# Daiwa House Industry (1925.JP)

Canonical: https://gigainvestors.com/s/1925.JP

Analysis as of: 2026-10-15T07:09:22.818Z. Financial observations: FY2013–FY2026.

Listing currency: JPY. Reporting currency: JPY.

## Verdict

Not a wonderful business

Quality tests for Buy: not passed (profit record: pass; earnings resilience is evidence only). Published buy qualification: no.

Share price: JPY 2,203.00 per share; close as of 2026-10-15.

Estimated value: low JPY 1,493.74 per share, central JPY 1,663.71 per share, high JPY 1,889.98 per share. Buy at or below the central value JPY 1,663.71 per share. Valuation as of 2026-10-15T07:09:22.818Z; scenarios are not confidence intervals.

Expected annual return: 8.0% at the stated quote. About 8.0% a year at today's price (required return 10.0%). required return 10.0% a year (10% floor; JP 10-year bond 2.9% + 4 points).

## Checklist

### understandable: pass

- 1 revenue decline in the last 10 years (informational)

- Financial history: 10 years

- Years with declining revenue: 1

- Years with a net loss: 0

- Operating margin variation: 0.08×

Chart: Operating margin; fiscal year observations.

- FY2017: 0.09×

- FY2018: 0.09×

- FY2019: 0.09×

- FY2020: 0.09×

- FY2021: 0.09×

- FY2022: 0.09×

- FY2023: 0.09×

- FY2024: 0.08×

- FY2025: 0.10×

- FY2026: 0.11×

### moat: fail

- ROIC median below threshold

- ROIC worst years below threshold (more than 1 bad year allowed)

- ROIC, median of available years: 9.0%

- ROIC, second-lowest year: 7.4%

- Typical minus recent gross margin: -0.1 pp

- Typical gross margin (annual median): 20.1%

- Recent gross margin (lower of latest and 3-year median): 20.3%

- Years with nonpositive capital: 0

- Capital spending / revenue: 7.7%

- ROIC including acquisitions, ten-year median: 3.3%

Chart: ROIC excluding acquisitions; fiscal year observations.

- FY2017: 12.7%

- FY2018: 12.9%

- FY2019: 12.7%

- FY2020: 10.7%

- FY2021: 8.9%

- FY2022: 8.3%

- FY2023: 9.1%

- FY2024: 7.3%

- FY2025: 8.0%

- FY2026: 7.4%

### economics: fail

- owner earnings cash conversion below threshold

- incremental invested capital return below threshold

- working capital as a share of revenue rose more than 10pp and ends positive

- Owner earnings / net income, 5-yr: 0.35×

- Cash conversion uses consolidated totals: No

- Owner earnings, five-year total: JPY 532B

- Net income, five-year total: JPY 1.51T

- Return on incremental invested capital: 4.7%

- Working capital / revenue, annual change: 4.7 pp

- Working capital / revenue, change between three-year averages: 33.1 pp

- Working capital / revenue, final three-year average: 43.2%

Chart: Annual owner cash / profit; fiscal year observations.

- FY2022: 0.15×

- FY2023: 0.40×

- FY2024: 0.58×

- FY2025: 0.50×

- FY2026: 0.11×

### management: fail

- Historical market-dollar context (not the management verdict): 2017 to 2026 (9 years)

- ROIC first 3 years vs last 3 years: 12.7% vs 7.4%

- Per-share earnings: 304.14 to 514.00 (three-year endpoint medians)

- material buybacks concentrated at lower earnings yields (Spearman rho below threshold)

- Management verdict uses per-share economic progress: Yes

- Ordinary dilution, 10-year annual growth: -0.7%

- Ordinary dilution, 5-year annual growth: -1.2%

- Market cap gain: JPY 462B

- Cumulative retained earnings: JPY 1.65T

- Diluted shares, 10-year annual growth: -0.7%

- Diluted shares, 5-year annual growth: -1.2%

- $1 test, starting fiscal year: FY2017

- $1 test, ending fiscal year: FY2026

- Per-share value growth: 6.8%

- Per-share value change: JPY 209.86

- Per-share value, starting three-year median: JPY 304.14

- Per-share value, ending three-year median: JPY 514.00

- Buybacks concentrated in cheaper years (correlation): -0.50

- Average buyback yield: 1.7%

- Buyback history: 10 years

- Debt-funded buybacks: No

- Acquisition spending: JPY 302B

- Cumulative net income, 10 years: JPY 2.61T

- ROIC, first three-year median: 12.7%

- ROIC, last three-year median: 7.4%

Chart: Earnings per share; fiscal year observations.

