Daytona Corporation (7228) AI Stock Analysis

• Market Cap: ¥9.26B
• Dividend Yield: 3.19%
• Average Volume (3M): 1.73K
• Price to Earnings (P/E): 8.1
• Beta (1Y): 0.28
• Revenue Growth: 5.38%
• EPS Growth: 5.29%
• Country: JP
• Employees: 200
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Auto - Parts
• EPS (TTM): 103.19
• Shares Outstanding: 3,604,600
• 10 Day Avg. Volume: 1,850
• 30 Day Avg. Volume: 1,730
• PEG Ratio: -1.57
• Price to Book (P/B): 0.98
• Price to Sales (P/S): 0.64
• P/FCF Ratio: 12.10
• 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): 547.5
• Revenue Forecast (FY): ¥16.30B

• Rating: 74 Outperform
• Price Target: ¥4,267.00 ▲(10.40% Upside)
• Action: Reiterated Date: 02/18/26
• Date: Action: Reiterated 02/18/26

The score is driven primarily by strong financial quality (notably the very conservative balance sheet) and attractive valuation (low P/E with a solid dividend). These positives are tempered by softer technical momentum and recent fundamental slowing, including revenue declines and some cash-flow volatility.

Positive Factors

Conservative balance sheet

Very low and declining leverage (debt-to-equity ~0.09) and meaningful equity growth give the company flexibility through industry cycles. This durable capital structure reduces refinancing risk, supports dividend capacity, and absorbs demand shocks over the next several quarters.

Healthy margins and profitability

Sustained gross margins in the high-30% range and consistent EBIT margins around 11–15% indicate solid underlying unit economics in aftermarket parts. These margin levels allow the business to generate operating profits across cycles and fund investments or shareholder returns.

Diversified revenue channels

Multiple distribution channels—online retail, physical stores, and wholesale to repair shops—reduce reliance on any single sales source. Structural diversification supports stable demand capture, better inventory turnover management, and resilience against localized retail disruptions.

Negative Factors

Revenue contraction trend

Recurrent revenue declines (noted in 2023 and 2025 and a negative recent growth rate) point to weakening top-line momentum. Over 2–6 months this suggests the company may struggle to restore prior growth without product, channel, or market share initiatives, pressuring long-term earnings potential.

Cash-flow volatility

While free cash flow generally covers net income, material swings—negative flows in 2022 and a sharp drop in 2025—show working-capital and timing risks. Inconsistent cash conversion can strain funding for capex, dividends, or inventory, reducing operational predictability.

Margin and returns compression

Compression of net margins and declining ROE since peak years signal weakening profitability translation and lower capital efficiency. If sustained, this reduces internal reinvestment capacity and weakens the company’s competitive position versus peers that maintain higher returns.

Daytona Corporation Business Overview & Revenue Model

Company Description

Daytona Corporation engages in the market research, planning, development, testing, procurement, logistics management, and export of motorcycle parts and accessories. The company offers hand controls, such as switches, switch housings, clutch levers, master cylinders, heated grips, hydraulic clutches, and control kits; gauges; brake parts comprising calipers, brackets, and rear master cylinders; and engine parts, including tappet lifters, connecting rods, switches, lifter blocks, rocker cover kits, rocker arms, oil pumps, cam chain tensioners, and cylinders. It also provides electrical parts, such as switches, charging systems, ignition coils, regulators, and other products; chassis parts, which include steering dampers, wheel rims, and fork bushes; decoration panels and reverse gear kits; and master cylinder and caliper rebuild kits. In addition, the company offers engines, and upgrade and setting parts; and multi-fit products, such as heated grips, gauges, mirrors, direction indicators, headlights, and premium zone series. Further, it provides chassis, handles, lights, seats, exhausts, and replacement parts and accessories; and smartphone, power supply, and multiuse mountbar accessories. The company sells its products through authorized overseas distributors in Asia, North America, Europe, Oceania, and Central and South America. Daytona Corporation was founded in 1972 and is based in Shizuoka, Japan.

