Naito & Co., Ltd. (7624) AI Stock Analysis

Naito & Co., Ltd.

(TSE/TYO:7624)

Select Model

Rating:63Neutral

Price Target:JPY 169.00▲(6.29% Upside)

Action:reiterated

Date:09/30/26

The score is driven primarily by strong financial resilience from a very low-debt balance sheet, offset by sharply weaker recent revenue performance and persistently thin margins. Technicals are supportive due to a clear uptrend, but extremely overbought signals raise near-term risk. Valuation is reasonable with a modest dividend, but not compelling enough to outweigh the recent operating deterioration.

Positive Factors

Very low leverageNear-zero leverage gives Naito substantial financial resilience and limits interest-related pressure on earnings. A stable, gradually rising equity base also provides capacity to support operations and pursue customer or equipment-related opportunities without relying heavily on debt.

Negative Factors

Sharp revenue deteriorationThe steep latest revenue decline signals materially weaker customer demand or sales activity and reduces the scale over which fixed operating costs can be absorbed. If the trend persists, it could constrain earnings, weaken bargaining leverage, and limit investment capacity.

Naito & Co., Ltd. (7624) vs. iShares MSCI Japan ETF (EWJ)

Market Cap: JPY 8.71B
Dividend Yield: 2.52%
Average Volume (3M): 168.73K
Price to Earnings (P/E): 12.0
Beta (1Y): 0.44
Revenue Growth: 8.40%
EPS Growth: 90.53%
Country: Japan
Employees: 309
Sector: General
Sector Strength: 55
Industry: Industrial - Distribution

Naito & Co., Ltd. Business Overview & Revenue Model

Company Description

Naito & Co., Ltd., a Tokyo-headquartered trading firm established in 1945, distributes a diverse array of industrial equipment across Japan and to international markets. Their extensive product portfolio features various cutting tools, including carb...

How the Company Makes Money

Naito & Co., Ltd. makes money primarily by acting as an intermediary distributor/wholesaler to manufacturing companies. Its core revenue comes from selling (1) machine tools and production equipment, (2) cutting tools and tooling consumables, and (3)...

Naito & Co., Ltd. Financial Statement Overview

Summary

Balance sheet strength is a clear positive (near-zero leverage and stable equity), but operating performance is the key drag: revenue declined sharply most recently (-58.5%) and margins are structurally thin (~0.9% operating, ~0.7% net). Cash flow is generally positive with solid recent FCF, but conversion has been uneven with past volatility.

Income Statement

46Neutral

Balance Sheet

82Very Positive

Cash Flow

58Neutral

Financial statement breakdown
Breakdown	TTM	Feb 2026	Feb 2025	Feb 2024	Feb 2023	Feb 2022
Income Statement
Total Revenue	47.45B	43.52B	43.55B	44.06B	44.46B	43.62B
Gross Profit	6.06B	5.24B	5.29B	5.41B	5.46B	5.00B
EBITDA	1.33B	769.00M	858.00M	838.00M	1.35B	871.00M
Net Income	724.00M	284.00M	314.00M	345.00M	732.00M	448.00M
Balance Sheet
Total Assets	18.50B	17.59B	17.28B	17.84B	17.24B	17.27B
Cash, Cash Equivalents and Short-Term Investments	590.00M	82.00M	113.00M	138.00M	186.00M	186.00M
Total Debt	0	101.00M	73.00M	876.00M	356.00M	710.00M
Total Liabilities	4.99B	4.45B	4.36B	5.01B	4.58B	5.04B
Stockholders Equity	13.51B	13.14B	12.91B	12.83B	12.66B	12.22B
Cash Flow
Free Cash Flow	0	406.00M	1.08B	-84.00M	409.00M	87.00M
Operating Cash Flow	0	462.00M	1.16B	101.00M	442.00M	92.00M
Investing Cash Flow	0	-290.00M	-158.00M	-452.00M	72.00M	-238.00M
Financing Cash Flow	0	-190.00M	-1.02B	300.00M	-518.00M	141.00M

Naito & Co., Ltd. Technical Analysis

Technical Analysis SentimentNeutral

Last Price159.00

Price Trends

50DMA165.00Negative

100DMA152.24Positive

200DMA144.07Positive

Market Momentum

MACD-1.54Positive

RSI37.53Neutral

STOCH12.25Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:7624, the sentiment is Neutral. The current price of 159.00 is below the 20-day moving average (MA) of 171.80, below the 50-day MA of 165.00, and above the 200-day MA of 144.07, indicating a neutral trend. The MACD of -1.54 indicates Positive momentum. The RSI at 37.53 is Neutral, neither overbought nor oversold. The STOCH value of 12.25 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for JP:7624.

Naito & Co., Ltd. Peers Comparison

Overall Rating

UnderperformOutperform

Sector (55)

Financial Indicators

JP:7624 against its peers
Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
JP:9902	74Outperform	JPY 90.62B	15.67	―	3.09%	9.00%	21.98%
JP:3176	73Outperform	JPY 66.18B	12.12	―	3.49%	7.05%	7.82%
JP:8103	71Outperform	JPY 37.17B	10.80	―	4.56%	17.27%	-5.38%
JP:9830	69Neutral	JPY 156.42B	9.54	―	2.57%	10.37%	1.94%
JP:7628	64Neutral	JPY 26.72B	11.65	―	3.86%	5.68%	39.50%
JP:7624	63Neutral	JPY 8.71B	12.03	―	2.52%	8.40%	90.53%
Sector *	55Neutral	$6.65B	3.83	-15.92%	6.20%	10.91%	7.18%

* General Sector Average

Performance Comparison

JP:7624 and its peers over the selected period
Ticker	Company Name	Price	Change	% Change
JP:7624	Naito & Co., Ltd.	159.00	24.85	18.53%
JP:3176	Sanyo Trading Co., Ltd.	1147.00	383.84	50.30%
JP:7628	Ohashi Technica Inc.	1061.00	71.34	7.21%
JP:8103	Meiwa Corporation	922.00	165.48	21.87%
JP:9830	Trusco Nakayama Corporation	2372.00	-0.22	>-0.01%
JP:9902	Nichiden Corporation	3070.00	666.03	27.71%

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 30, 2026

Naito & Co., Ltd. AI Stock Analysis