Original Engineering Consultants Co., Ltd. (4642) AI Stock Analysis

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Original Engineering Consultants Co., Ltd.

(TSE/TYO:4642)

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Rating:65Neutral

Price Target:JPY 1,490.00▲(9.56% Upside)

Action:reiterated

Date:11/05/26

The score is driven primarily by solid underlying financial performance (improving margins and strong 2025 revenue growth), tempered by weaker 2025 net income, a sharp increase in debt, and uneven cash-flow conversion. Technical signals are currently soft with the stock below key moving averages and a negative MACD, while valuation is supportive with a moderate P/E and a 2.5% dividend yield.

Positive Factors

Strong Revenue GrowthThe sharp 2025 revenue acceleration indicates stronger business activity and expanding demand. If sustained, this larger revenue base can support operating leverage, broaden the company’s market position, and provide more resources for investment over the next several quarters.

Negative Factors

Sharp Debt IncreaseThe sudden debt increase materially changes the company’s financial risk profile after several years of minimal leverage. Higher obligations may reduce financial flexibility, increase financing costs, and constrain future capital allocation if operating performance weakens.

Original Engineering Consultants Co., Ltd. (4642) vs. iShares MSCI Japan ETF (EWJ)

Market Cap: JPY 7.43B
Dividend Yield: 2.57%
Average Volume (3M): 2,525
Price to Earnings (P/E): 13.0
Beta (1Y): 0.49
Revenue Growth: 24.04%
EPS Growth: 13.29%
Country: Japan
Employees: 498
Sector: General
Sector Strength: 55
Industry: Engineering & Construction

Original Engineering Consultants Co., Ltd. Business Overview & Revenue Model

Company Description

Founded in Tokyo, Japan, in 1962, Original Engineering Consultants Co., Ltd. delivers specialized engineering consultancy for a broad range of environmental and infrastructure initiatives. The firm's comprehensive offerings span from initial pre-feas...

How the Company Makes Money

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Original Engineering Consultants Co., Ltd. Financial Statement Overview

Summary

Financials are generally healthy with improving profitability (net margin expanded to ~9.1% in 2024) and a major step-up in revenue growth in 2025 (+81.9%). Offsetting this, 2025 net income fell versus 2024 despite higher sales, debt rose sharply in 2025 after years of minimal leverage, and cash-flow conversion has been volatile (notably low OCF vs net income in 2024).

Income Statement

82Very Positive

Balance Sheet

74Positive

Cash Flow

58Neutral

Financial statement breakdown
Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	9.60B	8.52B	7.12B	6.63B	6.49B	6.21B
Gross Profit	3.16B	2.85B	2.37B	2.18B	2.10B	1.90B
EBITDA	1.38B	1.17B	992.22M	914.52M	795.46M	741.39M
Net Income	612.25M	541.34M	650.18M	477.35M	415.61M	376.06M
Balance Sheet
Total Assets	13.36B	11.96B	8.35B	7.93B	7.60B	7.11B
Cash, Cash Equivalents and Short-Term Investments	6.99B	3.99B	3.85B	3.98B	3.74B	3.55B
Total Debt	1.72B	1.84B	29.66M	58.23M	84.29M	111.34M
Total Liabilities	4.84B	4.06B	1.29B	1.44B	1.44B	1.20B
Stockholders Equity	8.52B	7.90B	7.06B	6.49B	6.15B	5.91B
Cash Flow
Free Cash Flow	0	486.31M	193.69M	388.94M	668.23M	266.88M
Operating Cash Flow	0	604.47M	241.63M	399.40M	691.72M	282.42M
Investing Cash Flow	0	-1.50B	-152.23M	63.97M	-277.00M	120.90M
Financing Cash Flow	0	1.31B	-222.69M	-224.58M	-225.29M	-227.52M

Original Engineering Consultants Co., Ltd. Technical Analysis

Technical Analysis SentimentNegative

Last Price1360.00

Price Trends

50DMA1398.60Negative

100DMA1409.29Negative

200DMA1457.66Negative

Market Momentum

MACD-10.49Positive

RSI42.11Neutral

STOCH36.30Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:4642, the sentiment is Negative. The current price of 1360.00 is below the 20-day moving average (MA) of 1388.80, below the 50-day MA of 1398.60, and below the 200-day MA of 1457.66, indicating a bearish trend. The MACD of -10.49 indicates Positive momentum. The RSI at 42.11 is Neutral, neither overbought nor oversold. The STOCH value of 36.30 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:4642.

Original Engineering Consultants Co., Ltd. Peers Comparison

Overall Rating

UnderperformOutperform

Sector (55)

Financial Indicators

JP:4642 against its peers
Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
JP:9768	78Outperform	JPY 25.06B	9.36	―	3.33%	4.52%	33.33%
JP:1828	77Outperform	JPY 24.83B	6.64	―	4.35%	6.05%	27.08%
JP:9621	73Outperform	JPY 101.73B	15.05	―	2.09%	7.70%	18.20%
JP:4673	69Neutral	JPY 3.19B	4.65	―	3.87%	-10.48%	-7.65%
JP:4642	65Neutral	JPY 7.46B	12.98	―	2.57%	24.04%	13.29%
JP:1914	57Neutral	JPY 18.46B	8.01	―	3.45%	-7.50%	122.97%
Sector *	55Neutral	$6.65B	3.83	-15.92%	6.20%	10.91%	7.18%

* General Sector Average

Performance Comparison

JP:4642 and its peers over the selected period
Ticker	Company Name	Price	Change	% Change
JP:4642	Original Engineering Consultants Co., Ltd.	1360.00	-144.27	-9.59%
JP:1828	Tanabe Engineering Corporation	2300.00	-54.13	-2.30%
JP:1914	Japan Foundation Engineering Co., Ltd.	870.00	240.26	38.15%
JP:4673	Kawasaki Geological Engineering Co., Ltd.	3745.00	-949.41	-20.22%
JP:9621	CTI Engineering Co., Ltd.	3580.00	757.14	26.82%
JP:9768	Idea Consultants,inc.	3540.00	123.32	3.61%

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

Original Engineering Consultants Co., Ltd. AI Stock Analysis