# Nippon Steel (5401.JP)

Canonical: https://gigainvestors.com/s/5401.JP

Analysis as of: 2026-10-15T07:10:37.986Z. 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 641.00 per share; close as of 2026-10-15.

Estimated value: low JPY 1,352.30 per share, central JPY 1,531.90 per share, high JPY 1,770.98 per share. Buy at or below the central value JPY 1,531.90 per share. Valuation as of 2026-10-15T07:10:37.986Z; scenarios are not confidence intervals.

Expected annual return: 21.2% at the stated quote. About 21.2% 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: fail

- 4 revenue declines in the last 10 years (informational)

- operating margin variation exceeds 0.35

- Financial history: 10 years

- Years with declining revenue: 4

- Years with a net loss: 2

- Operating margin variation: 1.15×

Chart: Operating margin; fiscal year observations.

- FY2017: 0.02×

- FY2018: 0.05×

- FY2019: 0.04×

- FY2020: -0.07×

- FY2021: 0.00×

- FY2022: 0.12×

- FY2023: 0.11×

- FY2024: 0.09×

- FY2025: 0.06×

- FY2026: 0.02×

### moat: fail

- ROIC median below threshold

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

- ROIC, median of available years: 4.7%

- ROIC, second-lowest year: 0.4%

- Typical minus recent gross margin: -0.5 pp

- Typical gross margin (annual median): 13.9%

- Recent gross margin (lower of latest and 3-year median): 14.4%

- Years with nonpositive capital: 0

- Capital spending / revenue: 7.0%

- ROIC including acquisitions, ten-year median: 4.0%

Chart: ROIC excluding acquisitions; fiscal year observations.

- FY2017: 1.9%

- FY2018: 4.5%

- FY2019: 4.9%

- FY2020: -13.9%

- FY2021: 0.4%

- FY2022: 24.1%

- FY2023: 21.9%

- FY2024: 14.1%

- FY2025: 8.6%

- FY2026: 3.3%

### economics: fail

- incremental invested capital return below threshold

- Owner earnings / net income, 5-yr: 0.91×

- Cash conversion uses consolidated totals: No

- Owner earnings, five-year total: JPY 2.04T

- Net income, five-year total: JPY 2.25T

- Return on incremental invested capital: 2.0%

- Working capital / revenue, annual change: 0.7 pp

- Working capital / revenue, change between three-year averages: 5.4 pp

- Working capital / revenue, final three-year average: 22.2%

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

- FY2022: 1.00×

- FY2023: 1.00×

- FY2024: 1.00×

- FY2025: 0.39×

- FY2026: 1.00×

### management: fail

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

- buybacks unrelated to price (informational)

- ROIC first 3 years vs last 3 years: 4.5% vs 8.6%

- Per-share earnings: 31.74 to 70.18 (three-year endpoint medians)

- five-year and ten-year diluted share growth both above threshold

- Management verdict uses per-share economic progress: Yes

- Ordinary dilution, 10-year annual growth: 1.3%

- Ordinary dilution, 5-year annual growth: 2.6%

- Market cap gain: JPY 743B

- Cumulative retained earnings: JPY 1.80T

- Diluted shares, 10-year annual growth: 1.3%

- Diluted shares, 5-year annual growth: 2.6%

- $1 test, starting fiscal year: FY2017

- $1 test, ending fiscal year: FY2026

- Per-share value growth: 10.4%

- Per-share value change: JPY 38.44

- Per-share value, starting three-year median: JPY 31.74

- Per-share value, ending three-year median: JPY 70.18

- Buybacks concentrated in cheaper years (correlation): -0.04

- Average buyback yield: 0.2%

- Buyback history: 10 years

- Debt-funded buybacks: No

- Acquisition spending: JPY 953B

- Cumulative net income, 10 years: JPY 2.35T

- ROIC, first three-year median: 4.5%

- ROIC, last three-year median: 8.6%

Chart: Earnings per share; fiscal year observations.

