Umenohana Co., Ltd. (7604) AI Stock Analysis

• Market Cap: ¥7.21B
• Dividend Yield: 1.21%
• Average Volume (3M): 12.39K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.05
• Revenue Growth: 0.13%
• EPS Growth: -175.61%
• Country: JP
• Employees: 657
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Restaurants
• EPS (TTM): -9.38
• Shares Outstanding: 9,029,200
• 10 Day Avg. Volume: 7,880
• 30 Day Avg. Volume: 12,386
• PEG Ratio: 0.14
• Price to Book (P/B): 4.07
• Price to Sales (P/S): 0.25
• P/FCF Ratio: -42.51
• 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
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 40 Underperform
• Price Target: ¥770.00 ▼(-5.52% Downside)

Umenohana Co., Ltd. is facing significant financial instability, with high leverage and negative profitability metrics being the most impactful factors. The technical analysis indicates bearish momentum, further contributing to the low score. The valuation is slightly supported by a modest dividend yield, but the negative P/E ratio reflects ongoing challenges. Overall, the stock is currently a high-risk investment.

Positive Factors

Strong Brand Presence

A strong brand presence enhances customer loyalty and market penetration, supporting long-term revenue growth and competitive positioning.

Product Diversification

Product diversification allows Umenohana to adapt to changing consumer preferences, reducing risk and enhancing revenue stability over time.

Operational Efficiency

High gross profit margins indicate efficient operations, enabling the company to generate substantial profit from sales despite revenue challenges.

Negative Factors

High Leverage

Significant leverage increases financial risk and limits flexibility, potentially hindering the company's ability to invest in growth opportunities.

Negative Profitability

Negative profitability indicates operational challenges and may impact the company's ability to sustain operations and invest in future growth.

Cash Flow Constraints

Negative cash flow limits the company's ability to reinvest in the business and manage liquidity, posing challenges for long-term sustainability.

Umenohana Co., Ltd. Business Overview & Revenue Model

Company Description

UMENOHANA Co., Ltd. engages in the restaurant business in Japan. It operates through three segments: Restaurant, Takeout, and Outside Sale. The company offers processed marine products, such as oyster products; Furuichian rolled sushi, inari sushi, oshizushi, assorted sushi, omusubi, steamed rice, etc.; take-out bento, Japanese side dishes, new year dishes, tofu and other processed soybean products, and frozen side dishes; and gift items, as well as perishables. It also provides Yuba and Tofu Shop Ume no Hana, Japanese nabedokoro sushihan hot pot dishes, sushi, rice bowls, set meals, drinks, take-out lunch boxes, seafood izakaya sakura suisan fish dishes, grilled chicken, a la carte dishes, drinks, and other food and drink products. It offers its products under the Ume-no-Hana and Furuichian brand names. The company was formerly known as K.K. Ume Corporation and changed its name to UMENOHANA Co., Ltd. in October 1997. UMENOHANA Co., Ltd. was founded in 1979 and is based in Kurume, Japan.

How the Company Makes Money

Umenohana generates revenue through the sale of its soy-based products, primarily tofu, which is distributed through various channels including supermarkets, convenience stores, and direct-to-consumer sales. The company's revenue model is supported by a diverse product lineup that includes not only traditional tofu but also innovative soy products designed to meet changing consumer preferences. Key revenue streams include wholesale distribution to retailers, direct sales from company-owned stores, and online sales platforms. Strategic partnerships with food service providers and health-focused brands further enhance its market reach and revenue potential, allowing Umenohana to tap into various consumer segments while promoting a sustainable and healthy lifestyle.

Umenohana Co., Ltd. Financial Statement Overview

Summary

Umenohana Co., Ltd. faces significant financial challenges, with declining revenues, negative net income, and high leverage. Despite strong gross profit margins, the company's high debt levels and negative profitability metrics pose substantial risks. Cash flow issues further exacerbate the situation, indicating potential liquidity constraints.

Income Statement

Umenohana Co., Ltd. has experienced a decline in revenue, with a negative revenue growth rate of 1.26% from 2024 to 2025. The company has a negative net profit margin of -1.30% for 2025, indicating losses. However, the gross profit margin remains strong at approximately 65.04%, showing operational efficiency in generating profit from sales. EBIT and EBITDA margins are low, at 1.87% and 2.98% respectively, reflecting challenges in covering operating expenses.

Balance Sheet

The company's balance sheet reveals a high debt-to-equity ratio of 9.06 for 2025, posing a risk due to significant leverage. The return on equity is negative, at -20.95%, indicating inefficiency in generating returns on shareholder investments. The equity ratio is low at 7.97%, suggesting a limited buffer for absorbing financial shocks. These factors highlight financial instability and potential difficulties in meeting long-term obligations.

Cash Flow

The cash flow statement for Umenohana Co., Ltd. shows a negative free cash flow of -175.3 million JPY in 2025, indicating less cash available for reinvestment and potential cash constraints. The operating cash flow to net income ratio is -1.89, suggesting inefficiencies in converting net income into cash flow. The free cash flow to net income ratio is also negative, highlighting challenges in liquidity management.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	29.58B	29.44B	29.82B	27.46B	22.59B	21.60B
Gross Profit	19.08B	19.15B	19.52B	17.65B	14.59B	14.22B
EBITDA	655.60M	878.17M	1.89B	421.50M	1.33B	-1.23B
Net Income	-571.05M	-383.55M	1.02B	-440.82M	217.18M	-1.92B
Balance Sheet
Total Assets	23.06B	22.95B	25.11B	25.30B	28.70B	28.16B
Cash, Cash Equivalents and Short-Term Investments	1.76B	2.08B	2.76B	3.66B	6.50B	5.55B
Total Debt	17.05B	16.58B	16.86B	17.57B	20.40B	21.52B
Total Liabilities	21.37B	21.13B	21.73B	22.76B	25.57B	26.97B
Stockholders Equity	1.69B	1.83B	3.36B	2.51B	2.99B	1.00B
Cash Flow
Free Cash Flow	0.00	-175.29M	-85.92M	156.30M	-88.04M	-396.05M
Operating Cash Flow	0.00	725.24M	690.54M	956.42M	369.55M	-59.33M
Investing Cash Flow	0.00	-676.55M	-132.91M	-844.46M	-222.74M	242.35M
Financing Cash Flow	0.00	-1.00B	-934.66M	-2.95B	780.56M	2.85B

Umenohana Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 815.00
• 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:7604, the sentiment is Neutral. The current price of 815 is above the 20-day moving average (MA) of 809.95, below the 50-day MA of 817.28, and below the 200-day MA of 827.40, indicating a neutral trend. The MACD of 1.04 indicates Negative momentum. The RSI at 55.64 is Neutral, neither overbought nor oversold. The STOCH value of 60.26 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for JP:7604.

Umenohana Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
3077	67 Neutral	¥3.05B	9.28	―	―	6.16%	86.76%
3063	62 Neutral	¥9.64B	112.54	―	0.51%	17.38%	-86.95%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
7682	53 Neutral	¥8.53B	93.09	―	0.38%	5.44%	-8.33%
7918	47 Neutral	¥4.88B	-24.41	―	―	0.64%	-156.28%
3069	46 Neutral	¥7.19B	30.54	―	―	-2.85%	-25.67%
7604	40 Underperform	¥7.21B	-17.20	―	1.21%	0.13%	-175.61%