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Nippon Gear Co., Ltd.
(6356)
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Rating:78Outperform
Price Target:
¥1,725.00
▲(102.23% Upside)
Action:Reiterated
Date:09/15/26
The score is driven primarily by strong financial performance—major margin expansion, very low leverage, and improved 2026 cash flow—partly offset by uneven revenue/cash conversion history. Technicals are supportive due to price strength versus key moving averages, but mixed momentum (negative MACD) tempers the outlook. Valuation is reasonable at ~11.55x earnings, though the dividend yield is modest.
Positive Factors
Material margin expansion
The substantial and sustained expansion in net and EBIT margins indicates stronger profitability through improved pricing, product mix, cost control, or a combination of these factors. Higher margins can strengthen internal funding capacity and provide greater resilience across the next several quarters.
Negative Factors
Choppy revenue trend
Uneven revenue performance shows that Nippon Gear’s top-line momentum has not been consistently dependable. Repeated annual declines can make capacity planning, fixed-cost absorption, and earnings forecasting more difficult, even when margins remain strong.
Read all positive and negative factors
Positive Factors
Negative Factors
Material margin expansion
The substantial and sustained expansion in net and EBIT margins indicates stronger profitability through improved pricing, product mix, cost control, or a combination of these factors. Higher margins can strengthen internal funding capacity and provide greater resilience across the next several quarters.
Read all positive factors
Nippon Gear Co., Ltd. (6356) vs. iShares MSCI Japan ETF (EWJ)
Market Cap
¥19.51B
Dividend Yield0.79%
Average Volume (3M)620.98K
Price to Earnings (P/E)10.8
Beta (1Y)0.35
Revenue Growth3.79%
EPS Growth26.46%
CountryJP
Employees393
SectorGeneral
Sector StrengthN/A
IndustryElectrical Equipment & Parts
Share Statistics
EPS (TTM)91.75
Shares Outstanding14,280,000
10 Day Avg. Volume1,563,740
30 Day Avg. Volume620,976
Financial Highlights & Ratios
PEG Ratio0.82
Price to Book (P/B)1.29
Price to Sales (P/S)1.89
P/FCF Ratio10.34
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
EPS Forecast (FY)N/A
Revenue Forecast (FY)N/A
Nippon Gear Co., Ltd. Business Overview & Revenue Model
Company Description
Nippon Gear Co., Ltd. specializes in the development, manufacturing, and distribution of industrial mechanical components, serving both domestic and international markets. Its extensive product portfolio includes valve actuators, widely utilized a...
How the Company Makes Money
Nippon Gear makes money primarily by manufacturing and selling mechanical and electromechanical components to business customers (B2B), with revenue recognized from product shipments. Key revenue streams include: (1) Automotive-related sales: supp...
Nippon Gear Co., Ltd. Financial Statement Overview
Summary
Income Statement
84
Very Positive
Balance Sheet
92
Very Positive
Cash Flow
78
Positive
| Breakdown | TTM | Mar 2026 | Mar 2025 | Mar 2024 | Mar 2023 | Mar 2022 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 9.20B | 9.88B | 9.56B | 9.62B | 7.52B | 7.57B |
| Gross Profit | 4.23B | 4.81B | 4.27B | 4.43B | 3.14B | 2.27B |
| EBITDA | 2.10B | 2.70B | 2.52B | 2.37B | 1.20B | 683.82M |
| Net Income | 1.31B | 1.75B | 1.55B | 1.54B | 685.13M | 295.83M |
Balance Sheet | ||||||
| Total Assets | 14.10B | 17.20B | 15.42B | 14.85B | 12.91B | 11.37B |
| Cash, Cash Equivalents and Short-Term Investments | 4.64B | 6.13B | 4.50B | 4.48B | 4.30B | 3.53B |
| Total Debt | 402.97M | 72.17M | 109.80M | 366.46M | 511.92M | 658.37M |
| Total Liabilities | 3.52B | 2.72B | 2.86B | 3.76B | 3.47B | 2.57B |
| Stockholders Equity | 10.58B | 14.48B | 12.56B | 11.10B | 9.44B | 8.79B |
Cash Flow | ||||||
| Free Cash Flow | 0.00 | 1.81B | 795.46M | 421.68M | 977.46M | 706.17M |
| Operating Cash Flow | 0.00 | 2.42B | 1.29B | 748.94M | 1.27B | 803.87M |
| Investing Cash Flow | 0.00 | -641.92M | -884.92M | -331.61M | -297.71M | -100.26M |
| Financing Cash Flow | 0.00 | -151.79M | -384.31M | -245.05M | -201.18M | -125.11M |
Nippon Gear Co., Ltd. Technical Analysis
Positive
853.00
Price Trends
1346.57
Positive
1425.99
Negative
1293.56
Positive
Market Momentum
10.04
Negative
53.50
Neutral
21.25
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:6356, the sentiment is Positive. The current price of 853 is below the 20-day moving average (MA) of 1349.38, below the 50-day MA of 1346.57, and below the 200-day MA of 1293.56, indicating a bullish trend. The MACD of 10.04 indicates Negative momentum. The RSI at 53.50 is Neutral, neither overbought nor oversold. The STOCH value of 21.25 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:6356.
Nippon Gear Co., Ltd. Peers Comparison
UnderperformOutperform
Sector (55)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
81 Outperform | ¥194.67B | 9.86 | ― | 5.30% | 7.40% | 25.62% | |
78 Outperform | ¥19.51B | 10.76 | ― | 0.79% | 3.79% | 26.46% | |
74 Outperform | ¥208.89B | 14.52 | 7.60% | 5.60% | 0.38% | 30.22% | |
71 Outperform | ¥71.42B | 7.08 | ― | 5.00% | 1.87% | 46.10% | |
60 Neutral | ¥655.29B | 34.90 | 2.47% | 3.03% | 4.64% | 106.98% | |
55 Neutral | $6.65B | 3.83 | -15.92% | 6.20% | 10.91% | 7.18% | |
49 Neutral | ¥194.42B | 136.49 | ― | 1.15% | 3.50% | -77.77% |
* General Sector Average
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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.