Mitsubishi Research Institute (3636) AI Stock Analysis

• Market Cap: ¥72.83B
• Dividend Yield: 3.28%
• Average Volume (3M): 24.01K
• Price to Earnings (P/E): 7.5
• Beta (1Y): 0.85
• Revenue Growth: 5.28%
• EPS Growth: 28.90%
• Country: JP
• Employees: 4,573
• Sector: Technology
• Sector Strength: 88
• Industry: Information Technology Services
• EPS (TTM): 167.27
• Shares Outstanding: 16,044,000
• 10 Day Avg. Volume: 20,130
• 30 Day Avg. Volume: 24,010
• PEG Ratio: 0.45
• Price to Book (P/B): 1.13
• Price to Sales (P/S): 0.67
• P/FCF Ratio: 29.06
• 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): 358.2
• Revenue Forecast (FY): ¥124.64B

• Rating: 77 Outperform
• Price Target: ¥5,221.00 ▲(7.43% Upside)
• Action: Reiterated Date: 02/07/26
• Date: Action: Reiterated 02/07/26

The score is driven primarily by strong financial performance (profitability and a very low-leverage balance sheet) and an attractive valuation (low P/E with a solid dividend). Technicals are supportive but less decisive due to mixed momentum signals, and declining free cash flow trends temper the otherwise solid fundamentals.

Positive Factors

Low Leverage / Strong Balance Sheet

Very low leverage gives MRI durable financial flexibility: it can fund project-backed IT and consulting investments, maintain dividends, and withstand public-sector budget timing variability. The conservative capital structure reduces refinancing risk and supports strategic optionality over months.

Consistent Revenue Growth & Margin Improvement

Sustained revenue growth coupled with rising gross margin signals effective pricing and cost control across consulting and systems work. Recurring client relationships and follow-on implementation work can continue to underpin steady fee revenue and margin durability over the medium term.

Healthy Operating Cash Generation

Stable operating cash flow, supported by positive net margin (5.26%), indicates the core business converts earnings to cash reliably. That cash flow supports reinvestment in IT services, working capital for multi-month projects, and sustainable shareholder distributions despite cyclical timing of engagements.

Negative Factors

Declining Free Cash Flow Conversion

A drop in free cash flow growth and a falling FCF-to-net-income ratio weakens the firm's ability to fund capex, strategic hires, or acquisitions from internal cash. Over the medium term this can constrain reinvestment into scalable IT offerings and reduce flexibility on shareholder returns.

Softening Return on Equity

A declining ROE implies the company is generating lower returns from shareholders' capital, which can indicate reduced operating leverage or capital allocation inefficiency. Persistently softer ROE may limit long-term shareholder value creation versus peers in the consulting/IT services space.

Modest Net Margin

Net margins around mid-single digits leave limited buffer for cost shocks or pricing pressure in a competitive consulting market. Given project-based revenue volatility and competition for implementation work, sustaining or expanding bottom-line profitability could be challenging without continued efficiency gains.

Mitsubishi Research Institute Business Overview & Revenue Model

Company Description

Mitsubishi Research Institute, Inc. provides think tank, consulting, and IT services to government agencies, financial institutions, and private companies in Japan. Its service solutions include management consulting, digital innovation, financial innovation, environment/energy, healthcare/wellness, regional revitalization, next-generation infrastructure, science/safety, nuclear safety, economy/society/R&D, project case, and public sector orders. Mitsubishi Research Institute, Inc. has a partnership with ForePaaS SAS to deliver cloud-native data intensive solutions in Japan. The company was founded in 1970 and is headquartered in Tokyo, Japan.

How the Company Makes Money

MRI primarily earns revenue by delivering fee-based services and solutions to public and private clients. Key revenue streams include: (1) Research and consulting fees: the company conducts commissioned research, policy studies, surveys, economic/industry analysis, and strategic consulting engagements. These projects are typically contracted by government ministries/local governments and by corporations, with revenue recognized based on project delivery/contract terms. (2) System and IT-related services: MRI’s group also generates revenue from providing IT/system-related services connected to its consulting and research work, such as designing, developing, and supporting information systems and other implementation services for clients. (3) Recurring/continuing client relationships: MRI’s earnings are supported by repeat engagements where research/strategy work leads into implementation, operational support, or follow-on studies. Specific material partnerships, customer concentration, or segment-level revenue breakdowns are not available in the provided context and are therefore null.

