Toray Industries (TRYIY) AI Stock Analysis

• Market Cap: $10.66B
• Dividend Yield: 1.48%
• Average Volume (3M): 818.00
• Price to Earnings (P/E): 114.8
• Beta (1Y): 0.32
• Revenue Growth: -1.45%
• EPS Growth: 30.18%
• Country: US
• Employees: 48,140
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Apparel - Manufacturers
• EPS (TTM): 0.03
• Shares Outstanding: 752,240,700
• 10 Day Avg. Volume: 0
• 30 Day Avg. Volume: 818
• PEG Ratio: 0.08
• Price to Book (P/B): 0.95
• Price to Sales (P/S): 0.63
• P/FCF Ratio: 21.39
• Enterprise Value/Market Cap: 230.75
• Enterprise Value/Revenue: 0.95
• Enterprise Value/Gross Profit: 4.79
• Enterprise Value/Ebitda: 9.53
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): 0.69
• Revenue Forecast (FY): $16.69B

• Rating: 57 Neutral
• Price Target: $15.00 ▲(15.03% Upside)
• Action: Reiterated Date: 02/18/26
• Date: Action: Reiterated 02/18/26

The score is held back primarily by weakening cash flow and thin profitability/low returns despite a manageable balance sheet. Technicals are supportive with a strong uptrend, but overbought signals add near-term risk, and the high P/E with only a modest yield reduces valuation appeal.

Positive Factors

Diversified advanced-materials portfolio

Diversified portfolio across fibers, performance chemicals, carbon fiber, specialty films and water treatment gives exposure to multiple end markets (automotive, aerospace, electronics, infrastructure). This reduces reliance on any single cycle and supports recurring B2B revenue from qualified, long-term customer relationships.

R&D and IP-driven product differentiation

Significant R&D and intellectual property enable specialty formulations and performance differentiation that command premium pricing. This creates durable barriers to entry, supports long qualification cycles in high-reliability end markets, and helps sustain margins and customer stickiness over the medium term.

Manageable leverage and sizeable equity base

Debt near 0.52x equity alongside a ¥1.76T equity base provides balance-sheet flexibility. Manageable leverage lowers refinancing and solvency risk, enabling continued investment in capacity, R&D and qualification programs needed for high-value materials without immediate pressure to cut strategic spending.

Negative Factors

Weak free cash flow generation

Free cash flow fell ~61% and FCF is only about 21% of net income, signaling weak cash conversion. Persistent low cash generation constrains funding for capex, R&D and shareholder returns, increases reliance on external financing, and reduces the firm's ability to absorb prolonged downturns.

Thin profitability and low returns

Net margin near 2.4% and ROE around 3.4% indicate limited profitability and weak capital efficiency. Low margins reduce the internal funding available for growth, leave little buffer against cost inflation, and make it harder to generate attractive long-term shareholder returns without structural margin improvement.

Modest revenue growth and earnings volatility

Only ~2.7% top-line growth and TTM net income below recent annual results indicate sluggish demand growth and profit variability. Limited revenue expansion and earnings volatility hinder scale economies, complicate multi-year planning and slow progress on improving returns and cash conversion over the medium term.

Toray Industries Business Overview & Revenue Model

Company Description

Toray Industries, Inc. is a leading global manufacturer specializing in advanced materials and technology solutions. Founded in Japan, the company operates across several sectors, including textiles, carbon fiber composites, plastics, and chemicals. Toray is known for its innovative products, including high-performance fibers, films, and resins that serve a wide range of industries such as aerospace, automotive, electronics, and healthcare.

How the Company Makes Money

Toray makes money primarily by manufacturing and selling materials and related products to business customers (B2B), with revenue largely tied to shipment volumes, product mix (commodity vs. high value-added specialties), and contract pricing. Key revenue streams include: (1) Fibers & Textiles: sales of synthetic fibers, yarns, fabrics, and downstream textile products used in apparel, industrial materials, and other applications; earnings are driven by production scale, product differentiation (e.g., functional textiles), and demand from consumer and industrial markets. (2) Performance Chemicals and specialty materials: sales of resins, chemicals, films, and other functional materials used in electronics, packaging, and industrial uses; profitability depends on specialty formulations, application-specific performance, and long-term customer relationships with manufacturers. (3) Carbon Fiber Composite Materials: sales of carbon fibers, prepregs, and composite-related materials and intermediate products for aerospace, automotive, wind energy, sporting goods, and industrial applications; this segment typically benefits from higher value-added products, qualification cycles, and multi-year supply relationships where performance and reliability are critical. (4) Environmental & Engineering (including water treatment): revenue from membranes, filtration and separation materials, and related engineered products and services supporting municipal and industrial water treatment and environmental applications; earnings depend on project demand, consumable replacement cycles, and adoption of membrane-based solutions. Across these businesses, Toray’s earnings are supported by its R&D and intellectual property that enable premium pricing in specialty applications, global manufacturing footprint that supports supply reliability, and integration across upstream materials and downstream processing. Specific material, component, and solution sales may also be influenced by strategic customer partnerships and qualification requirements in regulated or high-reliability end markets (e.g., aerospace and electronics), which can lead to repeat business once products are designed into customer platforms.

