Nakabayashi Co., Ltd. (7987) AI Stock Analysis

• Market Cap: ¥15.53B
• Dividend Yield: 3.79%
• Average Volume (3M): 51.46K
• Price to Earnings (P/E): 6.2
• Beta (1Y): 0.55
• Revenue Growth: -0.03%
• EPS Growth: 84.08%
• Country: JP
• Employees: 2,184
• Sector: Industrials
• Sector Strength: 72
• Industry: Specialty Business Services
• EPS (TTM): 23.84
• Shares Outstanding: 28,794,294
• 10 Day Avg. Volume: 34,500
• 30 Day Avg. Volume: 51,463
• PEG Ratio: 0.06
• Price to Book (P/B): 0.49
• Price to Sales (P/S): 0.22
• P/FCF Ratio: 7.21
• 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: 69 Neutral
• Price Target: ¥698.00 ▲(19.32% Upside)
• Action: Reiterated Date: 11/01/25
• Date: Action: Reiterated 11/01/25

Nakabayashi Co., Ltd. scores a 69, driven by strong financial performance and attractive valuation. The company's improvements in profitability and cash flow management are significant strengths. However, technical indicators suggest a neutral to slightly bearish outlook, which tempers the overall score. The absence of earnings call data and corporate events means these factors do not influence the score.

Positive Factors

Cash generation

The company converted negative free cash flow to positive in 2025 and reports operating cash flow 1.4x net income. Durable operational cash generation supports reinvestment, steady dividends, debt servicing and provides financial flexibility for multi‑period strategic initiatives.

Improving margins

Meaningful uplift in gross and operating margins indicates improving cost control and operational efficiency. Sustained margin expansion increases internal funding for product development and helps the business better absorb input cost volatility over several quarters to years.

Balanced capital structure

A moderate leverage profile and roughly 50% equity ratio suggest a conservative, resilient balance sheet that preserves financing optionality. Improved ROE shows better capital efficiency while maintaining headroom to invest or deleverage without creating acute liquidity risk.

Negative Factors

Revenue contraction

Reported negative revenue growth implies weakening top‑line traction or temporary loss of sales volume. Persistent or recurrent revenue decline risks eroding scale economics, constraining margin improvement and limiting the firm's ability to fund strategic investments from operating results.

Low absolute profitability

Despite improvement, low absolute margins leave limited buffer against input cost shocks or price competition. Structurally thin profitability reduces internal capital available for growth initiatives and heightens sensitivity to operational setbacks over the medium term.

Earnings volatility

Documented historical variability in net income increases forecasting uncertainty and complicates capital allocation. Volatility can impair investor confidence, hinder long‑term planning and elevate refinancing or investment risks if adverse cycles recur over the next several quarters.

Nakabayashi Co., Ltd. Business Overview & Revenue Model

Company Description

Nakabayashi Co., Ltd. engages in business process's solution, consumer-communication, office appliance, energy, and other businesses in Japan and internationally. Its business process's solution services comprise BPO, data printing, library solution, diary, temporary-employment, and contracted management of examination services. The company's consumer-communications products consists of notebooks, photo albums, files, storage boxes, gadget accessories, paper for printing, and child car seats; and office appliances include shredders, binding machines, wastepaper recycling, office furniture, wooden furniture, wagn for electronic charts, and intravenous drip stands. In addition, it is involved in the biomass and solar power generation activities; and agriculture business. The company was formerly known as Nakabayashi Bookbinding and Printing Co., Ltd. and changed its name to Nakabayashi Co., Ltd. in October 1970. Nakabayashi Co., Ltd. was founded in 1923 and is headquartered in Tokyo, Japan.

How the Company Makes Money

Nakabayashi Co., Ltd. generates revenue primarily through the sale of its diverse range of office supplies and stationery products. The company has established a strong distribution network that includes retail partnerships, online sales channels, and direct sales to businesses and educational institutions. Key revenue streams include traditional stationery products, such as notebooks and writing instruments, as well as technology-related products, including electronic stationery and organizational tools. Additionally, Nakabayashi benefits from partnerships with schools and corporate clients, providing customized solutions that cater to specific needs, thus enhancing its earnings potential. The company's commitment to innovation and quality also plays a crucial role in attracting and retaining customers, further contributing to its financial success.

Nakabayashi Co., Ltd. Financial Statement Overview

Summary

Nakabayashi Co., Ltd. exhibits a positive financial trajectory with improvements in profitability and cash flow management. The income statement shows a significant improvement in net profit margin and operational efficiency. The balance sheet reflects moderate financial stability, and cash flow performance is strong with robust operational cash generation. However, historical earnings volatility poses some risk.

Income Statement

Nakabayashi Co., Ltd. has shown a strong recovery in its income statement metrics. The company achieved a gross profit margin of 24.4% and a significant improvement in net profit margin to 3.2% in 2025 from 1.4% in 2024. Revenue growth was moderate at 2.8%. Notably, EBIT margin improved from 0.8% in 2024 to 2.8% in 2025, indicating better operational efficiency. However, historical fluctuations in profitability highlight potential volatility.

