KANAME KOGYO Co., Ltd. (6566) AI Stock Analysis

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KANAME KOGYO Co., Ltd.

(TSE/TYO:6566)

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Rating:77Outperform

Price Target:JPY 1,365.00▲(10.71% Upside)

Action:upgraded

Date:08/18/26

Overall score is driven primarily by solid financial performance—improving profitability and a notably low-debt balance sheet—partly offset by mixed cash conversion. Technicals are supportive with price above key short-to-medium moving averages and positive MACD, though momentum is somewhat extended and the 200-day average is nearby. Valuation is reasonable with a mid-teens P/E and a ~2.1% dividend yield.

Positive Factors

Revenue and margin expansionSustained revenue growth alongside substantial gross- and net-margin expansion indicates improving economics across the business. This combination suggests stronger pricing, better cost control, or a more favorable project mix, supporting durable earnings growth and greater capacity to reinvest.

Negative Factors

Weak cash conversionCash generation remains positive, but recent operating cash flow has not fully converted reported earnings into cash, while free cash flow has been volatile. Working-capital swings or reinvestment needs can constrain internally funded growth and make earnings quality less consistent.

KANAME KOGYO Co., Ltd. (6566) vs. iShares MSCI Japan ETF (EWJ)

Market Cap: JPY 19.57B
Dividend Yield: 2.35%
Average Volume (3M): 3,612
Price to Earnings (P/E): 12.1
Beta (1Y): 0.45
Revenue Growth: 3.32%
EPS Growth: 6.59%
Country: Japan
Employees: 467
Sector: General
Sector Strength: 55
Industry: Waste Management

KANAME KOGYO Co., Ltd. Business Overview & Revenue Model

Company Description

Kaname Kogyo Co.,Ltd. is a firm dedicated to environmental services, offering complete waste management solutions. Their operations cover the entire process of handling diverse waste streams, from the initial collection and transportation to the fina...

How the Company Makes Money

KANAME KOGYO generates revenue mainly through (1) project-based contracting and (2) ongoing service/maintenance tied to installed systems. 1) Project-based contracting (core revenue stream) - The company earns sales by winning contracts to supply and...

KANAME KOGYO Co., Ltd. Financial Statement Overview

Summary

Strong multi-year revenue growth with meaningful margin improvement (gross margin ~17.8% to ~23.1%, net margin ~5.6% to ~10.6%). Balance sheet is a key strength with very low leverage (debt-to-equity ~0.06 in 2026). Main drawback is cash-flow quality: operating cash flow has trailed net income in 2024–2026 and free cash flow is only ~56% of net income in 2026, indicating weaker near-term cash conversion.

Income Statement

78Positive

Balance Sheet

86Very Positive

Cash Flow

70Positive

Financial statement breakdown
Breakdown	TTM	Mar 2026	Mar 2025	Mar 2024	Mar 2023	Mar 2022
Income Statement
Total Revenue	14.95B	14.95B	14.51B	13.50B	13.03B	11.93B
Gross Profit	3.45B	3.45B	3.37B	2.98B	2.91B	2.39B
EBITDA	2.90B	3.01B	2.88B	2.44B	2.35B	1.86B
Net Income	1.58B	1.58B	1.51B	1.29B	1.26B	873.00M
Balance Sheet
Total Assets	25.75B	25.75B	24.13B	23.58B	22.43B	21.54B
Cash, Cash Equivalents and Short-Term Investments	6.80B	6.80B	5.64B	5.78B	5.43B	4.80B
Total Debt	1.32B	1.32B	978.78M	1.46B	1.52B	1.84B
Total Liabilities	4.91B	4.91B	4.55B	5.12B	5.00B	5.09B
Stockholders Equity	20.84B	20.84B	19.57B	18.46B	17.43B	16.44B
Cash Flow
Free Cash Flow	0	1.15B	1.09B	1.23B	1.55B	792.44M
Operating Cash Flow	0	2.05B	2.13B	1.81B	1.93B	1.38B
Investing Cash Flow	0	-572.14M	-1.19B	-623.58M	-451.59M	-679.18M
Financing Cash Flow	0	-325.99M	-1.09B	-830.06M	-771.64M	-462.24M

KANAME KOGYO Co., Ltd. Technical Analysis

Technical Analysis SentimentNegative

Last Price1233.00

Price Trends

50DMA1265.96Negative

100DMA1272.68Negative

200DMA1346.91Negative

Market Momentum

MACD-8.21Negative

RSI46.21Neutral

STOCH81.48Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:6566, the sentiment is Negative. The current price of 1233.00 is above the 20-day moving average (MA) of 1231.65, below the 50-day MA of 1265.96, and below the 200-day MA of 1346.91, indicating a neutral trend. The MACD of -8.21 indicates Negative momentum. The RSI at 46.21 is Neutral, neither overbought nor oversold. The STOCH value of 81.48 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:6566.

KANAME KOGYO Co., Ltd. Peers Comparison

Overall Rating

UnderperformOutperform

Sector (55)

Financial Indicators

JP:6566 against its peers
Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
JP:5698	80Outperform	JPY 18.98B	7.42	―	3.96%	-9.49%	118.07%
JP:6566	77Outperform	JPY 19.57B	12.07	―	2.35%	3.32%	6.59%
JP:6564	75Outperform	JPY 52.84B	17.74	―	0.94%	13.53%	5.25%
JP:9793	72Outperform	JPY 161.97B	15.71	12.40%	2.44%	3.67%	13.39%
JP:5699	65Neutral	JPY 4.93B	6.76	―	2.20%	10.72%	73.57%
Sector *	55Neutral	$6.65B	3.83	-15.92%	6.20%	10.91%	7.18%
JP:2195	52Neutral	JPY 6.33B	20.24	―	1.54%	0.03%	-16.01%

* General Sector Average

Performance Comparison

JP:6566 and its peers over the selected period
Ticker	Company Name	Price	Change	% Change
JP:6566	KANAME KOGYO Co., Ltd.	1233.00	-240.84	-16.34%
JP:9793	Daiseki Co	3405.00	229.70	7.23%
JP:2195	Amita Holdings Co., Ltd.	325.00	12.41	3.97%
JP:5698	Envipro Holdings, Inc.	632.00	142.32	29.06%
JP:5699	IBOKIN Co., Ltd.	1453.00	82.86	6.05%
JP:6564	MIDAC HOLDINGS CO. LTD.	1915.00	80.04	4.36%

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: Aug 18, 2026

KANAME KOGYO Co., Ltd. AI Stock Analysis

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