Eidai Kako Co., Ltd. (7877) AI Stock Analysis

• Market Cap: ¥2.69B
• Dividend Yield: 2.85%
• Average Volume (3M): 776.00
• Price to Earnings (P/E): 4.3
• Beta (1Y): 0.24
• Revenue Growth: -1.81%
• EPS Growth: 144.79%
• Country: JP
• Employees: 493
• Sector: Basic Materials
• Sector Strength: 58
• Industry: Chemicals - Specialty
• EPS (TTM): 103.99
• Shares Outstanding: 1,460,000
• 10 Day Avg. Volume: 830
• 30 Day Avg. Volume: 776
• PEG Ratio: 2.38
• Price to Book (P/B): 0.27
• Price to Sales (P/S): 0.22
• P/FCF Ratio: 2.70
• 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: 73 Outperform
• Price Target: ¥2,202.00 ▲(22.33% Upside)
• Action: Reiterated Date: 02/18/26
• Date: Action: Reiterated 02/18/26

The score is driven primarily by solid financial performance (strong cash flow and low leverage) and attractive valuation (low P/E with a dividend). These positives are tempered by technical overbought conditions (very high RSI and elevated Stoch), which raise near-term downside risk, and by declining revenue growth.

Positive Factors

Strong cash generation

A 334% increase in free cash flow and an operating-cash-flow-to-net-income ratio of 4.79 indicate durable cash generation. Persistent FCF improves financial flexibility to fund capex, dividends or strategic M&A, lowers refinancing risk, and cushions cyclical downturns.

Conservative capital structure

A low debt-to-equity ratio (0.16) and a 73.1% equity ratio reflect conservative leverage. Structural low indebtedness increases resilience to demand volatility, preserves borrowing capacity for strategic moves, and reduces financial distress risk in cyclical chemicals markets.

Healthy gross margins

A gross margin around 21.7% implies efficient cost management or pricing strength in plastics-related products. This structural margin provides headroom to cover SG&A and R&D, enabling potential operating margin expansion if revenue stabilizes or grows.

Negative Factors

Declining revenue

A 2.5% year-over-year revenue decline signals potential secular demand weakness or market share erosion. Continued top-line contraction undermines fixed-cost absorption, weakens operating leverage, and makes sustaining margins and funding growth initiatives more challenging over time.

Modest operating profitability

Net margin of 2.1% and EBIT margin of 3.3% are thin for durable reinvestment. Low operating profitability limits the company's buffer against raw-material inflation and pricing pressure, constraining its ability to fund expansion, improve competitive positioning, or materially raise shareholder returns.

Low return on equity

ROE of 2.6% indicates limited efficiency in converting equity into returns despite a strong equity base. Persistently low ROE suggests the company may struggle to deliver attractive shareholder returns unless it achieves meaningful margin improvement or reverses revenue declines.

Eidai Kako Co., Ltd. Business Overview & Revenue Model

Company Description

Eidai Kako Co.,Ltd. manufactures and sells synthetic resin sheets and molded products. The company offers synthetic resin deformed molded products, including interior/exterior parts for home appliances, building materials for homes, and office furniture products; and floor mats for vehicles and bath lids. It also provides semiconductor-related parts, which include magazine sticks used for transporting and storing IC devices and various electronic components; laboratory benches and partition parts for office furniture parts; industrial parts that are used in the field of terminal block covers, LED lighting covers, aircraft parts, and escalator sliding parts; and sewer pipe rehabilitation materials, concrete block flexible joints, landscape material bamboo panels, etc.; and various home appliances related products and car accessories. The company also imports and exports various products. Eidai Kako Co.,Ltd. was founded in 1949 and is headquartered in Osaka, Japan.

How the Company Makes Money

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Eidai Kako Co., Ltd. Financial Statement Overview

Summary

Financials are solid overall: strong cash flow (free cash flow growth of 334% and high cash conversion vs. net income) and a conservative balance sheet (debt-to-equity 0.16, equity ratio 73.1%). Offsetting factors include modest profitability (net margin 2.1%, EBIT margin 3.3%) and a 2.5% revenue decline from 2024 to 2025.

Income Statement

Eidai Kako Co., Ltd. shows a solid gross profit margin of approximately 21.7% in 2025, indicating efficient cost management. The net profit margin improved to 2.1% from previous periods, reflecting a return to profitability. However, revenue has shown a declining trend by 2.5% from 2024 to 2025, and the EBIT margin, though positive, remains modest at 3.3%. Overall, the company demonstrates profitability recovery but faces challenges in revenue growth.

