Kura Sushi USA (KRUS) AI Stock Analysis

• Market Cap: $892.77M
• Dividend Yield: N/A
• Average Volume (3M): 350.31K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.65
• Revenue Growth: 18.76%
• EPS Growth: -1259.53%
• Country: US
• Employees: 3,300
• Sector: Consumer Cyclical
• Sector Strength: 65
• Industry: Restaurants
• EPS (TTM): 0.05
• Shares Outstanding: 11,093,889
• 10 Day Avg. Volume: 461,340
• 30 Day Avg. Volume: 350,312
• PEG Ratio: -9.36
• Price to Book (P/B): 3.87
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 106.43
• Enterprise Value/Market Cap: 1.12
• Enterprise Value/Revenue: 0.98
• Enterprise Value/Gross Profit: 8.70
• Enterprise Value/Ebitda: 68.84
• 1Y Price Target: $94.43
• Price Target Upside: 23.52% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 8

• Rating: 59 Neutral
• Price Target: $80.00 ▲(4.64%Upside)

Kura Sushi USA's overall stock score is driven by moderate financial performance and challenges in valuation. The company's strong revenue growth is overshadowed by unprofitability and increased debt levels. Technical analysis reflects mixed signals with potential oversold conditions. The earnings call provides some optimism with strategic initiatives, but negative sales growth and cost pressures remain concerns.

Positive Factors

Business Expansion

Management has raised revenue guidance and plans for more net new openings, reflecting confidence in business growth and expansion.

Financial Performance

Kura Sushi reported better than expected results on all line items, with revenue beating consensus and showing sequential acceleration in same-store sales.

Operational Efficiency

The reservation system rollout is likely to be a material transaction driver, with more than 50% of customers being seated within 2 minutes of their reservation time.

Negative Factors

Same Store Sales Decline

Same store sales were -2.1%, trailing both the estimate and Consensus Metrix.

Tariff Volatility

There remains volatility around the tariff situation, which could impact costs, with management indicating that worst case scenario could lead to higher costs of goods sold.

Traffic Decline

There is a projected 7% traffic decline, although this shows improvement from the -8.5% decline in the previous quarter.

Kura Sushi USA Business Overview & Revenue Model

Company Description

Kura Sushi USA, Inc. operates technology-enabled Japanese restaurants in the United States. The company's restaurants provide Japanese cuisine through an engaging revolving sushi service model, which is known as 'Kura Experience'. As of August 31, 2021, it operated 33 restaurants in nine states and Washington DC. The company was formerly known as Kula Sushi USA, Inc. and changed its name to Kura Sushi USA, Inc. in October 2017. The company was founded in 2008 and is headquartered in Irvine, California. Kura Sushi USA, Inc. is a subsidiary of Kura Sushi, Inc.

How the Company Makes Money

Kura Sushi USA makes money primarily through the operation of its revolving sushi bar restaurants. The company's revenue model is centered around the sale of sushi and other Japanese-inspired dishes directly to customers in its brick-and-mortar locations. Key revenue streams include dine-in sales, takeout, and delivery services. The automated, conveyor-belt sushi system allows for efficient service and maximizes table turnover, contributing significantly to revenue. Kura Sushi USA also benefits from its loyalty programs and unique dining features, such as touch screen ordering and a prize system, which enhance customer engagement and repeat visits. Partnerships with technology providers enable the seamless integration of these automated systems, further optimizing operational efficiency and profitability.

Kura Sushi USA Financial Statement Overview

Summary

Kura Sushi USA demonstrates strong revenue growth and improved gross profitability. However, the company faces challenges with negative net income and an increase in debt levels, which affect overall financial health. There's a need to focus on achieving sustainable profitability and managing leverage effectively to enhance financial stability.

Income Statement

Kura Sushi USA has shown significant revenue growth over the years, with a notable increase from $141 million in 2022 to $269 million in TTM (Trailing-Twelve-Months). Despite the revenue growth, profitability remains a challenge with negative net income and EBIT margins. The gross profit margin has improved, indicating better cost management, but the net profit margin remains negative, reflecting ongoing challenges in achieving profitability.

