Morpho, Inc. (3653) AI Stock Analysis

• Market Cap: ¥5.32B
• Dividend Yield: N/A
• Average Volume (3M): 24.81K
• Price to Earnings (P/E): 22.7
• Beta (1Y): 0.97
• Revenue Growth: 1.91%
• EPS Growth: -122.15%
• Country: JP
• Employees: 162
• Sector: Technology
• Sector Strength: 88
• Industry: Software - Application
• EPS (TTM): -3.39
• Shares Outstanding: 5,508,500
• 10 Day Avg. Volume: 14,970
• 30 Day Avg. Volume: 24,810
• PEG Ratio: -0.14
• Price to Book (P/B): 2.31
• Price to Sales (P/S): 2.55
• P/FCF Ratio: 127.99
• 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

• Rating: 58 Neutral
• Price Target: ¥1,138.00 ▲(12.12% Upside)

Morpho, Inc. demonstrates strong financial performance with significant improvements in revenue and profitability, which is the most significant factor in the overall score. However, technical indicators suggest bearish momentum, and the valuation is negatively impacted by a high negative P/E ratio and lack of dividend yield.

Morpho, Inc. Business Overview & Revenue Model

Company Description

Morpho, Inc. engages in the research, development, and licensing of artificial intelligence (AI) and image processing technologies in Japan, the United States, China, South Korea, Europe, and internationally. It offers image processing products, such as image stabilization and noise reduction; video stabilization; video generation; video processing software package; noise reduction in video; HDR image generation; DR-corrected image generation; panorama image generation for selfie photography; motion vector detection; photo effect filters library; image super resolution; frame interpolation; cinemagraph; and smooth camera switching for zooming. The company also provides AI products, that includes fast AI inference engine, image enhancement by AI Based segmentation and pixel filtering, pose estimation, bokeh image generation using dual cameras, image classification, object detection, single camera background blur, image segmentation, object tracking, automatic mask generation, automatic wipe generation, and training data for AI development. Its solutions are used in smart devices, automotives, semiconductors, medical products, digital media, and smart city. The company was incorporated in 2004 and is headquartered in Tokyo, Japan.

How the Company Makes Money

Morpho, Inc. generates revenue through multiple streams primarily centered around the sale of biometric hardware and software solutions. Key revenue streams include direct sales of biometric devices, subscription fees for software services, and maintenance contracts for installed systems. Additionally, the company engages in partnerships with government agencies and large corporations, enabling it to secure long-term contracts that provide steady income. The growing demand for security solutions in various sectors, coupled with the expanding use of biometric technology globally, contributes significantly to Morpho's earnings.

Morpho, Inc. Financial Statement Overview

Summary

Morpho, Inc. has shown a strong financial recovery with significant revenue growth, improved profit margins, and a robust balance sheet with no debt. Cash flow management has also improved, indicating sustainable future growth.

Income Statement

Morpho, Inc. has demonstrated a remarkable turnaround with a significant increase in revenue from ¥2,383 million to ¥3,301 million, representing a 38.3% growth rate. The gross profit margin remains healthy at 57.6%, and the net profit margin has improved from a negative position to 9.13%. The company has successfully transitioned from negative EBIT and EBITDA margins to positive 7.79% and 9.90%, respectively, highlighting improved operational efficiency.

Balance Sheet

The balance sheet of Morpho, Inc. is robust, with no debt and a strong equity position. The equity ratio stands at an impressive 85.43%, indicating financial stability and low leverage risk. The company's return on equity is solid at 8.28%, reflecting effective utilization of equity.

Cash Flow

Morpho, Inc. has shown a positive shift in cash flow management with free cash flow growing from a negative position to ¥65.72 million. The operating cash flow to net income ratio is 0.69, demonstrating efficient cash generation from operations relative to net income. This improvement indicates better cash handling and operational performance.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	3.28B	3.30B	2.38B	2.00B	1.73B	2.07B
Gross Profit	1.79B	1.90B	1.36B	952.07M	866.53M	1.44B
EBITDA	40.62M	326.88M	-226.63M	-473.41M	-734.07M	-214.81M
Net Income	-68.92M	301.48M	-300.18M	-668.39M	-793.42M	-652.16M
Balance Sheet
Total Assets	3.97B	4.26B	3.71B	3.86B	4.55B	5.39B
Cash, Cash Equivalents and Short-Term Investments	2.37B	2.94B	2.71B	3.06B	3.39B	4.44B
Total Debt	2.73M	23.29M	36.25M	12.84M	21.95M	1.06M
Total Liabilities	500.00M	621.77M	558.59M	460.63M	400.45M	282.33M
Stockholders Equity	3.47B	3.64B	3.15B	3.40B	4.15B	5.10B
Cash Flow
Free Cash Flow	0.00	65.73M	-365.22M	-477.78M	-694.79M	-176.87M
Operating Cash Flow	0.00	207.18M	-267.62M	-415.53M	-653.58M	-62.55M
Investing Cash Flow	0.00	-140.72M	-92.50M	161.38M	-175.87M	-275.11M
Financing Cash Flow	0.00	131.83M	-16.21M	-176.43M	-257.00M	767.00K

Morpho, Inc. Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 1015.00
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:3653, the sentiment is Negative. The current price of 1015 is below the 20-day moving average (MA) of 1029.45, below the 50-day MA of 1158.92, and below the 200-day MA of 1212.92, indicating a bearish trend. The MACD of -41.63 indicates Negative momentum. The RSI at 38.10 is Neutral, neither overbought nor oversold. The STOCH value of 22.34 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:3653.

Morpho, Inc. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
4372	81 Outperform	¥5.43B	12.25	―	1.27%	13.82%	3.01%
3933	75 Outperform	¥4.86B	12.05	―	1.87%	70.44%	55.95%
4446	69 Neutral	¥15.68B	101.15	―	―	32.04%	-32.55%
4379	65 Neutral	¥5.47B	30.06	―	―	12.95%	271.70%
4447	62 Neutral	¥3.31B	16.93	―	3.89%	42.88%	-5.21%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
3653	58 Neutral	¥5.32B	22.71	―	―	1.91%	-122.15%