Balance Sheet

The balance sheet of Nakabayashi Co., Ltd. reflects moderate financial stability with a debt-to-equity ratio of 0.47, and an equity ratio of 50.7% as of 2025, indicating a balanced capital structure. Return on equity improved to 6.9% from 3.2% in the previous year, showcasing enhanced profitability. Despite the improvement, the historical variability in net income suggests some degree of financial risk.

Cash Flow

Cash flow performance has been strong, with free cash flow growing significantly from negative in 2024 to positive in 2025. The operating cash flow to net income ratio of 1.4 indicates robust operational cash generation. Additionally, the company efficiently converted free cash flow to net income, reflecting sound cash management practices.

Breakdown	TTM	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	62.91B	62.77B	61.04B	61.58B	63.12B	63.64B
Gross Profit	15.92B	15.34B	14.42B	14.57B	16.03B	16.74B
EBITDA	3.84B	3.40B	2.24B	2.32B	3.63B	4.42B
Net Income	2.43B	1.99B	877.00M	-665.00M	1.02B	1.55B
Balance Sheet
Total Assets	55.22B	56.58B	57.97B	57.70B	58.23B	57.11B
Cash, Cash Equivalents and Short-Term Investments	7.75B	7.74B	7.21B	7.87B	8.10B	6.47B
Total Debt	12.33B	13.72B	15.03B	15.76B	13.63B	12.62B
Total Liabilities	25.77B	27.20B	29.84B	30.85B	29.72B	29.06B
Stockholders Equity	28.80B	28.72B	27.44B	26.20B	26.86B	25.82B
Cash Flow
Free Cash Flow	0.00	1.95B	-341.00M	-1.51B	1.04B	748.00M
Operating Cash Flow	0.00	2.79B	1.33B	-87.00M	2.23B	2.41B
Investing Cash Flow	0.00	-396.00M	-1.13B	-1.33B	-283.00M	-518.00M
Financing Cash Flow	0.00	-1.97B	-1.42B	1.07B	-299.00M	-2.27B

Nakabayashi Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 585.00
• 50DMA: Negative
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:7987, the sentiment is Neutral. The current price of 585 is below the 20-day moving average (MA) of 619.30, below the 50-day MA of 607.16, and above the 200-day MA of 563.90, indicating a neutral trend. The MACD of -0.30 indicates Positive momentum. The RSI at 44.21 is Neutral, neither overbought nor oversold. The STOCH value of 15.45 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for JP:7987.

Nakabayashi Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
7805	77 Outperform	¥3.53B	4.67	―	1.93%	-1.00%	105.56%
7987	69 Neutral	¥15.53B	6.15	―	3.79%	-0.03%	84.08%
7914	68 Neutral	¥41.21B	7.42	―	3.71%	-0.04%	93.95%
7919	66 Neutral	¥3.61B	6.84	―	3.69%	0.62%	-24.08%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
7916	61 Neutral	¥5.60B	-22.35	―	2.72%	-1.30%	―
3948	53 Neutral	¥6.78B	45.76	―	2.94%	-2.81%	57.37%

Nakabayashi Co., Ltd. Corporate Events

Nakabayashi Lifts Profits Despite Lower Sales, Keeps Dividend Outlook Intact

Nakabayashi Co., Ltd., a Tokyo-listed maker of stationery, office and document-related products, reported a modest decline in net sales but a sharp improvement in profitability for the nine months ended December 31, 2025. The company continues to emphasize financial stability, maintaining an equity ratio above 50%, and upholds a policy of steady shareholder returns via consistent dividends.

Consolidated net sales for the nine-month period slipped 3.6% year on year to ¥44.4 billion, yet operating profit surged 78.4% to ¥1.65 billion and ordinary profit climbed 63.4% to ¥1.93 billion, with profit attributable to owners of parent up 10% to ¥881 million. For the full year ending March 31, 2026, Nakabayashi forecasts slight net sales growth to ¥63.5 billion and double-digit percentage gains in operating and ordinary profit, while projecting a decline in full-year net profit and keeping its annual dividend forecast unchanged at ¥22 per share, signaling a focus on profitability and stable shareholder returns despite revenue headwinds.

The company’s net assets stood at ¥29.3 billion at December 31, 2025, with the equity ratio improving to 53.1%, indicating reinforced balance sheet strength. This combination of rising profitability, a stronger capital base and maintained dividends may support investor confidence, though the expected drop in full-year profit attributable to owners of parent suggests lingering cost or business-structure pressures that management will need to address to sustain longer-term earnings growth.

The most recent analyst rating on (JP:7987) stock is a Buy with a Yen691.00 price target. To see the full list of analyst forecasts on Nakabayashi Co., Ltd. stock, see the JP:7987 Stock Forecast page.