few years, with a revenue growth rate of 18.85% in the latest year. The gross profit margin stands at 12.44%, indicating efficient cost management. However, the net profit margin is relatively low at 2.46%, suggesting room for improvement in profitability. The EBIT margin is 2.74%, and the EBITDA margin is 8.20%, reflecting moderate operational efficiency.

Balance Sheet

The company maintains a strong equity position with an equity ratio of 69.61%, indicating financial stability. The debt-to-equity ratio is low at 0.11, which minimizes financial risk. Return on equity is modest at 2.15%, highlighting potential for increased shareholder returns.

Cash Flow

Cash flow analysis reveals a challenging picture with a negative free cash flow, though there is a significant improvement in operating cash flow. The operating cash flow to net income ratio is 3.58, indicating strong cash generation relative to net income. However, the free cash flow to net income ratio is negative, suggesting cash constraints.

Breakdown	TTM	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	10.02B	9.85B	8.29B	8.02B	7.86B	8.47B
Gross Profit	1.26B	1.23B	1.22B	928.60M	1.03B	1.22B
EBITDA	828.67M	808.18M	743.52M	131.36M	308.89M	187.29M
Net Income	227.97M	241.95M	247.57M	-540.13M	-121.40M	-82.33M
Balance Sheet
Total Assets	16.69B	16.14B	15.36B	14.99B	14.99B	15.30B
Cash, Cash Equivalents and Short-Term Investments	2.90B	2.67B	2.71B	4.41B	4.34B	4.84B
Total Debt	1.17B	1.26B	1.22B	1.26B	1.24B	1.28B
Total Liabilities	5.28B	4.91B	4.62B	4.71B	4.13B	4.36B
Stockholders Equity	11.41B	11.23B	10.73B	10.28B	10.86B	10.94B
Cash Flow
Free Cash Flow	0.00	-143.64M	-1.44B	-311.55M	-410.82M	583.28M
Operating Cash Flow	0.00	866.32M	-515.64M	241.20M	58.36M	950.06M
Investing Cash Flow	0.00	-877.36M	-895.23M	-137.04M	-496.27M	-101.58M
Financing Cash Flow	0.00	-30.99M	-288.90M	-33.92M	-60.45M	-92.69M

Nitchitsu Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 2252.00
• 50DMA: Negative
• 100DMA: Negative
• 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:7021, the sentiment is Negative. The current price of 2252 is below the 20-day moving average (MA) of 2286.00, below the 50-day MA of 2379.90, and above the 200-day MA of 2119.77, indicating a neutral trend. The MACD of -42.32 indicates Positive momentum. The RSI at 43.27 is Neutral, neither overbought nor oversold. The STOCH value of 52.42 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:7021.

Nitchitsu Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
6334	68 Neutral	¥4.57B	-15.45	―	1.22%	12.31%	138.05%
6408	67 Neutral	¥6.89B	3.03	―	1.37%	-3.05%	―
7021	66 Neutral	¥4.64B	162.52	―	1.64%	11.40%	-67.55%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
6155	58 Neutral	¥5.14B	1,292.28	―	2.10%	-0.59%	89.24%
6757	49 Neutral	¥4.23B	40.07	―	4.06%	1.44%	-184.10%
6218	47 Neutral	¥3.57B	4.24	―	1.93%	-14.00%	-216.77%