# Toray Industries (3402.JP)

Canonical: https://gigainvestors.com/s/3402.JP

Analysis as of: 2026-10-15T07:09:51.531Z. Financial observations: FY2013–FY2026.

Listing currency: JPY. Reporting currency: JPY.

## Verdict

Not a wonderful business

Quality tests for Buy: not passed (profit record: pass; earnings resilience is evidence only). Published buy qualification: no.

Share price: JPY 1,222.00 per share; close as of 2026-10-15.

Estimated value: low JPY 586.97 per share, central JPY 648.28 per share, high JPY 729.91 per share. Buy at or below the central value JPY 648.28 per share. Valuation as of 2026-10-15T07:09:51.531Z; scenarios are not confidence intervals.

Expected annual return: 6.2% at the stated quote. About 6.2% a year at today's price (required return 10.0%). required return 10.0% a year (10% floor; JP 10-year bond 2.9% + 4 points).

## Checklist

### understandable: pass

- 4 revenue declines in the last 10 years (informational)

- Financial history: 10 years

- Years with declining revenue: 4

- Years with a net loss: 0

- Operating margin variation: 0.33×

Chart: Operating margin; fiscal year observations.

- FY2017: 0.07×

- FY2018: 0.07×

- FY2020: 0.05×

- FY2021: 0.03×

- FY2022: 0.05×

- FY2023: 0.04×

- FY2024: 0.02×

- FY2025: 0.05×

- FY2026: 0.04×

### moat: fail

- ROIC median below threshold

- ROIC worst years below threshold (more than 1 bad year allowed)

- ROIC, median of available years: 4.1%

- ROIC, second-lowest year: 2.2%

- Years with nonpositive capital: 0

- Capital spending / revenue: 6.5%

- ROIC including acquisitions, ten-year median: 2.6%

Chart: ROIC excluding acquisitions; fiscal year observations.

- FY2017: 7.2%

- FY2018: 6.9%

- FY2019: 5.1%

- FY2020: 4.8%

- FY2021: 2.2%

- FY2022: 3.9%

- FY2023: 3.7%

- FY2024: 1.6%

- FY2025: 4.4%

- FY2026: 3.5%

### economics: fail

- incremental invested capital return below threshold

- Owner earnings / net income, 5-yr: 0.93×

- Cash conversion uses consolidated totals: No

- Owner earnings, five-year total: JPY 312B

- Net income, five-year total: JPY 336B

- Return on incremental invested capital: -5.6%

- Working capital / revenue, annual change: 0.4 pp

- Working capital / revenue, final three-year average: 33.2%

Chart: Annual owner cash / profit; fiscal year observations.

- FY2022: 1.20×

- FY2023: 1.17×

- FY2024: 0.24×

- FY2025: 0.77×

- FY2026: 0.77×

### management: fail

- Historical market-dollar context (not the management verdict): 2017 to 2026 (9 years)

- buybacks unrelated to price (informational)

- ROIC first 3 years vs last 3 years: 6.9% vs 3.5%

- Per-share earnings: 59.97 to 48.93 (three-year endpoint medians)

- per-share value declined or ends nonpositive

- Management verdict uses per-share economic progress: Yes

- Ordinary dilution, 10-year annual growth: -0.6%

- Ordinary dilution, 5-year annual growth: -1.3%

- Market cap gain: JPY 74B

- Cumulative retained earnings: JPY 471B

- Diluted shares, 10-year annual growth: -0.6%

- Diluted shares, 5-year annual growth: -1.3%

- $1 test, starting fiscal year: FY2017

- $1 test, ending fiscal year: FY2026

- Per-share value growth: -2.5%

- Per-share value change: JPY -11.04

- Per-share value, starting three-year median: JPY 59.97

- Per-share value, ending three-year median: JPY 48.93

- Buyback history: 0 years

- Debt-funded buybacks: No

- Acquisition spending: JPY 146B

- Cumulative net income, 10 years: JPY 662B

- ROIC, first three-year median: 6.9%

- ROIC, last three-year median: 3.5%

Chart: Earnings per share; fiscal year observations.