- FY2017: JPY 29.59

- FY2018: JPY 40.97

- FY2019: JPY 56.35

- FY2020: JPY -93.75

- FY2021: JPY -7.04

- FY2022: JPY 138.43

- FY2023: JPY 150.73

- FY2024: JPY 119.31

- FY2025: JPY 70.18

- FY2026: JPY 3.28

### accounting: pass

- Sloan accruals: -4.8%

- Receivables to sales index (DSRI): 1.07×

- Restructuring years, last five: 0

- Stock compensation / operating cash flow: 0.0%

- Earnings backed by cash: Yes

- Operating cash / earnings: 41.78×

- Accounting red flags: 0

- Goodwill and intangibles / equity: 0.20×

Chart: Sloan accruals; fiscal year observations.

- FY2017: -4.9%

- FY2018: -3.9%

- FY2019: -2.5%

- FY2020: -12.4%

- FY2021: -5.8%

- FY2022: 0.2%

- FY2023: 0.3%

- FY2024: -4.3%

- FY2025: -5.7%

- FY2026: -4.8%

## Holders

## Price story

Down 1% since Oct 2023 · sales +15.7%

Story as of 2026-10-16T10:00:14.350Z; price observation 2026-10-15.

Price needs cash profits to shrink 10.8% a year for ten years

### Sales · FY2025–2026

sales +15.7%; source https://disclosure2dl.edinet-fsa.go.jp/searchdocument/pdf/S100YF8E.pdf; observed 2026-06-23.

- FY2017: JPY 4.63T 

- FY2018: JPY 5.71T 

- FY2019: JPY 6.18T 

- FY2020: JPY 5.92T 

- FY2021: JPY 4.83T 

- FY2022: JPY 6.81T 

- FY2023: JPY 7.98T 

- FY2024: JPY 8.87T 

- FY2025: JPY 8.70T 

- FY2026: JPY 10.06T 

### Gross margin · FY2026

gross margin 14.4%; source https://disclosure2dl.edinet-fsa.go.jp/searchdocument/pdf/S100YF8E.pdf; observed 2026-06-23.

- FY2017: 12.2% 

- FY2018: 13.4% 

- FY2019: 12.7% 

- FY2020: 10.3% 

- FY2021: 11.7% 

- FY2022: 17.9% 

- FY2023: 16.2% 

- FY2024: 15.6% 

- FY2025: 15.8% 

- FY2026: 14.4% 

## Owner memo

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

### How it makes money

Operates in steel; annual sales are JPY 10.1 trillion.

- Source: https://disclosure2dl.edinet-fsa.go.jp/searchdocument/pdf/S100YF8E.pdf (filed 2026-06-23); FY2026: revenue 10063216000000; grossProfit 1444808000000; margin = grossProfit / revenue.

### Why customers stay

Margins ranged from 14.4% to 15.8% during 2024–26; it earns 4.7% on its capital.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-06-23); FY2024: grossProfit / revenue = 15.6%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-06-23); FY2025: grossProfit / revenue = 15.8%.

- Source: https://disclosure2dl.edinet-fsa.go.jp/searchdocument/pdf/S100YF8E.pdf (filed 2026-06-23); FY2026: grossProfit / revenue = 14.4%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-06-23); 10-year return on capital observations [[2017,0.01867054344860333],[2018,0.044661966691412563],[2019,0.04924016166298913],[2020,-0.1390895068351691],[2021,0.0038191437394602813],[2022,0.24085775572277032],[2023,0.21854780808317037],[2024,0.14070314883015303],[2025,0.08626491618108137],[2026,0.032828551764862435]]; median 0.04695106417720085. ROIC follows the displayed moat series; financial companies use return on tangible equity.

