Shinwa Co., Ltd. (7607) AI Stock Analysis

• Market Cap: ¥42.59B
• Dividend Yield: 4.07%
• Average Volume (3M): 26.39K
• Price to Earnings (P/E): 12.8
• Beta (1Y): 0.76
• Revenue Growth: 10.66%
• EPS Growth: 21.24%
• Country: JP
• Employees: 900
• Sector: Industrials
• Sector Strength: 72
• Industry: Industrial - Machinery
• EPS (TTM): 60.52
• Shares Outstanding: 13,815,319
• 10 Day Avg. Volume: 34,150
• 30 Day Avg. Volume: 26,390
• PEG Ratio: 0.62
• Price to Book (P/B): 1.00
• Price to Sales (P/S): 0.50
• P/FCF Ratio: 4.11
• 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: 70 Outperform
• Price Target: ¥3,630.00 ▲(21.00% Upside)
• Action: Reiterated Date: 12/19/25
• Date: Action: Reiterated 12/19/25

Shinwa Co., Ltd. has a strong financial foundation with consistent revenue growth and solid operational performance, contributing significantly to the overall score. The valuation is attractive with a low P/E ratio and high dividend yield. However, technical analysis indicates bearish momentum, which slightly offsets the positive financial and valuation aspects.

Positive Factors

Balance Sheet Strength

Low leverage and a robust equity ratio provide durable financial flexibility. Over a multi-month horizon this supports capital expenditure, R&D funding, dividend sustainability and resilience to cyclical downturns, enabling strategic investment without stressing liquidity.

Consistent Revenue and Cash Generation

Around 8% revenue growth and improved operating cash flow indicate stable demand and increasingly efficient cash generation. Persistent revenue expansion plus strong operating cash flow to net income supports reinvestment, working capital needs and predictable operating liquidity.

Niche Product Franchise & Diversified Channels

A focused portfolio of precision measuring tools serving manufacturing, construction and engineering benefits from structural demand for quality measurement. Multiple distribution channels and international reach reduce concentration risk and support steady order flow over months.

Negative Factors

Low Net Profit Margin

Despite stable gross margins and healthy EBIT/EBITDA, a relatively low net margin limits retained earnings and the firm's capacity to self-fund growth or absorb shocks. Persistently muted bottom-line conversion can constrain long-term return to shareholders.

Free Cash Flow Volatility

Volatile free cash flow raises risk that operating cash generation may fluctuate across cycles, complicating planning for capex, dividends, or R&D. Over a 2–6 month horizon this uncertainty can limit predictable allocation of cash to strategic initiatives.

Modest Scale (Workforce Size)

A workforce of ~900 suggests modest operational scale versus larger global competitors. Limited scale can constrain rapid capacity expansion, international sales push or large industrial program support, potentially slowing market share gains in capital goods markets.

Shinwa Co., Ltd. Business Overview & Revenue Model

Company Description

Shinwa Co., Ltd. (7607) is a Japanese company primarily engaged in the manufacturing and sales of precision measuring tools, including calipers, micrometers, and other measuring instruments. The company serves various sectors, including manufacturing, construction, and engineering, providing essential tools that ensure accuracy and quality in measurement processes. Shinwa is known for its commitment to innovation and quality, developing products that cater to both professional and consumer markets.

How the Company Makes Money

Shinwa Co., Ltd. generates revenue primarily through the sale of its precision measuring tools and instruments, which are distributed both domestically and internationally. The company benefits from various revenue streams, including direct sales to retailers, online sales, and bulk orders from industrial clients. Additionally, Shinwa may engage in partnerships with distributors and retailers to expand its market reach. Key factors contributing to its earnings include the demand for high-quality measurement tools in manufacturing and construction sectors, as well as ongoing investments in research and development to innovate and improve product offerings.

Shinwa Co., Ltd. Financial Statement Overview

Summary

Shinwa Co., Ltd. exhibits a strong financial position with consistent revenue growth and solid operational performance. The balance sheet is well-managed with low leverage, and cash flow generation has improved significantly. While profitability margins could be enhanced, the company is on a positive trajectory with a stable financial foundation.