- FY2017: JPY 62.17

- FY2018: JPY 59.97

- FY2019: JPY 0

- FY2020: JPY 52.65

- FY2021: JPY 28.61

- FY2022: JPY 52.63

- FY2023: JPY 45.49

- FY2024: JPY 13.67

- FY2025: JPY 48.93

- FY2026: JPY 52.96

### accounting: pass

- Sloan accruals: -3.8%

- Receivables to sales index (DSRI): 1.05×

- Restructuring years, last five: 0

- Stock compensation / operating cash flow: 0.0%

- Earnings backed by cash: Yes

- Operating cash / earnings: 2.66×

- Accounting red flags: 0

- Goodwill and intangibles / equity: 0.11×

Chart: Sloan accruals; fiscal year observations.

- FY2017: -3.1%

- FY2018: -1.3%

- FY2019: 0.0%

- FY2020: -5.6%

- FY2021: -5.8%

- FY2022: -1.8%

- FY2023: -2.3%

- FY2024: -4.7%

- FY2025: -5.4%

- FY2026: -3.8%

## Holders

## Price story

Price needs cash profits to grow 10.4% a year for ten years · sales +0.9%

Story as of 2026-10-16T10:00:14.022Z; price observation 2026-10-15.

Price needs cash profits to grow 10.4% a year for ten years

### Sales · FY2025–2026

sales +0.9%; source https://disclosure2dl.edinet-fsa.go.jp/searchdocument/pdf/S100YFG9.pdf; observed 2026-06-22.

- FY2017: JPY 2.03T 

- FY2018: JPY 2.20T 

- FY2019: JPY 0 

- FY2020: JPY 2.09T 

- FY2021: JPY 1.88T 

- FY2022: JPY 2.23T 

- FY2023: JPY 2.49T 

- FY2024: JPY 2.46T 

- FY2025: JPY 2.56T 

- FY2026: JPY 2.59T 

### Gross margin · FY2026

gross margin 20.1%; source https://disclosure2dl.edinet-fsa.go.jp/searchdocument/pdf/S100YFG9.pdf; observed 2026-06-22.

- FY2017: 21.2% 

- FY2018: 20.7% 

- FY2020: 20.5% 

- FY2021: 20.0% 

- FY2022: 19.6% 

- FY2023: 16.9% 

- FY2024: 18.0% 

- FY2025: 19.7% 

- FY2026: 20.1% 

## Owner memo

Memo as of 2026-10-16T08:06:05.509Z.

### How it makes money

Annual sales are JPY 2.6 trillion.

- Source: https://disclosure2dl.edinet-fsa.go.jp/searchdocument/pdf/S100YFG9.pdf (filed 2026-06-22); FY2026: revenue 2585077000000; grossProfit 520048000000; margin = grossProfit / revenue.

### Why customers stay

Margins ranged from 18% to 20.1% during 2024–26; it earns 4.1% on its capital.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-06-22); FY2024: grossProfit / revenue = 18%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-06-22); FY2025: grossProfit / revenue = 19.7%.

- Source: https://disclosure2dl.edinet-fsa.go.jp/searchdocument/pdf/S100YFG9.pdf (filed 2026-06-22); FY2026: grossProfit / revenue = 20.1%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-06-22); 10-year return on capital observations [[2017,0.072487803201771],[2018,0.06861616200387619],[2019,0.0508066005639634],[2020,0.04815906134115828],[2021,0.02181729497820069],[2022,0.039413977689871836],[2023,0.037036706716677865],[2024,0.016190217990067205],[2025,0.043544970261357126],[2026,0.03454130592775727]]; median 0.04147947397561448. ROIC follows the displayed moat series; financial companies use return on tangible equity.

