CMC Corporation (2185) AI Stock Analysis

• Market Cap: ¥25.52B
• Dividend Yield: 3.06%
• Average Volume (3M): 4.83K
• Price to Earnings (P/E): 10.6
• Beta (1Y): 0.25
• Revenue Growth: -6.49%
• EPS Growth: 4.98%
• Country: JP
• Employees: 862
• Sector: Technology
• Sector Strength: 88
• Industry: Information Technology Services
• EPS (TTM): 43.47
• Shares Outstanding: 14,364,000
• 10 Day Avg. Volume: 3,670
• 30 Day Avg. Volume: 4,830
• PEG Ratio: 2.22
• Price to Book (P/B): 1.04
• Price to Sales (P/S): 1.23
• P/FCF Ratio: 12.59
• 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
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 79 Outperform
• Price Target: ¥2,166.00 ▲(23.63% Upside)
• Action: Reiterated Date: 12/11/25
• Date: Action: Reiterated 12/11/25

CMC Corporation's stock is rated highly due to its strong financial performance and attractive valuation. The technical analysis supports a bullish outlook, although caution is advised due to potential overbought conditions. The absence of recent earnings call data and corporate events means these factors do not influence the score.

Positive Factors

Conservative balance sheet

CMC's low leverage and strong equity ratio provide durable financial resilience. Conservative debt levels reduce bankruptcy and refinancing risk, supporting continued R&D, capex, and strategic partnerships without stressing cash flow, enabling multi‑quarter operational stability and optionality.

Strong cash generation

Robust operating cash flow and improving free cash flow support sustainable internal funding for capex, dividends, and R&D. Over the medium term this underpins the company's ability to invest in product development and meet contractual obligations without relying on external financing.

Diversified end markets and R&D partnerships

Serving multiple end markets spreads demand risk across telecom, automotive and industrial cycles. Strategic R&D collaborations enhance product pipeline and technical differentiation, supporting durable competitive advantages and revenue streams across technology cycles over several quarters.

Negative Factors

Negative revenue trend

A persistent negative revenue growth rate signals demand or share challenges that can erode margin leverage and cash conversion. If the decline continues, it could constrain reinvestment capacity and require margin improvements or new customer wins to restore top-line momentum over the next several quarters.

Historical free cash flow volatility

Although FCF has expanded, historical fluctuations indicate variability in cash available for reinvestment or distributions. This volatility complicates multi‑period planning for R&D and capex and raises the risk that funding for strategic projects could be uneven across business cycles.

Limited investor visibility / guidance

Absence of formal guidance and limited earnings commentary reduces transparency for forecasting revenues and cash flows. That limits investor visibility and can delay market recognition of operational improvements, making medium‑term planning and capital allocation assessments more uncertain.

CMC Corporation Business Overview & Revenue Model

Company Description

CMC Corporation, together with its subsidiaries, provides manual creation, business process management, training, translation, and interpretation services. The company provides technical information solutions, such as user manuals, AR manuals, data structuring, and XML editor; personnel development solutions, including training events, staff manuals, training programs, and virtual work experiences; process improvement solutions, such as knowledge transfer and management, document management, and RPA applications; and marketing solutions, such as web/video, VR, and AR content, as well as event activation. It also offers various services, such as knowledge connect, ATOM knowledge, AR tools, VR showroom, hiyari hatto VR, AI contact, AI contents search, MaaS business development, multiplay VR, VR prototyping, AR repair manual, ICT for real estate promotion, workplace kaizen, VR content, digital sales support tools for real estate, Abook, automotive business development, and total printing, as well as manual writing, editing, and translation. CMC Corporation was founded in 1962 and is headquartered in Nagoya, Japan.

How the Company Makes Money

CMC Corporation generates revenue through multiple key streams. Primarily, the company earns money by selling its electronic components and systems to a wide array of industries, including telecommunications providers, automotive manufacturers, and industrial equipment suppliers. Its revenue model is centered around direct sales, long-term contracts, and strategic partnerships that enhance its market reach. Additionally, CMC engages in research and development collaborations with major tech firms, allowing it to innovate and introduce cutting-edge products that meet the evolving needs of its clients. This combination of direct sales, partnerships, and R&D collaborations contributes significantly to the company's overall earnings.

CMC Corporation Financial Statement Overview

Summary

CMC Corporation demonstrates strong financial health with stable profitability and efficient cash management. While revenue growth has recently declined, the company maintains a solid balance sheet with low leverage and strong equity. Cash flow metrics are generally positive, though past volatility warrants attention.

Income Statement

CMC Corporation shows a strong gross profit margin and consistent net profit margins, indicating stable profitability. However, the recent revenue growth rate is negative, which is a concern. Despite this, EBIT and EBITDA margins remain healthy, reflecting efficient operations.

Balance Sheet

The company maintains a low debt-to-equity ratio, suggesting a conservative leverage strategy. Return on equity is solid, indicating effective use of shareholder funds. The equity ratio is strong, highlighting financial stability and low risk.

Cash Flow

Operating cash flow is robust relative to net income, showing good cash generation. Free cash flow has grown significantly, but historical fluctuations suggest potential volatility. The free cash flow to net income ratio is favorable, indicating efficient cash management.

Breakdown	Sep 2025	Sep 2024	Sep 2023	Sep 2022	Sep 2021
Income Statement
Total Revenue	18.26B	19.52B	18.45B	17.92B	17.33B
Gross Profit	6.90B	7.28B	6.86B	6.86B	6.54B
EBITDA	3.07B	3.31B	2.89B	2.90B	2.65B
Net Income	2.15B	2.08B	1.76B	2.00B	1.62B
Balance Sheet
Total Assets	27.14B	26.41B	24.75B	22.63B	21.07B
Cash, Cash Equivalents and Short-Term Investments	13.12B	12.32B	13.54B	11.50B	9.93B
Total Debt	220.79M	298.35M	389.81M	71.22M	15.48M
Total Liabilities	5.22B	5.48B	5.52B	5.09B	5.11B
Stockholders Equity	21.59B	20.63B	18.94B	17.42B	15.88B
Cash Flow
Free Cash Flow	1.78B	-209.16M	2.71B	1.65B	1.79B
Operating Cash Flow	2.31B	2.10B	3.06B	1.79B	1.92B
Investing Cash Flow	367.13M	-3.11B	-671.30M	-158.75M	-209.66M
Financing Cash Flow	-1.57B	-649.30M	-474.56M	-450.10M	-1.28B

CMC Corporation Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 1752.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:2185, the sentiment is Positive. The current price of 1752 is below the 20-day moving average (MA) of 1837.95, below the 50-day MA of 1793.00, and above the 200-day MA of 1631.99, indicating a bullish trend. The MACD of 27.09 indicates Negative momentum. The RSI at 70.97 is Negative, neither overbought nor oversold. The STOCH value of 80.38 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:2185.

CMC Corporation Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
2359	80 Outperform	¥31.86B	11.12	―	2.93%	2.11%	5.55%
2185	79 Outperform	¥25.52B	10.55	―	3.06%	-6.49%	4.98%
4396	76 Outperform	¥27.04B	16.07	―	1.70%	22.25%	31.88%
3393	74 Outperform	¥30.63B	13.84	―	4.36%	12.32%	10.42%
4072	73 Outperform	¥33.63B	11.50	―	2.22%	9.57%	315.38%
4725	65 Neutral	¥32.65B	10.11	10.34%	4.82%	-3.03%	38.83%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%