Income Statement

Shinwa Co., Ltd. has demonstrated consistent revenue growth over the years, with a notable increase in the latest year. The gross profit margin has remained stable, indicating efficient cost management. However, the net profit margin is relatively low, suggesting room for improvement in profitability. The EBIT and EBITDA margins are healthy, reflecting strong operational performance.

Balance Sheet

The company maintains a strong balance sheet with a low debt-to-equity ratio, indicating prudent financial leverage. The return on equity is satisfactory, showcasing effective utilization of shareholder funds. The equity ratio is robust, highlighting a solid capital structure and financial stability.

Cash Flow

Shinwa Co., Ltd. has shown significant improvement in operating and free cash flows in recent years. The operating cash flow to net income ratio is strong, indicating efficient cash generation relative to earnings. However, historical volatility in free cash flow growth suggests potential risks in cash flow stability.

Breakdown	Aug 2025	Aug 2024	Aug 2023	Aug 2022	Aug 2021
Income Statement
Total Revenue	86.15B	77.85B	76.11B	71.06B	61.16B
Gross Profit	13.28B	11.53B	12.95B	12.27B	10.28B
EBITDA	5.93B	4.98B	6.03B	6.30B	4.89B
Net Income	3.31B	2.73B	3.59B	3.78B	2.77B
Balance Sheet
Total Assets	74.41B	65.60B	58.92B	62.70B	56.91B
Cash, Cash Equivalents and Short-Term Investments	29.64B	19.86B	17.80B	19.34B	14.88B
Total Debt	663.18M	792.01M	521.02M	469.12M	1.66B
Total Liabilities	30.80B	23.97B	19.68B	26.45B	24.95B
Stockholders Equity	43.47B	41.47B	39.10B	36.11B	31.84B
Cash Flow
Free Cash Flow	10.53B	3.32B	-524.25M	5.97B	-1.90B
Operating Cash Flow	11.34B	3.97B	1.22B	7.50B	-1.04B
Investing Cash Flow	-810.40M	-702.67M	-1.87B	-1.55B	-1.02B
Financing Cash Flow	-1.49B	-1.37B	-1.14B	-2.33B	-3.59M

Shinwa Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 3000.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:7607, the sentiment is Positive. The current price of 3000 is below the 20-day moving average (MA) of 3195.10, below the 50-day MA of 3119.26, and below the 200-day MA of 3098.05, indicating a bullish trend. The MACD of 52.26 indicates Negative momentum. The RSI at 68.96 is Neutral, neither overbought nor oversold. The STOCH value of 18.11 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:7607.

Shinwa Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
6309	79 Outperform	¥63.90B	16.90	―	3.47%	13.90%	6.51%
6237	76 Outperform	¥61.82B	14.21	―	2.79%	2.85%	3.17%
6247	72 Outperform	¥47.67B	11.75	―	3.32%	18.47%	64.23%
7607	70 Outperform	¥42.59B	12.84	―	4.07%	10.66%	21.24%
7438	68 Neutral	¥39.09B	11.92	―	3.14%	4.54%	-1.41%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
6240	61 Neutral	¥42.38B	23.45	―	2.53%	6.56%	23.98%

Shinwa Co., Ltd. Corporate Events

Shinwa Enhances Shareholder Benefits to Attract Long-Term Retail Investors

Shinwa Co., Ltd. has approved an enhancement to its shareholder benefit program aimed at rewarding long-term investors and broadening its shareholder base. The company positions the move as a way to increase the appeal of its shares, particularly for retail investors who value non-cash perks such as gift cards and in-kind benefits.

Under the revised scheme effective for shareholders of record on August 31, 2026, the minimum holding tier of 100 to less than 300 shares will continue to receive two rice gift cards after one year of continuous ownership. A new middle tier of 300 to less than 1,000 shares will receive six rice gift cards, while investors holding 1,000 shares or more will still be eligible for a 5 kg bag of Uonuma-grown Koshihikari rice, reinforcing incentives for both entry-level and higher-commitment shareholders.