### Where the cash goes

Spends 15.5% of cash earnings on expansion; paid dividends in 4 of 10 years.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-06-22); FY2017: growth capex 0; upkeep 143894000000; owner earnings 44597000000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-06-22); FY2018: growth capex 52110000000; upkeep 95815000000; owner earnings 95915000000. Growth capex / owner earnings = 0.5432935411562321.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-06-22); FY2020: growth capex 26013000000; upkeep 114725000000; owner earnings 73064000000. Growth capex / owner earnings = 0.35603032957407205.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-06-22); FY2021: growth capex 0; upkeep 122483000000; owner earnings 27515000000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-06-22); FY2022: growth capex 0; upkeep 92195000000; owner earnings 100771000000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-06-22); FY2023: growth capex 0; upkeep 102216000000; owner earnings 85278000000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-06-22); FY2024: growth capex 0; upkeep 134130000000; owner earnings 5356000000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-06-22); FY2025: growth capex 44427484253.4628; upkeep 134820515746.5372; owner earnings 59730484253.4628. Growth capex / owner earnings = 0.7437991640070651.

- Source: https://disclosure2dl.edinet-fsa.go.jp/searchdocument/pdf/S100YFG9.pdf (filed 2026-06-22); FY2026: growth capex 9485397494.141846; upkeep 137015602505.85815; owner earnings 61092397494.141846. Growth capex / owner earnings = 0.15526314047588985.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-06-22); Dividend observations: [[2017,22396000000],[2018,22400000000],[2019,25602000000],[2020,25612000000],[2021,0],[2022,0],[2023,0],[2024,0],[2025,0],[2026,0]]. Zero only counted when supported by a complete cash-flow statement.

### What the price says

The price assumes cash profits grow 10.4% yearly over ten years; actual decline was 3.1%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-06-22); Ten-year compound average after fade. Initial solved rate 0.1371828825444542. Price 1222; FX 1; discount 0.1; same standard ten-year fade to terminal 0.03. FY2016 owner earnings/share 55.776692254881084 → FY2026 40.68677923177214. Closing-price date 2026-10-15.

