Kuroda Precision Industries Ltd. (7726) AI Stock Analysis

• Market Cap: ¥5.78B
• Dividend Yield: 2.05%
• Average Volume (3M): 3.93K
• Price to Earnings (P/E): 68.8
• Beta (1Y): 0.73
• Revenue Growth: -6.69%
• EPS Growth: -80.28%
• Country: JP
• Employees: 645
• Sector: Industrials
• Sector Strength: 72
• Industry: Manufacturing - Tools & Accessories
• EPS (TTM): 50.97
• Shares Outstanding: 5,743,286
• 10 Day Avg. Volume: 3,980
• 30 Day Avg. Volume: 3,933
• PEG Ratio: -0.50
• Price to Book (P/B): 0.50
• Price to Sales (P/S): 0.33
• P/FCF Ratio: -13.18
• 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: 63 Neutral
• Price Target: ¥1,072.00 ▲(9.95% Upside)

The overall stock score is primarily influenced by strong technical analysis, indicating bullish momentum. However, financial performance challenges and high valuation concerns weigh down the score. The lack of earnings call and corporate events data limits additional insights.

Positive Factors

Diverse B2B revenue streams

Kuroda’s mix of engineered project work and repeat component sales provides durable revenue diversity. Project work supports higher margins and customer lock-in, while repeat shipments smooth order volatility, supporting steadier demand and long-term customer relationships in industrial markets.

Niche precision manufacturing expertise

Specialization in high-accuracy tooling and components is a structural competitive advantage. Technical expertise and tight tolerances create higher switching costs and barriers to competition, enabling long-term customer partnerships in automation and industrial equipment supply chains.

Relatively healthy equity ratio

A solid equity ratio implies capital resilience and better ability to absorb cyclical downturns. This financial stability supports continued access to financing for capex or working capital, preserving strategic flexibility over multiple quarters despite industry cyclicality.

Negative Factors

Revenue decline trend

Recent negative revenue growth indicates weakening end-market demand or lost share, reducing operating leverage and pressuring profitability. Continued top-line contraction can erode R&D and capital spending capacity, impairing long-term competitiveness if not reversed.

Rising leverage risk

An increasing debt burden elevates financial risk if cash generation falters. Higher leverage reduces flexibility for capex, delays, or downturns and increases interest expense sensitivity, constraining strategic investments and exposing the firm to refinancing risk over the medium term.

Weak cash flow generation

Negative and volatile cash flow undermines the firm’s ability to self-fund capex, pay down debt, or return capital to shareholders. Persistent cash shortfalls force reliance on external financing and limit the company’s capacity to invest in productivity or pursue strategic projects.

Kuroda Precision Industries Ltd. Business Overview & Revenue Model

Company Description

Kuroda Precision Industries Ltd. manufactures and sells motion control systems, press tools and die systems, and machine tools and measurement systems worldwide. It offers support tools, precision ground ball screws, and custom ball/JIS standard screws; ball screw actuators; line motion guides, support-units, greases, and feed screws; surface grinding machines; laminated precision press tools for motor core; and precision metal press products/motor core products. The company also provides parallel thread, taper thread/taper pipe thread, oil country, master/plain, and taper gauges; gauge blocks, test bars, and measuring instruments; wafer flatness measuring systems, wafer flatness/SORI measuring systems, and surface and flatness measuring systems, as well as surface and flatness measuring systems for large discs. In addition, it offers hydraulic tools; and minimal quantity lubrication systems, as well as clamping force tester and machine gauge. The company was formerly known as Kuroda Gauge Manufacturing Co., Ltd. and changed its name to Kuroda Precision Industries Ltd. in June 1965. Kuroda Precision Industries Ltd. was founded in 1925 and is headquartered in Kawasaki, Japan.

How the Company Makes Money

Kuroda Precision Industries generates revenue primarily through the sale of its precision machinery and tools, which are essential for manufacturing and assembly processes in multiple sectors. The company's revenue model is supported by several key streams, including direct sales of machinery to manufacturers, aftermarket services such as maintenance and repairs, and the provision of specialized engineering solutions. Kuroda has established strategic partnerships with major industrial players, allowing it to expand its market reach and enhance its product offerings. Additionally, the demand for high-quality precision tools in growing industries like robotics and electronics contributes significantly to its earnings.

Kuroda Precision Industries Ltd. Financial Statement Overview

Summary

Kuroda Precision Industries Ltd. shows a mixed financial performance with challenges in revenue growth and profitability. The balance sheet remains relatively stable, but increasing leverage could pose risks if profitability does not improve. Cash flow management needs attention, particularly in generating positive free cash flow.

Income Statement

Kuroda Precision Industries Ltd. has experienced fluctuating revenues with a notable decline in the most recent year, impacting profitability. Gross Profit Margin is reasonable but declining, and both EBIT and net profit margins have decreased, indicating potential operational inefficiencies.

Balance Sheet

The company maintains a relatively healthy equity ratio, suggesting a stable financial structure. However, the increase in total debt over recent years has raised the debt-to-equity ratio, which could pose a risk if profitability continues to decline. Return on Equity is moderate but could be improved.

Cash Flow

Cash flow performance is concerning, with negative free cash flow and inconsistent operating cash flow over the periods. The operating cash flow to net income ratio is varied, reflecting fluctuating cash management efficiency.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	16.75B	17.28B	18.50B	22.75B	18.04B	13.29B
Gross Profit	3.66B	4.10B	4.44B	5.44B	4.91B	3.35B
EBITDA	1.01B	1.56B	1.21B	2.62B	2.02B	1.17B
Net Income	-197.85M	172.59M	498.44M	906.71M	563.75M	126.69M
Balance Sheet
Total Assets	27.74B	26.16B	25.88B	25.40B	22.05B	19.66B
Cash, Cash Equivalents and Short-Term Investments	3.42B	3.29B	3.26B	4.01B	2.90B	2.16B
Total Debt	9.01B	7.55B	6.58B	5.50B	4.00B	4.54B
Total Liabilities	16.45B	14.58B	14.19B	14.67B	12.24B	10.35B
Stockholders Equity	11.12B	11.39B	11.51B	10.52B	9.61B	9.13B
Cash Flow
Free Cash Flow	0.00	-429.10M	-968.36M	-68.92M	1.44B	-369.54M
Operating Cash Flow	0.00	1.23B	427.82M	1.35B	2.15B	531.23M
Investing Cash Flow	0.00	-1.65B	-1.31B	-1.43B	-716.43M	-887.36M
Financing Cash Flow	0.00	468.15M	214.68M	1.15B	-748.14M	315.04M

Kuroda Precision Industries Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 975.00
• 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:7726, the sentiment is Positive. The current price of 975 is below the 20-day moving average (MA) of 1013.65, below the 50-day MA of 996.44, and above the 200-day MA of 933.36, indicating a neutral trend. The MACD of 3.27 indicates Positive momentum. The RSI at 49.95 is Neutral, neither overbought nor oversold. The STOCH value of 31.06 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:7726.

Kuroda Precision Industries Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
6157	77 Outperform	¥20.94B	16.43	―	3.31%	0.97%	-10.47%
6165	73 Outperform	¥13.56B	10.97	―	3.84%	5.57%	89.21%
5966	67 Neutral	¥6.08B	13.94	―	3.24%	1.16%	-31.17%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
7726	63 Neutral	¥5.78B	68.83	―	2.05%	-6.69%	-80.28%
6156	55 Neutral	¥7.81B	-46.43	―	5.64%	-0.91%	-319.62%
5990	54 Neutral	¥4.57B	23.04	―	3.60%	-4.75%	-178.90%