Shinmaywa Industries (7224) AI Stock Analysis

• Market Cap: ¥178.74B
• Dividend Yield: 2.84%
• Average Volume (3M): 256.82K
• Price to Earnings (P/E): 17.4
• Beta (1Y): 1.16
• Revenue Growth: 0.26%
• EPS Growth: 14.29%
• Country: JP
• Employees: 6,181
• Sector: Industrials
• Sector Strength: 72
• Industry: Conglomerates
• EPS (TTM): 53.67
• Shares Outstanding: 70,000,000
• 10 Day Avg. Volume: 245,450
• 30 Day Avg. Volume: 256,820
• PEG Ratio: 0.45
• Price to Book (P/B): 0.83
• Price to Sales (P/S): 0.35
• P/FCF Ratio: 9.03
• 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): N/A
• Revenue Forecast (FY): N/A

• Rating: 63 Neutral
• Price Target: ¥2,900.00 ▲(41.33% Upside)
• Action: Downgraded Date: 02/05/26
• Date: Action: Downgraded 02/05/26

The score is held back primarily by weak TTM cash generation (negative free cash flow and poor cash conversion), which offsets improving earnings and otherwise manageable leverage. Strong technical uptrend and reasonable valuation with a ~2.4% dividend provide support but do not fully mitigate the cash-flow risk.

Positive Factors

Diversified industrial business & recurring aftermarket

ShinMaywa's mix of aerospace, special-purpose vehicles and industrial machinery creates multiple revenue streams. Long-lived installed bases generate recurring parts, service and MRO demand, cushioning cyclical equipment sales and supporting steady aftermarket revenue over months to years.

Improving revenue and multi-year net income growth

Consistent top-line expansion and multi-year net income improvement indicate strengthening operational performance and demand. Sustained earnings gains improve ability to reinvest in product lines, fund service capabilities, and support strategic projects without relying solely on external financing.

Manageable leverage with equity growth

A moderate debt ratio and rising equity provide balance-sheet resilience and borrowing capacity. Manageable leverage reduces refinancing pressure and helps preserve financial flexibility to fund contracts, capex or working-capital needs during multi-month operational cycles.

Negative Factors

Weak cash generation and negative FCF

Trailing cash conversion is weak: operating cash flow is low relative to profits and free cash flow is negative. Persistent weak cash generation raises funding and earnings-quality risk, may force external financing or deferred investment, and limits capacity to self-fund growth or cushion downturns.

Relatively thin margins

Modest gross and operating margins leave limited buffer against input-cost inflation, contract mix shifts, or pricing pressure. For a diversified industrial group, thin margins constrain the firm's ability to absorb adverse cost swings without eroding profitability or requiring sustained price increases.

Rising debt in TTM reduces flexibility

An increase in absolute debt during the TTM period lowers headroom and heightens reliance on cash flow for servicing. Coupled with weakened cash conversion, higher debt elevates liquidity and refinancing risk, potentially constraining strategic investment and increasing sensitivity to revenue volatility.

Shinmaywa Industries Business Overview & Revenue Model

Company Description

ShinMaywa Industries, Ltd., together with its subsidiaries, manufactures and sells transportation equipment in Japan, Asia, North America, and internationally. It offers amphibian and aircraft components; and special purpose trucks, such as dump trucks, refuse compactors, tailgate lifters, concrete mixers, and petroleum tanks; and fluid and related facilities and equipment, including pumps, essentials for water treatment, and remote monitoring systems. The company also provides wire processing systems for home electric appliance and auto industries; environmental systems; thin film coating systems; direct drive motors; and aircraft passenger boarding bridges. In addition, it manufactures, sells, installs, maintains, improves, and repairs mechanical car parking systems; and develops a range of surface modification technologies that provide surface hardness, wear resistance, corrosion resistance, and polishing. The company was formerly known as Shin Meiwa Industry Company Limited. ShinMaywa Industries, Ltd. was incorporated in 1949 and is headquartered in Takarazuka, Japan.

How the Company Makes Money

Shinmaywa Industries generates revenue through multiple key streams. Primarily, the company earns money by manufacturing and selling its specialized industrial equipment, such as aircraft components and wastewater treatment systems. This includes both direct sales to businesses and government contracts. Additionally, Shinmaywa benefits from long-term service contracts and maintenance agreements that provide ongoing revenue after initial sales. The company also engages in partnerships with other corporations and governmental bodies, which can facilitate joint ventures or collaborative projects that contribute to revenue. Factors such as demand for environmental technologies and advancements in aerospace also play a significant role in driving Shinmaywa's earnings.

Shinmaywa Industries Financial Statement Overview

Summary

Income statement trends are improving (TTM revenue +3.6% and multi-year net income growth) with moderate but better margins, and leverage remains manageable (~0.51x debt/equity). However, TTM cash flow is a major weakness (operating cash flow ~JPY 6.0B and negative free cash flow ~JPY -3.7B), with weak cash conversion versus net income, increasing near-term funding and earnings-quality risk.

Income Statement

TTM (Trailing-Twelve-Months) results show steady top-line expansion (revenue growth of 3.6%) and a clear multi-year earnings improvement versus prior annual periods (net income rising from ~JPY 5.5B in 2021 to ~JPY 10.4B in TTM). Profitability is moderate but improving: gross margin is ~17.1% and operating margin is ~5.7% in TTM, both better than earlier years, while net margin remains modest at ~3.8%. The main weakness is that margins are still relatively thin for a diversified industrial profile, leaving results more sensitive to cost inflation and mix changes.

