OM2 Network Co., Ltd. (7614) AI Stock Analysis

• Market Cap: ¥10.67B
• Dividend Yield: 2.23%
• Average Volume (3M): 28.91K
• Price to Earnings (P/E): 7.9
• Beta (1Y): 0.41
• Revenue Growth: 7.53%
• EPS Growth: -17.97%
• Country: JP
• Employees: 715
• Sector: Consumer Defensive
• Sector Strength: 42
• Industry: Food Distribution
• EPS (TTM): 48.74
• Shares Outstanding: 7,335,634
• 10 Day Avg. Volume: 81,380
• 30 Day Avg. Volume: 28,913
• PEG Ratio: -0.81
• Price to Book (P/B): 0.57
• Price to Sales (P/S): 0.29
• P/FCF Ratio: 9.14
• 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: ¥1,801.00 ▲(17.18% Upside)
• Action: Reiterated Date: 03/15/26
• Date: Action: Reiterated 03/15/26

The score is driven primarily by solid overall financial health—especially the strong, low-leverage balance sheet and continued growth—partly tempered by recent margin pressure and uneven cash conversion. Technicals support the rating with a clear uptrend and moderate momentum, while valuation is also supportive with a modest P/E and a mid-level dividend yield.

Positive Factors

Conservative balance sheet

Very low leverage and rising equity give the company durable financial flexibility. This reduces refinancing risk, supports consistent capital allocation (capex, dividends, M&A) and provides a cushion against sector downturns over the next several months.

Consistent revenue growth

Sustained top-line growth signals steady demand and operational execution. Consistent revenue provides a foundation for scaling margins and reinvesting in the business, making near-term earnings recovery and strategic initiatives more attainable.

Persistent positive free cash flow

Recurrent free cash flow across years indicates genuine cash generation capacity, supporting dividends, debt reduction, and reinvestment. Even with volatility, steady FCF underpins long-term financial resilience and funding optionality.

Negative Factors

Margin compression

Declining operating and net margins point to cost pressure or weakening pricing power. Persistent margin erosion reduces profitability and returns on capital, limiting the company's ability to fund growth or improve shareholder returns without structural changes.

Uneven cash conversion

Inconsistent conversion of earnings into cash raises uncertainty about the reliability of cash available for investment, dividends or debt repayment. Shortfalls in OCF versus net income suggest working-capital or accrual timing issues that could persist.

Recent EPS deterioration

Negative EPS growth indicates recent profitability weakness despite revenue gains. Continued EPS decline can compress retained earnings and reduce reinvestment capacity, signalling operational headwinds that may affect medium-term returns.

OM2 Network Co., Ltd. Business Overview & Revenue Model

Company Description

OM2 Network Co.,Ltd. retails meat and prepared food products in Japan. The company is also involved in the meat manufacturing and processing activities. It also operates various restaurants. The company serves its customers under 12 months and o dining brand names. OM2 Network Co.,Ltd. was founded in 1958 and is headquartered in Tokyo, Japan.

How the Company Makes Money

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OM2 Network Co., Ltd. Financial Statement Overview

Summary

Financials show steady revenue growth and consistently positive earnings and free cash flow, supported by a very low-debt, resilient balance sheet. The key offset is recent margin compression and uneven cash conversion, which softens near-term quality of performance.

Income Statement

Revenue has been consistently growing across the last several annual periods (with a strong step-up in the latest year), indicating steady demand and execution. Profitability, however, has moderated: the latest year shows a noticeable decline in operating and net margins versus the prior two years, suggesting higher costs and/or pricing pressure. Overall earnings remain positive and fairly stable, but the margin compression in the most recent period is the key watch item.

Balance Sheet

The balance sheet appears conservatively positioned with very low leverage: debt remains a small fraction of equity across all periods, and equity has steadily increased alongside asset growth. Returns on equity are positive and generally healthy, though they have cooled from the peak levels seen two years ago, consistent with the recent profitability softening. Net, the company looks financially resilient with ample balance-sheet flexibility.

Cash Flow

Cash generation is solid with positive operating cash flow and free cash flow in every year shown, and free cash flow has typically represented a meaningful share of net income. That said, cash conversion is uneven: operating cash flow is materially lower than net income in multiple years, and free cash flow growth has been volatile with declines in several recent periods (despite a strong rebound one year). Overall, cash flow quality is acceptable but not consistently strong.

Breakdown	TTM	Jan 2026	Jan 2025	Jan 2024	Jan 2023	Jan 2022
Income Statement
Total Revenue	34.15B	35.37B	32.78B	32.11B	31.54B	29.72B
Gross Profit	13.32B	14.04B	12.65B	12.67B	12.08B	11.05B
EBITDA	1.76B	1.80B	1.88B	2.23B	1.86B	1.58B
Net Income	987.90M	944.25M	1.10B	1.34B	886.76M	972.58M
Balance Sheet
Total Assets	22.64B	23.38B	22.06B	20.24B	19.18B	18.26B
Cash, Cash Equivalents and Short-Term Investments	10.72B	10.91B	9.74B	11.97B	11.05B	9.62B
Total Debt	911.24M	814.86M	507.13M	54.56M	190.68M	315.06M
Total Liabilities	5.21B	5.27B	4.83B	3.80B	3.82B	3.63B
Stockholders Equity	17.43B	18.11B	17.24B	16.44B	15.36B	14.63B
Cash Flow
Free Cash Flow	0.00	1.12B	884.81M	1.32B	1.69B	710.50M
Operating Cash Flow	0.00	1.47B	1.27B	1.65B	1.85B	973.02M
Investing Cash Flow	0.00	-315.20M	-2.44B	-438.77M	171.34M	-516.01M
Financing Cash Flow	0.00	70.12M	-1.08B	-297.61M	-285.74M	-10.04M

OM2 Network Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 1537.00
• 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:7614, the sentiment is Neutral. The current price of 1537 is below the 20-day moving average (MA) of 1597.25, below the 50-day MA of 1576.64, and above the 200-day MA of 1514.45, indicating a neutral trend. The MACD of 3.28 indicates Positive momentum. The RSI at 49.25 is Neutral, neither overbought nor oversold. The STOCH value of 53.42 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for JP:7614.

OM2 Network Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
7481	80 Outperform	¥23.94B	7.27	―	4.11%	8.87%	-17.91%
7614	73 Outperform	¥10.67B	7.90	―	2.23%	7.53%	-17.97%
2692	69 Neutral	¥164.93B	9.61	―	1.39%	3.91%	-0.28%
8030	68 Neutral	¥16.78B	2.44	―	3.17%	5.19%	11.04%
Sector *	62 Neutral	$20.33B	14.63	-3.31%	3.23%	1.93%	-12.26%
3182	61 Neutral	¥48.53B	3.77	―	0.52%	20.97%	-56.39%
8039	61 Neutral	¥9.03B	12.72	―	0.95%	6.26%	67.81%