Muro Corporation (7264) AI Stock Analysis

• Market Cap: ¥8.30B
• Dividend Yield: 3.54%
• Average Volume (3M): 4.56K
• Price to Earnings (P/E): 5.2
• Beta (1Y): 0.44
• Revenue Growth: -0.72%
• EPS Growth: -72.70%
• Country: JP
• Employees: 1,145
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Auto - Parts
• EPS (TTM): 64.34
• Shares Outstanding: 6,546,200
• 10 Day Avg. Volume: 4,260
• 30 Day Avg. Volume: 4,560
• PEG Ratio: -0.24
• Price to Book (P/B): 0.33
• Price to Sales (P/S): 0.32
• P/FCF Ratio: -13.85
• 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: 70 Outperform
• Price Target: ¥1,510.00 ▲(12.94% Upside)
• Action: N/A Date: 07/28/25
• Date: Action: N/A 07/28/25

The overall stock score of 70 reflects a balanced view of Muro Corporation's strengths and challenges. The strong balance sheet and reasonable valuation are positive factors, but concerns about profitability and liquidity, along with overbought technical indicators, temper the outlook. Investors should monitor these areas for future developments.

Positive Factors

Balance Sheet Strength

A strong equity base and low leverage provide durable financial flexibility: the company can fund working capital, absorb cyclical auto demand shocks, and invest in tooling or productivity without immediate reliance on costly external debt, supporting multi-month resilience.

Stable Gross Margins

Relatively stable gross margins point to controlled production costs and efficiency in metal forming processes. That stability helps preserve profitability through volume swings, supports pricing discipline with OEMs, and reduces margin erosion risk over a 2-6 month horizon.

Recurring OEM Supply Model

A business model built on recurring supply contracts to automakers creates predictable baseline demand tied to vehicle programs. High integration into OEM supply chains and repeat manufacturing requirements produce steadier revenue streams and durable customer relationships over medium-term cycles.

Negative Factors

Negative Free Cash Flow

Sustained negative free cash flow reduces internal funding for capex, maintenance, or growth projects and can force reliance on external financing. Over several months this constrains the firm's ability to upgrade equipment or respond to sudden demand shifts without impacting liquidity or strategy.

Declining Net Profit Margin

A falling net margin signals pressure below gross profit—higher overhead, SG&A, or financing costs—weakening the firm's capacity to generate returns on sales. Persisting margin decline will reduce retained earnings and limit long-term reinvestment and shareholder returns.

Earnings Volatility and EPS Drop

A sharp EPS decline and volatile operating margins indicate earnings unpredictability tied to cyclical auto volumes or cost swings. This undermines planning, raises execution risk for multi-month budgets, and may pressure investment or dividend policies if volatility persists.

Muro Corporation Business Overview & Revenue Model

Company Description

Muro Corporation manufactures and sells metal and resin-related parts in Japan. The company provides sprocket, cam pilot, gear ring, gear sun, angle sensor, gear sprocket, gear pulsar, and insert gear products. It also offers forged gear, rotor magnet end plate, adapter, and sprocket drive related products. The company serves vehicles, automobiles, electric bicycles, and industrial engine sectors. The company was formerly known as Muro-Kinzoku Kogyo Co, LTD. and changed its name to Muro Corporation in March 1990. The company was founded in 1953 and is headquartered in Tochigi, Japan.

How the Company Makes Money

Muro Corporation primarily makes money by manufacturing and selling automotive fasteners and related metal-formed components to customers in the automotive industry. Revenue is generated from product sales under supply arrangements where Muro produces specified parts (e.g., bolts, nuts, and other fastening components) to customer requirements and ships them on an ongoing basis. Earnings are driven by (1) sales volumes tied to vehicle production levels and customer platform demand, (2) the product mix and pricing of fasteners and adjacent formed parts, and (3) manufacturing performance (yield, scrap rates, uptime) that affects unit costs and margins. Additional specific breakdowns of revenue streams (e.g., by segment, customer, geography, or aftermarket vs. OEM), named significant partnerships, or other quantified drivers are null.

