Koken Ltd. (7963) AI Stock Analysis

• Market Cap: ¥9.13B
• Dividend Yield: 1.89%
• Average Volume (3M): 4.09K
• Price to Earnings (P/E): 11.8
• Beta (1Y): 0.19
• Revenue Growth: 9.47%
• EPS Growth: 37.35%
• Country: JP
• Employees: 321
• Sector: Healthcare
• Sector Strength: 45
• Industry: Medical - Devices
• EPS (TTM): 14.39
• Shares Outstanding: 5,104,003
• 10 Day Avg. Volume: 2,750
• 30 Day Avg. Volume: 4,086
• PEG Ratio: 3.58
• Price to Book (P/B): 0.58
• Price to Sales (P/S): 0.70
• P/FCF Ratio: 16.98
• 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: 74 Outperform
• Price Target: ¥1,994.00 ▲(14.66% Upside)

Koken Ltd. scores well due to its solid financial performance and attractive valuation. The company's stable revenue growth and strong gross margins are key strengths. However, technical analysis indicates some bearish momentum, which slightly offsets the positive valuation metrics.

Positive Factors

Revenue Growth

Consistent revenue growth indicates a strong market position and demand for Koken's products, supporting long-term business sustainability.

Gross Margins

High gross margins reflect efficient production and pricing strategies, enhancing the company's ability to invest in growth and innovation.

Balance Sheet Health

A strong equity ratio indicates financial stability and resilience, providing a solid foundation for future investments and growth opportunities.

Negative Factors

Free Cash Flow Decline

A significant decline in free cash flow can limit the company's ability to fund new projects, pay down debt, or return capital to shareholders.

Net Profit Margin

Moderate net profit margins suggest limited profitability improvements, which could impact the company's ability to enhance shareholder value.

Cash Flow Efficiency

While cash flow generation is strong, the close alignment with net income indicates limited flexibility in managing cash for strategic initiatives.

Koken Ltd. Business Overview & Revenue Model

Company Description

Koken Ltd. (7963) is a Japan-based company primarily engaged in the manufacture and sale of automotive service equipment. The company specializes in the production of wrenches, sockets, and other tools essential for automotive maintenance and repair. Koken Ltd. is known for its high-quality, durable products that cater to both professional mechanics and automotive enthusiasts.

How the Company Makes Money

Koken Ltd. generates revenue through the sale of its automotive service tools and equipment. Its core revenue stream comes from direct sales to automotive repair shops, dealerships, and tool distributors. The company benefits from a strong brand reputation for quality and reliability, which helps in maintaining a steady customer base. Additionally, Koken Ltd. may engage in strategic partnerships with automotive manufacturers or distributors to expand its market reach. Export sales also contribute to its earnings, allowing the company to tap into international markets where there is demand for premium automotive tools.

Koken Ltd. Financial Statement Overview

Summary

Koken Ltd. demonstrates solid financial health with stable revenue growth and strong gross margins. The balance sheet is robust with a healthy equity ratio and manageable debt levels. However, there is room for improvement in net profitability and cash flow efficiency, as indicated by a decline in free cash flow.

Income Statement

Koken Ltd. has demonstrated stable revenue growth with a 1.65% increase in 2024 compared to 2023. The gross profit margin stands at 45.74%, indicating strong profitability. However, the net profit margin is 6.71%, which is moderate. The EBIT margin of 9.38% and EBITDA margin of 13.86% reflect efficient operations, though there is room for improvement in net profitability.

Balance Sheet

The company's balance sheet shows a solid equity position with an equity ratio of 62.47%. The debt-to-equity ratio is 0.40, indicating a manageable level of leverage. Return on equity is 5.54%, which suggests moderate efficiency in generating returns from shareholders' equity. Overall, the balance sheet is stable, but there is potential to enhance returns.

Cash Flow

Koken Ltd. experienced a decline in free cash flow by 49.79% in 2024. The operating cash flow to net income ratio is 0.92, indicating that operating cash flow is closely aligned with net income. The free cash flow to net income ratio is 0.62, showing that a significant portion of net income is converted into free cash flow. Despite the decline in free cash flow, cash flow generation remains relatively strong.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	11.06B	10.76B	10.59B	10.60B	10.20B	10.15B
Gross Profit	5.12B	4.92B	4.84B	4.99B	4.65B	4.89B
EBITDA	1.55B	1.49B	1.51B	1.80B	1.88B	1.69B
Net Income	777.84M	722.06M	701.13M	833.11M	862.37M	837.66M
Balance Sheet
Total Assets	20.83B	20.87B	20.82B	20.57B	19.60B	19.00B
Cash, Cash Equivalents and Short-Term Investments	3.02B	2.53B	2.98B	2.39B	2.19B	1.56B
Total Debt	5.51B	5.18B	6.05B	6.13B	6.13B	5.95B
Total Liabilities	7.71B	7.83B	8.46B	8.75B	8.49B	8.54B
Stockholders Equity	13.12B	13.04B	12.35B	11.82B	11.11B	10.47B
Cash Flow
Free Cash Flow	0.00	445.38M	886.94M	451.74M	417.31M	709.59M
Operating Cash Flow	0.00	666.37M	1.08B	618.95M	655.48M	1.37B
Investing Cash Flow	0.00	-98.81M	-206.25M	-184.20M	147.58M	-606.28M
Financing Cash Flow	0.00	-1.05B	-307.82M	-291.98M	-176.25M	-680.15M

Koken Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 1739.00
• 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:7963, the sentiment is Positive. The current price of 1739 is below the 20-day moving average (MA) of 1848.00, below the 50-day MA of 1808.50, and above the 200-day MA of 1697.79, indicating a bullish trend. The MACD of 11.73 indicates Positive momentum. The RSI at 58.69 is Neutral, neither overbought nor oversold. The STOCH value of 53.87 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:7963.

Koken Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
5187	78 Outperform	¥9.32B	11.43	―	3.66%	4.97%	-10.07%
7963	74 Outperform	¥9.13B	11.80	―	1.89%	9.47%	37.35%
6678	74 Outperform	¥16.44B	13.56	―	3.65%	-4.36%	-14.92%
6823	69 Neutral	¥31.34B	10.06	―	2.78%	6.72%	20.01%
6849	61 Neutral	¥297.83B	21.71	―	1.89%	4.31%	96.31%
7600	58 Neutral	¥12.61B	―	―	3.15%	3.59%	-163.08%
Sector *	51 Neutral	$7.86B	-0.30	-43.30%	2.27%	22.53%	-2.21%