Sumitomo Rubber Industries (5110) AI Stock Analysis

• Market Cap: $431.71B
• Dividend Yield: 3.3%
• Average Volume (3M): 1.18M
• Price to Earnings (P/E): 50.9
• Beta (1Y): 1.14
• Revenue Growth: 1.37%
• EPS Growth: -119.72%
• Country: JP
• Employees: 37,995
• Sector: Consumer Cyclical
• Sector Strength: 63
• Industry: Auto - Parts
• EPS (TTM): 13.54
• Shares Outstanding: 263,043,060
• 10 Day Avg. Volume: 1,428,960
• 30 Day Avg. Volume: 1,175,316
• PEG Ratio: 0.19
• Price to Book (P/B): 0.75
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 12.82
• 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: $1,984.77
• Price Target Upside: 20.91% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 2

• Rating: 52 Neutral
• Price Target: ¥1,752.00 ▲(6.73%Upside)

The overall stock score is primarily influenced by the company's mixed financial performance, with strengths in cash flow and balance sheet stability but challenges in profitability. Technical analysis indicates bearish momentum, and valuation concerns are highlighted by a negative P/E ratio. While the dividend yield offers some attractiveness, the stock's current trajectory suggests caution.

Sumitomo Rubber Industries Business Overview & Revenue Model

Company Description

Sumitomo Rubber Industries, Ltd., together with its subsidiaries, offers tires, sports, and industrial and other products in Japan, rest of Asia, Europe, North America, and internationally. The company manufactures and sells a range of tires for various vehicles, such as passenger cars, trucks, buses, motorcycles, construction vehicles, agricultural vehicles, and race and rally cars, as well as for industrial vehicles under the Dunlop and Falken brands; and aluminum wheels. It also manufactures and sells golf clubs and balls under the XXIO, SRIXON, and Cleveland Golf brand names; and tennis rackets and balls under the Dunlop brand name, as well as manages fitness clubs, and golf and tennis schools. In addition, the company offers rubber parts for medical applications, precision rubber parts for office equipment, vibration control dampers, artificial turf for sporting facilities, rubber gloves, rubber gas tubes, portable wheelchair ramps, water cushions and cooling packs, and ladies inner wear. The company was formerly known as Dunlop Rubber Company (Far East) Ltd. and changed its name to Sumitomo Rubber Industries, Ltd. in 1963. Sumitomo Rubber Industries, Ltd. was founded in 1909 and is headquartered in Kobe, Japan.

How the Company Makes Money

Sumitomo Rubber Industries generates revenue primarily through the sale of tires, which is its largest segment. The company's tire products cater to a wide range of vehicles, including passenger cars, trucks, buses, and motorcycles, serving both original equipment manufacturers (OEMs) and the replacement market. In addition to tires, the company earns revenue from its sports division, which offers golf clubs, balls, and tennis equipment under well-known brands. The industrial product segment contributes to earnings through the sale of rubber parts for industrial applications, including precision rubber parts and vibration control products. The company's global presence and strategic partnerships with automotive manufacturers and distributors play a crucial role in its revenue generation, enabling access to diverse markets and customer bases.

Sumitomo Rubber Industries Financial Statement Overview

Summary

Sumitomo Rubber Industries exhibits consistent revenue growth and strong gross margins. However, concerns arise from declining net profit margin and free cash flow, indicating potential risks. The company maintains a stable balance sheet with moderate leverage but needs to focus on cost efficiency and cash management.

Income Statement

Sumitomo Rubber Industries shows a consistent growth trend in revenues and profitability. The gross profit margin for 2024 stands at 29.57%, indicating efficient production. However, the net profit margin has decreased to 0.81% from 3.15% in 2023, driven by a significant drop in net income. Revenue growth rate from 2023 to 2024 is 2.93%, demonstrating stable yet modest growth. The EBIT margin decreased to 0.92%, whereas the EBITDA margin slightly rose to 13.75%, reflecting controlled operating expenses but a notable decline in operating profit.

Balance Sheet

The balance sheet indicates a solid financial position with an equity ratio of 48.92% in 2024, suggesting a stable asset funding through equity. The debt-to-equity ratio is 0.38, showing moderate leverage. The return on equity (ROE) dropped to 1.50% in 2024 from 5.94% in 2023, raising concerns about the company's ability to generate returns for shareholders.

Cash Flow

The cash flow analysis reveals a decline in free cash flow from 97.51 billion yen in 2023 to 47.53 billion yen in 2024, reflecting a 51.26% decrease, indicating potential cash flow challenges. The operating cash flow to net income ratio is 10.57, showing robust cash generation relative to reported income. However, the free cash flow to net income ratio decreased significantly, highlighting pressure on free cash flow.