Mitsubishi Research Institute Financial Statement Overview

Summary

Strong overall fundamentals: revenue grew 4.05% with improved gross margin (24.91%) and solid profitability (net margin 5.26%). Balance sheet strength is a key positive with very low leverage (debt-to-equity 0.014), though ROE has softened. Main risk area is cash conversion, as free cash flow growth and FCF-to-net-income have declined despite healthy operating cash flow.

Income Statement

Mitsubishi Research Institute has demonstrated consistent revenue growth with a 4.05% increase in the latest year, following a recovery from a slight dip the previous year. The gross profit margin has improved to 24.91%, indicating efficient cost management. Net profit margin stands at 5.26%, reflecting solid profitability. The EBIT and EBITDA margins have also shown positive trends, enhancing operational efficiency.

Balance Sheet

The company maintains a strong balance sheet with a low debt-to-equity ratio of 0.014, indicating minimal leverage and financial stability. The equity ratio is robust, highlighting a strong equity base. However, the return on equity has slightly decreased, suggesting room for improvement in generating returns from shareholders' equity.

Cash Flow

Operating cash flow remains healthy, but there has been a significant decline in free cash flow growth, which could impact future investments. The operating cash flow to net income ratio is stable, indicating good cash generation relative to net income. However, the free cash flow to net income ratio has decreased, suggesting potential challenges in converting profits into free cash flow.

Breakdown	Sep 2025	Sep 2024	Sep 2023	Sep 2022	Sep 2021
Income Statement
Total Revenue	121.46B	115.36B	122.13B	116.62B	103.03B
Gross Profit	30.26B	27.13B	27.72B	28.07B	24.50B
EBITDA	11.48B	10.81B	12.44B	12.78B	10.47B
Net Income	6.39B	5.00B	6.29B	7.71B	5.01B
Balance Sheet
Total Assets	131.00B	121.90B	120.27B	116.44B	101.57B
Cash, Cash Equivalents and Short-Term Investments	30.31B	30.93B	25.23B	33.16B	29.40B
Total Debt	1.04B	1.11B	2.09B	3.53B	4.93B
Total Liabilities	49.65B	45.52B	45.88B	45.28B	37.73B
Stockholders Equity	71.92B	67.63B	65.80B	63.05B	56.28B
Cash Flow
Free Cash Flow	2.81B	12.18B	3.09B	7.94B	2.30B
Operating Cash Flow	6.42B	13.54B	5.70B	9.26B	3.25B
Investing Cash Flow	-4.00B	-2.91B	-2.41B	-6.65B	-1.97B
Financing Cash Flow	-3.01B	-4.94B	-6.20B	-3.85B	-4.62B

Mitsubishi Research Institute Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 4860.00
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:3636, the sentiment is Negative. The current price of 4860 is above the 20-day moving average (MA) of 4788.75, below the 50-day MA of 4923.60, and above the 200-day MA of 4840.34, indicating a bearish trend. The MACD of -87.08 indicates Positive momentum. The RSI at 37.09 is Neutral, neither overbought nor oversold. The STOCH value of 22.22 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:3636.

Mitsubishi Research Institute Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
3636	77 Outperform	¥72.83B	7.46	―	3.28%	5.28%	28.90%
2317	76 Outperform	¥151.48B	14.81	―	2.30%	13.82%	37.07%
9715	75 Outperform	¥147.83B	9.34	11.52%	2.76%	4.00%	38.72%
9682	66 Neutral	¥169.13B	15.99	18.89%	2.78%	11.90%	60.66%
4725	65 Neutral	¥30.97B	10.75	10.34%	4.82%	-3.03%	38.83%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%

Mitsubishi Research Institute Corporate Events

Mitsubishi Research Institute Posts Profit Surge but Keeps Cautious Full-Year Outlook

Mitsubishi Research Institute reported a strong rebound in earnings for the quarter ended December 31, 2025, with net sales rising 11.5% year on year to ¥30.9 billion and profit attributable to owners of parent surging 165.6% to ¥2.63 billion, driving basic earnings per share up to ¥167.27. The company also strengthened its financial position, as the equity-to-asset ratio improved to 59.0%, while it kept its full-year forecasts for the fiscal year ending September 30, 2026 unchanged, projecting essentially flat net sales and a modest decline in profits, and reaffirmed plans to maintain the annual dividend at ¥165 per share, signaling stability for shareholders despite expectations of lower profitability ahead.

The most recent analyst rating on (JP:3636) stock is a Buy with a Yen5341.00 price target. To see the full list of analyst forecasts on Mitsubishi Research Institute stock, see the JP:3636 Stock Forecast page.