Toray Industries (3402) AI Stock Analysis

• Market Cap: ¥1.50T
• Dividend Yield: 1.86%
• Average Volume (3M): 4.93M
• Price to Earnings (P/E): 26.6
• Beta (1Y): 0.68
• Revenue Growth: -2.18%
• EPS Growth: 26.45%
• Country: JP
• Employees: 48,140
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Apparel - Manufacturers
• EPS (TTM): 13.07
• Shares Outstanding: 1,504,481,400
• 10 Day Avg. Volume: 6,748,400
• 30 Day Avg. Volume: 4,930,880
• PEG Ratio: 0.08
• Price to Book (P/B): 0.95
• Price to Sales (P/S): 0.63
• P/FCF Ratio: 21.35
• 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: ¥1,481.08
• Price Target Upside: 45.35% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 1
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 65 Neutral
• Price Target: ¥1,036.00 ▲(1.67% Upside)

Toray Industries' overall stock score reflects a stable but challenged financial performance, with concerns about growth and cash generation. The technical analysis suggests potential for moderate gains, but the high valuation could limit upside potential. The absence of earnings call data and corporate events means these factors do not influence the score.

Positive Factors

Diversified Revenue Streams

The company's diversified revenue streams across fibers, plastics, chemicals, and carbon fiber materials provide resilience against sector-specific downturns, supporting long-term stability and growth.

Strong Balance Sheet

A strong balance sheet with moderate leverage and a solid equity base provides financial stability and flexibility for future investments and strategic initiatives.

Innovative Technologies

Toray's focus on innovation and high-performance products enhances its competitive advantage, driving demand in key industries like automotive and aerospace, and supporting long-term growth.

Negative Factors

Declining Revenue Growth

The lack of revenue growth, with a decline of -0.71%, signals potential market challenges and could hinder future performance and expansion opportunities.

Low Return on Equity

A low ROE indicates inefficiencies in generating returns on shareholder investments, which could impact investor confidence and limit capital raising capabilities.

Declining Free Cash Flow

Declining free cash flow poses challenges in funding operations and growth initiatives, potentially limiting the company's ability to invest in new opportunities or weather economic downturns.

Toray Industries Business Overview & Revenue Model

Company Description

Toray Industries, Inc., together with its subsidiaries, manufactures, processes, and sells fibers and textiles, performance chemicals, carbon fiber composite materials, environment and engineering products, and life science products in Japan, China, North America, Europe, and internationally. The company offers filament yarns, staple fibers, and spun yarns, as well as woven and knitted fabrics of nylon, polyester, acrylics, and others; non-woven fabrics; ultra-fine fibers; and apparel products. It also provides nylon, ABS, PBT, PPS, and other resins and molded products; polyolefin foam products; polyester, polyethylene, polypropylene, and other films; processed film products; raw materials for synthetic fibers and other plastics; fine chemicals; electronic and information materials; and graphic materials. In addition, the company offers carbon fibers, carbon fiber composite materials, and molded products; analysis, physical evaluation, research, and other services; and pharmaceuticals, medical devices, etc. Further, it provides engineering services; condominiums; industrial equipment and machinery; IT-related equipment; water treatment membranes and related equipment; and materials for housing, building, and civil engineering applications. The company was formerly known as Toyo Rayon Co., Ltd. and changed its name to Toray Industries, Inc. in 1970. The company was incorporated in 1926 and is headquartered in Tokyo, Japan.

How the Company Makes Money

Toray Industries generates revenue through a diversified model that encompasses several key streams. The primary source of income comes from the sale of fibers and textiles, including synthetic fibers used in apparel and industrial applications. Additionally, the company earns significant revenue from its plastics and chemicals segment, which produces engineering plastics and chemical products for various industries. The carbon fiber composite materials division is also a crucial revenue driver, particularly in aerospace and automotive sectors, where demand for lightweight and high-strength materials is increasing. Toray has formed strategic partnerships and collaborations with leading companies, enhancing its market reach and technological capabilities. Furthermore, investments in R&D enable Toray to innovate and maintain a competitive edge, contributing to its overall earnings. The company's comprehensive approach to sustainability and eco-friendly products also resonates with consumers, further solidifying its revenue base.

Toray Industries Financial Statement Overview

Summary

Toray Industries presents a mixed financial picture. The income statement reflects stable profitability despite recent revenue declines. The balance sheet is robust, with a moderate debt level and solid equity base. However, the cash flow statement indicates challenges in free cash flow generation, which could impact future financial flexibility. Overall, while the company is financially stable, it faces challenges in maintaining growth and cash flow generation.

Income Statement

Toray Industries shows a mixed performance in its income statement. The TTM data indicates a slight decline in revenue growth, with a negative growth rate of -1.64%. However, the company maintains a stable gross profit margin of approximately 19.83% and a net profit margin of 2.70%. The EBIT and EBITDA margins are also healthy at 4.69% and 9.78%, respectively, indicating operational efficiency. Despite the recent revenue decline, the company has shown resilience in maintaining profitability.

