Hokushin Co., Ltd. (7897) AI Stock Analysis

• Market Cap: ¥3.23B
• Dividend Yield: 1.8%
• Average Volume (3M): 219.22K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.55
• Revenue Growth: 0.71%
• EPS Growth: -118.76%
• Country: JP
• Employees: 183
• Sector: Basic Materials
• Sector Strength: 58
• Industry: Paper, Lumber & Forest Products
• EPS (TTM): -1.38
• Shares Outstanding: 28,373,005
• 10 Day Avg. Volume: 188,970
• 30 Day Avg. Volume: 219,223
• PEG Ratio: -1.70
• Price to Book (P/B): 0.52
• Price to Sales (P/S): 0.29
• P/FCF Ratio: -49.78
• 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: 54 Neutral
• Price Target: ¥122.00 ▲(9.91% Upside)

The overall stock score is primarily impacted by financial performance challenges, including declining profitability and revenue. Technical analysis indicates a bearish trend, and valuation concerns are significant due to a negative P/E ratio. The stable balance sheet provides some support, but overall, the stock faces headwinds.

Positive Factors

Stable Balance Sheet

A stable balance sheet with manageable leverage provides financial resilience, allowing the company to navigate economic fluctuations and invest in growth opportunities.

Cash Generation Ability

Effective cash generation from operations supports ongoing business activities and investments, ensuring liquidity and financial stability.

Technological Focus

A focus on advanced technology and sustainability can drive innovation and efficiency, enhancing competitive advantage and market position.

Negative Factors

Declining Profitability

Declining profitability pressures cost management and pricing strategies, potentially limiting reinvestment in growth and innovation.

Negative Revenue Growth

Negative revenue growth indicates challenges in market demand or competitive positioning, which could impact long-term business sustainability.

Free Cash Flow Challenges

Negative free cash flow can constrain the company's ability to fund operations and investments, potentially impacting future growth and financial health.

Hokushin Co., Ltd. Business Overview & Revenue Model

Company Description

Hokushin Co., Ltd. manufactures and sells medium density fiberboards. The company was incorporated in 1950 and is based in Kishiwada, Japan.

How the Company Makes Money

Hokushin Co., Ltd. generates revenue primarily through the sale of its precision manufacturing products, including molds and components used in various industrial applications. The company operates on a business-to-business model, securing contracts with manufacturers in the automotive and electronics sectors, which represent significant portions of its revenue. Key revenue streams include direct sales of products, custom manufacturing services, and long-term contracts that ensure a steady flow of income. Additionally, Hokushin may engage in strategic partnerships with other firms to enhance its technological capabilities and expand its market reach, further contributing to its earnings.

Hokushin Co., Ltd. Financial Statement Overview

Summary

The company faces challenges in sustaining revenue and profitability, with declining margins and negative revenue growth. However, the balance sheet is stable with manageable leverage, and cash flow pressures are evident but not critical.

Income Statement

The income statement reveals a challenging revenue environment with a negative revenue growth rate over the last year. The company also experienced a significant decline in profitability as indicated by the negative EBIT margin for the most recent period. Gross profit margin remains moderate, but the net profit margin has decreased considerably. This suggests pressure on cost management and pricing strategies.

Balance Sheet

The balance sheet indicates a stable financial position with a reasonable debt-to-equity ratio, suggesting manageable leverage. The equity ratio is healthy, indicating a strong equity base relative to total assets. However, the return on equity has decreased, likely due to declining profitability, which could impact future growth.

Cash Flow

Cash flow analysis shows some strain, with free cash flow turning negative in the most recent year, indicating potential liquidity challenges. The operating cash flow to net income ratio remains positive, suggesting that the company generates cash from operations effectively. However, a decline in free cash flow growth rate highlights potential issues in sustaining capital expenditures.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	11.24B	10.22B	10.98B	12.89B	10.78B	9.11B
Gross Profit	1.38B	1.35B	1.54B	1.99B	1.75B	1.25B
EBITDA	321.12M	378.94M	549.17M	767.65M	850.02M	595.21M
Net Income	17.64M	20.34M	158.74M	332.41M	377.34M	173.00M
Balance Sheet
Total Assets	14.51B	13.73B	14.34B	14.38B	13.60B	12.68B
Cash, Cash Equivalents and Short-Term Investments	1.67B	1.68B	1.71B	1.67B	1.67B	1.81B
Total Debt	5.47B	5.02B	5.05B	5.08B	5.10B	5.13B
Total Liabilities	8.71B	7.91B	8.40B	8.59B	8.07B	7.43B
Stockholders Equity	5.80B	5.82B	5.94B	5.79B	5.54B	5.25B
Cash Flow
Free Cash Flow	609.82M	-60.37M	127.14M	143.36M	-59.58M	-406.21M
Operating Cash Flow	609.82M	268.67M	259.55M	463.70M	176.16M	244.21M
Investing Cash Flow	0.00	-199.89M	-80.74M	-329.76M	-243.59M	-572.15M
Financing Cash Flow	0.00	-93.31M	-144.74M	-134.40M	-71.94M	421.79M

Hokushin Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 111.00
• 50DMA: Positive
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:7897, the sentiment is Negative. The current price of 111 is above the 20-day moving average (MA) of 110.95, below the 50-day MA of 111.12, and below the 200-day MA of 117.02, indicating a neutral trend. The MACD of 0.43 indicates Negative momentum. The RSI at 51.41 is Neutral, neither overbought nor oversold. The STOCH value of 86.67 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:7897.

Hokushin Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
6342	70 Neutral	¥3.99B	26.89	―	4.26%	-23.31%	-89.08%
Sector *	61 Neutral	$10.43B	7.12	-0.05%	2.87%	2.86%	-36.73%
7808	61 Neutral	¥5.83B	5.10	―	2.57%	4.01%	-2.62%
7897	54 Neutral	¥3.23B	-92.45	―	1.80%	0.71%	-118.76%
3896	50 Neutral	¥3.39B	-15.23	―	―	11.79%	-1.56%
7426	47 Neutral	¥1.27B	-0.94	―	2.77%	25.73%	-282.69%
7815	42 Neutral	¥982.33M	-8.79	―	―	-3.43%	-48.08%