Toray Industries Financial Statement Overview

Summary

Modest revenue growth (TTM +2.7%) and manageable leverage support stability, but profitability is thin (net margin ~2.4%) and ROE is low (~3.4%). The main drag is cash flow: free cash flow fell sharply (~-61%) and is low relative to net income (~21%), reducing financial flexibility.

Income Statement

TTM (Trailing-Twelve-Months) revenue grew 2.7%, indicating modest top-line momentum. Profitability is steady but not strong for the period: gross margin is ~19.9% and operating profitability is moderate (EBIT margin ~4.6%, EBITDA margin ~9.7%), while net margin is thin (~2.4%). Net income in TTM is notably below the most recent annual result, pointing to weaker bottom-line conversion and some earnings volatility.

Balance Sheet

Leverage looks manageable with debt at ~0.52x equity in TTM (improved versus higher leverage in earlier years), supported by a sizeable equity base (~¥1.76T) against total assets (~¥3.52T). However, returns are modest: TTM return on equity is ~3.4%, well below stronger prior-year levels, suggesting the balance sheet is not currently generating high profitability.

Cash Flow

Cash generation is a key weak spot in TTM: free cash flow is positive (~¥19.2B) but sharply down (about -61% growth), and free cash flow is low relative to net income (~21%). Operating cash flow coverage is also modest (~0.28), indicating limited cash cushion versus funding needs, and cash flow strength appears less consistent than in prior annual periods.

Breakdown	TTM	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	2.58T	2.56T	2.46T	2.49T	2.23T	1.88T
Gross Profit	513.24B	505.89B	443.52B	420.83B	377.50B	438.36B
EBITDA	258.05B	265.29B	207.84B	219.00B	252.43B	206.08B
Net Income	43.30B	77.91B	21.90B	72.82B	84.23B	45.79B
Balance Sheet
Total Assets	3.52T	3.29T	3.47T	3.19T	2.85T	2.65T
Cash, Cash Equivalents and Short-Term Investments	245.72B	254.52B	248.86B	254.69B	242.49B	242.49B
Total Debt	1.02T	842.66B	949.68B	950.09B	935.66B	973.93B
Total Liabilities	1.63T	1.47T	1.62T	1.56T	1.53T	1.47T
Stockholders Equity	1.76T	1.71T	1.74T	1.54T	1.41T	1.24T
Cash Flow
Free Cash Flow	19.16B	75.78B	51.55B	43.00B	89.11B	85.62B
Operating Cash Flow	182.68B	255.03B	185.68B	145.21B	211.59B	225.77B
Investing Cash Flow	-15.05B	-63.20B	-121.00B	-102.72B	-97.87B	-142.36B
Financing Cash Flow	-105.88B	-188.52B	-70.37B	-57.38B	-69.40B	-67.59B

Toray Industries Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 13.04
• 50DMA: Negative
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TRYIY, the sentiment is Neutral. The current price of 13.04 is below the 20-day moving average (MA) of 16.17, below the 50-day MA of 15.12, and below the 200-day MA of 13.65, indicating a neutral trend. The MACD of -0.07 indicates Positive momentum. The RSI at 41.04 is Neutral, neither overbought nor oversold. The STOCH value of 10.01 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for TRYIY.

Toray Industries Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
GIII	71 Outperform	$1.10B	18.62	8.61%	―	-2.61%	-11.87%
COLM	68 Neutral	$2.88B	17.00	10.53%	2.18%	2.76%	-7.83%
ZGN	68 Neutral	$4.11B	10.67	10.58%	1.33%	-1.88%	-5.94%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
TRYIY	57 Neutral	$10.66B	114.81	3.37%	1.48%	-1.45%	30.18%
AIN	51 Neutral	$1.55B	-25.23	-7.05%	2.13%	-9.37%	-160.13%
UFI	51 Neutral	$67.82M	-1.65	-9.61%	―	-5.26%	42.84%