MEDIROM Healthcare Technologies (MRM) AI Stock Analysis

• Market Cap: $12.33M
• Dividend Yield: N/A
• Average Volume (3M): 588.78K
• Price to Earnings (P/E): 8.9
• Beta (1Y): 0.39
• Revenue Growth: 12.93%
• EPS Growth: 66.81%
• Country: US
• Employees: 334
• Sector: Consumer Cyclical
• Sector Strength: 58
• Industry: Personal Products & Services
• EPS (TTM): 0.95
• Shares Outstanding: 7,901,950
• 10 Day Avg. Volume: 53,541
• 30 Day Avg. Volume: 588,776
• PEG Ratio: -0.19
• Price to Book (P/B): -54.48
• Price to Sales (P/S): 0.00
• P/FCF Ratio: -4.01
• 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: $5.00
• Price Target Upside: 220.51% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 0

• Rating: 61 Neutral
• Price Target: $1.00 ▼(-35.90%Downside)

MEDIROM Healthcare Technologies demonstrates a mix of growth and risk. Strong revenue growth is a positive, but profitability and cash flow challenges, alongside high leverage, pose significant risks. The technical analysis suggests short-term positive momentum, though overbought signals could lead to a correction. The valuation appears favorable with a low P/E ratio, adding investment appeal.

MEDIROM Healthcare Technologies Business Overview & Revenue Model

Company Description

MEDIROM Healthcare Technologies (MRM) is a Japanese company operating in the healthcare and wellness sectors. It primarily provides health management services, including relaxation salons, digital health solutions, and related wellness products. The company aims to enhance the quality of life for its clients through innovative and personalized healthcare services.

How the Company Makes Money

MEDIROM Healthcare Technologies generates revenue through multiple streams. A significant portion of its income comes from its network of relaxation salons, which offer therapeutic and wellness services to customers. The company also earns money by providing digital health solutions, including health monitoring applications and platforms that cater to the growing demand for personalized healthcare management. Additionally, MEDIROM partners with corporate clients to offer employee wellness programs, further diversifying its revenue base. These partnerships, along with its consumer-focused services, play a crucial role in the company's earnings.

MEDIROM Healthcare Technologies Financial Statement Overview

Summary

MEDIROM Healthcare Technologies exhibits strong revenue growth with a 21.5% increase, but faces profitability challenges with negative EBIT and thin profit margins. The balance sheet shows improvement in equity, yet high debt levels indicate financial risk. Cash flow concerns are significant, with a 147.2% decline in free cash flow, highlighting liquidity issues.

Income Statement

MEDIROM Healthcare Technologies shows a significant revenue growth rate of 21.5% from 2023 to 2024, indicating a positive trajectory. However, the company struggles with negative EBIT and thin profit margins, suggesting challenges in cost management and profitability. The Gross Profit Margin improved to 27.1% in 2024 showing better efficiency in revenue generation. The EBITDA Margin has also improved to 4.7% from a negative position. Overall, while revenue growth is strong, profitability remains a concern.

Balance Sheet

The company has a high Debt-to-Equity Ratio, reflecting significant leverage and potential financial risk. Stockholders' Equity is positive in 2024, recovering from negative equity in previous years, indicating a strengthening balance sheet. The Equity Ratio is low at 11.5%, suggesting high reliance on debt financing. Return on Equity is positive but low at 15.9%, showing moderate efficiency in generating profits from shareholders’ investments. While improvements are seen in equity, the high debt levels pose a risk.

Cash Flow

Cash flow analysis reveals a significant deterioration in Free Cash Flow, with a decline of 147.2% from 2023 to 2024. The Operating Cash Flow to Net Income ratio is negative, indicating cash flow challenges relative to earnings. Financing activities have been significant, suggesting reliance on external funding. Overall, the cash flow situation is concerning, with negative free cash flow indicating liquidity challenges.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
8.30B	6.83B	6.95B	5.41B	3.34B
	Gross Profit
2.25B	1.57B	1.90B	1.42B	428.95M
	EBIT
-18.10M	-391.58M	96.97M	-470.59M	-746.09M
	EBITDA
387.50M	310.08M	281.02M	-276.29M	-551.16M
	Net Income Common Stockholders
148.76M	115.05M	148.97M	-990.73M	-539.17M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
335.56M	106.85M	605.95M	377.12M	1.47B
	Total Assets
8.09B	6.85B	6.75B	5.75B	5.71B
	Total Debt
3.96B	3.65B	3.23B	2.04B	2.56B
	Net Debt
3.63B	3.54B	2.63B	2.42B	1.12B
	Total Liabilities
6.90B	6.63B	6.81B	5.96B	5.22B
	Stockholders Equity
933.27M	210.88M	-59.38M	-208.34M	491.26M
Cash Flow		Free Cash Flow
-1.90B	-767.58M	-806.44M	-652.88M	-439.98M
	Operating Cash Flow
-1.33B	-631.74M	-685.70M	-557.23M	-366.42M
	Investing Cash Flow
361.39M	-328.58M	580.44M	-83.94M	-139.60M
	Financing Cash Flow
1.19B	461.21M	340.10M	-427.95M	1.43B

MEDIROM Healthcare Technologies Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 1.56
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For MRM, the sentiment is Positive. The current price of 1.56 is above the 20-day moving average (MA) of 1.47, above the 50-day MA of 1.07, and below the 200-day MA of 1.80, indicating a neutral trend. The MACD of 0.18 indicates Positive momentum. The RSI at 59.45 is Neutral, neither overbought nor oversold. The STOCH value of 63.89 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for MRM.

MEDIROM Healthcare Technologies Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
RGS	68 Neutral	$55.03M	0.61	548.07%	―	-4.88%	―
Sector *	62 Neutral	$6.82B	11.05	2.80%	4.32%	2.67%	-24.92%
MRM	61 Neutral	$12.33M	8.87	23.48%	―	12.93%	66.81%
MED	54 Neutral	$142.66M	66.49	-3.32%	―	-39.47%	-110.28%
TRNR	51 Neutral	$7.07M	―	-446.50%	―	445.72%	84.92%
XWEL	47 Neutral	$4.85M	―	-797.66%	―	1.33%	35.82%
WGHTQ	40 Neutral	$20.87M	―		―	-10.33%	79.59%