Daiwa Office Investment Corporation (8976) AI Stock Analysis

• Market Cap: ¥350.06B
• Dividend Yield: 3.96%
• Average Volume (3M): 1.33K
• Price to Earnings (P/E): 25.1
• Beta (1Y): 0.15
• Revenue Growth: 19.18%
• EPS Growth: -23.37%
• Country: JP
• Employees: 124
• Sector: Real Estate
• Sector Strength: 53
• Industry: REIT - Office
• EPS (TTM): 7348.00
• Shares Outstanding: 934,745
• 10 Day Avg. Volume: 992
• 30 Day Avg. Volume: 1,334
• PEG Ratio: 19.53
• Price to Book (P/B): 1.08
• Price to Sales (P/S): 9.19
• P/FCF Ratio: 34.53
• 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: Moderate Sell
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 64 Neutral
• Price Target: ¥388,945 ▲(3.86% Upside)

Daiwa Office Investment Corporation's stock score is primarily driven by its solid financial performance, characterized by strong profitability and effective leverage management. However, technical indicators suggest a neutral trend, and valuation metrics indicate a moderate valuation. The absence of earnings call and corporate events data limits additional insights.

Positive Factors

Revenue Growth

The company shows a stable revenue growth rate of 5.77%, indicating effective market positioning and demand for its office spaces, which supports long-term financial stability.

Leverage Management

A moderate debt-to-equity ratio reflects prudent financial management, allowing the company to maintain financial flexibility and invest in growth opportunities without excessive risk.

Profitability

Strong profitability metrics demonstrate efficient operations and cost management, contributing to sustained financial health and the ability to reinvest in property enhancements.

Negative Factors

Declining Gross Profit Margin

A declining gross profit margin suggests rising costs or pricing pressures, which could impact future profitability if not addressed through cost management or pricing strategies.

Free Cash Flow Challenges

A significant drop in free cash flow indicates potential challenges in generating cash after capital expenditures, which may limit the company's ability to fund new investments or return capital to shareholders.

Earnings Decline

A decline in earnings per share growth can signal potential issues in revenue generation or cost control, affecting investor confidence and the company's ability to sustain dividends or reinvest in growth.

Daiwa Office Investment Corporation Business Overview & Revenue Model

Company Description

Daiwa Office Investment Corporation is a REIT focused on investment and management of office buildings in the Central 5wards of Tokyo.

How the Company Makes Money

Daiwa Office Investment Corporation generates revenue primarily through leasing office space to tenants, thereby collecting rental income. The company's revenue model is largely dependent on the occupancy rates of its properties, the rental agreements in place, and the overall demand for office space in the Japanese market. Key revenue streams include long-term leases with corporate tenants and short-term leases that allow for flexibility in rental agreements. Additionally, the company may earn income from property sales or through capital appreciation of its portfolio. The corporation's financial performance is supported by partnerships with real estate management firms and strategic investors, which enhance its ability to acquire and manage high-value properties effectively.

Daiwa Office Investment Corporation Financial Statement Overview

Summary

Daiwa Office Investment Corporation demonstrates solid profitability with strong revenue growth and effective leverage management. However, declining gross profit margins and a significant drop in free cash flow highlight areas for potential improvement.

Income Statement

Daiwa Office Investment Corporation shows a stable revenue growth rate of 5.77% in the latest year, with strong profitability metrics such as a high net profit margin of 46.47% and an EBIT margin of 50.38%. However, the gross profit margin has decreased from previous years, indicating potential cost pressures.

Balance Sheet

The company maintains a moderate debt-to-equity ratio of 0.90, indicating a balanced approach to leverage. Return on equity is stable at 5.46%, suggesting efficient use of equity capital. However, the equity ratio is not explicitly calculated, which could provide additional insights into financial stability.

Cash Flow

Operating cash flow remains strong, but free cash flow has significantly decreased by 292.25%, indicating potential challenges in generating cash after capital expenditures. The operating cash flow to net income ratio is healthy at 0.65, but the free cash flow to net income ratio has dropped to 0.40, suggesting reduced cash conversion efficiency.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	32.44B	28.79B	28.70B	28.37B	28.94B	29.12B
Gross Profit	8.19B	15.31B	17.15B	17.77B	18.34B	17.89B
EBITDA	19.71B	18.25B	17.71B	18.56B	19.12B	18.70B
Net Income	14.11B	13.38B	13.29B	14.01B	14.35B	13.81B
Balance Sheet
Total Assets	491.80B	491.24B	482.20B	481.05B	483.28B	488.57B
Cash, Cash Equivalents and Short-Term Investments	36.64B	29.40B	25.88B	19.08B	26.65B	28.14B
Total Debt	217.95B	219.40B	207.80B	205.80B	202.35B	204.45B
Total Liabilities	247.39B	246.27B	234.68B	233.56B	229.64B	233.06B
Stockholders Equity	244.42B	244.97B	247.52B	247.49B	253.64B	255.51B
Cash Flow
Free Cash Flow	19.16B	7.66B	18.52B	10.07B	17.08B	13.06B
Operating Cash Flow	22.84B	19.05B	22.57B	24.56B	20.90B	24.32B
Investing Cash Flow	-2.95B	-10.91B	-4.57B	-14.90B	-3.95B	-10.67B
Financing Cash Flow	-12.08B	-4.53B	-11.10B	-17.14B	-18.51B	-13.18B

