Kura Sushi USA (KRUS) AI Stock Analysis

• Market Cap: $737.94M
• Dividend Yield: N/A
• Average Volume (3M): 381.93K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.53
• Revenue Growth: 21.37%
• EPS Growth: -705.26%
• Country: US
• Employees: 3,300
• Sector: Consumer Cyclical
• Sector Strength: 56
• Industry: Restaurants
• EPS (TTM): -0.91
• Shares Outstanding: 11,085,419
• 10 Day Avg. Volume: 411,487
• 30 Day Avg. Volume: 381,929
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): 2.65
• Price to Cash Flow (P/CF): 38.10
• P/FCF Ratio: 0.00
• 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: $64.38
• Price Target Upside: 5.44% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 10

Kura Sushi USA shows robust revenue growth and operational improvements, yet faces significant challenges with profitability and cash flow. The bearish technical indicators and poor valuation metrics further compound these issues. While the company has optimistic growth plans, the increased operating losses and sales decline present substantial risks, resulting in a cautious stock outlook.

Positive Factors

Growth and Expansion

KRUS appears well-positioned for a strong second half, supported by accelerating unit growth, upcoming IP collaborations, and tech rollouts like its reservation system.

Technological Advancements

The company continues to make progress on idiosyncratic initiatives such as new ordering technology and reservation system.

Negative Factors

Analyst Outlook

The analyst no longer forecasts positive comparable sales for Kura Sushi in 2025, which impacts the overall outlook.

Sales Performance

Same-store sales decreased by 5.3% due to traffic decline and negative impacts from severe weather and fires.

Tariff Impact

There is a significant impact from tariffs on Kura Sushi, with a 14.0% weighted average tariff on cost of goods sold.

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 its restaurant operations, where it generates revenue by serving sushi and other Japanese dishes to its customers. The company's key revenue streams include dine-in sales, takeout and delivery services, and the sale of alcoholic beverages. Kura Sushi USA's unique selling proposition lies in its revolving sushi bar concept, which enhances customer engagement and encourages higher volume sales. Additionally, the company benefits from strategic partnerships with suppliers to ensure the quality and affordability of its ingredients, contributing to its profitability. The use of technology in its operations, such as automated billing and customer service robots, also helps in streamlining operations and reducing costs, thereby maximizing revenue.

Kura Sushi USA Financial Statement Overview

Summary

Kura Sushi USA demonstrates robust revenue growth and a solid balance sheet, providing a strong foundation for future expansion. However, persistent profitability issues and negative free cash flow are significant challenges. The company needs to focus on operational efficiencies and cost management to improve margins and cash flow to ensure sustainable growth and financial stability.

Income Statement

Kura Sushi USA shows a positive trajectory in revenue growth, with TTM revenue of $250.8M, up from $237.9M annually, indicating strong top-line growth. However, the company struggles with profitability, as evidenced by a negative net profit margin, with a TTM net income of -$7.7M. The gross profit margin improved to 27.6% in TTM, indicating better cost management. Despite these improvements, negative EBIT and EBITDA margins highlight ongoing operational challenges.

Balance Sheet

The balance sheet shows a strong equity position with a debt-to-equity ratio of 0.67, suggesting manageable leverage. The company has increased its stockholders' equity to $227.6M in TTM, reflecting a stable financial base. However, the rise in total debt to $152.9M may pose future risks. The equity ratio of 56.4% demonstrates a solid foundation but needs careful debt management to maintain financial health.

Cash Flow

Despite a challenging operating environment, Kura Sushi USA has managed positive operating cash flow of $17.5M in TTM, highlighting effective cash management. However, negative free cash flow growth due to high capital expenditures poses a risk. The operating cash flow to net income ratio is strong, indicating good cash generation relative to net income, but the negative free cash flow to net income ratio is concerning.

Breakdown
TTM	Sep 2024	Sep 2023	Sep 2022	Sep 2021	Sep 2020
Income Statement		Total Revenue
250.84M	237.86M	187.43M	141.09M	64.89M	45.17M
	Gross Profit
69.23M	29.52M	28.78M	21.89M	6.11M	-4.25M
	EBIT
-8.02M	-9.95M	332.00K	-754.00K	-9.99M	-16.50M
	EBITDA
4.77M	3.20M	9.64M	5.01M	-5.84M	-13.07M
	Net Income Common Stockholders
-7.72M	-8.80M	1.50M	-764.00K	-10.29M	-17.36M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
5.71M	50.99M	78.24M	35.78M	40.43M	9.26M
	Total Assets
0.00	328.52M	304.66M	201.36M	177.67M	118.38M
	Total Debt
0.00	141.35M	119.56M	90.81M	72.96M	64.51M
	Net Debt
5.71M	90.36M	49.86M	55.03M	32.53M	55.25M
	Total Liabilities
0.00	165.98M	140.02M	108.06M	86.83M	72.67M
	Stockholders Equity
21.50M	162.54M	164.64M	93.29M	90.84M	45.71M
Cash Flow		Free Cash Flow
-15.55M	18.37M	-22.75M	-3.97M	-21.38K	-27.46M
	Operating Cash Flow
17.55M	15.61M	18.06M	23.69M	-7.15K	-13.00M
	Investing Cash Flow
-40.94M	-36.46M	-49.90M	-28.17M	-14.67K	-14.78M
	Financing Cash Flow
66.91M	2.14M	65.75M	-170.00K	52.98K	-1.00M

Kura Sushi USA Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 61.06
• 50DMA: Positive
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For KRUS, the sentiment is Neutral. The current price of 61.06 is above the 20-day moving average (MA) of 52.68, above the 50-day MA of 58.26, and below the 200-day MA of 74.41, indicating a neutral trend. The MACD of 0.70 indicates Negative momentum. The RSI at 59.05 is Neutral, neither overbought nor oversold. The STOCH value of 88.90 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for KRUS.

Kura Sushi USA Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
NATH	71 Outperform	$391.86M	16.54	-102.54%	2.08%	6.83%	24.77%
HEPS	68 Neutral	$1.06B	―	-39.43%	―	29.68%	-919.86%
RICK	62 Neutral	$349.09M	70.62	1.73%	0.69%	-1.53%	-80.10%
MPAA	61 Neutral	$178.21M	―	-6.40%	―	4.26%	64.64%
MYE	60 Neutral	$355.43M	49.51	2.53%	5.46%	2.86%	-85.38%
Sector *	60 Neutral	$6.78B	11.63	3.24%	4.20%	2.36%	-21.91%
KRUS	46 Neutral	$737.94M	―	-5.38%	―	21.37%	-705.26%

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.