KITAKEI CO., LTD. (9872) AI Stock Analysis

• Market Cap: ¥8.10B
• Dividend Yield: 2.96%
• Average Volume (3M): 70.45K
• Price to Earnings (P/E): 14.7
• Beta (1Y): 0.40
• Revenue Growth: -1.07%
• EPS Growth: -17.15%
• Country: JP
• Employees: 378
• Sector: Industrials
• Sector Strength: 72
• Industry: Construction
• EPS (TTM): 16.77
• Shares Outstanding: 10,011,841
• 10 Day Avg. Volume: 30,300
• 30 Day Avg. Volume: 70,446
• PEG Ratio: -0.63
• Price to Book (P/B): 0.58
• Price to Sales (P/S): 0.14
• P/FCF Ratio: -16.23
• 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: 66 Neutral
• Price Target: ¥1,003.00 ▲(8.43% Upside)

Overall score reflects a strong, low-risk balance sheet but softened fundamentals and volatile cash generation (including negative 2025 operating/free cash flow). This is partly supported by moderately positive price momentum and a reasonable valuation with a ~3% dividend yield.

Positive Factors

Debt-Free Balance Sheet

A debt-free balance sheet significantly reduces financial risk and provides the company with flexibility to navigate economic cycles and invest in growth opportunities.

Gross Margin Improvement

Improving gross margins indicate better cost management and pricing power, which can enhance profitability over time despite revenue challenges.

Stable Equity Growth

Stable equity growth suggests a solid foundation for future expansion and resilience against market fluctuations, contributing to long-term business sustainability.

Negative Factors

Revenue Decline

A declining revenue trend poses a challenge to the company's growth prospects and may pressure profitability if not addressed through strategic initiatives.

Negative Cash Flow

Negative cash flow in 2025 raises concerns about the company's ability to fund operations and investments, potentially impacting its financial health and strategic flexibility.

Declining ROE

A declining ROE indicates reduced efficiency in generating profits from shareholder equity, which could deter investment and affect long-term competitiveness.

KITAKEI CO., LTD. Business Overview & Revenue Model

Company Description

KITAKEI CO., LTD. (9872) is a Japanese company primarily engaged in the wholesale distribution of building materials. The company operates within the construction sector, providing a wide range of products necessary for building and construction projects. Its core offerings include timber, plywood, and other essential materials needed by construction companies and contractors to carry out their projects efficiently.

How the Company Makes Money

KITAKEI CO., LTD. generates revenue mainly through the sale of building materials to construction companies and contractors. The company's primary revenue stream is the wholesale distribution of timber, plywood, and related products, which are critical to the construction industry. By maintaining relationships with suppliers and manufacturers, KITAKEI CO., LTD. ensures a steady supply of materials, which it then sells to its clients. The company may also engage in partnerships with construction firms to provide tailored solutions and bulk purchase agreements, further enhancing its revenue potential.

KITAKEI CO., LTD. Financial Statement Overview

Summary

Financials are mixed. A debt-free balance sheet (strong risk profile) is offset by weakening operating performance (revenue down and margins/ROE compressing) and a notable cash-flow setback in 2025 with negative operating and free cash flow.

Income Statement

Revenue has been choppy, with a return to modest contraction in 2024 (-0.02%) and a sharper decline in 2025 (-5.44%). Profitability is steady but thin for the sector: gross margin has gradually improved to ~11.0% in 2025, while net margin has compressed to ~0.9% (down from ~1.3% in 2023). Operating profit has also stepped down (EBIT margin ~1.5% in 2025 vs. ~2.0% in 2023), indicating weaker operating leverage and higher pressure on costs/pricing.

Balance Sheet

The balance sheet is conservatively positioned with effectively no debt (debt-to-equity ~0 across recent years), which materially lowers financial risk and provides flexibility through cycles. Equity has been stable-to-growing over time, supporting asset growth. The main weakness is moderate returns on shareholder capital, with return on equity trending down to ~3.9% in 2025 (from ~6.1% in 2023), consistent with the recent profit slowdown.

Cash Flow

Cash generation is volatile. After strong operating and free cash flow in 2023, 2025 turned negative (operating cash flow -471M; free cash flow -502M), suggesting working-capital swings and/or higher cash outlays. While 2024 was positive, the sharp reversal in 2025 raises execution risk and reduces near-term financial flexibility despite the debt-free balance sheet.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	62.37B	58.98B	61.29B	62.37B	60.87B	57.23B
Gross Profit	6.42B	6.47B	6.59B	6.42B	5.91B	5.73B
EBITDA	1.39B	1.02B	1.22B	1.39B	1.11B	1.07B
Net Income	812.62M	551.00M	718.92M	812.62M	641.13M	644.11M
Balance Sheet
Total Assets	29.25B	27.85B	29.08B	29.01B	28.70B	27.38B
Cash, Cash Equivalents and Short-Term Investments	11.65B	11.10B	12.05B	11.65B	10.25B	10.32B
Total Debt	265.00K	0.00	0.00	265.00K	1.92M	3.77M
Total Liabilities	15.90B	13.79B	15.13B	15.45B	15.88B	14.98B
Stockholders Equity	13.36B	14.06B	13.96B	13.36B	12.82B	12.40B
Cash Flow
Free Cash Flow	273.08M	-502.00M	535.86M	1.65B	153.35M	-167.68M
Operating Cash Flow	273.08M	-471.00M	603.82M	1.83B	353.25M	-92.78M
Investing Cash Flow	0.00	-14.00M	-66.20M	-208.60M	-198.72M	324.81M
Financing Cash Flow	0.00	-258.00M	-337.67M	-222.16M	-222.07M	-231.13M

KITAKEI CO., LTD. Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 925.00
• 50DMA: Negative
• 100DMA: Negative
• 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:9872, the sentiment is Negative. The current price of 925 is above the 20-day moving average (MA) of 890.20, above the 50-day MA of 902.10, and above the 200-day MA of 867.59, indicating a neutral trend. The MACD of -9.26 indicates Positive momentum. The RSI at 38.57 is Neutral, neither overbought nor oversold. The STOCH value of 29.15 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:9872.

KITAKEI CO., LTD. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
5237	78 Outperform	¥12.46B	12.31	―	3.90%	0.58%	-9.72%
5940	74 Outperform	¥11.67B	4.23	―	2.89%	2.56%	17.52%
9872	66 Neutral	¥8.10B	14.71	―	2.96%	-1.07%	-17.15%
4224	65 Neutral	¥9.08B	47.53	―	3.73%	3.06%	-75.19%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
5936	63 Neutral	¥6.09B	7.97	―	4.13%	2.76%	-10.23%
5391	56 Neutral	¥10.98B	105.09	―	4.54%	7.32%	-93.45%