Tanaka Seimitsu Kogyo Co., Ltd. (7218) AI Stock Analysis

• Market Cap: ¥10.25B
• Dividend Yield: 3.33%
• Average Volume (3M): 2.19K
• Price to Earnings (P/E): 5.9
• Beta (1Y): 0.79
• Revenue Growth: -7.85%
• EPS Growth: -34.41%
• Country: JP
• Employees: 1,402
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Auto - Parts
• EPS (TTM): 50.02
• Shares Outstanding: 9,763,600
• 10 Day Avg. Volume: 2,930
• 30 Day Avg. Volume: 2,190
• PEG Ratio: -0.29
• Price to Book (P/B): 0.40
• Price to Sales (P/S): 0.24
• P/FCF Ratio: 11.49
• 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: ¥1,146.00
• Price Target Upside: 9.14% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 1

• Rating: 72 Outperform
• Price Target: ¥1,146.00 ▲(9.14% Upside)

Tanaka Seimitsu Kogyo Co., Ltd. has a strong financial foundation with robust revenue growth and profitability. The stock appears undervalued with a low P/E ratio and attractive dividend yield. However, technical indicators suggest bearish momentum, which could pose short-term challenges.

Tanaka Seimitsu Kogyo Co., Ltd. Business Overview & Revenue Model

Company Description

Tanaka Seimitsu Kogyo Co., Ltd. (7218) is a leading Japanese manufacturer specializing in precision machining and component production for the automotive and aerospace industries. Established in 1952, the company is known for its high-quality products, including precision gears, automotive components, and various machining services. With a strong focus on innovation and technology, Tanaka Seimitsu Kogyo provides tailored solutions to meet the specific needs of its clients, ensuring reliability and performance in critical applications.

How the Company Makes Money

Tanaka Seimitsu Kogyo generates revenue primarily through the manufacturing and sale of precision machined components and assemblies for the automotive and aerospace sectors. The company's revenue model is based on direct sales to major automotive manufacturers and aerospace companies, often through long-term contracts that provide stability and predictability in earnings. Key revenue streams include the sale of precision gears, automotive transmission components, and custom machining services. Additionally, the company benefits from partnerships with industry leaders, allowing it to secure large-scale projects and maintain a competitive edge in technology and innovation, which further contributes to its overall profitability.

Tanaka Seimitsu Kogyo Co., Ltd. Financial Statement Overview

Summary

Tanaka Seimitsu Kogyo Co., Ltd. demonstrates strong revenue growth and improved profitability margins. The balance sheet is robust with low leverage and a strong equity ratio. Cash flow management is positive, but there's room for improvement in sustaining cash flow growth. Overall, financial performance is solid but faces challenges in maintaining profitability.

Income Statement

Tanaka Seimitsu Kogyo Co., Ltd. has shown strong revenue growth over the past years, with a 13.4% increase in total revenue from 2023 to 2024, and a further 7.3% increase from 2024 to 2025. The gross profit margin improved from 14.6% in 2022 to 18.4% in 2025, indicating enhanced efficiency and cost management. The net profit margin also increased significantly, reaching 4.4% in 2025 from 1.3% in 2022. The company has improved its EBIT and EBITDA margins, reflecting better operational efficiency. However, the net income saw a decline in 2025, suggesting potential challenges in maintaining profitability.

Balance Sheet

The balance sheet of Tanaka Seimitsu Kogyo Co., Ltd. shows a stable financial position with a debt-to-equity ratio of 0.18 in 2025, indicating a low level of leverage. The return on equity (ROE) has improved to 7.4% in 2025, up from 2.3% in 2022, highlighting improved profitability from shareholders' equity. The equity ratio has remained strong, reflecting a solid capital structure. However, the company's total assets have grown modestly, and maintaining this growth could be challenging if operational efficiency does not keep pace.

Cash Flow

The cash flow analysis indicates that Tanaka Seimitsu Kogyo Co., Ltd. has maintained a positive operating cash flow, though it saw a decline from 2024 to 2025. The free cash flow grew significantly from 2023 to 2024, but the growth rate slowed in 2025. The operating cash flow to net income ratio remained strong, suggesting good cash generation relative to net income. The free cash flow to net income ratio is healthy, indicating efficient capital expenditure management. However, the overall cash flow stability could be improved to sustain long-term investments.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	40.12B	40.47B	42.55B	34.23B	29.67B	26.04B
Gross Profit	7.34B	7.44B	7.68B	5.73B	4.36B	3.21B
EBITDA	5.21B	5.49B	6.60B	5.55B	3.60B	2.06B
Net Income	1.70B	1.79B	2.22B	1.02B	373.65M	-571.96M
Balance Sheet
Total Assets	42.33B	43.72B	42.68B	39.28B	36.84B	36.90B
Cash, Cash Equivalents and Short-Term Investments	9.50B	9.68B	10.33B	8.55B	6.82B	7.10B
Total Debt	4.19B	4.09B	4.08B	6.71B	8.20B	9.25B
Total Liabilities	11.80B	12.66B	12.53B	13.96B	14.12B	15.74B
Stockholders Equity	24.04B	24.05B	22.72B	18.58B	16.50B	15.19B
Cash Flow
Free Cash Flow	0.00	846.36M	4.87B	3.51B	696.34M	790.61M
Operating Cash Flow	0.00	4.42B	7.42B	4.98B	2.37B	3.06B
Investing Cash Flow	0.00	-3.13B	-2.82B	-1.11B	-1.56B	-1.44B
Financing Cash Flow	0.00	-2.10B	-3.66B	-2.67B	-1.39B	-879.60M

Tanaka Seimitsu Kogyo Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 1050.00
• 50DMA: Negative
• 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:7218, the sentiment is Neutral. The current price of 1050 is below the 20-day moving average (MA) of 1063.97, below the 50-day MA of 1050.89, and above the 200-day MA of 1008.09, indicating a neutral trend. The MACD of -2.19 indicates Positive momentum. The RSI at 47.73 is Neutral, neither overbought nor oversold. The STOCH value of 8.04 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for JP:7218.

Tanaka Seimitsu Kogyo Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
7247	79 Outperform	¥12.11B	4.83	―	3.73%	0.85%	94.79%
7254	78 Outperform	¥14.08B	4.63	―	2.43%	-4.83%	5.31%
7228	77 Outperform	¥9.66B	7.88	―	3.13%	7.41%	7.38%
7218	72 Outperform	¥10.25B	5.86	―	3.33%	-7.85%	-34.41%
5985	68 Neutral	¥28.41B	8.52	―	0.53%	20.25%	―
7273	64 Neutral	¥17.63B	6.60	―	3.90%	17.13%	429.28%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%