Muro Corporation Financial Statement Overview

Summary

Muro Corporation has a robust balance sheet with low leverage and strong equity financing, scoring 85. However, the income statement and cash flow statement highlight concerns, such as declining profitability margins and negative free cash flow, scoring 72 and 68 respectively. Overall, the financial performance is mixed, with strengths in financial stability but challenges in profitability and liquidity.

Income Statement

Muro Corporation's income statement shows a mixed performance. The gross profit margin has been relatively stable, indicating consistent cost management. However, the net profit margin has declined in recent years, suggesting challenges in converting revenue into profit. Revenue growth has been inconsistent, with a recent decline, which could be a concern for future profitability. The EBIT and EBITDA margins have also shown volatility, reflecting operational challenges.

Balance Sheet

The balance sheet of Muro Corporation is strong, with a solid equity base and a low debt-to-equity ratio, indicating financial stability. The return on equity has been moderate, showing efficient use of equity to generate profits. The equity ratio is high, suggesting a strong capital structure with a significant portion of assets financed by equity rather than debt.

Cash Flow

Cash flow analysis reveals some concerns with free cash flow, which has been negative in recent periods, indicating potential liquidity issues. The operating cash flow to net income ratio is healthy, showing good cash generation relative to reported profits. However, the free cash flow to net income ratio is weak, pointing to challenges in maintaining liquidity after capital expenditures.

Breakdown	TTM	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	22.78B	22.59B	23.66B	21.84B	20.53B	18.97B
Gross Profit	4.01B	3.91B	4.43B	3.25B	3.89B	3.33B
EBITDA	2.31B	2.21B	2.88B	1.81B	2.61B	2.28B
Net Income	163.19M	486.28M	1.32B	291.52M	1.35B	974.70M
Balance Sheet
Total Assets	30.39B	30.49B	32.43B	28.05B	27.36B	26.75B
Cash, Cash Equivalents and Short-Term Investments	8.72B	8.59B	9.68B	7.23B	6.95B	8.08B
Total Debt	2.19B	2.59B	2.93B	2.05B	1.58B	2.79B
Total Liabilities	8.65B	8.42B	10.75B	8.32B	8.05B	8.96B
Stockholders Equity	21.74B	22.07B	21.68B	19.74B	19.31B	17.80B
Cash Flow
Free Cash Flow	0.00	-525.50M	1.43B	-557.81M	-68.67M	719.19M
Operating Cash Flow	0.00	677.70M	3.88B	1.06B	1.74B	2.78B
Investing Cash Flow	0.00	-1.39B	-2.17B	-1.48B	-1.34B	-1.74B
Financing Cash Flow	0.00	-705.31M	394.22M	159.06M	-1.55B	1.29B

Muro Corporation Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 1337.00
• 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:7264, the sentiment is Neutral. The current price of 1337 is below the 20-day moving average (MA) of 1394.05, below the 50-day MA of 1407.66, and above the 200-day MA of 1278.56, indicating a neutral trend. The MACD of -9.86 indicates Positive momentum. The RSI at 44.27 is Neutral, neither overbought nor oversold. The STOCH value of 51.62 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for JP:7264.

Muro Corporation Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
7266	71 Outperform	¥18.75B	8.04	―	2.70%	-8.63%	-55.68%
7284	71 Outperform	¥4.22B	60.43	―	4.08%	3.46%	―
7264	70 Outperform	¥8.30B	5.20	―	3.54%	-0.72%	-72.70%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
7291	60 Neutral	¥8.11B	4.65	―	4.24%	-7.88%	-73.98%
7294	57 Neutral	¥18.89B	18.77	―	3.19%	-8.99%	-62.26%
7256	52 Neutral	¥10.83B	0.59	―	―	-9.54%	21.21%