Kurogane Kosakusho Ltd. (7997) AI Stock Analysis

• Market Cap: ¥1.85B
• Dividend Yield: 1.73%
• Average Volume (3M): 22.99K
• Price to Earnings (P/E): 5.8
• Beta (1Y): 0.56
• Revenue Growth: -9.48%
• EPS Growth: -66.01%
• Country: JP
• Employees: 254
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Furnishings, Fixtures & Appliances
• EPS (TTM): 85.90
• Shares Outstanding: 1,857,113
• 10 Day Avg. Volume: 16,990
• 30 Day Avg. Volume: 22,990
• PEG Ratio: -0.08
• Price to Book (P/B): 0.31
• Price to Sales (P/S): 0.20
• P/FCF Ratio: -2.03
• 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: 70 Outperform
• Price Target: ¥1,309.00 ▲(30.25% Upside)

The stock's overall score is driven by strong technical momentum and attractive valuation, offset by financial performance concerns. The lack of earnings call data and corporate events means these factors do not influence the score.

Positive Factors

Improved Leverage

Improved leverage management indicates better financial discipline and reduces risk, enhancing long-term financial stability.

Revenue Model

A diversified revenue model with direct sales and service contracts provides stable income streams and reduces dependency on single markets.

Partnerships

Strategic partnerships enhance product offerings and market reach, supporting innovation and competitive positioning in the industry.

Negative Factors

Operational Inefficiencies

Ongoing inefficiencies can hinder profitability and growth, requiring management focus to improve operational processes and cost control.

Negative Cash Flow

Negative cash flow poses liquidity risks and limits the company's ability to invest in growth opportunities or weather economic downturns.

Profitability Concerns

Sustained negative EBIT margins suggest challenges in achieving operational efficiency, impacting long-term profitability and competitiveness.

Kurogane Kosakusho Ltd. Business Overview & Revenue Model

Company Description

Kurogane Kosakusho Ltd. (7997) is a Japanese company primarily engaged in the manufacturing of precision machinery and equipment. Operating within the industrial machinery sector, Kurogane Kosakusho specializes in the production of high-quality machine tools, including lathes, milling machines, and other related products. The company serves a diverse range of industries, including automotive, aerospace, and electronics, providing innovative solutions that enhance manufacturing efficiency and precision.

How the Company Makes Money

Kurogane Kosakusho generates revenue through the sale of its precision machinery and tools to various sectors, with a significant portion of its income derived from both domestic and international markets. The company’s revenue model is primarily based on direct sales to industrial clients, as well as long-term contracts for maintenance and support services. Key revenue streams include new machine sales, aftermarket parts, and service contracts. Additionally, Kurogane Kosakusho has established partnerships with other manufacturing firms and technology providers, enhancing its product offerings and market reach. These collaborations not only bolster its revenue but also contribute to the company's reputation for quality and innovation in the machinery sector.

Kurogane Kosakusho Ltd. Financial Statement Overview

Summary

Kurogane Kosakusho Ltd. shows revenue growth and improved leverage, but faces significant risks due to persistent operational inefficiencies and negative cash flows. The positive net income in 2024 is a notable improvement, yet overall financial health is challenged by cash flow concerns and profitability issues.

Income Statement

Kurogane Kosakusho Ltd. has demonstrated steady revenue growth from 2022 to 2024, with a modest increase in gross profit margin. However, persistent negative EBIT margins indicate ongoing operational challenges. The company has managed to improve its net income significantly in 2024, but overall profitability remains a concern due to negative EBIT and EBITDA margins in several years.

Balance Sheet

The company's debt-to-equity ratio has improved over the years, indicating better leverage management. However, the equity ratio remains moderate, reflecting a balanced capital structure. Return on equity has seen a positive turnaround in 2024, but prior negative net income has impacted historical ROE. Overall, the balance sheet shows signs of stabilization with a strong equity base.

Cash Flow

Kurogane Kosakusho Ltd. faces challenges in generating positive operating cash flow, with negative figures in recent years. Free cash flow has been consistently negative, indicating potential liquidity issues. The operating cash flow to net income ratio shows volatility, pointing to issues in translating profits into cash flow. While there are improvements, cash flow stability remains a concern.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	6.66B	7.20B	7.18B	6.92B	8.37B	8.22B
Gross Profit	1.49B	1.55B	1.45B	1.38B	1.68B	1.72B
EBITDA	334.94M	393.97M	1.51B	-337.08M	280.31M	-208.35M
Net Income	153.95M	209.38M	1.21B	-566.03M	-5.37M	-508.42M
Balance Sheet
Total Assets	8.30B	8.06B	8.20B	8.52B	9.64B	9.62B
Cash, Cash Equivalents and Short-Term Investments	1.00B	907.86M	1.32B	658.82M	775.12M	629.90M
Total Debt	886.64M	883.32M	931.73M	2.86B	3.43B	3.52B
Total Liabilities	3.67B	3.48B	3.92B	5.60B	6.25B	6.21B
Stockholders Equity	4.62B	4.58B	4.27B	2.91B	3.37B	3.40B
Cash Flow
Free Cash Flow	0.00	-710.24M	-445.98M	172.22M	233.90M	-664.01M
Operating Cash Flow	0.00	-248.97M	-428.43M	181.12M	290.34M	-604.08M
Investing Cash Flow	0.00	-81.60M	3.01B	238.81M	-26.69M	-59.59M
Financing Cash Flow	0.00	-61.98M	-2.03B	-591.22M	-118.44M	136.63M

Kurogane Kosakusho Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 1005.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:7997, the sentiment is Positive. The current price of 1005 is below the 20-day moving average (MA) of 1114.95, below the 50-day MA of 1057.10, and above the 200-day MA of 862.25, indicating a bullish trend. The MACD of 34.43 indicates Negative momentum. The RSI at 74.61 is Negative, neither overbought nor oversold. The STOCH value of 80.73 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:7997.

Kurogane Kosakusho Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
7807	80 Outperform	¥4.09B	7.73	―	1.48%	0.65%	-39.91%
7887	80 Outperform	¥7.28B	13.60	―	1.94%	8.56%	2690.35%
7997	70 Outperform	¥1.85B	5.78	―	1.73%	-9.48%	-66.01%
7791	69 Neutral	¥3.47B	7.61	―	4.07%	11.73%	37.16%
7898	66 Neutral	¥8.38B	3.51	―	2.79%	1.11%	―
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
7822	46 Neutral	¥10.08B	31.89	―	4.35%	2.78%	-88.37%