Mori-Gumi Co., Ltd. (1853) AI Stock Analysis

• Market Cap: ¥10.91B
• Dividend Yield: 4.42%
• Average Volume (3M): 71.56K
• Price to Earnings (P/E): 10.3
• Beta (1Y): 0.24
• Revenue Growth: -7.40%
• EPS Growth: 60.55%
• Country: JP
• Employees: 371
• Sector: Industrials
• Sector Strength: 72
• Industry: Engineering & Construction
• EPS (TTM): -0.94
• Shares Outstanding: 32,800,000
• 10 Day Avg. Volume: 100,760
• 30 Day Avg. Volume: 71,563
• PEG Ratio: 0.31
• Price to Book (P/B): 0.66
• Price to Sales (P/S): 0.33
• P/FCF Ratio: -2.21
• 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: Hold
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 68 Neutral
• Price Target: ¥349.00 ▲(10.09% Upside)

Mori-Gumi Co., Ltd. benefits from a strong financial foundation and attractive valuation metrics, including a low P/E ratio and high dividend yield. However, technical indicators suggest potential short-term bearish momentum, and cash flow challenges could impact liquidity. These factors collectively result in a moderate overall stock score.

Positive Factors

Strong Balance Sheet

A strong balance sheet with minimal leverage provides financial stability and flexibility, allowing the company to invest in growth opportunities and withstand economic downturns.

Revenue Growth

Consistent revenue growth indicates the company's ability to expand its market presence and capitalize on its expertise in construction, supporting long-term business sustainability.

Profitability Improvement

Improved profitability reflects the company's effective cost management and operational efficiency, enhancing its ability to generate returns for shareholders over the long term.

Negative Factors

Cash Flow Challenges

Challenges in converting income to cash can impact the company's ability to fund operations and growth initiatives, potentially leading to liquidity constraints.

Stagnant Asset Growth

Stagnant asset growth may limit the company's ability to expand its operations and invest in new projects, potentially affecting future revenue streams and competitiveness.

Decreased EBIT Margin

A decrease in EBIT margin indicates potential operational inefficiencies, which could impact profitability and the company's ability to maintain competitive pricing.

Mori-Gumi Co., Ltd. Business Overview & Revenue Model

Company Description

Mori-Gumi Co., Ltd., established in 1853, is a longstanding company based in Japan that operates primarily in the construction and civil engineering sectors. The company specializes in providing comprehensive construction services, including infrastructure development, urban planning, and environmental engineering. With a commitment to innovation and sustainability, Mori-Gumi is known for its involvement in large-scale public works projects and private sector developments, offering clients a range of solutions from project management to construction execution.

How the Company Makes Money

Mori-Gumi Co., Ltd. generates revenue primarily through its construction and engineering services. The company earns money by securing contracts for public and private infrastructure projects, including roads, bridges, and buildings, which are typically funded through government budgets or private investments. Key revenue streams include fixed-price contracts, cost-plus contracts, and time-and-materials contracts. Additionally, Mori-Gumi may engage in joint ventures with other construction firms or local governments to broaden its project portfolio and share financial risks. Strategic partnerships with suppliers and subcontractors enable the company to manage costs effectively and enhance operational efficiency, further contributing to its profitability.

Mori-Gumi Co., Ltd. Financial Statement Overview

Summary

Mori-Gumi Co., Ltd. shows solid revenue growth and a strong balance sheet with low leverage. However, challenges in cash flow, particularly in converting income into cash, may pose liquidity risks. Despite these challenges, the company's stable financial structure and profitability improvements contribute positively to its financial health.

Income Statement

Mori-Gumi Co., Ltd. shows a consistent increase in revenue over the years, with a notable revenue growth rate of 6.79% in the latest year. The gross profit margin stands at 8.64% for the most recent year, indicating moderate cost efficiency. The net profit margin improved to 3.13%, showcasing better profitability. However, the EBIT margin has slightly decreased to 3.67%, suggesting potential efficiency issues in operations.

Balance Sheet

Mori-Gumi Co., Ltd. maintains a strong balance sheet with a low debt-to-equity ratio of 0.06, indicating minimal leverage. The return on equity is 6.18%, showing moderate profitability on shareholder's equity. The equity ratio is substantial at 58.91%, highlighting financial stability and a strong capital structure. However, overall asset growth has been relatively stagnant.

Cash Flow

The company experienced a significant decline in operating cash flow, resulting in negative free cash flow growth. The operating cash flow to net income ratio is negative, reflecting challenges in converting income to cash. Despite this, the company has managed its capital expenditures efficiently, maintaining a positive free cash flow to net income ratio.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	29.45B	27.58B	24.62B	31.32B	28.58B
Gross Profit	2.55B	2.43B	2.23B	3.27B	3.36B
EBITDA	1.17B	1.14B	921.00M	2.00B	2.10B
Net Income	921.00M	685.00M	523.00M	1.25B	1.32B
Balance Sheet
Total Assets	25.30B	27.39B	23.78B	25.41B	23.60B
Cash, Cash Equivalents and Short-Term Investments	4.48B	9.57B	9.43B	9.18B	7.73B
Total Debt	831.00M	827.00M	831.00M	831.00M	929.00M
Total Liabilities	10.40B	13.03B	9.72B	11.45B	10.45B
Stockholders Equity	14.90B	14.36B	14.06B	13.97B	13.14B
Cash Flow
Free Cash Flow	-4.45B	617.00M	711.00M	2.02B	-325.00M
Operating Cash Flow	-4.23B	680.00M	799.00M	2.10B	-228.00M
Investing Cash Flow	-407.00M	-70.00M	-80.00M	-78.00M	-74.00M
Financing Cash Flow	-466.00M	-468.00M	-468.00M	-569.00M	-474.00M

Mori-Gumi Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 317.00
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:1853, the sentiment is Negative. The current price of 317 is below the 20-day moving average (MA) of 324.10, below the 50-day MA of 326.10, and above the 200-day MA of 311.47, indicating a neutral trend. The MACD of -2.54 indicates Positive momentum. The RSI at 41.32 is Neutral, neither overbought nor oversold. The STOCH value of 26.67 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:1853.

Mori-Gumi Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
1798	82 Outperform	¥15.50B	5.62	―	1.51%	22.31%	101.45%
1850	77 Outperform	¥17.15B	8.31	―	1.04%	17.09%	43.01%
1966	77 Outperform	¥12.52B	6.22	―	4.12%	5.33%	-27.53%
1807	71 Outperform	¥10.07B	9.79	―	4.57%	2.65%	45.12%
1853	68 Neutral	¥10.91B	10.32	―	4.42%	-7.40%	60.55%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
1848	59 Neutral	¥9.10B	3.62	―	2.36%	7.66%	562.50%