Sumitomo Rubber Industries (5110) AI Stock Analysis

• Market Cap: $627.79B
• Dividend Yield: 2.59%
• Average Volume (3M): 1.09M
• Price to Earnings (P/E): 12.5
• Beta (1Y): 1.15
• Revenue Growth: -0.26%
• EPS Growth: 129.15%
• Country: JP
• Employees: 37,995
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Auto - Parts
• EPS (TTM): 92.69
• Shares Outstanding: 263,043,060
• 10 Day Avg. Volume: 1,079,310
• 30 Day Avg. Volume: 1,086,830
• PEG Ratio: 0.03
• Price to Book (P/B): 0.89
• Price to Sales (P/S): 0.53
• P/FCF Ratio: 6.93
• Enterprise Value/Market Cap: 1.36
• Enterprise Value/Revenue: 0.71
• Enterprise Value/Gross Profit: 2.31
• Enterprise Value/Ebitda: 4.66
• 1Y Price Target: $2,732.26
• Price Target Upside: 14.39% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 9
• EPS Forecast (FY): 257.18
• Revenue Forecast (FY): $1.28T

• Rating: 70 Outperform
• Price Target: ¥2,831.00 ▲(18.53% Upside)
• Action: Reiterated Date: 03/03/26
• Date: Action: Reiterated 03/03/26

The score is driven primarily by improving financial performance (strong 2025 revenue/profitability rebound and better free cash flow), tempered by historical volatility and increased debt. Technicals add moderate support with longer-term uptrend signals, while valuation is reasonable with a mid P/E and ~3% yield.

Positive Factors

Revenue and margin rebound (2025)

A sharp 2025 top-line recovery with materially improved operating and net margins suggests the company can regain pricing power and operating leverage. This improves structural profitability and cash generation capacity, supporting reinvestment and resilience over the medium term.

Stronger cash generation (2025)

Substantially higher operating and free cash flow in 2025 strengthens the firm's ability to fund capex, dividends, and debt service from internal sources. Reliable cash conversion (FCF covered ~0.61x net income) supports durable financial flexibility and lowers refinancing risk.

Balance-sheet improvement

Rising equity and a mid-range debt profile provide a stronger capital base to absorb cyclicality typical of auto parts. Improved equity cushions losses, supports investment, and helps preserve credit capacity, enhancing the firm's structural capacity to navigate downturns.

Negative Factors

Earnings and cash-flow volatility

Historic swings in earnings and cash flow highlight exposure to cyclical demand, input-cost shocks and working-capital timing. Periodic negative FCF constrains long-term planning, complicates consistent capex/dividend policies, and raises execution risk across cycles.

Higher total debt (2025)

A material increase in absolute debt amplifies leverage sensitivity in a cyclical industry. Elevated debt requires sustained cash generation to avoid financial strain, reducing optionality for strategic investments and increasing vulnerability to profit downcycles or rising rates.

Inconsistent returns on equity

Volatile and occasionally very low ROE indicates inconsistent ability to convert capital into profits. This undermines long-term compounding, signals potential structural margin or mix issues, and makes shareholder return outcomes less predictable across multi-year horizons.

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 for passenger vehicles, trucks, and buses, which constitute a significant portion of its total sales. The company benefits from a well-established distribution network that includes partnerships with automotive manufacturers and aftermarket retailers. In addition to tire sales, Sumitomo Rubber also earns revenue from its industrial rubber products and sporting goods divisions. Strategic partnerships and collaborations with global automotive brands enhance its market presence and drive sales. Furthermore, the company invests in research and development to innovate and improve product performance, which can lead to increased sales and market share.

Sumitomo Rubber Industries Financial Statement Overview

Summary

Strong 2025 rebound with sharp revenue growth and materially improved operating and net margins, supported by higher operating cash flow and free cash flow. Offsetting factors are notable earnings/cash-flow volatility across years and higher total debt in 2025, which adds cyclicality risk.

