Mori-Gumi Co., Ltd. (1853) AI Stock Analysis

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Mori-Gumi Co., Ltd.

(TSE/TYO:1853)

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Rating:78Outperform

Price Target:JPY 508.00▲(13.90% Upside)

Action:reiterated

Date:11/14/26

Mori-Gumi Co., Ltd. earns a solid rating primarily driven by its pristine, near-zero debt balance sheet and an attractive valuation profile characterized by a low P/E ratio and a healthy dividend yield. While recent bottom-line improvements and cash flow turnarounds are fundamentally encouraging, the lack of long-term top-line revenue growth remains a core challenge. Technically, the stock is experiencing intense upward momentum, though extremely overbought RSI levels suggest investors should be mindful of potential near-term price consolidation.

Positive Factors

Very low leverageExceptionally low leverage and steadily rising equity provide substantial financial flexibility. This strengthens Mori-Gumi’s ability to fund projects, withstand construction-cycle volatility, and preserve capital-allocation options without relying heavily on borrowing.

Negative Factors

Uneven revenue trendRepeated revenue declines and sharp year-to-year swings indicate that project timing creates an uneven top-line profile. This makes forward workload conversion less predictable and can reduce operating leverage when completed-project volumes soften.

Mori-Gumi Co., Ltd. (1853) vs. iShares MSCI Japan ETF (EWJ)

Market Cap: JPY 14.61B
Dividend Yield: 3.14%
Average Volume (3M): 27.71K
Price to Earnings (P/E): 12.6
Beta (1Y): 0.69
Revenue Growth: -7.32%
EPS Growth: 30.80%
Country: Japan
Employees: 311
Sector: Industrials
Sector Strength: 63
Industry: Engineering & Construction

Mori-Gumi Co., Ltd. Business Overview & Revenue Model

Company Description

Mori-Gumi Co., Ltd. is a Japanese company primarily engaged in extensive civil engineering and building construction activities across the nation. Its civil engineering division undertakes projects such as the development of roads, tunnels, railways,...

How the Company Makes Money

Mori-Gumi primarily makes money by taking on construction contracts and recognizing revenue as it performs and completes contracted work. Key revenue streams generally include: (1) Civil engineering contracting revenue from public-works and infrastru...

Mori-Gumi Co., Ltd. Financial Statement Overview

Summary

Demonstrates a highly stable financial profile with an impeccable, practically debt-free balance sheet. Despite stagnant top-line growth and historically volatile project-based cash flows, bottom-line profit expansion and rebounding operating cash flows provide a strong margin of safety.

Income Statement

65Positive

Balance Sheet

88Very Positive

Cash Flow

75Positive

Financial statement breakdown
Breakdown	Mar 2026	Mar 2025	Mar 2024	Mar 2023	Mar 2022
Income Statement
Total Revenue	28.04B	29.45B	27.58B	24.62B	31.32B
Gross Profit	2.86B	2.55B	2.43B	2.23B	3.27B
EBITDA	1.49B	1.17B	1.17B	921.00M	2.00B
Net Income	926.00M	921.00M	685.00M	523.00M	1.25B
Balance Sheet
Total Assets	25.16B	25.58B	27.39B	23.78B	25.41B
Cash, Cash Equivalents and Short-Term Investments	6.40B	4.48B	9.57B	9.43B	9.18B
Total Debt	21.00M	831.00M	827.00M	831.00M	821.00M
Total Liabilities	9.69B	10.68B	13.03B	9.71B	11.45B
Stockholders Equity	15.47B	14.90B	14.36B	14.06B	13.97B
Cash Flow
Free Cash Flow	2.50B	-4.45B	617.00M	711.00M	2.02B
Operating Cash Flow	2.64B	-4.23B	680.00M	799.00M	2.10B
Investing Cash Flow	552.00M	-407.00M	-70.00M	-80.00M	-78.00M
Financing Cash Flow	-1.27B	-466.00M	-468.00M	-468.00M	-569.00M

Mori-Gumi Co., Ltd. Technical Analysis

Technical Analysis SentimentPositive

Last Price446.00

Price Trends

50DMA325.96Positive

100DMA326.89Positive

200DMA324.71Positive

Market Momentum

MACD11.31Negative

RSI92.11Negative

STOCH81.75Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:1853, the sentiment is Positive. The current price of 446.00 is above the 20-day moving average (MA) of 329.20, above the 50-day MA of 325.96, and above the 200-day MA of 324.71, indicating a bullish trend. The MACD of 11.31 indicates Negative momentum. The RSI at 92.11 is Negative, neither overbought nor oversold. The STOCH value of 81.75 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:1853.

Mori-Gumi Co., Ltd. Peers Comparison

Overall Rating

UnderperformOutperform

Sector (63)

Financial Indicators

JP:1853 against its peers
Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
JP:1853	78Outperform	JPY 14.61B	12.64	―	3.14%	-7.32%	30.80%
JP:1798	77Outperform	JPY 11.36B	5.58	―	3.56%	-15.16%	-27.86%
JP:1768	76Outperform	JPY 7.33B	5.70	―	4.99%	34.73%	33.28%
JP:1807	75Outperform	JPY 10.70B	16.50	―	4.44%	-20.00%	-41.44%
JP:1826	71Outperform	JPY 13.03B	9.54	―	5.55%	22.99%	134.56%
JP:1718	64Neutral	JPY 7.21B	5.58	―	16.51%	9.59%	-7.35%
Sector *	63Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%

* Industrials Sector Average

Performance Comparison

JP:1853 and its peers over the selected period
Ticker	Company Name	Price	Change	% Change
JP:1853	Mori-Gumi Co., Ltd.	446.00	134.38	43.12%
JP:1718	MIKIKOGYO CO., LTD.	2120.00	-463.22	-17.93%
JP:1768	Sonec Corporation	1003.00	-378.49	-27.40%
JP:1798	Moriya Corporation	1011.00	-302.85	-23.05%
JP:1807	Watanabe Sato Co., Ltd.	1801.00	133.95	8.04%
JP:1826	Sata Construction Co., Ltd.	1082.00	-0.14	-0.01%

Glossary

BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.

Date of analysis: Nov 14, 2026

Mori-Gumi Co., Ltd. AI Stock Analysis