East Japan Railway (EJPRY) AI Stock Analysis

• Market Cap: $24.20B
• Dividend Yield: 1.1%
• Average Volume (3M): 4.56K
• Price to Earnings (P/E): 16.4
• Beta (1Y): -0.02
• Revenue Growth: 0.43%
• EPS Growth: 191.22%
• Country: US
• Employees: 68,769
• Sector: Industrials
• Sector Strength: 87
• Industry: Railroads
• EPS (TTM): 0.65
• Shares Outstanding: 2,268,824,500
• 10 Day Avg. Volume: 5,365
• 30 Day Avg. Volume: 4,556
• PEG Ratio: 0.17
• Price to Book (P/B): 1.22
• Price to Sales (P/S): 0.00
• P/FCF Ratio: -123.89
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0

• Rating: 70 Outperform
• Price Target: ―

East Japan Railway is on a recovery trajectory with strong financial performance and positive technical indicators. However, concerns over historical earnings volatility, reliance on debt, and current overbought technical signals temper the overall outlook. The valuation is reasonable, though the low dividend yield may not appeal to all investors.

East Japan Railway Business Overview & Revenue Model

Company Description

East Japan Railway Company operates as a passenger railway company in Japan and internationally. The company operates through Transportation, Retail & Services, Real Estate & Hotels, and Others segments. It offers passenger railway, freight, bus transportation, travel agency, warehousing, financial, telecommunication, computer-related data, casualty insurance, and dry cleaning and other agency services. The company is also involved in the operation of aerial cableway and parking lot; advertising and promotion; books and magazines publication; automobile maintenance and repair; hotel and restaurant management; civil engineering and general construction; facilities construction; and electricity supply businesses. In addition, it engages in the sale of prepaid vouchers, memberships for sport and leisure facilities, including golf and tennis clubs; and oil, gas, and car accessories; travel goods, food, beverages, liquors, medicines, cosmetics, and daily necessities. Further, the company is involved in the sale, leasing, management, and brokerage of real estate properties; manufacture of transport-related machinery and equipment, as well as precision and industrial machinery and tools; production and sale of signs and information boards; and establishment and management of recreation areas, physical fitness facilities, cultural facilities, preparatory schools and other educational facilities, and movie theaters. Additionally, it engages in the production of beverages and liquors; processing and sale of marine products; manufacture and sale of aggregates, masonry materials, concrete posts, and blocks; sale of tickets for events, etc.; and photo development activities. The company operates 1,676 railway stations and 7,401.7 kilometers of railway network; 193 shopping centers; and various hotel with a total of 9,190 guest rooms. East Japan Railway Company was incorporated in 1987 and is headquartered in Tokyo, Japan.

How the Company Makes Money

East Japan Railway Company generates revenue through multiple streams, with its primary income derived from passenger fares on its extensive rail network, including the iconic Shinkansen bullet trains and local commuter services. The company also earns significant revenue from its non-transportation businesses, which include retail operations in and around its stations, as well as real estate development and management of commercial properties. Additionally, JR East has a hospitality segment, operating hotels and other facilities that cater to travelers and tourists. Strategic partnerships and collaborations with other companies in the technology and retail sectors further bolster its revenue, while innovative services like the Suica card system provide additional sources of income through electronic payment systems.

East Japan Railway Financial Statement Overview

Summary

East Japan Railway is experiencing a notable recovery in financial performance, driven by increased revenue and profitability. The income statement shows strong recovery with improved margins and net income, but historical volatility poses risks. Balance sheet indicates moderate leverage with a debt-to-equity ratio of 1.68, while the cash flow statement reflects improving operational cash flow but negative free cash flow growth.

Income Statement

East Japan Railway's income statement shows a strong recovery from past negative earnings, with a significant increase in net income to ¥196.4 billion and a revenue growth rate of 13.48% over the past year. Gross profit margin has improved to 35.34%, and net profit margin has risen to 7.19%, indicating effective cost management. However, historical volatility in earnings and net losses in previous years highlight potential risks.

Balance Sheet

The balance sheet reveals a robust equity base with a debt-to-equity ratio of 1.68, indicating moderate leverage. Return on equity stands at 7.23%, showing decent profitability on shareholders' investment. However, the equity ratio of 27.81% suggests a reliance on debt financing, which could pose risks in a rising interest rate environment.

Cash Flow

The cash flow statement displays improving operational cash flow, with a healthy operating cash flow to net income ratio of 3.50, indicating strong earnings quality. Despite negative free cash flow growth, the company has shown a capacity to manage cash efficiently. Continued negative free cash flow needs addressing to ensure long-term sustainability.

Breakdown	TTM	Mar 2024	Mar 2023	Mar 2022	Mar 2021	Mar 2020
Income Statement
Total Revenue	2.79T	2.73T	2.41T	1.98T	1.76T	2.95T
Gross Profit	1.01T	964.48B	636.22B	299.43B	-40.26B	940.05B
EBITDA	572.16B	748.45B	541.16B	274.28B	-120.36B	765.67B
Net Income	224.94B	196.45B	99.23B	-94.95B	-577.90B	198.43B
Balance Sheet
Total Assets	8.36T	9.77T	9.41T	9.16T	8.98T	8.59T
Cash, Cash Equivalents and Short-Term Investments	263.92B	281.00B	215.19B	171.29B	198.27B	153.97B
Total Debt	2.84T	4.56T	4.79T	4.72T	4.37T	3.33T
Total Liabilities	5.27T	7.03T	6.91T	6.74T	6.42T	5.41T
Stockholders Equity	3.07T	2.72T	2.47T	2.39T	2.54T	3.15T
Cash Flow
Free Cash Flow	-19.55B	-26.81B	26.17B	-392.55B	-955.45B	-155.22B
Operating Cash Flow	127.27B	688.10B	581.75B	190.51B	-189.97B	548.69B
Investing Cash Flow	-129.22B	-690.62B	-565.51B	-526.36B	-749.40B	-701.60B
Financing Cash Flow	95.22B	66.10B	26.83B	304.64B	983.38B	43.41B

East Japan Railway Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 10.68
• 50DMA: Negative
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For EJPRY, the sentiment is Positive. The current price of 10.68 is above the 20-day moving average (MA) of 10.47, below the 50-day MA of 10.74, and above the 200-day MA of 9.88, indicating a neutral trend. The MACD of -0.01 indicates Negative momentum. The RSI at 55.26 is Neutral, neither overbought nor oversold. The STOCH value of 55.39 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for EJPRY.

East Japan Railway Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
NSC	78 Outperform	$57.67B	17.47	24.52%	2.11%	0.70%	135.08%
CSX	73 Outperform	$61.82B	19.61	26.13%	1.58%	-2.39%	-7.80%
GATX	73 Outperform	$5.53B	19.63	11.64%	1.57%	12.07%	11.93%
ODFL	72 Outperform	$34.59B	30.68	26.59%	0.68%	-2.63%	-6.12%
UNP	71 Outperform	$138.26B	20.85	42.47%	2.34%	0.63%	5.93%
EJPRY	70 Outperform	$24.20B	16.42	7.93%	1.10%	0.43%	191.22%
Sector *	65 Neutral	$10.56B	15.49	5.57%	1.96%	2.71%	-26.28%