Income Statement

Revenue has grown meaningfully over the period, with a particularly sharp jump in 2025 (annual revenue growth of 71.2%), pointing to strong top-line momentum. Profitability also improved materially in 2025 versus 2024: net margin rose to ~4.2% (from ~0.8%) and operating margin improved to ~7.5% (from ~1.9%), suggesting a strong rebound after a weak 2024. The key weakness is earnings volatility—profits and margins have swung notably across years (e.g., very low profitability in 2022 and 2024), which raises questions about through-cycle stability for an auto-parts manufacturer.

Balance Sheet

Leverage appears manageable overall, with debt-to-equity generally in a mid range (about 0.38–0.57 across the period), and equity has trended higher over time (from ~¥455B in 2020 to ~¥716B in 2025), supporting balance-sheet resilience. However, total debt increased in 2025 (to ~¥322B from ~¥252B in 2024), and returns on equity have been inconsistent (very low in 2022 and 2024), reflecting uneven profitability and reducing the quality of balance-sheet compounding.

Cash Flow

Cash generation improved in 2025: operating cash flow rose to ~¥150B and free cash flow increased to ~¥91.5B, with strong free-cash-flow growth (+37.5%). Free cash flow also covered a meaningful portion of earnings in recent years (about 0.61x net income in 2025 and 0.57x in 2023), which is supportive. The main concern is volatility—2022 saw negative free cash flow (~-¥47B) and very weak operating cash flow, indicating periodic cash pressure likely tied to capex/working-capital swings.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	1.21T	1.21T	1.18T	1.10T	936.04B
Gross Profit	368.37B	358.29B	326.50B	253.22B	259.70B
EBITDA	169.46B	106.66B	155.01B	101.45B	115.20B
Net Income	50.38B	9.87B	37.05B	9.41B	29.47B
Balance Sheet
Total Assets	1.46T	1.34T	1.27T	1.23T	1.09T
Cash, Cash Equivalents and Short-Term Investments	98.64B	102.64B	93.15B	80.80B	77.19B
Total Debt	322.05B	252.44B	245.38B	311.80B	238.65B
Total Liabilities	723.62B	665.31B	625.30B	661.34B	572.63B
Stockholders Equity	716.08B	656.13B	624.11B	546.20B	501.54B
Cash Flow
Free Cash Flow	91.53B	47.53B	97.51B	-47.05B	10.09B
Operating Cash Flow	150.43B	104.33B	169.80B	27.87B	63.09B
Investing Cash Flow	-186.56B	-64.66B	-62.23B	-78.70B	-54.02B
Financing Cash Flow	30.88B	-35.62B	-95.57B	41.56B	-13.33B

Sumitomo Rubber Industries Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 2388.50
• 50DMA: Negative
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

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 2388.5 is below the 20-day moving average (MA) of 2681.32, below the 50-day MA of 2579.66, and above the 200-day MA of 2001.31, indicating a neutral trend. The MACD of 15.22 indicates Positive momentum. The RSI at 34.53 is Neutral, neither overbought nor oversold. The STOCH value of 35.32 is Neutral, 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
5105	81 Outperform	¥642.54B	10.10	15.27%	2.93%	2.81%	2.78%
7282	75 Outperform	¥555.78B	12.60	8.26%	2.62%	1.44%	-0.92%
5161	73 Outperform	¥156.29B	22.42	―	5.78%	-4.26%	17.85%
5108	72 Outperform	¥4.60T	14.54	6.59%	3.07%	0.24%	-23.93%
5110	70 Outperform	$627.79B	12.46	4.89%	2.59%	-0.26%	129.15%
5101	69 Neutral	¥1.11T	10.52	9.11%	1.60%	10.53%	-2.52%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%

Sumitomo Rubber Industries Corporate Events

Sumitomo Rubber Overhauls Leadership Ahead of New Management Structure in 2026

Sumitomo Rubber Industries announced a broad reshuffle of its leadership, including changes to representative directors, directors, audit and supervisory board members, and executive officers, to establish a new management structure effective March 26, 2026. Key moves include the retirement of senior figures such as Hidekazu Nishiguchi and Hiroki Ishida, the transition of Naoki Okawa from director to standing audit and supervisory board member, and the promotion of executives Hitoshi Hino and Masahiro Tsuzaki to director and senior executive officer roles, signaling a generational shift aimed at strengthening corporate planning, finance, and the core tire business.

