Musashino Kogyo Co., Ltd. (9635) AI Stock Analysis

• Market Cap: ¥2.58B
• Dividend Yield: N/A
• Average Volume (3M): 1.27K
• Price to Earnings (P/E): 6.9
• Beta (1Y): 0.23
• Revenue Growth: 1.57%
• EPS Growth: 892.96%
• Country: JP
• Employees: 48
• Sector: Real Estate
• Sector Strength: 53
• Industry: Real Estate - Services
• EPS (TTM): 301.46
• Shares Outstanding: 1,050,000
• 10 Day Avg. Volume: 810
• 30 Day Avg. Volume: 1,266
• PEG Ratio: 0.03
• Price to Book (P/B): 0.61
• Price to Sales (P/S): 1.62
• P/FCF Ratio: 16.75
• 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: ¥2,665.00 ▲(18.50% Upside)

Musashino Kogyo Co., Ltd. shows solid financial performance with strong profitability and a stable balance sheet, which are the most significant factors. Technical analysis indicates neutral momentum, while valuation suggests the stock is relatively expensive. The absence of earnings call and corporate events data limits additional insights.

Positive Factors

Balance sheet strength

Extremely low leverage and a robust equity base give the company durable financial flexibility. This reduces refinancing risk, supports investment or selective capex in theaters, and provides a buffer through cyclical box-office downturns, strengthening long-term resilience.

Margin sustainability

High gross margins above 45% signal persistent pricing power or efficient cost control in exhibition operations. Coupled with improving net margin and positive revenue growth, this supports sustainable operating cash generation and the ability to weather film lineup variability over multiple quarters.

Cash generation ability

Material improvement in operating cash flow and positive free cash flow indicate the business can convert earnings into cash. This underpins reinvestment in facilities, potential shareholder returns, and the ability to self-fund strategic initiatives without relying on external financing.

Negative Factors

Business concentration risk

Heavy reliance on a single core business—cinema exhibition and in-theater sales—creates structural exposure to shifts in consumer attendance patterns, film supply cycles, and local competition. Limited diversification reduces resilience to sustained industry disruption.

Free cash flow volatility

While recent cash generation improved, past free cash flow volatility undermines predictability for reinvestment, dividends, or debt reduction. Persistent swings in FCF complicate multi-quarter planning and make sustained capital allocation decisions riskier for management.

Modest returns on capital

Although ROE is improving, the absolute level remains low, indicating limited returns from shareholder equity. Combined with modest net margins, this suggests the business currently generates only modest economic returns, constraining long-term ability to rapidly compound shareholder value.

Musashino Kogyo Co., Ltd. Business Overview & Revenue Model

Company Description

Musashino Kogyo Co., Ltd. engages in the movie entertainment, real estate, and commercial businesses in Japan. It operates through Movie Business, Real Estate Business, Driving Training Business, and Commercial Business segments The company is involved in the movie distribution and operation of theater concession stands. It also engages in the investing, leasing, operating, and managing tenant buildings; and managing restaurants, as well as operates a driving school. The company was incorporated in 1920 and is headquartered in Tokyo, Japan.

How the Company Makes Money

Musashino Kogyo generates revenue primarily through the sale of precision machinery and components to various industries, notably automotive and electronics. The company employs a business model that focuses on high-value contracts with manufacturers, which provides a steady stream of income. Key revenue streams include direct sales of machinery, custom machining services, and maintenance contracts. Additionally, Musashino Kogyo may benefit from partnerships with major automotive and electronics firms, which can lead to long-term contracts and increased demand for its products. The company also invests in R&D to develop new technologies and improve existing products, thereby enhancing its market position and profitability.

Musashino Kogyo Co., Ltd. Financial Statement Overview

Summary

Musashino Kogyo Co., Ltd. demonstrates strong profitability improvements with a solid balance sheet. Revenue growth and efficient cost management contribute positively, while low leverage minimizes financial risk. Cash flow analysis shows effective cash generation, though historical volatility in free cash flow warrants attention.

Income Statement

Musashino Kogyo Co., Ltd. shows a strong gross profit margin, consistently above 45% over the years, indicating efficient cost management. The net profit margin improved significantly in 2025 to 4.76% from 0.36% in 2024, showcasing better profitability. Revenue growth from 2024 to 2025 was 6.39%, demonstrating positive growth momentum. However, fluctuating EBIT and EBITDA margins suggest some operational challenges, though they have shown improvement in recent periods.

Balance Sheet

The company maintains a healthy balance sheet with a low debt-to-equity ratio of 0.09 in 2025, indicating low leverage and financial stability. The equity ratio remains robust, reflecting a strong equity base relative to total assets. Return on Equity (ROE) improved to 1.80% in 2025 from 0.13% in 2024, showing increased profitability from equity. Overall, the balance sheet indicates a low-risk financial position with strong equity support.

Cash Flow

Operating cash flow improved significantly in 2025, contributing to a positive free cash flow. Free cash flow to net income ratio is favorable, indicating effective cash generation from operations. However, the free cash flow growth rate showed volatility in previous years. The company has maintained a solid operating cash flow to net income ratio, reinforcing its ability to convert earnings into cash flow efficiently.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	1.35B	1.36B	1.28B	1.38B	1.29B	1.23B
Gross Profit	678.49M	680.36M	633.39M	734.27M	687.39M	665.36M
EBITDA	144.80M	154.81M	87.19M	103.44M	143.83M	-81.14M
Net Income	58.11M	64.96M	4.67M	40.58M	50.01M	-216.67M
Balance Sheet
Total Assets	6.02B	6.07B	5.98B	5.95B	5.99B	6.06B
Cash, Cash Equivalents and Short-Term Investments	815.24M	861.28M	758.32M	743.27M	759.25M	835.37M
Total Debt	305.04M	317.69M	345.02M	347.44M	411.26M	499.27M
Total Liabilities	2.39B	2.46B	2.40B	2.38B	2.45B	2.58B
Stockholders Equity	3.63B	3.62B	3.58B	3.58B	3.54B	3.49B
Cash Flow
Free Cash Flow	0.00	131.81M	16.80M	48.99M	13.48M	-115.56M
Operating Cash Flow	0.00	200.09M	41.57M	91.95M	65.56M	58.04M
Investing Cash Flow	0.00	-69.37M	-20.39M	-44.10M	-47.15M	-172.77M
Financing Cash Flow	0.00	-27.76M	-6.18M	-63.87M	-94.58M	272.69M

Musashino Kogyo Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 2249.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:9635, the sentiment is Positive. The current price of 2249 is below the 20-day moving average (MA) of 2389.80, below the 50-day MA of 2285.58, and above the 200-day MA of 2212.09, indicating a bullish trend. The MACD of 60.93 indicates Negative momentum. The RSI at 71.72 is Negative, neither overbought nor oversold. The STOCH value of 70.51 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:9635.

Musashino Kogyo Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
9342	72 Outperform	¥3.03B	23.27	―	0.22%	5.29%	22.75%
8946	66 Neutral	¥1.90B	12.10	―	―	85.59%	330.15%
8912	66 Neutral	¥2.32B	18.76	―	2.00%	6.86%	10.06%
Sector *	65 Neutral	$2.17B	12.19	3.79%	4.94%	3.15%	1.96%
9816	65 Neutral	¥2.76B	16.28	―	1.51%	1.82%	332.58%
9635	63 Neutral	¥2.58B	6.92	―	―	1.57%	892.96%
9423	63 Neutral	¥2.72B	43.59	―	2.43%	11.80%	-41.76%