Daido Metal Co., Ltd. (7245) AI Stock Analysis

• Market Cap: ¥48.27B
• Dividend Yield: 1.97%
• Average Volume (3M): 832.29K
• Price to Earnings (P/E): 17.1
• Beta (1Y): 0.93
• Revenue Growth: 3.51%
• EPS Growth: -0.74%
• Country: JP
• Employees: 7,055
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Auto - Parts
• EPS (TTM): 12.60
• Shares Outstanding: 47,520,252
• 10 Day Avg. Volume: 1,217,220
• 30 Day Avg. Volume: 832,286
• PEG Ratio: 1.46
• Price to Book (P/B): 0.32
• Price to Sales (P/S): 0.17
• P/FCF Ratio: 68.09
• 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): 11,415.38
• Revenue Forecast (FY): ¥20.77T

• Rating: 74 Outperform
• Price Target: ¥1,383.00 ▲(54.70% Upside)

Daido Metal Co., Ltd. receives a solid score driven by strong technical analysis indicators and robust financial performance. The stock's bullish momentum and stable operational metrics are key strengths. However, the valuation is moderate, and there is room for improvement in profitability and cash flow conversion, which slightly tempers the overall score.

Daido Metal Co., Ltd. Business Overview & Revenue Model

Company Description

Daido Metal Co., Ltd. (7245) is a leading manufacturer specializing in high-performance bearing materials and components, primarily serving the automotive and industrial machinery sectors. The company is known for its innovative products, including bushings, bearings, and other friction-reducing materials, which are essential in enhancing the efficiency and longevity of various mechanical applications. With a strong focus on research and development, Daido Metal emphasizes quality and technology in its manufacturing processes.

How the Company Makes Money

Daido Metal generates revenue primarily through the sale of its bearing products to original equipment manufacturers (OEMs) in the automotive sector and industrial machinery markets. Its revenue model is driven by long-term contracts with major automotive manufacturers, providing a steady stream of income. Key revenue streams include the production and supply of custom-engineered bearings and bushings, which are critical for vehicle performance and durability. Additionally, the company benefits from ongoing partnerships and collaborations with automotive and industrial companies that require specialized bearing solutions. Factors contributing to its earnings include ongoing demand for automotive components, advancements in manufacturing technology, and a focus on expanding its product offerings to meet evolving industry requirements.

Daido Metal Co., Ltd. Financial Statement Overview

Summary

Daido Metal Co., Ltd. demonstrates robust revenue growth and stable operational performance, with a strong focus on cost management. While the balance sheet reflects a balanced leverage strategy, profitability metrics indicate room for improvement. Cash flow generation is strong, but conversion rates from income to cash could be enhanced. Overall, the company is on a positive trajectory with opportunities to strengthen profitability and cash flow efficiency.

Income Statement

Daido Metal Co., Ltd. has shown strong revenue growth, particularly in the TTM period with a 22.1% increase. The gross profit margin is healthy at 24.8%, indicating efficient cost management. However, the net profit margin remains relatively low at 2.0%, suggesting room for improvement in profitability. The EBIT and EBITDA margins are stable, reflecting consistent operational performance.

Balance Sheet

The company's debt-to-equity ratio is 0.90, indicating a balanced approach to leveraging. Return on equity is modest at 3.8%, which suggests moderate efficiency in using equity to generate profits. The equity ratio stands at 36.6%, showing a solid equity base relative to total assets, which enhances financial stability.

Cash Flow

Free cash flow growth is impressive at 268.7% in the TTM period, indicating strong cash generation capabilities. However, the operating cash flow to net income ratio is relatively low at 0.16, suggesting potential challenges in converting income into cash. The free cash flow to net income ratio is also low at 0.03, highlighting the need for improved cash flow management.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	136.60B	136.30B	128.74B	115.48B	104.02B	84.72B
Gross Profit	34.24B	32.17B	31.30B	26.17B	26.76B	19.52B
EBITDA	19.11B	18.79B	16.46B	12.77B	15.01B	11.65B
Net Income	2.85B	2.72B	2.57B	-2.21B	1.90B	104.00M
Balance Sheet
Total Assets	195.99B	196.66B	188.37B	173.32B	166.16B	155.18B
Cash, Cash Equivalents and Short-Term Investments	28.88B	29.15B	30.96B	24.11B	23.02B	22.01B
Total Debt	64.50B	65.79B	63.38B	61.93B	57.13B	58.47B
Total Liabilities	115.10B	114.56B	109.65B	102.87B	97.46B	90.64B
Stockholders Equity	71.84B	72.75B	68.82B	61.13B	60.34B	56.39B
Cash Flow
Free Cash Flow	1.26B	342.00M	8.67B	-162.00M	6.27B	1.84B
Operating Cash Flow	10.81B	10.92B	16.66B	5.00B	13.21B	10.10B
Investing Cash Flow	-6.80B	-8.39B	-8.30B	-6.34B	-8.07B	-7.04B
Financing Cash Flow	-481.00M	-2.39B	-2.50B	790.00M	-5.08B	-3.10B

Daido Metal Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 894.00
• 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:7245, the sentiment is Positive. The current price of 894 is below the 20-day moving average (MA) of 1006.60, below the 50-day MA of 959.56, and above the 200-day MA of 667.88, indicating a bullish trend. The MACD of 32.45 indicates Positive momentum. The RSI at 53.58 is Neutral, neither overbought nor oversold. The STOCH value of 15.61 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:7245.

Daido Metal Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
5185	77 Outperform	¥31.00B	11.21	―	4.30%	-1.15%	-34.09%
7236	75 Outperform	¥37.64B	5.85	―	3.77%	0.14%	882.91%
7245	74 Outperform	¥48.27B	17.14	4.24%	1.97%	3.51%	-0.74%
7229	72 Outperform	¥45.05B	11.47	―	2.36%	-13.35%	-19.38%
5989	66 Neutral	¥37.62B	3.88	―	5.18%	-7.52%	―
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
6470	46 Neutral	¥20.22B	575.18	―	2.91%	4.93%	―

Daido Metal Co., Ltd. Corporate Events

Daido Metal Reports Q1 2025 Financial Results with Profit Growth

Daido Metal Co., Ltd. reported its consolidated financial results for the three months ended June 30, 2025, showing a slight increase in net sales by 0.9% to ¥33,516 million. The company experienced substantial growth in operating profit by 31.9% and profit attributable to owners of the parent by 26.8%. Despite these positive results, comprehensive income showed a significant decline, indicating potential challenges in other financial areas. The company maintained its dividend forecast for the fiscal year ending March 31, 2026, with an expected increase in total annual dividends, reflecting confidence in its financial stability.