Fenwal Controls of Japan, Ltd. (6870) AI Stock Analysis

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Fenwal Controls of Japan, Ltd.

(TSE/TYO:6870)

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Rating:64Neutral

Price Target:JPY 2,039.00▲(8.52% Upside)

Action:reiterated

Date:11/04/26

The overall score is constrained by extremely weak technical momentum, with the stock in a deep downtrend and oversold conditions. Strong financial health, characterized by a robust balance sheet and record profitability, provides a fundamental floor. Attractive valuation and a high dividend yield offer a buffer, but the poor cash flow conversion and persistent selling pressure are the most significant factors weighing on the score.

Positive Factors

Conservative balance sheetVery low and improving leverage gives the company substantial financial flexibility and reduces pressure from interest or refinancing obligations. A stronger capital base can support continued operations and selective investment through weaker periods, while limiting balance-sheet constraints on future capital allocation.

Negative Factors

Weak cash conversionCash generation is materially weaker than reported earnings, reducing confidence in the quality and repeatability of current profitability. Negative free cash flow also limits internally funded investment and increases execution risk, particularly if working-capital needs or investment spending remain elevated.

Fenwal Controls of Japan, Ltd. (6870) vs. iShares MSCI Japan ETF (EWJ)

Market Cap: JPY 10.50B
Dividend Yield: 4.15%
Average Volume (3M): 3,006
Price to Earnings (P/E): 11.4
Beta (1Y): 0.36
Revenue Growth: 4.70%
EPS Growth: -27.90%
Country: Japan
Employees: 271
Sector: General
Sector Strength: 55
Industry: Security & Protection Services

Fenwal Controls of Japan, Ltd. Business Overview & Revenue Model

Company Description

Fenwal Controls of Japan Ltd. engages in the development, sale, design, construction, and maintenance of thermal control systems. It operates through the following segments: Safety Security Protection (SSP), Thermal, Medical, and Printed Wiring Board...

Fenwal Controls of Japan, Ltd. Financial Statement Overview

Summary

Solid income statement and a very strong balance sheet are offset by weak cash flow generation. Revenue growth and record net income support profitability, but negative free cash flow and low operating cash flow coverage raise concerns about earnings quality.

Income Statement

78Positive

Balance Sheet

90Very Positive

Cash Flow

45Neutral

Financial statement breakdown
Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	13.55B	12.91B	12.52B	12.60B	12.40B	12.37B
Gross Profit	4.38B	4.16B	4.14B	4.01B	4.05B	3.90B
EBITDA	1.65B	1.50B	1.58B	929.57M	1.45B	1.07B
Net Income	921.11M	1.25B	1.12B	385.00M	826.57M	387.57M
Balance Sheet
Total Assets	19.58B	19.23B	19.52B	19.46B	19.10B	18.69B
Cash, Cash Equivalents and Short-Term Investments	5.17B	4.83B	6.29B	7.32B	6.32B	6.89B
Total Debt	727.38M	622.95M	1.24B	1.54B	1.78B	2.11B
Total Liabilities	4.30B	4.62B	5.94B	6.78B	6.79B	6.76B
Stockholders Equity	15.28B	14.61B	13.59B	12.68B	12.31B	11.92B
Cash Flow
Free Cash Flow	0	-468.06M	293.62M	936.00M	55.01M	859.69M
Operating Cash Flow	0	342.48M	949.44M	1.11B	401.18M	1.20B
Investing Cash Flow	0	-1.29B	-659.28M	940.68M	-80.91M	-1.27B
Financing Cash Flow	0	-1.04B	-920.32M	-646.00M	-714.24M	226.09M

Fenwal Controls of Japan, Ltd. Technical Analysis

Technical Analysis SentimentNegative

Last Price1879.00

Price Trends

50DMA2050.56Negative

100DMA2243.20Negative

200DMA2153.84Negative

Market Momentum

MACD-64.71Negative

RSI36.66Neutral

STOCH45.37Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:6870, the sentiment is Negative. The current price of 1879.00 is below the 20-day moving average (MA) of 1937.40, below the 50-day MA of 2050.56, and below the 200-day MA of 2153.84, indicating a bearish trend. The MACD of -64.71 indicates Negative momentum. The RSI at 36.66 is Neutral, neither overbought nor oversold. The STOCH value of 45.37 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:6870.

Fenwal Controls of Japan, Ltd. Peers Comparison

Overall Rating

UnderperformOutperform

Sector (55)

Financial Indicators

JP:6870 against its peers
Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
JP:6744	84Outperform	JPY 274.68B	16.21	―	2.74%	11.62%	53.88%
JP:6809	78Outperform	JPY 61.69B	13.43	―	5.08%	12.04%	29.00%
JP:7734	72Outperform	JPY 157.24B	14.24	―	1.74%	14.25%	30.90%
JP:9735	72Outperform	JPY 3.10T	24.90	8.70%	1.55%	4.25%	14.23%
JP:6870	64Neutral	JPY 10.56B	11.44	―	4.15%	4.70%	-27.90%
Sector *	55Neutral	$6.65B	3.83	-15.92%	6.20%	10.91%	7.18%

* General Sector Average

Performance Comparison

JP:6870 and its peers over the selected period
Ticker	Company Name	Price	Change	% Change
JP:6870	Fenwal Controls of Japan, Ltd.	1879.00	181.55	10.70%
JP:9735	Secom Co	7117.00	1898.83	36.39%
JP:6744	Nohmi Bosai Ltd.	4520.00	1103.97	32.32%
JP:6809	Toa Corporation	1772.00	159.12	9.87%
JP:7734	Riken Keiki Co., Ltd.	3455.00	253.43	7.92%

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 04, 2026

Fenwal Controls of Japan, Ltd. AI Stock Analysis