Balance Sheet

The balance sheet indicates a moderate debt-to-equity ratio, which suggests manageable leverage. The equity ratio has remained stable, showing a solid asset base. However, the company has experienced an increase in total debt over the years, which could pose risks if profitability does not improve. The return on equity is negative, reflecting the net income losses.

Cash Flow

Cash flow analysis reveals an improving operating cash flow, which is a positive indicator of the company's ability to generate cash from operations. However, the free cash flow remains volatile, and the ratio of operating cash flow to net income is skewed due to negative net income. The company needs to focus on increasing free cash flow to ensure financial stability.

Breakdown	Sep 2024	Sep 2023	Sep 2022	Sep 2021	Sep 2020
Income Statement
Total Revenue	237.86M	187.43M	141.09M	64.89M	45.17M
Gross Profit	29.52M	28.78M	21.89M	6.11M	-4.25M
EBITDA	3.20M	9.64M	5.01M	-5.84M	-13.07M
Net Income	-8.80M	1.50M	-764.00K	-10.29M	-17.36M
Balance Sheet
Total Assets	328.52M	304.66M	201.36M	177.67M	118.38M
Cash, Cash Equivalents and Short-Term Investments	50.99M	78.24M	35.78M	40.43M	9.26M
Total Debt	141.35M	119.56M	90.81M	72.96M	64.51M
Total Liabilities	165.98M	140.02M	108.06M	86.83M	72.67M
Stockholders Equity	162.54M	164.64M	93.29M	90.84M	45.71M
Cash Flow
Free Cash Flow	-28.91M	-22.75M	-3.97M	-21.38K	-27.46M
Operating Cash Flow	15.61M	18.06M	23.69M	-7.15K	-13.00M
Investing Cash Flow	-36.46M	-49.90M	-28.17M	-14.67K	-14.78M
Financing Cash Flow	2.14M	65.75M	-170.00K	52.98K	-1.00M

Kura Sushi USA Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 76.45
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For KRUS, the sentiment is Positive. The current price of 76.45 is below the 20-day moving average (MA) of 80.75, above the 50-day MA of 74.19, and below the 200-day MA of 77.08, indicating a neutral trend. The MACD of -0.06 indicates Positive momentum. The RSI at 47.82 is Neutral, neither overbought nor oversold. The STOCH value of 12.67 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for KRUS.

Kura Sushi USA Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
MYE	66 Neutral	$550.27M	52.59	3.69%	3.63%	3.92%	-73.64%
MPAA	65 Neutral	$224.09M	―	-7.17%	―	5.53%	60.54%
NATH	64 Neutral	$421.46M	17.29	-102.54%	1.94%	6.91%	22.33%
RICK	63 Neutral	$335.27M	45.22	2.62%	0.73%	-3.93%	-59.06%
Sector *	63 Neutral	$16.78B	10.88	-7.08%	3.04%	1.73%	-25.15%
KRUS	59 Neutral	$892.77M	―	-4.77%	―	18.76%	-1259.53%
HEPS	57 Neutral	$851.66M	―	-51.21%	―	22.41%	―

Kura Sushi USA Corporate Events

Kura Sushi USA Completes Successful Public Offering

Kura Sushi USA, Inc., a technology-driven Japanese restaurant chain, successfully closed its public offering of 800,328 Class A common stock shares, raising approximately $64.6 million. Priced at $85 per share, the offering was managed by William Blair, Barclays Capital, and TD Securities among others. The proceeds will be used for general corporate purposes, including capital expenditures and working capital, reflecting Kura Sushi’s growth strategy amid volatile market conditions.

Kura Sushi USA Announces Public Offering of Stock

Kura Sushi USA, a technology-driven Japanese restaurant brand, is launching an underwritten public offering of Class A common stock, with plans to use the proceeds for general corporate purposes. The offering is managed by William Blair, Barclays Capital, and TD Securities, and is subject to market conditions. Forward-looking statements highlight potential risks including economic factors, competition, and regulatory impacts.