Harima-Kyowa Co., Ltd. (7444) AI Stock Analysis

• Market Cap: ¥10.36B
• Dividend Yield: 2.6%
• Average Volume (3M): 2.38K
• Price to Earnings (P/E): 8.6
• Beta (1Y): 0.44
• Revenue Growth: -3.81%
• EPS Growth: -18.49%
• Country: JP
• Employees: 191
• Sector: Consumer Cyclical
• Sector Strength: 75
• Industry: Department Stores
• EPS (TTM): 60.29
• Shares Outstanding: 5,441,568
• 10 Day Avg. Volume: 2,280
• 30 Day Avg. Volume: 2,376
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• 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: ¥2,123.00
• Price Target Upside: 10.46% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 1

• Rating: 73 Outperform
• Price Target: ¥2,123.00 ▲(10.46% Upside)

Harima-Kyowa Co., Ltd. has a strong financial foundation with solid revenue growth and a robust balance sheet. The stock appears undervalued with a low P/E ratio and a decent dividend yield. However, technical indicators suggest neutral momentum, and there is a need for improved cash flow management.

Positive Factors

Strong Balance Sheet

A strong balance sheet with low leverage enhances financial stability, providing the company with resilience against economic downturns and flexibility for strategic investments.

Revenue Growth

Consistent revenue growth indicates a robust business model and effective market penetration, which are critical for sustaining long-term profitability and competitive positioning.

Improved Cash Flow

Improved operating cash flow suggests enhanced efficiency in core operations, providing the company with more resources to reinvest in growth opportunities and manage liabilities.

Negative Factors

Declining Net Profit Margin

A declining net profit margin can signal inefficiencies or pricing pressures, which may erode profitability if not addressed, impacting long-term financial health.

Negative Free Cash Flow

Negative free cash flow suggests that the company is heavily investing in capital expenditures, which could strain liquidity if not balanced with sufficient returns on investment.

Revenue Growth Decline

A decline in revenue growth can indicate weakening demand or competitive pressures, potentially challenging the company's ability to maintain market share and profitability.

Harima-Kyowa Co., Ltd. Business Overview & Revenue Model

Company Description

Harima-Kyowa Co., Ltd. is a Japan-based company primarily engaged in the wholesale distribution of industrial materials and equipment. Operating across various sectors, the company focuses on providing high-quality products and services to support manufacturing and industrial operations. Its core offerings include electrical machinery, mechanical parts, and construction materials, catering to a diverse clientele in the manufacturing and construction industries.

How the Company Makes Money

Harima-Kyowa Co., Ltd. generates revenue primarily through the distribution and sale of industrial materials and equipment. The company's key revenue streams include the wholesale of electrical machinery and components, mechanical parts, and construction materials to businesses in the manufacturing and construction sectors. It leverages strong relationships with manufacturers and suppliers to source high-quality products at competitive prices, which it then sells to its clients, ensuring a steady flow of income. Additionally, the company may engage in strategic partnerships and collaborations that enhance its product offerings and expand its market reach, further contributing to its earnings.

Harima-Kyowa Co., Ltd. Financial Statement Overview

Summary

Harima-Kyowa Co., Ltd. shows a positive growth trajectory with strong revenue performance and a solid balance sheet. However, there is room for improvement in profit margins and cash flow management to ensure sustainable long-term growth.

Income Statement

Harima-Kyowa Co., Ltd. has demonstrated consistent revenue growth over the past years, with a notable increase from ¥61.58 billion to ¥62.04 billion in the most recent period. The gross profit margin is stable, reflecting effective cost management. However, the slight decline in net profit margin from 2.28% to 2.08% indicates a need for better control over expenses or pricing strategies.

Balance Sheet

The company's balance sheet is strong, with a low debt-to-equity ratio reflecting prudent leverage management. The equity ratio is robust, supporting financial stability. Return on equity is relatively healthy, showcasing efficient use of shareholder investments to generate profit.

Cash Flow

Operating cash flow has improved significantly, highlighting better cash generation capabilities. However, free cash flow is negative, indicating high capital expenditures. The cash flow to net income ratios suggest a need for better alignment between reported profits and cash generation.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	62.03B	62.04B	61.58B	60.16B	57.78B	54.48B
Gross Profit	7.44B	7.16B	7.13B	6.96B	6.43B	6.63B
EBITDA	2.48B	2.48B	2.62B	2.62B	2.36B	2.33B
Net Income	1.29B	1.29B	1.41B	1.39B	1.20B	1.16B
Balance Sheet
Total Assets	36.30B	36.30B	33.14B	31.35B	30.11B	28.44B
Cash, Cash Equivalents and Short-Term Investments	3.58B	3.58B	2.75B	4.18B	3.01B	3.21B
Total Debt	2.46B	2.46B	320.00M	190.00M	360.00M	290.00M
Total Liabilities	11.49B	11.49B	8.98B	9.13B	9.10B	8.30B
Stockholders Equity	24.78B	24.78B	24.13B	22.19B	20.99B	20.12B
Cash Flow
Free Cash Flow	0.00	-1.05B	-1.38B	1.53B	-118.93M	1.21B
Operating Cash Flow	0.00	2.47B	120.46M	1.95B	746.81M	1.40B
Investing Cash Flow	0.00	-3.53B	-1.46B	-387.12M	-817.73M	-505.43M
Financing Cash Flow	0.00	1.90B	-89.69M	-385.62M	-137.30M	-290.85M

Harima-Kyowa Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 1922.00
• 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:7444, the sentiment is Positive. The current price of 1922 is above the 20-day moving average (MA) of 1911.80, above the 50-day MA of 1907.38, and above the 200-day MA of 1907.67, indicating a bullish trend. The MACD of 4.97 indicates Negative momentum. The RSI at 55.10 is Neutral, neither overbought nor oversold. The STOCH value of 36.60 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:7444.

Harima-Kyowa Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
7444	73 Outperform	¥10.36B	8.58		2.60%	-3.81%	-18.49%
8260	64 Neutral	¥4.93B	5.27		1.40%	-2.12%	8.28%
Sector *	61 Neutral	$18.09B	12.97	-1.60%	2.98%	1.42%	-15.92%
7506	61 Neutral	¥6.49B	80.96		1.81%	-3.92%	-129.57%
8254	61 Neutral	¥2.53B	20.46		―	-10.22%	-23.30%
8247	54 Neutral	¥2.21B	8.85		―	-2.19%	-58.67%
8217	49 Neutral	¥38.60B	172.60		2.71%	1.48%	-346.93%