- FY2017: JPY 304.14

- FY2018: JPY 355.87

- FY2019: JPY 357.29

- FY2020: JPY 351.84

- FY2021: JPY 297.18

- FY2022: JPY 343.82

- FY2023: JPY 469.12

- FY2024: JPY 457.16

- FY2025: JPY 514.00

- FY2026: JPY 566.47

### accounting: pass

- Sloan accruals: 1.9%

- Receivables to sales index (DSRI): 0.51×

- Restructuring years, last five: 0

- Stock compensation / operating cash flow: 0.0%

- Earnings backed by cash: Yes

- Operating cash / earnings: 0.54×

- Accounting red flags: 0

- Goodwill and intangibles / equity: 0.13×

Chart: Sloan accruals; fiscal year observations.

- FY2017: -2.4%

- FY2018: -3.6%

- FY2019: -2.7%

- FY2020: 1.8%

- FY2021: -4.7%

- FY2022: -2.0%

- FY2023: 1.3%

- FY2024: -0.1%

- FY2025: -1.4%

- FY2026: 1.9%

## Holders

## Price story

Down 22% since Feb 2026 · sales +2.6%

Story as of 2026-10-16T10:00:13.900Z; price observation 2026-10-15.

Price needs cash profits to grow 5% a year for ten years

### Sales · FY2025–2026

sales +2.6%; source https://disclosure2dl.edinet-fsa.go.jp/searchdocument/pdf/S100YAZ5.pdf; observed 2026-06-17.

- FY2017: JPY 3.51T 

- FY2018: JPY 3.80T 

- FY2019: JPY 4.14T 

- FY2020: JPY 4.38T 

- FY2021: JPY 4.13T 

- FY2022: JPY 4.44T 

- FY2023: JPY 4.91T 

- FY2024: JPY 5.20T 

- FY2025: JPY 5.43T 

- FY2026: JPY 5.58T 

### Gross margin · FY2026

gross margin 22.3%; source https://disclosure2dl.edinet-fsa.go.jp/searchdocument/pdf/S100YAZ5.pdf; observed 2026-06-17.

- FY2017: 20.5% 

- FY2018: 20.9% 

- FY2019: 20.3% 

- FY2020: 19.9% 

- FY2021: 20.0% 

- FY2022: 19.5% 

- FY2023: 19.5% 

- FY2024: 19.1% 

- FY2025: 20.3% 

- FY2026: 22.3% 

## Owner memo

Memo as of 2026-10-16T08:06:05.509Z.

### How it makes money

Annual sales are JPY 5.6 trillion.

- Source: https://disclosure2dl.edinet-fsa.go.jp/searchdocument/pdf/S100YAZ5.pdf (filed 2026-06-17); FY2026: revenue 5576861000000; grossProfit 1241820000000; margin = grossProfit / revenue.

### Why customers stay

Margins ranged from 19.1% to 22.3% during 2024–26; it earns 9% on its capital.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-06-17); FY2024: grossProfit / revenue = 19.1%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-06-17); FY2025: grossProfit / revenue = 20.3%.

- Source: https://disclosure2dl.edinet-fsa.go.jp/searchdocument/pdf/S100YAZ5.pdf (filed 2026-06-17); FY2026: grossProfit / revenue = 22.3%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-06-17); 10-year return on capital observations [[2017,0.12714686770231906],[2018,0.12919396968920016],[2019,0.12673540925320023],[2020,0.10680129404158127],[2021,0.08905401854135936],[2022,0.08294012889332657],[2023,0.09075720842947797],[2024,0.07286032125994436],[2025,0.07982182785114429],[2026,0.07391135070379865]]; median 0.08990561348541867. ROIC follows the displayed moat series; financial companies use return on tangible equity.

### Can it raise prices

Kept about a 19% gross margin through 2022 cost inflation.

- Source: https://disclosure2dl.edinet-fsa.go.jp/searchdocument/pdf/S100YAZ5.pdf (filed 2026-06-17); Gross margin observations: [[2021,0.2003705562390335],[2022,0.1947685523892587],[2023,0.1946119136571276]]; range within 2 percentage points.

### Where the cash goes

Earns 4.7% on new investment; paid dividends in 10 of 10 years.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-06-17); FY2017: growth capex 123772017264.54456; upkeep 199411982735.45544; owner earnings 58893017264.544556. Growth capex / owner earnings = 2.1016416378968445.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-06-17); FY2018: growth capex 110317621281.12805; upkeep 166623378718.87195; owner earnings 130361621281.12805. Growth capex / owner earnings = 0.8462430905429242.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-06-17); FY2019: growth capex 135296486188.3768; upkeep 120643513811.6232; owner earnings 182263486188.3768. Growth capex / owner earnings = 0.7423126212374886.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-06-17); FY2020: growth capex 92332487164.08081; upkeep 199135512835.9192; owner earnings 103181487164.08081. Growth capex / owner earnings = 0.8948551692926489.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-06-17); FY2022: growth capex 129535044163.33289; upkeep 281445955836.6671; owner earnings 34391044163.332886. Growth capex / owner earnings = 3.7665342043159256.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-06-17); FY2023: growth capex 195861386173.04266; upkeep 290654613826.95734; owner earnings 122858386173.04266. Growth capex / owner earnings = 1.5942044517594207.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-06-17); FY2024: growth capex 123034354728.27234; upkeep 233013645271.72766; owner earnings 173774354728.27234. Growth capex / owner earnings = 0.7080121512789319.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-06-17); FY2025: growth capex 96852943804.0871; upkeep 284933056195.9129; owner earnings 161163943804.0871. Growth capex / owner earnings = 0.6009591321606199.

