Kamigumi (TSE:9364) Valuation in Focus Following Upgraded Guidance and Higher Dividend Announcement

Kamigumi (TSE:9364) has just updated its outlook for the year ending March 2026, and has also revealed a significant bump in its second quarter dividend compared to last year. Both moves could catch the eye of investors.

See our latest analysis for Kamigumi.

Kamigumi’s revised guidance and strengthened dividend appear to have fueled investor confidence, as reflected in the company’s robust price trends. Its share price has climbed 42.5% year-to-date and long-term total shareholder returns are even more striking, with a 48.2% gain over the last year and nearly tripling over five years. This suggests momentum is firmly on the upswing.

If Kamigumi’s momentum has you thinking bigger, this could be a great moment to broaden your search and discover fast growing stocks with high insider ownership

Still, with the stock surging and trading above analyst targets, investors may wonder whether Kamigumi is truly undervalued or if all this future growth is already reflected in its current share price.

Price-to-Earnings of 17.3x: Is it justified?

Kamigumi’s shares are trading at a price-to-earnings (P/E) ratio of 17.3x, which benchmarks the company as expensive compared to its listed peers. The last close price of ¥4,924 puts it above not only analyst targets, but also well above the average multiples in the sector.

The P/E ratio measures how much investors are willing to pay for each yen of Kamigumi’s earnings. For mature companies in infrastructure, investors usually expect a lower multiple unless they see strong profit growth or unique competitive advantages.

Despite recent earnings growth, Kamigumi’s P/E is significantly higher than both the Japanese Infrastructure industry average (13.7x) and its peer group (9.6x). Compared to the estimated “fair” P/E of 13.4x, the current valuation suggests considerable optimism baked into the price. The market could eventually adjust towards this level.

Explore the SWS fair ratio for Kamigumi

Result: Price-to-Earnings of 17.3x (OVERVALUED)

However, slowing revenue growth and recent net income stagnation could temper enthusiasm. These factors present potential risks that may challenge Kamigumi’s upbeat outlook.

Find out about the key risks to this Kamigumi narrative.

Another View: SWS DCF Model Weighs In

Taking a different angle, our SWS DCF model suggests Kamigumi shares are trading above their estimated fair value of ¥4,584. While the market momentum is strong, the DCF result hints that the current price could carry a premium. Could the optimism be running ahead of fundamentals?

Look into how the SWS DCF model arrives at its fair value.

Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out Kamigumi for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover 918 undervalued stocks based on their cash flows. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity.

Build Your Own Kamigumi Narrative

If you see the numbers differently or want to explore your own perspective, you can quickly put together a personal narrative: Do it your way

A great starting point for your Kamigumi research is our analysis highlighting 1 key reward and 1 important warning sign that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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