## Monthly share-price history (JPY per share)

- 2016-11: JPY 929.40 per share

- 2016-12: JPY 946.20 per share

- 2017-01: JPY 977.60 per share

- 2017-02: JPY 1,005.00 per share

- 2017-03: JPY 987.00 per share

- 2017-04: JPY 986.10 per share

- 2017-05: JPY 924.90 per share

- 2017-06: JPY 940.30 per share

- 2017-07: JPY 997.00 per share

- 2017-08: JPY 1,047.00 per share

- 2017-09: JPY 1,091.50 per share

- 2017-10: JPY 1,143.50 per share

- 2017-11: JPY 1,057.00 per share

- 2017-12: JPY 1,062.50 per share

- 2018-01: JPY 1,085.00 per share

- 2018-02: JPY 1,086.00 per share

- 2018-03: JPY 1,006.50 per share

- 2018-04: JPY 1,022.00 per share

- 2018-05: JPY 890.90 per share

- 2018-06: JPY 874.00 per share

- 2018-07: JPY 865.90 per share

- 2018-08: JPY 833.70 per share

- 2018-09: JPY 853.50 per share

- 2018-10: JPY 801.90 per share

- 2018-11: JPY 890.30 per share

- 2018-12: JPY 772.00 per share

- 2019-01: JPY 806.90 per share

- 2019-02: JPY 775.50 per share

- 2019-03: JPY 706.90 per share

- 2019-04: JPY 758.00 per share

- 2019-05: JPY 746.90 per share

- 2019-06: JPY 819.20 per share

- 2019-07: JPY 752.90 per share

- 2019-08: JPY 757.60 per share

- 2019-09: JPY 802.10 per share

- 2019-10: JPY 770.70 per share

- 2019-11: JPY 724.00 per share

- 2019-12: JPY 741.10 per share

- 2020-01: JPY 725.20 per share

- 2020-02: JPY 624.70 per share

- 2020-03: JPY 469.00 per share

- 2020-04: JPY 499.10 per share

- 2020-05: JPY 523.90 per share

- 2020-06: JPY 507.50 per share

- 2020-07: JPY 454.10 per share

- 2020-08: JPY 503.70 per share

- 2020-09: JPY 479.30 per share

- 2020-10: JPY 470.40 per share

- 2020-11: JPY 566.10 per share

- 2020-12: JPY 610.90 per share

- 2021-01: JPY 681.20 per share

- 2021-02: JPY 696.60 per share

- 2021-03: JPY 712.50 per share

- 2021-04: JPY 679.20 per share

- 2021-05: JPY 710.60 per share

- 2021-06: JPY 739.10 per share

- 2021-07: JPY 717.20 per share

- 2021-08: JPY 741.80 per share

- 2021-09: JPY 716.20 per share

- 2021-10: JPY 708.90 per share

- 2021-11: JPY 660.80 per share

- 2021-12: JPY 681.80 per share

- 2022-01: JPY 725.10 per share

- 2022-02: JPY 659.70 per share

- 2022-03: JPY 638.80 per share

- 2022-04: JPY 618.90 per share

- 2022-05: JPY 666.30 per share

- 2022-06: JPY 761.20 per share

- 2022-07: JPY 732.60 per share

- 2022-08: JPY 798.90 per share

- 2022-09: JPY 711.80 per share

- 2022-10: JPY 724.50 per share

- 2022-11: JPY 738.60 per share

- 2022-12: JPY 736.60 per share

- 2023-01: JPY 795.80 per share

- 2023-02: JPY 779.20 per share

- 2023-03: JPY 756.40 per share

- 2023-04: JPY 767.70 per share

- 2023-05: JPY 737.20 per share

- 2023-06: JPY 800.40 per share

- 2023-07: JPY 795.20 per share

- 2023-08: JPY 786.10 per share

- 2023-09: JPY 778.00 per share

- 2023-10: JPY 724.80 per share

- 2023-11: JPY 767.10 per share

- 2023-12: JPY 733.10 per share

- 2024-01: JPY 740.50 per share

- 2024-02: JPY 690.50 per share

- 2024-03: JPY 738.50 per share

- 2024-04: JPY 722.20 per share

- 2024-05: JPY 785.80 per share

- 2024-06: JPY 761.50 per share

- 2024-07: JPY 785.30 per share

- 2024-08: JPY 750.40 per share

- 2024-09: JPY 843.20 per share

- 2024-10: JPY 836.20 per share

- 2024-11: JPY 954.30 per share

- 2024-12: JPY 1,001.50 per share

- 2025-01: JPY 1,079.50 per share

- 2025-02: JPY 996.00 per share

- 2025-03: JPY 1,016.00 per share

- 2025-04: JPY 909.30 per share

- 2025-05: JPY 998.10 per share

- 2025-06: JPY 987.80 per share

- 2025-07: JPY 1,038.00 per share

- 2025-08: JPY 993.30 per share

- 2025-09: JPY 945.30 per share

- 2025-10: JPY 946.10 per share

- 2025-11: JPY 1,015.00 per share

- 2025-12: JPY 1,020.00 per share

- 2026-01: JPY 1,138.50 per share

- 2026-02: JPY 1,340.00 per share

- 2026-03: JPY 1,100.50 per share

- 2026-04: JPY 1,121.00 per share

- 2026-05: JPY 1,192.00 per share

- 2026-06: JPY 1,127.50 per share

- 2026-07: JPY 1,158.00 per share

- 2026-08: JPY 1,287.50 per share

- 2026-09: JPY 1,260.50 per share

- 2026-10: JPY 1,250.50 per share

## Annual estimated value (JPY per share)

- FY2024: low JPY 744.42 per share, central JPY 898.68 per share, high JPY 1,029.25 per share

- FY2025: low JPY 556.08 per share, central JPY 654.20 per share, high JPY 743.32 per share

- FY2026: low JPY 586.97 per share, central JPY 648.28 per share, high JPY 729.91 per share

Historical values use today's bond yield for every fiscal year

Historical values use today's FX rate into trading currency for every fiscal year

Historical values use current restated fundamentals and current commodity classification; they are not point-in-time estimates

## Sources

[Original EDINET filing](https://disclosure2dl.edinet-fsa.go.jp/searchdocument/pdf/S100YFG9.pdf); period 2026-03-31, filed 2026-06-22.

Estimates depend on assumptions and are not guarantees or investment advice. Underlying data remains subject to its source licenses; public reading does not grant bulk redistribution rights.

## Reported holder observations