- Source: https://disclosure2dl.edinet-fsa.go.jp/searchdocument/pdf/S100YAZ5.pdf (filed 2026-06-17); FY2026: growth capex 58463156905.98578; upkeep 435368843094.0142; owner earnings 40130156905.98578. Growth capex / owner earnings = 1.4568384829132195.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-06-17); Incremental return on capital 0.04736829044892027, from the economics test's unchanged annual inputs.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-06-17); Dividend observations: [[2017,56515000000],[2018,64618000000],[2019,74612000000],[2020,79016000000],[2021,72556000000],[2022,79239000000],[2023,86089000000],[2024,87520000000],[2025,95635000000],[2026,95892000000]]. Zero only counted when supported by a complete cash-flow statement.

- Source: https://disclosure2dl.edinet-fsa.go.jp/searchdocument/pdf/S100YAZ5.pdf (filed 2026-06-17); FY2026: cash repurchases 14000000 JPY.

### What the price says

The price assumes cash profits grow 5% yearly over ten years; actual decline was 8.2%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-06-17); Ten-year compound average after fade. Initial solved rate 0.058236424273031884. Price 2203; FX 1; discount 0.1; same standard ten-year fade to terminal 0.03. FY2016 owner earnings/share 152.24753371887581 → FY2026 64.84485173356886. Closing-price date 2026-10-15.