### Where the cash goes

Earns 2% on new investment; paid dividends in 9 of 10 years.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-06-23); FY2017: growth capex 0; upkeep 321879000000; owner earnings 115583534929.2784. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-06-23); FY2018: growth capex 45361000000; upkeep 366565000000; owner earnings 180832000000. Growth capex / owner earnings = 0.25084608918775436.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-06-23); FY2019: growth capex 30142000000; upkeep 408616000000; owner earnings 251169000000. Growth capex / owner earnings = 0.12000684797885089.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-06-23); FY2022: growth capex 136291000000; upkeep 330611000000; cash acquisitions 0; owner earnings 637321000000. Growth capex plus acquisitions / owner earnings = 0.21384984960483022.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-06-23); FY2023: growth capex 129847000000; upkeep 340171000000; cash acquisitions 4369000000; owner earnings 694016000000. Growth capex plus acquisitions / owner earnings = 0.19339035411287347.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-06-23); FY2024: growth capex 103343000000; upkeep 363002000000; cash acquisitions 0; owner earnings 549372000000. Growth capex plus acquisitions / owner earnings = 0.18811115237034287.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-06-23); FY2025: growth capex 0; upkeep 597938000000; cash acquisitions 113715000000; owner earnings 137532000000. Growth capex plus acquisitions / owner earnings = 0.8268257569147544.

- Source: https://disclosure2dl.edinet-fsa.go.jp/searchdocument/pdf/S100YF8E.pdf (filed 2026-06-23); FY2026: growth capex 289260000000; upkeep 573916000000; owner earnings 17158000000. Growth capex / owner earnings = 16.858608229397365.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-06-23); Incremental return on capital 0.020441373512519078, from the economics test's unchanged annual inputs.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-06-23); Dividend observations: [[2017,13554000000],[2018,66293000000],[2019,70710000000],[2020,46101000000],[2021,0],[2022,73757000000],[2023,165950000000],[2024,152117000000],[2025,162085000000],[2026,146480000000]]. Zero only counted when supported by a complete cash-flow statement.

- Source: https://eodhd.com/api/fundamentals/NPS.F.json#2026-03-31 (filed 2026-06-23); FY2026: cash repurchases 29000000 JPY.

### What the price says

The price assumes cash profits shrink 10.8% yearly over ten years; actual decline was 20.8%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-06-23); Ten-year compound average after fade. Initial solved rate -0.16289558121212516. Price 641; FX 1; discount 0.1; same standard ten-year fade to terminal 0.03. FY2016 owner earnings/share 33.83879376147546 → FY2026 3.28. Closing-price date 2026-10-15.

