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Kokusai Co., Ltd. (7722) AI Stock Analysis

JP:7722

Kokusai Co., Ltd.

(TSE/TYO:7722)

Select Model
Rating:73Outperform
Price Target:JPY 885.00â–²(22.24% Upside)
Action:reiterated
Date:08/19/26

The score is driven primarily by improving financial performance (profitability recovery, stronger margins, and lower leverage) and favorable valuation (low P/E and high dividend yield). These positives are tempered by neutral technical signals and the longer-term downtrend vs. the 200-day moving average, plus prior cash-flow volatility that bears monitoring.

Positive Factors
Profitability and Margin RecoveryThe return to profitability and materially higher margins indicates improved operating efficiency and cost control. If sustained, this creates a stronger earnings base and provides resilience even if revenue growth remains moderate.
Negative Factors
Modest and Uneven Revenue GrowthThe earnings recovery has relied more on margin normalization and cost control than sustained demand expansion. Uneven revenue performance may limit operating leverage and make future profit growth less durable if efficiency gains moderate.

Kokusai Co., Ltd. (7722) vs. iShares MSCI Japan ETF (EWJ)

-10%0%10%20%30%40%50%60%JP:7722+11.63%EWJ+15.87%Dec '25Jan '26Feb '26Mar '26Apr '26May '26Jun '26Jul '26Aug '26Sep '26Oct '26
Market Cap
JPY 9.76B
Dividend Yield
6.22%
Average Volume (3M)
31.74K
Price to Earnings (P/E)
7.4
Beta (1Y)
1.01
Revenue Growth
-2.31%
EPS Growth
13.09%
Country
Japan
Employees
296
Sector
General
Sector Strength
55
Industry
Industrial - Machinery

Kokusai Co., Ltd. Business Overview & Revenue Model

Company Description

Kokusai Co., Ltd. engages in the manufacture and sale of testers and measurement instruments for motors and rotating equipment, and automatic inspection equipment in Japan, the United States, South Korea, China, and internationally. It offers balanci...

How the Company Makes Money

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Kokusai Co., Ltd. Financial Statement Overview

Summary

Overall financials indicate a solid recovery: profitability and margins improved materially in 2025–2026, leverage is conservative and improving (debt-to-equity ~0.21 in 2026), and recent free cash flow is strong and closely tracks earnings (~94% of net income). Offsetting factors are modest/uneven revenue growth and historically volatile cash flows (negative in 2022–2023), raising questions about durability.

Income Statement

74Positive

Balance Sheet

78Positive

Cash Flow

71Positive
Financial statement breakdown
BreakdownTTMMar 2026Mar 2025Mar 2024Mar 2023Mar 2022
Income Statement
Total Revenue14.04B14.95B13.20B10.24B10.04B11.13B
Gross Profit5.79B5.98B4.90B2.69B2.92B3.56B
EBITDA2.19B2.26B1.60B21.64M375.39M868.77M
Net Income1.32B1.50B940.38M-258.16M-66.37M475.02M
Balance Sheet
Total Assets20.31B20.80B20.84B20.52B20.41B17.37B
Cash, Cash Equivalents and Short-Term Investments8.07B8.54B7.90B8.25B7.41B5.45B
Total Debt2.37B2.57B3.41B4.02B4.79B2.48B
Total Liabilities7.42B7.84B9.24B9.50B9.16B6.07B
Stockholders Equity12.41B12.49B11.22B10.74B11.02B11.13B
Cash Flow
Free Cash Flow01.72B974.29M1.28B-514.43M-130.32M
Operating Cash Flow01.82B1.03B1.34B-471.56M-119.70M
Investing Cash Flow0-284.06M-315.95M-518.82M129.41M225.16M
Financing Cash Flow0-1.28B-977.82M-1.05B2.03B-509.07M

Kokusai Co., Ltd. Peers Comparison

Overall Rating

UnderperformOutperform
Sector (55)

Financial Indicators

JP:7722 against its peers
NameOverall RatingMarket CapP/E RatioROEDividend YieldRevenue GrowthEPS Growth
JP:6488JP:648881OutperformJPY 12.16B7.49―3.50%8.79%58.86%
JP:6402JP:640276OutperformJPY 8.71B7.51―4.72%4.59%34.39%
JP:7722JP:772273OutperformJPY 9.95B7.37―6.22%-2.31%13.09%
JP:6384JP:638472OutperformJPY 9.99B14.08―4.32%-2.00%15.23%
JP:6393JP:639367NeutralJPY 12.03B10.28―5.12%-1.68%-9.54%
Sector *55Neutral$6.65B3.83-15.92%6.20%10.91%7.18%
JP:6495JP:649544NeutralJPY 5.19B60.49―1.98%9.69%29.00%

* General Sector Average

Performance Comparison

0%50%100%150%JP:7722JP:6384JP:6393JP:6402JP:6488JP:6495Dec '25Jan '26Feb '26Mar '26Apr '26May '26Jun '26Jul '26Aug '26Sep '26Oct '26
JP:7722 and its peers over the selected period
Show on chartTickerCompany NamePriceChange% Change
JP:7722Kokusai Co., Ltd.724.00104.7416.91%
JP:6384SHOWA SHINKU CO., LTD.1622.00239.3417.31%
JP:6393Yuken Kogyo Co., Ltd.2932.00134.364.80%
JP:6402Kanematsu Engineering Co., Ltd.1567.00111.577.67%
JP:6488Yoshitake Inc.1000.0087.259.56%
JP:6495Miyairi Valve Mfg.Co., Ltd.101.00-11.95-10.58%
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 19, 2026