Balance Sheet

Leverage looks manageable with debt at ~0.51x equity in TTM (generally in the 0.46–0.62x range across the annual history), and equity has grown over time, supporting balance-sheet resilience. Returns are reasonable but not high, with return on equity at ~7.7% in TTM, broadly stable versus recent years. The key risk is a higher debt level in TTM versus the latest annual period (debt increased to ~JPY 60.3B from ~JPY 51.2B), which reduces flexibility if profitability or cash generation weakens.

Cash Flow

Cash generation is the weakest area in TTM (Trailing-Twelve-Months): operating cash flow is only ~JPY 6.0B and free cash flow is negative (~JPY -3.7B). Cash conversion also deteriorated sharply, with operating cash flow running at only ~5.6% of net income and free cash flow below net income (negative relative to profits), suggesting working-capital or investment drag. While the latest annual period showed healthy cash performance (positive free cash flow and better cash conversion), the TTM reversal raises near-term quality-of-earnings and funding risk if it persists.

Breakdown	TTM	Mar 2025	Mar 2025	Mar 2024	Mar 2023	Mar 2022
Income Statement
Total Revenue	274.94B	266.44B	257.06B	225.18B	216.82B	209.23B
Gross Profit	47.05B	44.75B	40.83B	35.93B	35.11B	33.56B
EBITDA	21.71B	19.63B	17.35B	15.80B	17.54B	15.20B
Net Income	10.37B	8.96B	7.28B	7.31B	6.91B	5.49B
Balance Sheet
Total Assets	285.66B	266.44B	260.10B	226.91B	221.21B	212.06B
Cash, Cash Equivalents and Short-Term Investments	22.46B	28.47B	23.38B	22.75B	26.60B	23.05B
Total Debt	60.30B	51.20B	50.62B	52.42B	52.25B	54.54B
Total Liabilities	167.46B	153.37B	151.37B	126.47B	126.95B	123.22B
Stockholders Equity	117.39B	112.03B	107.01B	98.75B	92.46B	87.94B
Cash Flow
Free Cash Flow	-3.67B	10.25B	7.77B	1.53B	10.69B	11.75B
Operating Cash Flow	6.04B	20.50B	14.06B	6.40B	16.00B	18.12B
Investing Cash Flow	-11.75B	-10.81B	-8.22B	-7.16B	-7.22B	-9.13B
Financing Cash Flow	4.92B	-5.12B	-5.88B	-4.11B	-5.20B	-5.97B

Shinmaywa Industries Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 2052.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Negative
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:7224, the sentiment is Positive. The current price of 2052 is below the 20-day moving average (MA) of 2579.55, below the 50-day MA of 2273.62, and above the 200-day MA of 1851.87, indicating a bullish trend. The MACD of 124.97 indicates Positive momentum. The RSI at 72.56 is Negative, neither overbought nor oversold. The STOCH value of 79.38 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:7224.

Shinmaywa Industries Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
5331	78 Outperform	¥195.25B	15.80	8.27%	2.68%	-2.45%	7.31%
6328	77 Outperform	¥73.06B	16.07	16.91%	2.28%	12.37%	26.48%
4206	73 Outperform	¥261.72B	13.86	―	3.90%	2.65%	7.16%
3105	65 Neutral	¥278.88B	19.69	8.35%	2.73%	3.35%	810.44%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
7224	63 Neutral	¥178.74B	17.37	7.75%	2.84%	0.26%	14.29%
3401	53 Neutral	¥333.09B	-4.10	-20.43%	3.72%	-8.20%	―

Shinmaywa Industries Corporate Events

ShinMaywa Industries Lifts Nine-Month Profit and Confirms Higher Full-Year Dividend Outlook

ShinMaywa Industries reported consolidated net sales of ¥195.7 billion for the nine months ended 31 December 2025, up 4.5% year-on-year, with operating profit rising 6.5% to ¥8.9 billion and profit attributable to owners of parent jumping 28.5% to ¥6.3 billion, lifting basic earnings per share to ¥95.87. Total assets increased to ¥285.7 billion and equity to ¥117.4 billion, while the company maintained a solid equity-to-asset ratio of just above 41%. The board kept its dividend stance intact, confirming a full-year forecast of ¥54 per share for the year ending March 2026, and revised its full-year outlook to project 5.5% sales growth and modest profit expansion, signaling continued, albeit moderate, earnings momentum for shareholders despite a slight expected decline in ordinary profit.

The most recent analyst rating on (JP:7224) stock is a Buy with a Yen2470.00 price target. To see the full list of analyst forecasts on Shinmaywa Industries stock, see the JP:7224 Stock Forecast page.

ShinMaywa Industries Announces CEO Succession and Management Reshuffle

ShinMaywa Industries has announced a leadership transition, appointing current Director and Managing Executive Officer Takashi Kunihara as Representative Director, President and Chief Executive Officer effective April 1, 2026, as part of a broader change in its management structure. Incumbent President and CEO Tatsuyuki Isogawa will move to the role of Director and Chairman of the Board, while finance chief Toshiki Kume will be promoted to Director, Senior Managing Executive Officer, signaling a planned, internal succession aimed at reinforcing continuity in strategy and governance while potentially sharpening the company’s focus on new business development and financial oversight.

The most recent analyst rating on (JP:7224) stock is a Buy with a Yen2132.00 price target. To see the full list of analyst forecasts on Shinmaywa Industries stock, see the JP:7224 Stock Forecast page.