## Monthly share-price history (JPY per share)

- 2016-11: JPY 1,626.00 per share

- 2016-12: JPY 1,598.00 per share

- 2017-01: JPY 1,532.00 per share

- 2017-02: JPY 1,542.00 per share

- 2017-03: JPY 1,598.00 per share

- 2017-04: JPY 1,655.50 per share

- 2017-05: JPY 1,809.50 per share

- 2017-06: JPY 1,919.00 per share

- 2017-07: JPY 1,924.50 per share

- 2017-08: JPY 1,923.50 per share

- 2017-09: JPY 1,942.50 per share

- 2017-10: JPY 2,070.00 per share

- 2017-11: JPY 2,057.00 per share

- 2017-12: JPY 2,163.50 per share

- 2018-01: JPY 2,152.50 per share

- 2018-02: JPY 1,988.50 per share

- 2018-03: JPY 2,050.00 per share

- 2018-04: JPY 2,005.00 per share

- 2018-05: JPY 1,973.50 per share

- 2018-06: JPY 1,888.00 per share

- 2018-07: JPY 2,034.00 per share

- 2018-08: JPY 1,694.50 per share

- 2018-09: JPY 1,684.00 per share

- 2018-10: JPY 1,704.50 per share

- 2018-11: JPY 1,787.50 per share

- 2018-12: JPY 1,749.00 per share

- 2019-01: JPY 1,763.50 per share

- 2019-02: JPY 1,722.50 per share

- 2019-03: JPY 1,759.50 per share

- 2019-04: JPY 1,555.50 per share

- 2019-05: JPY 1,625.50 per share

- 2019-06: JPY 1,570.50 per share

- 2019-07: JPY 1,555.50 per share

- 2019-08: JPY 1,666.00 per share

- 2019-09: JPY 1,753.00 per share

- 2019-10: JPY 1,867.50 per share

- 2019-11: JPY 1,674.50 per share

- 2019-12: JPY 1,695.00 per share

- 2020-01: JPY 1,730.50 per share

- 2020-02: JPY 1,489.75 per share

- 2020-03: JPY 1,338.75 per share

- 2020-04: JPY 1,378.75 per share

- 2020-05: JPY 1,337.25 per share

- 2020-06: JPY 1,271.00 per share

- 2020-07: JPY 1,166.00 per share

- 2020-08: JPY 1,420.25 per share

- 2020-09: JPY 1,348.75 per share

- 2020-10: JPY 1,367.75 per share

- 2020-11: JPY 1,600.00 per share

- 2020-12: JPY 1,532.00 per share

- 2021-01: JPY 1,482.25 per share

- 2021-02: JPY 1,501.50 per share

- 2021-03: JPY 1,620.50 per share

- 2021-04: JPY 1,617.50 per share

- 2021-05: JPY 1,603.00 per share

- 2021-06: JPY 1,667.50 per share

- 2021-07: JPY 1,672.50 per share

- 2021-08: JPY 1,678.00 per share

- 2021-09: JPY 1,869.50 per share

- 2021-10: JPY 1,875.50 per share

- 2021-11: JPY 1,658.00 per share

- 2021-12: JPY 1,654.00 per share

- 2022-01: JPY 1,667.50 per share

- 2022-02: JPY 1,634.50 per share

- 2022-03: JPY 1,600.50 per share

- 2022-04: JPY 1,571.50 per share

- 2022-05: JPY 1,552.50 per share

- 2022-06: JPY 1,581.00 per share

- 2022-07: JPY 1,646.50 per share

- 2022-08: JPY 1,568.00 per share

- 2022-09: JPY 1,471.75 per share

- 2022-10: JPY 1,506.00 per share

- 2022-11: JPY 1,579.50 per share

- 2022-12: JPY 1,519.50 per share

- 2023-01: JPY 1,555.50 per share

- 2023-02: JPY 1,571.50 per share

- 2023-03: JPY 1,557.00 per share

- 2023-04: JPY 1,728.50 per share

- 2023-05: JPY 1,821.00 per share

- 2023-06: JPY 1,896.00 per share

- 2023-07: JPY 1,931.00 per share

- 2023-08: JPY 2,024.00 per share

- 2023-09: JPY 2,007.50 per share

- 2023-10: JPY 2,063.50 per share

- 2023-11: JPY 2,099.50 per share

- 2023-12: JPY 2,136.00 per share

- 2024-01: JPY 2,292.00 per share

- 2024-02: JPY 2,165.00 per share

- 2024-03: JPY 2,260.50 per share

- 2024-04: JPY 2,220.00 per share

- 2024-05: JPY 2,087.50 per share

- 2024-06: JPY 2,038.50 per share

- 2024-07: JPY 2,146.50 per share

- 2024-08: JPY 2,244.50 per share

- 2024-09: JPY 2,252.50 per share

- 2024-10: JPY 2,285.50 per share

- 2024-11: JPY 2,352.50 per share

- 2024-12: JPY 2,429.00 per share

- 2025-01: JPY 2,449.00 per share

- 2025-02: JPY 2,468.00 per share

- 2025-03: JPY 2,469.00 per share

- 2025-04: JPY 2,577.50 per share

- 2025-05: JPY 2,435.50 per share

- 2025-06: JPY 2,477.00 per share

- 2025-07: JPY 2,502.00 per share

- 2025-08: JPY 2,614.50 per share

- 2025-09: JPY 2,660.00 per share

- 2025-10: JPY 2,616.50 per share

- 2025-11: JPY 2,663.50 per share

- 2025-12: JPY 2,599.00 per share

- 2026-01: JPY 2,630.00 per share

- 2026-02: JPY 2,821.50 per share

- 2026-03: JPY 2,459.00 per share

- 2026-04: JPY 2,394.00 per share

- 2026-05: JPY 2,167.00 per share

- 2026-06: JPY 2,208.50 per share

- 2026-07: JPY 2,339.00 per share

- 2026-08: JPY 2,340.00 per share

- 2026-09: JPY 2,196.00 per share

- 2026-10: JPY 2,182.00 per share

## Annual estimated value (JPY per share)

- FY2020: low JPY 2,570.27 per share, central JPY 2,884.23 per share, high JPY 3,302.18 per share

- FY2021: low JPY 2,142.73 per share, central JPY 2,365.91 per share, high JPY 2,663.01 per share

- FY2022: low JPY 2,135.95 per share, central JPY 2,376.50 per share, high JPY 2,696.71 per share

- FY2023: low JPY 2,789.48 per share, central JPY 3,809.66 per share, high JPY 4,404.93 per share

- FY2024: low JPY 2,974.85 per share, central JPY 3,874.11 per share, high JPY 4,450.31 per share

- FY2025: low JPY 3,221.64 per share, central JPY 4,365.57 per share, high JPY 5,061.52 per share

- FY2026: low JPY 2,987.48 per share, central JPY 3,327.42 per share, high JPY 3,779.96 per share

Historical values use today's bond yield for every fiscal year

Historical values use today's FX rate into trading currency for every fiscal year

Historical values use current restated fundamentals and current commodity classification; they are not point-in-time estimates

## Sources

[Original EDINET filing](https://disclosure2dl.edinet-fsa.go.jp/searchdocument/pdf/S100YAZ5.pdf); period 2026-03-31, filed 2026-06-17.

Estimates depend on assumptions and are not guarantees or investment advice. Underlying data remains subject to its source licenses; public reading does not grant bulk redistribution rights.

## Reported holder observations