KyOwa CORP (6570) AI Stock Analysis

• Market Cap: ¥7.51B
• Dividend Yield: 1.86%
• Average Volume (3M): 4.77K
• Price to Earnings (P/E): 7.0
• Beta (1Y): 0.55
• Revenue Growth: 17.11%
• EPS Growth: 49.43%
• Country: JP
• Employees: 202
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Leisure
• EPS (TTM): 27.55
• Shares Outstanding: 6,080,130
• 10 Day Avg. Volume: 4,710
• 30 Day Avg. Volume: 4,766
• PEG Ratio: 0.15
• Price to Book (P/B): 1.14
• Price to Sales (P/S): 0.33
• P/FCF Ratio: -54.28
• 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): N/A
• Revenue Forecast (FY): N/A

• Rating: 73 Outperform
• Price Target: ¥1,473.00 ▲(22.65% Upside)
• Action: Reiterated Date: 10/29/25
• Date: Action: Reiterated 10/29/25

KyOwa CORP's overall stock score is driven by strong financial performance and attractive valuation. The company's robust revenue growth and profitability improvements are significant strengths. However, high debt levels and inconsistent cash flow generation present risks. Technical indicators suggest a lack of strong momentum, which slightly tempers the overall score.

Positive Factors

Strong multi-year revenue growth

Sustained revenue expansion of this magnitude reflects growing market demand and scalable sales execution. Over 2-6 months this supports durability of top-line momentum, underpins reinvestment capacity for growth initiatives, and reduces single-period revenue concentration risk.

High and consistent gross margins (~50%)

A sustained ~50% gross margin indicates structural pricing power or efficient cost control in core operations. This durable margin buffer helps absorb input cost swings, funds SG&A and R&D, and supports long-term profitability even if revenue growth moderates.

Operating cash flow consistently exceeds net income

OCF outpacing net income signals high earnings quality and reliable cash generation from core operations. Over time this strengthens the company's ability to fund capex, service debt, and pursue strategic investments without depending solely on external financing.

Negative Factors

Relatively high leverage (D/E ~1.2)

A D/E near 1.2 and elevated liabilities constrain financial flexibility and increase interest expense sensitivity to rate moves. Over a multi-month horizon this higher leverage raises refinancing and downside risk, limiting capacity for opportunistic investments or dividend resilience.

Volatile and occasionally negative free cash flow

Intermittent negative FCF reflects uneven capex or investment timing and reduces predictability of internal funding. Persisting volatility forces reliance on external capital or debt, complicating long-term planning and increasing financing risks during adverse cycles.

EBIT/EBITDA margins remain only moderate

Moderate operating margins limit the company's earnings cushion versus competitors and cost inflation. Without further efficiency gains, margin compression risk persists, which combined with leverage could pressure net income and free cash flow over the medium term.

KyOwa CORP Business Overview & Revenue Model

Company Description

Kyowa Corporation engages in the amusement business in Japan. The company is involved in the amusement facility management, batting center and bowling alley management, game equipment sale, and amusement facility management outsourcing, as well as advertising agency and store decoration activities. Kyowa Corporation was founded in 1982 and is based in Nagano, Japan.

How the Company Makes Money

KyOwa CORP generates revenue through a multi-faceted business model that includes product sales, licensing agreements, and service contracts. The key revenue streams consist of direct sales of optical components to manufacturers in the telecommunications and medical sectors, as well as recurring revenue from service agreements for maintenance and support of its imaging systems. Additionally, KyOwa engages in strategic partnerships with technology firms and research institutions, allowing for collaborative development projects that expand its product offerings and market reach. These partnerships enhance the company's innovation capabilities and provide access to new customer bases, further contributing to its earnings.

KyOwa CORP Financial Statement Overview

Summary

KyOwa CORP demonstrates strong revenue growth and improving profitability, signaling a positive financial trajectory. However, the company's high debt levels and inconsistent free cash flow generation pose risks. While operational efficiency and equity utilization are commendable, attention to cash flow stability and debt management is needed to ensure sustainable financial health.

Income Statement

KyOwa CORP shows a strong revenue growth trend with a significant increase from ¥10,385M in 2022 to ¥16,705M in 2025, demonstrating a robust expansion trajectory. The gross profit margin has been consistently high, around 50%, indicating efficient cost management. The net profit margin improved notably to 5.5% in 2025, reflecting enhanced profitability. However, EBIT and EBITDA margins, while improving, remain moderate, suggesting room for operational efficiency enhancements.

Balance Sheet

The company's debt-to-equity ratio has been stable, yet relatively high, around 1.2, indicating a moderate reliance on debt financing. The return on equity (ROE) improved to 18.8% in 2025, showcasing effective utilization of equity. The equity ratio is satisfactory at approximately 31.6%, suggesting a balanced asset structure. Despite these positives, high total liabilities remain a concern.

Cash Flow

KyOwa CORP's cash flow statement reflects challenges in free cash flow management, with negative free cash flow in several years, particularly in 2025. Operating cash flow remains strong and consistently exceeds net income, indicating solid cash generation capacity. However, the volatility in free cash flow growth rates suggests potential issues in capital expenditure management and investment activities.

Breakdown	TTM	Mar 2025	Mar 2025	Mar 2024	Mar 2023	Mar 2022
Income Statement
Total Revenue	17.38B	16.71B	14.58B	12.44B	10.39B	10.71B
Gross Profit	9.21B	8.87B	7.68B	6.87B	5.78B	4.80B
EBITDA	3.33B	3.20B	2.81B	2.10B	1.44B	1.30B
Net Income	966.57M	917.23M	646.96M	432.65M	128.87M	-129.34M
Balance Sheet
Total Assets	15.19B	15.40B	14.21B	13.28B	12.09B	11.01B
Cash, Cash Equivalents and Short-Term Investments	4.06B	4.70B	5.33B	4.77B	5.10B	4.85B
Total Debt	5.95B	5.91B	6.10B	5.64B	6.23B	5.62B
Total Liabilities	10.18B	10.53B	10.22B	9.88B	9.00B	7.96B
Stockholders Equity	5.01B	4.87B	3.99B	3.40B	3.09B	3.05B
Cash Flow
Free Cash Flow	0.00	-102.51M	256.10M	489.65M	-153.44M	468.96M
Operating Cash Flow	0.00	2.51B	2.54B	2.55B	1.59B	1.06B
Investing Cash Flow	0.00	-2.73B	-2.44B	-2.18B	-1.93B	112.13M
Financing Cash Flow	0.00	-305.46M	347.74M	-698.28M	528.54M	924.20M

KyOwa CORP Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 1201.00
• 50DMA: Positive
• 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:6570, the sentiment is Positive. The current price of 1201 is below the 20-day moving average (MA) of 1258.50, below the 50-day MA of 1240.54, and above the 200-day MA of 1149.03, indicating a bullish trend. The MACD of 16.27 indicates Positive momentum. The RSI at 55.72 is Neutral, neither overbought nor oversold. The STOCH value of 23.56 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:6570.

KyOwa CORP Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
7608	82 Outperform	¥15.50B	12.42	―	2.37%	―	―
8135	81 Outperform	¥12.02B	12.52	―	3.96%	7.77%	247.26%
6570	73 Outperform	¥7.51B	7.05	―	1.86%	17.11%	49.43%
7809	70 Outperform	¥11.93B	8.49	―	2.70%	9.10%	27.73%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
2330	60 Neutral	¥5.24B	11.83	―	―	73.71%	1051.90%
7865	42 Neutral	¥1.63B	203.92	―	―	―	―