NOVAC CO., LTD. (5079) AI Stock Analysis

NOVAC CO., LTD.

(TSE/TYO:5079)

Select Model

Rating:64Neutral

Price Target:JPY 2,801.00▲(18.54% Upside)

Action:reiterated

Date:09/13/26

The overall score reflects a balance between attractive valuation and a recovering income statement against significant cash flow weakness. The high dividend yield and low P/E provide support, but negative operating cash flow is a major risk factor. Technical trends are neutral and do not provide a strong directional catalyst.

Positive Factors

Strong 2026 revenue reboundThe sharp 2026 revenue rebound indicates renewed demand and improved business activity after a weaker period. If sustained, stronger sales can support operating leverage, provide resources for project execution, and reinforce NOVAC’s market position over the next several quarters.

Negative Factors

Sharply negative operating and free cash flowLarge negative operating and free cash flow weaken the company’s ability to fund projects, dividends, and investment from internally generated cash. Because cash flow was also negative in 2024 and is described as highly volatile, funding needs may remain a material risk over coming quarters.

NOVAC CO., LTD. (5079) vs. iShares MSCI Japan ETF (EWJ)

Market Cap: JPY 12.26B
Dividend Yield: 5.04%
Average Volume (3M): 7,345
Price to Earnings (P/E): 11.4
Beta (1Y): 0.30
Revenue Growth: 18.51%
EPS Growth: 60.79%
Country: Japan
Employees: 290
Sector: General
Sector Strength: 55
Industry: Engineering & Construction

NOVAC CO., LTD. Business Overview & Revenue Model

Company Description

Novac Co., Ltd. operates in the civil engineering and construction general contracting business in Japan. It maintains and repairs public facilities, tenant buildings, condominiums, etc. It also involved in the design and construction supervision of...

NOVAC CO., LTD. Financial Statement Overview

Summary

Mixed financials: strong income recovery and solid balance sheet (low debt, improving ROE) are offset by volatile and negative operating cash flow in FY2026, raising concerns about earnings quality and liquidity.

Income Statement

68Positive

Balance Sheet

78Positive

Cash Flow

45Neutral

Financial statement breakdown
Breakdown	TTM	Apr 2025	Apr 2024	Apr 2024	Apr 2023	Apr 2022
Income Statement
Total Revenue	34.43B	35.36B	34.43B	27.51B	31.95B	35.37B
Gross Profit	2.33B	3.70B	2.27B	2.40B	4.01B	4.40B
EBITDA	870.66M	1.95B	873.49M	917.91M	2.66B	3.01B
Net Income	287.40M	1.18B	287.40M	573.39M	2.05B	2.11B
Balance Sheet
Total Assets	29.51B	32.14B	29.51B	25.96B	28.22B	28.99B
Cash, Cash Equivalents and Short-Term Investments	5.52B	4.63B	5.52B	7.53B	14.50B	11.86B
Total Debt	1.81B	4.37B	1.81B	433.41M	9.12M	15.53M
Total Liabilities	11.13B	13.37B	11.13B	7.77B	9.41B	11.42B
Stockholders Equity	18.38B	18.76B	18.38B	18.19B	18.81B	17.57B
Cash Flow
Free Cash Flow	0	-6.21B	-10.05B	4.30B	3.04B	886.09M
Operating Cash Flow	0	-5.84B	-9.96B	4.35B	5.05B	894.45M
Investing Cash Flow	0	-379.69M	-87.28M	-81.62M	-1.58B	417.70M
Financing Cash Flow	0	3.32B	1.08B	-2.26B	-830.62M	1.42B

NOVAC CO., LTD. Technical Analysis

Technical Analysis SentimentNegative

Last Price2363.00

Price Trends

50DMA2520.26Negative

100DMA2493.45Negative

200DMA2572.71Negative

Market Momentum

MACD-29.57Positive

RSI24.87Positive

STOCH-19.90Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:5079, the sentiment is Negative. The current price of 2363.00 is below the 20-day moving average (MA) of 2484.65, below the 50-day MA of 2520.26, and below the 200-day MA of 2572.71, indicating a bearish trend. The MACD of -29.57 indicates Positive momentum. The RSI at 24.87 is Positive, neither overbought nor oversold. The STOCH value of -19.90 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:5079.

NOVAC CO., LTD. Peers Comparison

Overall Rating

UnderperformOutperform

Sector (55)

Financial Indicators

JP:5079 against its peers
Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
JP:5918	78Outperform	JPY 16.62B	6.63	―	1.58%	11.22%	499.52%
JP:1826	71Outperform	JPY 12.95B	12.07	―	5.58%	19.40%	150.32%
JP:1914	68Neutral	JPY 18.67B	7.96	―	3.41%	-7.50%	122.97%
JP:5079	64Neutral	JPY 12.25B	11.40	―	5.04%	18.51%	60.79%
JP:1966	63Neutral	JPY 12.21B	7.80	―	4.20%	-0.13%	-22.25%
Sector *	55Neutral	$6.65B	3.83	-15.92%	6.20%	10.91%	7.18%

* General Sector Average

Performance Comparison

JP:5079 and its peers over the selected period
Ticker	Company Name	Price	Change	% Change
JP:5079	NOVAC CO., LTD.	2379.00	-117.08	-4.69%
JP:1826	Sata Construction Co., Ltd.	1075.00	-4.29	-0.40%
JP:1914	Japan Foundation Engineering Co., Ltd.	879.00	274.29	45.36%
JP:1966	Takada Corporation	1665.00	23.19	1.41%
JP:5918	Takigami Steel Construction Co., Ltd.	7590.00	417.51	5.82%

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: Sep 13, 2026

NOVAC CO., LTD. AI Stock Analysis