The most recent analyst rating on (JP:7607) stock is a Buy with a Yen3322.00 price target. To see the full list of analyst forecasts on Shinwa Co., Ltd. stock, see the JP:7607 Stock Forecast page.

Shinwa Delivers Profit Surge in Q1 but Keeps Cautious Full-Year Outlook and Stable Dividends

For the three months ended November 30, 2025, Shinwa Co., Ltd. reported modest year-on-year net sales growth of 2.3% to ¥19.72 billion, but significantly stronger profitability, with operating profit up 27.5% to ¥1.08 billion and profit attributable to owners of parent rising 27.4% to ¥811 million. Comprehensive income jumped sharply, and the equity-to-asset ratio improved to 60.0%, while total assets edged down slightly, indicating an ongoing strengthening of the balance sheet. The company maintained its dividend stance, keeping the full-year dividend forecast for the fiscal year ending August 31, 2026 at ¥124 per share, and left its earnings outlook unchanged, projecting slight top-line growth but lower profits year on year, suggesting a more cautious profitability environment despite stable shareholder returns.

The most recent analyst rating on (JP:7607) stock is a Buy with a Yen3322.00 price target. To see the full list of analyst forecasts on Shinwa Co., Ltd. stock, see the JP:7607 Stock Forecast page.

Shinwa Delivers Profit Surge in Q1 but Keeps Cautious Full-Year Outlook and Stable Dividends

For the three months ended November 30, 2025, Shinwa Co., Ltd. reported modest year-on-year net sales growth of 2.3% to ¥19.72 billion, but significantly stronger profitability, with operating profit up 27.5% to ¥1.08 billion and profit attributable to owners of parent rising 27.4% to ¥811 million. Comprehensive income jumped sharply, and the equity-to-asset ratio improved to 60.0%, while total assets edged down slightly, indicating an ongoing strengthening of the balance sheet. The company maintained its dividend stance, keeping the full-year dividend forecast for the fiscal year ending August 31, 2026 at ¥124 per share, and left its earnings outlook unchanged, projecting slight top-line growth but lower profits year on year, suggesting a more cautious profitability environment despite stable shareholder returns.

The most recent analyst rating on (JP:7607) stock is a Buy with a Yen3322.00 price target. To see the full list of analyst forecasts on Shinwa Co., Ltd. stock, see the JP:7607 Stock Forecast page.

Shinwa to Establish Industrial Equipment Sales Subsidiary in Vietnam

Shinwa Co., Ltd. has approved the establishment of a new local subsidiary in Hanoi, Vietnam, to strengthen its ability to serve the growing equipment needs of Japanese manufacturers that have rapidly expanded into the country. The new entity, Cong Ty TNHH SHINWA-INTEC VIET NAM, scheduled to be founded in June 2026 with share capital of USD 850,000, will mainly handle sales of welding equipment, materials and industrial machinery, and will be majority owned (95%) by the company’s Thai subsidiary with Shinwa itself holding the remaining 5%. By leveraging organic collaboration between its Thai and Vietnamese bases, Shinwa aims to expand its overseas business footprint and sharpen its competitive positioning in the regional industrial equipment market, while noting that the initiative will have only a minor impact on its consolidated results for the fiscal year ending August 31, 2026.

The most recent analyst rating on (JP:7607) stock is a Buy with a Yen3322.00 price target. To see the full list of analyst forecasts on Shinwa Co., Ltd. stock, see the JP:7607 Stock Forecast page.

Shinwa Co., Ltd. Completes Treasury Shares Disposal for Stock Remuneration

Shinwa Co., Ltd. has completed the payment procedures for the disposal of 13,100 treasury shares as restricted stock remuneration, following a resolution by its Board of Directors. This move, involving a total disposal price of ¥40,348,000, is aimed at compensating five directors and five executive officers, potentially impacting the company’s governance and aligning management interests with shareholder value.

The most recent analyst rating on (JP:7607) stock is a Buy with a Yen3724.00 price target. To see the full list of analyst forecasts on Shinwa Co., Ltd. stock, see the JP:7607 Stock Forecast page.