Breakdown
TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
1.21T	1.21T	1.18T	1.10T	936.04B	790.82B
	Gross Profit
352.94B	358.29B	326.50B	253.22B	259.70B	232.18B
	EBIT
54.31B	11.19B	77.67B	26.58B	49.17B	38.70B
	EBITDA
167.90B	106.66B	155.01B	101.45B	115.20B	101.02B
	Net Income Common Stockholders
-11.41B	9.87B	37.05B	9.41B	29.47B	22.60B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
87.03B	102.64B	93.15B	80.80B	77.19B	75.60B
	Total Assets
1.29T	1.34T	1.27T	1.23T	1.09T	974.80B
	Total Debt
262.02B	252.44B	245.38B	311.80B	238.65B	217.43B
	Net Debt
174.99B	152.06B	155.12B	237.96B	163.55B	143.23B
	Total Liabilities
640.83B	665.31B	625.30B	661.34B	572.63B	507.71B
	Stockholders Equity
631.19B	656.13B	624.11B	546.20B	501.54B	454.74B
Cash Flow		Free Cash Flow
36.75B	47.53B	97.51B	-47.05B	10.09B	77.50B
	Operating Cash Flow
96.16B	104.33B	169.80B	27.87B	63.09B	123.50B
	Investing Cash Flow
-63.37B	-64.66B	-62.23B	-78.70B	-54.02B	-45.59B
	Financing Cash Flow
-27.29B	-35.62B	-95.57B	41.56B	-13.33B	-61.88B

Sumitomo Rubber Industries Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 1641.50
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:5110, the sentiment is Negative. The current price of 1641.5 is below the 20-day moving average (MA) of 1777.85, below the 50-day MA of 1744.41, and below the 200-day MA of 1680.19, indicating a bearish trend. The MACD of -26.38 indicates Positive momentum. The RSI at 34.59 is Neutral, neither overbought nor oversold. The STOCH value of 7.67 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:5110.

Sumitomo Rubber Industries Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
Sector *	62 Neutral	$6.88B	11.32	2.95%	3.87%	2.70%	-24.57%
5110	52 Neutral	$431.71B	50.94	-1.90%	3.30%	1.37%	-119.72%
TOTTF		$3.20B	5.90	14.57%	4.76%	―	―
YORUF		$3.81B	9.38	7.48%	2.61%	―	―
5185	75 Outperform	¥27.30B	9.05		4.56%	0.91%	-3.92%
5191	74 Outperform	¥176.09B	6.42		3.89%	2.91%	47.09%
5161	69 Neutral	¥97.87B	24.12		4.23%	2.32%	-21.60%

Sumitomo Rubber Industries Corporate Events

Sumitomo Rubber Completes Treasury Stock Acquisition

Sumitomo Rubber Industries has completed the acquisition of 200,000 shares of its own common stock, with a total acquisition cost of approximately 355.7 million yen. This move, approved by the Board of Directors, is part of a strategic decision to utilize treasury stock for restricted stock compensation over multiple fiscal years, potentially impacting shareholder value and company operations.

The most recent analyst rating on (JP:5110) stock is a Buy with a Yen2100.00 price target. To see the full list of analyst forecasts on Sumitomo Rubber Industries stock, see the JP:5110 Stock Forecast page.

Sumitomo Rubber Reports Significant Foreign Exchange Loss

Sumitomo Rubber Industries reported a foreign exchange loss of ¥8,004 million for the first quarter of the fiscal year ending March 31, 2025, due to the yen’s unexpected appreciation. This financial impact is detailed in their consolidated financial results, indicating potential implications for their operational performance.

The most recent analyst rating on (JP:5110) stock is a Buy with a Yen2100.00 price target. To see the full list of analyst forecasts on Sumitomo Rubber Industries stock, see the JP:5110 Stock Forecast page.

Sumitomo Rubber Industries Announces Share Repurchase Plan

Sumitomo Rubber Industries has announced a decision by its Board of Directors to repurchase up to 200,000 shares of its own common stock, with a maximum acquisition cost of 400 million yen. This repurchase is intended to support a restricted stock compensation plan approved in 2022, which aims to deliver shares as compensation over multiple fiscal years, potentially impacting shareholder value and stock market operations.

The most recent analyst rating on (JP:5110) stock is a Buy with a Yen2100.00 price target. To see the full list of analyst forecasts on Sumitomo Rubber Industries stock, see the JP:5110 Stock Forecast page.

Sumitomo Rubber Industries Reports Q1 2025 Financial Results and Revises Year-End Forecast

Sumitomo Rubber Industries reported a decline in its financial performance for the first quarter of 2025, with sales revenue decreasing by 1.2% and operating profit dropping by 40.5% compared to the previous year. The company also revised its financial forecast for the full year, expecting a slight increase in sales revenue but a significant improvement in operating profit, indicating a strategic focus on enhancing profitability despite current challenges.

The most recent analyst rating on (JP:5110) stock is a Buy with a Yen2100.00 price target. To see the full list of analyst forecasts on Sumitomo Rubber Industries stock, see the JP:5110 Stock Forecast page.

Sumitomo Rubber Completes DUNLOP Trademark Acquisition from Goodyear

Sumitomo Rubber Industries has completed the acquisition of the DUNLOP trademark and related rights for four-wheel vehicles in Europe, North America, and Oceania from Goodyear. This acquisition, valued at 631 million US dollars, is part of Sumitomo’s strategy to maximize the DUNLOP brand’s value and achieve its long-term corporate goals under the R.I.S.E. 2035 strategy. The company is assessing the acquisition’s impact on its financial results for the fiscal year ending December 2025.

Sumitomo Rubber Completes Treasury Share Disposal for Compensation

Sumitomo Rubber Industries has completed the payment for the disposal of 10,000 treasury shares as restricted stock compensation, with a total disposal amount of 19,855,000 yen. This strategic move is aimed at aligning the interests of its directors with the company’s performance, potentially enhancing governance and operational efficiency.

Sumitomo Rubber Industries Enhances Corporate Governance and Diversity Initiatives

Sumitomo Rubber Industries has revised its corporate governance policies to enhance shareholder rights, transparency, and business efficiency. The company aims to improve its corporate value through strategic cross-shareholdings and diverse human resource initiatives, including promoting diversity and inclusion within its workforce.