The reorganization brings finance specialist Hino, who has led accounting, finance, and global new site projects, and business planning leader Tsuzaki, who has extensive experience in domestic replacement tire sales and hybrid rubber products, into more influential board positions. By elevating these internal leaders with deep operational and planning expertise while rotating others into advisory or oversight roles, the company appears to be consolidating governance around its key growth and efficiency drivers, a move likely to influence its strategic direction and execution in core markets.

The most recent analyst rating on (JP:5110) stock is a Buy with a Yen2662.00 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 Lifts Year-End Dividend After Earnings Beat

Sumitomo Rubber Industries has approved a year-end dividend of ¥42 per share for the fiscal year ended December 31, 2025, up from the previous forecast of ¥35 and the prior year’s ¥29, with total dividends amounting to ¥11,039 million, payable on March 27, 2026. The increase reflects consolidated results that exceeded earlier forecasts and underscores the company’s policy of prioritizing stable shareholder returns, with the proposal to be submitted for approval at the annual general meeting on March 26, 2026.

The most recent analyst rating on (JP:5110) stock is a Buy with a Yen2662.00 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 Outlines 2025 Results and 2026 Outlook

Sumitomo Rubber Industries has released its financial report for the fiscal year ended December 31, 2025, outlining annual results, changes in the scope of consolidation and affiliated companies, and key performance highlights. The company also presented its 2026 earnings forecast, including planned capital expenditures, depreciation trends, tire production capacity plans, and shareholder return policies, signaling how it aims to balance growth investment with returns to investors and maintain its competitive position in the tire market.

The most recent analyst rating on (JP:5110) stock is a Buy with a Yen2662.00 price target. To see the full list of analyst forecasts on Sumitomo Rubber Industries stock, see the JP:5110 Stock Forecast page.

Sumitomo Rubber Lifts Profit and Dividends, Signals Further Growth in 2026

Sumitomo Rubber Industries reported full-year 2025 sales revenue of ¥1.21 trillion, essentially flat year on year, while business profit edged up 3.2% to ¥90.8 billion and operating profit surged on a recovery from the prior year’s weak earnings. Profit attributable to owners of the parent jumped more than fourfold to ¥50.4 billion, lifting basic earnings per share to ¥191.62 and strengthening the balance sheet, with total assets rising to ¥1.46 trillion and equity attributable to owners of the parent increasing to ¥716.1 billion.

The company boosted annual dividends to ¥77 per share for 2025 from ¥58 a year earlier, improving both payout ratio and returns on equity for shareholders. For 2026, management forecasts a 9.4% increase in sales to ¥1.32 trillion and a 23.4% rise in business profit to ¥112 billion, signaling expectations of continued earnings momentum and an intention to raise full-year dividends again to ¥84 per share, underscoring a more shareholder-friendly capital policy.

The most recent analyst rating on (JP:5110) stock is a Buy with a Yen2662.00 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 CEO Succession and New Management Structure

Sumitomo Rubber Industries has announced a change in its top management, with the Board of Directors resolving to appoint Director and Senior Executive Officer Yasuaki Kuniyasu as the new Representative Director, President and CEO, effective March 26, 2026, subject to shareholder approval. Incumbent President and CEO Satoru Yamamoto will transition to the role of Representative Director and Chairperson of the Board, as part of a broader restructuring of the company’s management framework, signaling a planned leadership succession intended to strengthen governance and support the firm’s next phase of strategic development.

The most recent analyst rating on (JP:5110) stock is a Buy with a Yen2662.00 price target. To see the full list of analyst forecasts on Sumitomo Rubber Industries stock, see the JP:5110 Stock Forecast page.