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

• Market Cap: ¥43.80B
• Dividend Yield: 2.05%
• Average Volume (3M): 890.26K
• Price to Earnings (P/E): 11.4
• Beta (1Y): 0.93
• Revenue Growth: 1.26%
• EPS Growth: 56.37%
• Country: JP
• Employees: 7,055
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Auto - Parts
• EPS (TTM): 23.23
• Shares Outstanding: 47,520,252
• 10 Day Avg. Volume: 481,900
• 30 Day Avg. Volume: 890,263
• 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): 11,572.05
• Revenue Forecast (FY): ¥21.05T

• Rating: 62 Neutral
• Price Target: ¥977.00 ▲(5.05% Upside)

Daido Metal Co., Ltd. has a stable financial position with potential for improvement in profitability and cash flow management. The technical indicators suggest a bearish trend, while the valuation appears attractive with a low P/E ratio and decent dividend yield. The lack of earnings call data and corporate events limits additional insights.

Positive Factors

Strong R&D Focus

A strong focus on R&D enhances Daido Metal's ability to innovate, ensuring its products remain competitive and meet evolving industry needs.

Stable Financial Position

A balanced capital structure with manageable leverage provides financial stability, enabling the company to withstand economic fluctuations and invest in growth.

Free Cash Flow Growth

Improved cash generation enhances financial flexibility, allowing Daido Metal to invest in new opportunities and reduce debt, supporting long-term growth.

Negative Factors

Low Net Profit Margin

A low net profit margin indicates limited profitability, which can constrain the company's ability to reinvest in its business and reward shareholders.

Decline in Revenue Growth

Declining sales pose a risk to Daido Metal's market position and long-term revenue potential, necessitating strategic adjustments to regain growth momentum.

Limited Cash Flow from Operations

Limited cash generation from operations may restrict Daido Metal's ability to fund ongoing operations and growth initiatives without external financing.

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: 930.00
• 50DMA: Negative
• 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:7245, the sentiment is Positive. The current price of 930 is below the 20-day moving average (MA) of 950.90, below the 50-day MA of 979.90, and above the 200-day MA of 739.57, indicating a neutral trend. The MACD of -10.87 indicates Negative momentum. The RSI at 53.82 is Neutral, neither overbought nor oversold. The STOCH value of 54.09 is Neutral, 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	12.88	―	4.22%	-1.15%	-34.09%
7236	72 Outperform	¥49.08B	6.87	―	3.56%	0.14%	882.91%
7229	72 Outperform	¥45.05B	8.64	―	2.37%	-13.35%	-19.38%
7245	62 Neutral	¥43.80B	11.40	5.33%	2.05%	1.26%	56.37%
5989	62 Neutral	¥37.33B	4.16	―	5.08%	-11.67%	―
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
6470	51 Neutral	¥23.56B	670.08	―	2.46%	4.93%	―

Daido Metal Co., Ltd. Corporate Events

Daido Metal Reports Strong Profit Growth Despite Sales Dip

Daido Metal Co., Ltd. reported its consolidated financial results for the six months ended September 30, 2025, showing a slight decrease in net sales by 1.2% compared to the previous year. However, the company achieved significant growth in operating profit, ordinary profit, and profit attributable to owners of the parent, with increases of 43.7%, 26.5%, and 218.4% respectively. The company’s equity-to-asset ratio improved slightly, and it announced an increase in dividends for the fiscal year ending March 31, 2026. These results indicate a strong operational performance despite a challenging market environment, positioning Daido Metal favorably in its industry.