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

• Market Cap: ¥47.43B
• Dividend Yield: 2.09%
• Average Volume (3M): 890.26K
• Price to Earnings (P/E): 12.4
• Beta (1Y): 1.00
• 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): N/A
• Revenue Forecast (FY): N/A

• Rating: 62 Neutral
• Price Target: ¥1,089.00 ▲(17.10% 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

OEM-focused Product Franchise

Specialization in engine and drivetrain plain bearings for OEMs creates a durable revenue base tied to vehicle platform programs and long product lifecycles. OEM relationships and qualification barriers support repeat orders, higher switching costs and predictable demand from automakers and industrial manufacturers.

Balanced Capital Structure

Manageable leverage and a healthy equity base reduce refinancing and solvency risk, giving management flexibility to fund capex for tooling and scale production. This balance enhances resilience through automotive cycles and supports long-term investment in process improvements and product development.

Improving Free Cash Flow

Material FCF improvement points to growing internal funding capacity for capex, R&D, or dividends without heavy external financing. Stronger cash generation over the trailing period improves financial optionality and supports steady operations through industry cyclical swings.

Negative Factors

Low Net Profit Margin

A thin net margin limits retained earnings available for reinvestment and cushions against demand slumps or raw material cost shocks. Persistently low bottom-line profitability constrains returns to shareholders and reduces scope to invest in new products or automation for long-term competitiveness.

Negative Revenue Trend

Declining sales over the trailing period signals vulnerability to OEM order slowdowns or market share loss. Without revenue momentum, fixed-cost absorption worsens and margin recovery is harder, limiting long-term scale benefits and making investment cases for growth initiatives more challenging.

Weak Cash Conversion Metrics

Low cash conversion ratios indicate earnings quality issues and limited cash after capex, reducing ability to fund growth or withstand cyclicality. Over months, weak conversion can force reliance on external financing for capex or working capital, increasing financial risk and restricting strategic flexibility.

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 stable financials with efficient cost management and a balanced capital structure. However, challenges in revenue growth and profitability, along with room for improvement in cash flow management, limit the score.

Income Statement

Daido Metal Co., Ltd. shows a stable gross profit margin of around 25% in the TTM, indicating efficient cost management. However, the net profit margin is relatively low at 2.08%, suggesting limited profitability. The revenue growth rate is negative in the TTM, reflecting a decline in sales, which is a concern. EBIT and EBITDA margins are moderate, indicating decent operational efficiency but room for improvement.

Balance Sheet

The company's debt-to-equity ratio is below 1, indicating a balanced capital structure with manageable leverage. Return on equity is modest at 3.97%, suggesting average profitability for shareholders. The equity ratio is healthy, reflecting a strong equity base relative to total assets, which enhances financial stability.

Cash Flow

Free cash flow has grown significantly in the TTM, which is a positive sign of improved cash generation. However, the operating cash flow to net income ratio is low, indicating that cash generation from operations is not significantly higher than net income. The free cash flow to net income ratio is also low, suggesting limited cash available after capital expenditures.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	135.47B	136.30B	128.74B	115.48B	104.02B	84.72B
Gross Profit	34.23B	32.17B	31.30B	26.17B	26.76B	19.52B
EBITDA	20.18B	18.79B	16.46B	12.77B	15.01B	11.65B
Net Income	3.87B	2.72B	2.57B	-2.21B	1.90B	104.00M
Balance Sheet
Total Assets	199.65B	196.66B	188.37B	173.32B	166.16B	155.18B
Cash, Cash Equivalents and Short-Term Investments	30.87B	29.15B	30.96B	24.11B	23.02B	22.01B
Total Debt	66.37B	65.79B	63.38B	61.93B	57.13B	58.47B
Total Liabilities	116.39B	114.56B	109.65B	102.87B	97.46B	90.64B
Stockholders Equity	74.25B	72.75B	68.82B	61.13B	60.34B	56.39B
Cash Flow
Free Cash Flow	2.08B	342.00M	8.67B	-162.00M	6.27B	1.84B
Operating Cash Flow	11.14B	10.92B	16.66B	5.00B	13.21B	10.10B
Investing Cash Flow	-5.99B	-8.39B	-8.30B	-6.34B	-8.07B	-7.04B
Financing Cash Flow	649.00M	-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: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• 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 1048.40, below the 50-day MA of 995.10, and above the 200-day MA of 820.14, indicating a neutral trend. The MACD of 5.68 indicates Positive momentum. The RSI at 53.16 is Neutral, neither overbought nor oversold. The STOCH value of 51.38 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	¥33.03B	13.73	―	4.20%	-1.15%	-34.09%
7236	77 Outperform	¥51.30B	5.39	―	3.60%	0.14%	882.91%
7229	72 Outperform	¥47.05B	9.02	―	2.37%	-13.35%	-19.38%
7245	62 Neutral	¥47.43B	12.35	5.33%	2.09%	1.26%	56.37%
5989	62 Neutral	¥39.81B	4.43	―	5.16%	-11.67%	―
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
6470	51 Neutral	¥24.46B	99.51	―	2.45%	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.

The most recent analyst rating on (JP:7245) stock is a Buy with a Yen1383.00 price target. To see the full list of analyst forecasts on Daido Metal Co., Ltd. stock, see the JP:7245 Stock Forecast page.