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

- 2016-11: JPY 490.60 per share

- 2016-12: JPY 521.40 per share

- 2017-01: JPY 547.30 per share

- 2017-02: JPY 552.70 per share

- 2017-03: JPY 513.00 per share

- 2017-04: JPY 502.10 per share

- 2017-05: JPY 471.30 per share

- 2017-06: JPY 507.60 per share

- 2017-07: JPY 542.40 per share

- 2017-08: JPY 524.90 per share

- 2017-09: JPY 516.70 per share

- 2017-10: JPY 540.20 per share

- 2017-11: JPY 544.20 per share

- 2017-12: JPY 578.20 per share

- 2018-01: JPY 555.70 per share

- 2018-02: JPY 511.30 per share

- 2018-03: JPY 467.30 per share

- 2018-04: JPY 477.00 per share

- 2018-05: JPY 456.50 per share

- 2018-06: JPY 435.10 per share

- 2018-07: JPY 444.70 per share

- 2018-08: JPY 447.10 per share

- 2018-09: JPY 480.70 per share

- 2018-10: JPY 417.40 per share

- 2018-11: JPY 415.20 per share

- 2018-12: JPY 378.50 per share

- 2019-01: JPY 402.00 per share

- 2019-02: JPY 400.70 per share

- 2019-03: JPY 390.80 per share

- 2019-04: JPY 396.10 per share

- 2019-05: JPY 361.30 per share

- 2019-06: JPY 369.80 per share

- 2019-07: JPY 343.30 per share

- 2019-08: JPY 297.20 per share

- 2019-09: JPY 301.10 per share

- 2019-10: JPY 318.30 per share

- 2019-11: JPY 321.10 per share

- 2019-12: JPY 330.80 per share

- 2020-01: JPY 307.10 per share

- 2020-02: JPY 243.20 per share

- 2020-03: JPY 185.08 per share

- 2020-04: JPY 182.38 per share

- 2020-05: JPY 198.52 per share

- 2020-06: JPY 202.70 per share

- 2020-07: JPY 171.50 per share

- 2020-08: JPY 208.90 per share

- 2020-09: JPY 197.90 per share

- 2020-10: JPY 201.30 per share

- 2020-11: JPY 255.30 per share

- 2020-12: JPY 265.60 per share

- 2021-01: JPY 241.40 per share

- 2021-02: JPY 313.50 per share

- 2021-03: JPY 377.30 per share

- 2021-04: JPY 381.40 per share

- 2021-05: JPY 411.00 per share

- 2021-06: JPY 374.70 per share

- 2021-07: JPY 378.40 per share

- 2021-08: JPY 449.60 per share

- 2021-09: JPY 406.80 per share

- 2021-10: JPY 399.80 per share

- 2021-11: JPY 339.90 per share

- 2021-12: JPY 375.70 per share

- 2022-01: JPY 371.10 per share

- 2022-02: JPY 421.70 per share

- 2022-03: JPY 434.20 per share

- 2022-04: JPY 413.90 per share

- 2022-05: JPY 450.10 per share

- 2022-06: JPY 379.80 per share

- 2022-07: JPY 394.00 per share

- 2022-08: JPY 441.70 per share

- 2022-09: JPY 401.30 per share

- 2022-10: JPY 408.50 per share

- 2022-11: JPY 438.50 per share

- 2022-12: JPY 458.40 per share

- 2023-01: JPY 539.00 per share

- 2023-02: JPY 607.40 per share

- 2023-03: JPY 624.00 per share

- 2023-04: JPY 578.60 per share

- 2023-05: JPY 543.10 per share

- 2023-06: JPY 600.80 per share

- 2023-07: JPY 649.20 per share

- 2023-08: JPY 689.40 per share

- 2023-09: JPY 701.00 per share

- 2023-10: JPY 646.40 per share

- 2023-11: JPY 691.40 per share

- 2023-12: JPY 646.00 per share

- 2024-01: JPY 714.00 per share

- 2024-02: JPY 743.00 per share

- 2024-03: JPY 733.80 per share

- 2024-04: JPY 708.20 per share

- 2024-05: JPY 686.40 per share

- 2024-06: JPY 680.20 per share

- 2024-07: JPY 656.00 per share

- 2024-08: JPY 662.00 per share

- 2024-09: JPY 639.60 per share

- 2024-10: JPY 613.80 per share

- 2024-11: JPY 611.80 per share

- 2024-12: JPY 636.40 per share

- 2025-01: JPY 645.80 per share

- 2025-02: JPY 665.80 per share

- 2025-03: JPY 639.00 per share

- 2025-04: JPY 602.00 per share

- 2025-05: JPY 581.60 per share

- 2025-06: JPY 546.60 per share

- 2025-07: JPY 583.90 per share

- 2025-08: JPY 623.00 per share

- 2025-09: JPY 609.50 per share

- 2025-10: JPY 636.30 per share

- 2025-11: JPY 631.90 per share

- 2025-12: JPY 641.80 per share

- 2026-01: JPY 645.90 per share

- 2026-02: JPY 636.00 per share

- 2026-03: JPY 575.90 per share

- 2026-04: JPY 572.30 per share

- 2026-05: JPY 566.60 per share

- 2026-06: JPY 536.10 per share

- 2026-07: JPY 649.60 per share

- 2026-08: JPY 669.80 per share

- 2026-09: JPY 656.00 per share

- 2026-10: JPY 647.00 per share

## Annual estimated value (JPY per share)

- FY2018: low JPY 448.20 per share, central JPY 509.95 per share, high JPY 592.15 per share

- FY2019: low JPY 488.23 per share, central JPY 554.35 per share, high JPY 642.37 per share

- FY2026: low JPY 1,352.30 per share, central JPY 1,531.90 per share, high JPY 1,770.98 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/S100YF8E.pdf); period 2026-03-31, filed 2026-06-23.

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