Balance Sheet

The company's balance sheet appears strong with a low debt-to-equity ratio of 0.16, indicating conservative leverage usage. The equity ratio is high at 73.1%, suggesting a solid asset base funded by equity. Return on equity stands at 2.6%, which is an improvement but still modest. The company maintains a healthy financial position with significant equity, though ROE could be improved further.

Cash Flow

Eidai Kako Co., Ltd. exhibits robust cash flow management with a significant free cash flow growth rate of 334% from 2024 to 2025, driven by increased operating cash flow. The operating cash flow to net income ratio is 4.79, reflecting strong cash generation relative to earnings. The free cash flow to net income ratio of 3.95 further supports efficient cash utilization. Overall, the cash flow position is strong, significantly enhancing financial flexibility.

Breakdown	TTM	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	8.91B	8.86B	9.09B	8.30B	8.29B	7.70B
Gross Profit	2.06B	1.92B	1.80B	1.42B	1.78B	1.77B
EBITDA	705.17M	607.17M	561.74M	35.16M	539.91M	515.00M
Net Income	209.35M	185.23M	179.66M	-238.25M	160.53M	161.71M
Balance Sheet
Total Assets	9.59B	9.85B	9.58B	9.67B	9.76B	9.59B
Cash, Cash Equivalents and Short-Term Investments	2.06B	2.38B	1.70B	1.70B	1.63B	2.33B
Total Debt	1.06B	1.12B	1.11B	1.33B	669.45M	826.10M
Total Liabilities	2.45B	2.65B	2.58B	2.94B	2.76B	2.69B
Stockholders Equity	7.14B	7.20B	7.00B	6.72B	7.00B	6.89B
Cash Flow
Free Cash Flow	0.00	731.40M	168.44M	-504.27M	-342.43M	430.50M
Operating Cash Flow	0.00	888.54M	402.77M	-69.69M	-57.81M	598.94M
Investing Cash Flow	0.00	-152.16M	-160.83M	-425.93M	-398.97M	-197.57M
Financing Cash Flow	0.00	-84.88M	-280.95M	519.03M	-287.10M	-217.56M

Eidai Kako Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 1800.00
• 50DMA: Negative
• 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:7877, the sentiment is Neutral. The current price of 1800 is below the 20-day moving average (MA) of 2169.60, below the 50-day MA of 2030.86, and above the 200-day MA of 1764.04, indicating a neutral trend. The MACD of -21.32 indicates Positive momentum. The RSI at 35.31 is Neutral, neither overbought nor oversold. The STOCH value of 20.98 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for JP:7877.

Eidai Kako Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
7877	73 Outperform	¥2.69B	4.27	―	2.85%	-1.81%	144.79%
4623	72 Outperform	¥6.59B	7.93	―	3.50%	-8.27%	-3.23%
4629	70 Outperform	¥7.76B	8.04	―	2.51%	2.26%	51.04%
4624	66 Neutral	¥5.75B	6.39	―	1.39%	2.67%	37.55%
Sector *	61 Neutral	$10.43B	7.12	-0.05%	2.87%	2.86%	-36.73%
4616	51 Neutral	¥1.87B	29.11	―	2.34%	-2.27%	-12.76%
4615	44 Neutral	¥4.25B	-15.17	―	―	8.66%	-239.07%

Eidai Kako Co., Ltd. Corporate Events

Eidai Kako Posts Strong Profit Growth on Modest Sales Rise, Maintains Solid Balance Sheet

Eidai Kako Co., Ltd. reported consolidated net sales of ¥6,949 million for the third quarter ended December 2025, a 3.4% year-on-year increase, with operating profit surging 85.6% to ¥398 million and profit attributable to owners of parent rising 86.0% to ¥273 million. The company’s financial position remained solid with total assets of ¥9,771 million, net assets of ¥7,241 million, and a capital adequacy ratio of 74.1%, although it continued its policy of paying no interim dividends for the second quarter of the fiscal year ending March 2026.

Basic earnings per share nearly doubled to ¥215.88 from ¥112.18 a year earlier, reflecting significantly improved profitability despite only modest sales growth. This combination of strong earnings momentum, stable balance sheet metrics, and a conservative dividend stance underscores management’s focus on strengthening internal reserves and financial resilience, which may support future strategic flexibility and reinforce the company’s positioning within its market segment.

The most recent analyst rating on (JP:7877) stock is a Buy with a Yen2193.00 price target. To see the full list of analyst forecasts on Eidai Kako Co., Ltd. stock, see the JP:7877 Stock Forecast page.