Balance Sheet

The balance sheet of Toray Industries reflects a stable financial position. The debt-to-equity ratio is moderate at 0.54, suggesting a balanced approach to leveraging. The return on equity (ROE) is modest at 3.95%, indicating room for improvement in generating returns for shareholders. The equity ratio stands at 50.75%, showcasing a solid equity base relative to total assets. Overall, the company maintains a stable balance sheet with manageable debt levels.

Cash Flow

The cash flow statement reveals some challenges for Toray Industries. The free cash flow growth rate is negative at -23.66%, indicating a decline in free cash flow generation. The operating cash flow to net income ratio is 0.28, and the free cash flow to net income ratio is 0.23, suggesting that cash flow generation is not as strong as net income figures might imply. While the company is generating positive cash flow, the declining trend in free cash flow is a concern.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	2.50T	2.56T	2.46T	2.49T	2.23T	1.88T
Gross Profit	498.18B	505.89B	443.52B	420.83B	435.97B	377.50B
EBITDA	243.86B	267.64B	197.91B	242.65B	227.59B	176.45B
Net Income	59.32B	77.91B	21.90B	72.82B	84.23B	45.79B
Balance Sheet
Total Assets	3.35T	3.29T	3.47T	3.19T	3.04T	2.85T
Cash, Cash Equivalents and Short-Term Investments	228.06B	237.29B	235.89B	224.00B	229.30B	236.35B
Total Debt	896.19B	842.66B	949.68B	950.09B	935.66B	973.93B
Total Liabilities	1.52T	1.47T	1.62T	1.56T	1.54T	1.53T
Stockholders Equity	1.72T	1.71T	1.74T	1.54T	1.41T	1.24T
Cash Flow
Free Cash Flow	48.76B	75.78B	51.55B	43.00B	46.09B	89.11B
Operating Cash Flow	232.44B	255.03B	185.68B	145.21B	138.29B	211.59B
Investing Cash Flow	-81.77B	-63.20B	-121.00B	-102.72B	-57.17B	-97.87B
Financing Cash Flow	-159.66B	-188.52B	-70.37B	-57.38B	-101.52B	-69.40B

Toray Industries Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 1019.00
• 50DMA: Positive
• 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 JP:3402, the sentiment is Positive. The current price of 1019 is above the 20-day moving average (MA) of 1008.07, above the 50-day MA of 978.04, and above the 200-day MA of 973.71, indicating a bullish trend. The MACD of 12.12 indicates Negative momentum. The RSI at 55.46 is Neutral, neither overbought nor oversold. The STOCH value of 55.68 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:3402.

Toray Industries Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
3104	78 Outperform	¥84.87B	16.94	―	1.90%	10.76%	54.82%
3109	72 Outperform	¥12.86B	13.83	―	4.82%	4.49%	26.84%
3201	72 Outperform	¥109.22B	15.68	―	2.64%	7.56%	-17.12%
3110	70 Outperform	¥372.09B	26.01	11.10%	1.04%	9.49%	55.64%
3002	66 Neutral	¥140.17B	53.15	2.34%	3.36%	>-0.01%	-49.83%
3402	65 Neutral	¥1.50T	26.59	3.37%	1.86%	-2.18%	26.45%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%

Toray Industries Corporate Events

Toray Industries Announces Share Repurchase Program

Toray Industries has announced the repurchase of 6,553,500 shares of its common stock for a total price of 6,571,264,095 yen. This repurchase, conducted on the Tokyo Stock Exchange, is part of a broader plan authorized by the Board of Directors to buy back up to 63 million shares by May 2026, potentially impacting the company’s stock value and shareholder returns.

Toray Industries to Repurchase and Cancel Shares to Boost Capital Efficiency

Toray Industries, Inc. has announced a strategic move to repurchase and cancel a significant portion of its common stock, aligning with its policy to enhance capital efficiency by reducing cross-shareholdings. This initiative, set to take place between November 2025 and May 2026, involves repurchasing up to 63 million shares and cancelling 127 million shares, aiming to optimize shareholder value and streamline its capital structure.

Toray Industries Reports Decline in Financial Results but Plans Share Repurchase

Toray Industries reported a decline in its consolidated financial results for the six months ended September 30, 2025, with revenue dropping by 4.6% and profit attributable to owners decreasing by 32.5% compared to the previous year. Despite the decline, the company announced a slight increase in its annual dividend forecast and plans for a share repurchase, indicating a strategic effort to enhance shareholder value.

Toray Industries Completes Share Repurchase Program

Toray Industries, Inc. has completed its share repurchase program, acquiring 3,056,500 shares at a total cost of 2,912,908,350 yen through market purchases on the Tokyo Stock Exchange. This move is part of a broader strategy approved by the Board of Directors to repurchase up to 155,000,000 shares, aiming to enhance shareholder value and optimize capital structure.

Toray Industries Reports Progress on Share Repurchase Program

Toray Industries has announced the status of its share repurchase program, revealing that it has repurchased 7,688,000 shares of common stock for a total of 7,532,034,240 yen between September 1 and September 30, 2025. This move is part of a larger plan authorized by the Board of Directors to repurchase up to 155,000,000 shares, aiming to enhance shareholder value and optimize capital structure.