Daiwa Office Investment Corporation Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 374500.00
• 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:8976, the sentiment is Positive. The current price of 374500 is above the 20-day moving average (MA) of 373500.89, above the 50-day MA of 369282.32, and above the 200-day MA of 328313.37, indicating a bullish trend. The MACD of -76.42 indicates Positive momentum. The RSI at 54.84 is Neutral, neither overbought nor oversold. The STOCH value of 74.71 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:8976.

Daiwa Office Investment Corporation Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
8975	75 Outperform	¥149.95B	16.18	―	6.14%	55.69%	24.75%
8954	71 Outperform	¥580.15B	24.68	―	4.10%	-31.88%	2.02%
8987	67 Neutral	¥197.32B	23.94	―	3.86%	64.38%	0.79%
8958	66 Neutral	¥136.83B	16.14	―	5.90%	90.94%	40.39%
Sector *	65 Neutral	$2.17B	12.19	3.79%	4.94%	3.15%	1.96%
8976	64 Neutral	¥350.06B	25.10	―	3.96%	19.18%	-23.37%
3295	64 Neutral	¥251.28B	21.04	―	4.63%	-5.47%	14.66%

Daiwa Office Investment Corporation Corporate Events

Daiwa Office Investment Completes First Phase of Real Estate Divestment

Daiwa Office Investment Corporation has completed the first transfer of a co-ownership interest in the trust beneficial interest of the Daiwa Sarugakucho property, valued at 2,550 million yen. This divestment is part of a two-phase transfer, with the second phase scheduled for completion in May 2026, reflecting the company’s ongoing strategy to optimize its real estate portfolio.

Daiwa Office Investment Completes Final Transfer of Trust Beneficial Interest

Daiwa Office Investment Corporation has completed the third and final transfer of a 30% co-ownership interest in the trust beneficial interest of domestic real estate, specifically the Daiwa Tsukishima property, for 2,940 million yen. This divestment marks the conclusion of a strategic move announced in July 2024, potentially impacting the company’s asset portfolio and financial strategy.

Daiwa Office Investment Corporation to Cancel 8,410 Investment Units

Daiwa Office Investment Corporation announced the cancellation of 8,410 of its own investment units, representing 0.89% of its total issued units. This move, scheduled for November 28, 2025, is part of the company’s strategic financial management, potentially impacting its market positioning and stakeholder interests.

Daiwa Office Investment Secures 5.5 Billion Yen for Debt Refinancing

Daiwa Office Investment Corporation announced a borrowing of 5,500 million yen to refinance existing debt due on November 28, 2025. This financial maneuver maintains the company’s interest-bearing liabilities at a stable level, with no significant change in investment risks, ensuring continued financial stability and operational efficiency.

Daiwa Office Investment Corporation Updates Related Party Status

Daiwa Office Investment Corporation announced a change in its specified related parties, with Daiwa Securities Realty Co., Ltd. now classified as such due to significant transactions involving real estate and trust beneficiary rights. This change, effective from June 1, 2025, does not impact the company’s investment status or distribution forecasts, indicating stability in its operations despite the reclassification.

Daiwa Office Investment Corporation Revises Financial Forecasts Upward for November 2025

Daiwa Office Investment Corporation has announced an upward revision in its financial forecasts for the fiscal period ending November 2025, citing a significant increase in expected operating revenue, income, and distribution per unit. This revision is attributed to asset divestment and reflects a positive adjustment in the company’s financial outlook, potentially impacting its stakeholders and market positioning.

Daiwa Office Investment Corporation Divests Daiwa Sarugakucho Property to Enhance Portfolio

Daiwa Office Investment Corporation announced the divestment of its trust beneficial interest in the Daiwa Sarugakucho property for 5,100 million yen. This decision aligns with the company’s strategy to improve unitholder value by realizing unrealized gains and optimizing its portfolio. The property, which has been a stable income source due to high occupancy rates, requires significant capital expenditures due to its age. The divestment will be executed in two phases to stabilize returns to unitholders, and the proceeds will be reinvested in new properties or used for other strategic financial maneuvers.

Daiwa Office Investment Completes Strategic Acquisition of Own Units

Daiwa Office Investment Corporation has completed the acquisition of 8,410 of its own investment units, totaling approximately 2.99 billion yen, through market purchases on the Tokyo Stock Exchange. This strategic move, approved by the board, aims to optimize the company’s capital structure by canceling these units, which will reduce the total number of outstanding investment units to 934,745, potentially increasing the value for existing stakeholders.