Nankai Tatsumura Construction Co., Ltd. (1850) AI Stock Analysis

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Nankai Tatsumura Construction Co., Ltd.

(TSE/TYO:1850)

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Rating:72Outperform

Price Target:JPY 455.00▲(15.19% Upside)

Action:upgraded

Date:11/05/26

The score is driven primarily by improved profitability and a very low-debt balance sheet, complemented by an inexpensive valuation (low P/E and a modest dividend yield). These positives are tempered by near-term technical weakness (price below major moving averages with negative MACD) and business/cash-flow cyclicality indicated by the sharp 2026 revenue decline and prior-year cash flow volatility.

Positive Factors

Improved ProfitabilityThe sustained improvement in net and EBIT margins indicates stronger earnings conversion than earlier in the period. If maintained, better profitability can support internal funding, improve resilience across construction cycles, and provide greater flexibility for investment and shareholder returns.

Negative Factors

Revenue ContractionThe sharp revenue decline demonstrates that demand or contract timing can materially affect the company’s top line. Continued variability would make forward earnings less predictable, potentially limiting operating leverage and reducing the consistency of cash available for reinvestment.

Nankai Tatsumura Construction Co., Ltd. (1850) vs. iShares MSCI Japan ETF (EWJ)

Market Cap: JPY 11.13B
Dividend Yield: 2.03%
Average Volume (3M): 29.85K
Price to Earnings (P/E): 5.5
Beta (1Y): 0.87
Revenue Growth: -14.45%
EPS Growth: 1.74%
Country: Japan
Employees: 511
Sector: Industrials
Sector Strength: 63
Industry: Engineering & Construction

Nankai Tatsumura Construction Co., Ltd. Business Overview & Revenue Model

Company Description

Based in Japan, Nankai Tatsumura Construction Co., Ltd. is a comprehensive player in the construction industry. Its expertise spans civil engineering projects, general building construction, and specialized infrastructure development, including pipe-...

How the Company Makes Money

Publicly available, company-specific details on Nankai Tatsumura Construction Co., Ltd.’s revenue model, key revenue streams, contract mix (e.g., private vs. public works), and material partnerships are not available in the provided context. null

Nankai Tatsumura Construction Co., Ltd. Financial Statement Overview

Summary

Profitability has improved (net margin ~1.5% in 2021 to ~4.6% in 2026; EBIT margin ~6.2% in 2026) and the balance sheet is notably stronger with very low leverage (debt-to-equity ~0.04 in 2026). Offsetting this, results appear cyclical with a sharp 2026 revenue decline (-14.9% YoY) and historically volatile cash flows (notably negative operating/free cash flow in 2025).

Income Statement

73Positive

Balance Sheet

82Very Positive

Cash Flow

62Positive

Financial statement breakdown
Breakdown	TTM	Mar 2026	Mar 2025	Mar 2024	Mar 2023	Mar 2022
Income Statement
Total Revenue	44.17B	45.80B	52.95B	43.63B	42.40B	37.19B
Gross Profit	5.08B	5.20B	4.82B	3.79B	4.02B	3.99B
EBITDA	2.84B	3.00B	2.52B	1.73B	2.28B	1.41B
Net Income	1.98B	2.09B	1.71B	1.10B	1.90B	1.31B
Balance Sheet
Total Assets	31.71B	35.08B	43.30B	30.34B	35.14B	32.73B
Cash, Cash Equivalents and Short-Term Investments	8.16B	6.69B	3.93B	6.27B	7.83B	5.42B
Total Debt	752.00M	770.00M	5.98B	1.93B	4.42B	4.46B
Total Liabilities	12.28B	15.37B	26.01B	14.56B	20.68B	20.06B
Stockholders Equity	19.43B	19.70B	17.29B	15.77B	14.45B	12.67B
Cash Flow
Free Cash Flow	0	8.43B	-6.29B	1.51B	1.80B	1.57B
Operating Cash Flow	0	8.45B	-6.13B	1.52B	1.82B	1.60B
Investing Cash Flow	0	-305.00M	-137.00M	-507.00M	711.00M	-33.00M
Financing Cash Flow	0	-5.38B	3.93B	-2.57B	-125.00M	-551.00M

Nankai Tatsumura Construction Co., Ltd. Technical Analysis

Technical Analysis SentimentNegative

Last Price395.00

Price Trends

50DMA421.44Negative

100DMA421.64Negative

200DMA453.76Negative

Market Momentum

MACD-7.79Positive

RSI41.68Neutral

STOCH33.33Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:1850, the sentiment is Negative. The current price of 395.00 is below the 20-day moving average (MA) of 407.35, below the 50-day MA of 421.44, and below the 200-day MA of 453.76, indicating a bearish trend. The MACD of -7.79 indicates Positive momentum. The RSI at 41.68 is Neutral, neither overbought nor oversold. The STOCH value of 33.33 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:1850.

Nankai Tatsumura Construction Co., Ltd. Peers Comparison

Overall Rating

UnderperformOutperform

Sector (63)

Financial Indicators

JP:1850 against its peers
Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
JP:1770	84Outperform	JPY 17.86B	7.61	―	3.99%	19.68%	82.97%
JP:5918	78Outperform	JPY 16.73B	6.74	―	1.56%	11.22%	499.52%
JP:1716	74Outperform	JPY 14.58B	8.95	―	3.55%	-0.69%	20.83%
JP:1853	74Outperform	JPY 10.32B	10.66	―	4.44%	-5.96%	-7.00%
JP:1850	72Outperform	JPY 11.15B	5.46	―	2.03%	-14.45%	1.74%
JP:1826	71Outperform	JPY 12.90B	12.12	―	5.52%	22.99%	134.56%
Sector *	63Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%

* Industrials Sector Average

Performance Comparison

JP:1850 and its peers over the selected period
Ticker	Company Name	Price	Change	% Change
JP:1850	Nankai Tatsumura Construction Co., Ltd.	395.00	-217.60	-35.52%
JP:1716	Daiichi Cutter Kogyo K.K.	1268.00	-40.18	-3.07%
JP:1770	Fujita Engineering Co., Ltd.	1978.00	381.94	23.93%
JP:1826	Sata Construction Co., Ltd.	1086.00	-15.15	-1.38%
JP:1853	Mori-Gumi Co., Ltd.	315.00	8.18	2.67%
JP:5918	Takigami Steel Construction Co., Ltd.	7710.00	232.51	3.11%

Glossary

BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.

Date of analysis: Nov 05, 2026

Nankai Tatsumura Construction Co., Ltd. AI Stock Analysis