How the Company Makes Money

Daytona Corporation generates revenue through multiple streams, primarily from the sale of automotive parts and accessories. The company profits by supplying a wide range of products to both retail and wholesale markets, capitalizing on the growing demand for aftermarket automotive enhancements. Key revenue streams include direct sales to consumers via online platforms and brick-and-mortar retail locations, as well as bulk sales to automotive repair shops and other businesses. Additionally, Daytona benefits from strategic partnerships with manufacturers and distributors, allowing it to expand its product offerings and reach. The company also invests in marketing and brand development to enhance its visibility and drive sales, contributing to its overall profitability.

Daytona Corporation Financial Statement Overview

Summary

Strong and improving balance sheet (very low leverage; debt-to-equity down to ~0.09) supports resilience. Profitability remains solid (EBIT margin ~11–15%), but revenue has been declining again in 2025 and net margins have compressed versus 2021–2022. Cash flow is generally positive but has shown volatility (notably weak in 2022 and a step-down in 2025).

Income Statement

Profitability is solid for an auto-parts business, with gross margin holding in the high-30% range in 2024–2025 and operating profitability remaining healthy (EBIT margin ~11–15% across the period). However, growth has turned choppy: after strong expansion in 2021–2022, revenue declined in 2023 and again in 2025, and margins have compressed from the 2021–2022 peak (net margin down from ~10–11% to ~8% in 2024–2025). Overall: good earnings power, but momentum has softened.

Balance Sheet

The balance sheet looks conservative and strengthening. Leverage is low and improving, with debt-to-equity declining steadily from ~0.40 (2020) to ~0.09 (2025), while equity has grown meaningfully over time. This provides flexibility through industry cycles. A watch item is that returns on equity have come down from the very strong 2021–2022 levels, consistent with slower growth and some margin pressure, but the capital structure remains a clear positive.

Cash Flow

Cash generation is generally positive, with free cash flow typically covering a large portion of net income (roughly ~0.8–1.0x in most years, including 2025). That said, cash flow has been less consistent than earnings: operating cash flow dropped sharply in 2025 versus 2024, and 2022 was a notable weak year with negative operating and free cash flow despite strong profits—suggesting working-capital or timing volatility. Overall: good conversion in most years, but not consistently smooth.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	15.10B	14.38B	14.58B	13.96B	14.59B	12.54B
Gross Profit	5.76B	5.33B	5.60B	5.45B	5.86B	5.21B
EBITDA	2.06B	1.85B	1.98B	1.97B	2.35B	2.12B
Net Income	1.24B	1.15B	1.21B	1.18B	1.43B	1.32B
Balance Sheet
Total Assets	11.58B	11.65B	10.93B	10.33B	9.64B	8.17B
Cash, Cash Equivalents and Short-Term Investments	2.21B	2.55B	2.34B	1.73B	1.13B	1.35B
Total Debt	942.05M	852.47M	1.04B	1.33B	1.52B	1.28B
Total Liabilities	2.70B	2.21B	2.30B	2.67B	2.90B	2.72B
Stockholders Equity	8.84B	9.40B	8.60B	7.64B	6.72B	5.44B
Cash Flow
Free Cash Flow	0.00	759.52M	1.19B	1.07B	-100.10M	593.90M
Operating Cash Flow	0.00	837.52M	1.43B	1.22B	-4.23M	752.54M
Investing Cash Flow	0.00	-226.35M	-252.64M	-164.22M	-278.26M	-172.69M
Financing Cash Flow	0.00	-502.60M	-576.33M	-486.49M	39.43M	-538.56M

Daytona Corporation Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 3865.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:7228, the sentiment is Positive. The current price of 3865 is above the 20-day moving average (MA) of 3816.50, above the 50-day MA of 3842.54, and above the 200-day MA of 3769.74, indicating a bullish trend. The MACD of 8.23 indicates Negative momentum. The RSI at 65.26 is Neutral, neither overbought nor oversold. The STOCH value of 54.68 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:7228.

Daytona Corporation Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
7235	78 Outperform	¥16.54B	8.81	―	4.02%	2.31%	10.68%
7254	76 Outperform	¥17.48B	6.83	―	1.67%	-4.44%	-17.38%
7228	74 Outperform	¥9.26B	8.07	―	3.19%	5.38%	5.29%
5985	66 Neutral	¥37.62B	9.29	―	0.55%	7.65%	―
7273	62 Neutral	¥20.78B	4.87	―	4.58%	34.99%	468.97%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
7277	56 Neutral	¥12.74B	16.51	―	2.23%	-4.06%	―