CTW Cayman Class A (CTW) AI Stock Analysis

• Market Cap: $90.48M
• Dividend Yield: N/A
• Average Volume (3M): 215.42K
• Price to Earnings (P/E): 22.9
• Beta (1Y): -0.45
• Revenue Growth: N/A
• EPS Growth: N/A
• Country: US
• Employees: N/A
• Sector: Communication Services
• Sector Strength: 97
• Industry: Electronic Gaming & Multimedia
• EPS (TTM): N/A
• Shares Outstanding: 50,400,000
• 10 Day Avg. Volume: 139,482
• 30 Day Avg. Volume: 215,416
• PEG Ratio: -0.80
• Price to Book (P/B): 9.64
• Price to Sales (P/S): 2.95
• P/FCF Ratio: -562.87
• Enterprise Value/Market Cap: 0.98
• Enterprise Value/Revenue: 0.98
• Enterprise Value/Gross Profit: 1.30
• Enterprise Value/Ebitda: 9.92
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 52 Neutral
• Price Target: $1.50 ▼(-17.13% Downside)
• Action: Reiterated Date: 02/13/26
• Date: Action: Reiterated 02/13/26

The score is held back primarily by the sharp deterioration in 2025 cash flow and the meaningful margin/ROE compression despite strong revenue growth. Technicals are mixed with negative MACD and price below key moving averages, and valuation looks relatively expensive at ~28x earnings with no dividend support.

Positive Factors

Sustained Revenue Growth

An ~18.6% revenue acceleration in 2025 indicates durable demand and market traction for CTW's products. Strong top-line growth provides room to scale operations, invest in product development and marketing, and capture share, supporting lasting competitive momentum.

Manageable Leverage / Capital Structure

Low-to-moderate leverage (~0.25 D/E) and equity growth support financial flexibility across cycles. A resilient capital structure reduces refinancing risk, preserves optionality for M&A or capex, and underpins the company's ability to fund strategic initiatives without excessive leverage.

Equity-Based Incentives for Retention

A 2025 equity incentive grant aligns employee and management incentives with shareholder outcomes and aids retention. Over the medium term this can improve execution, talent stability and alignment on long-term goals, supporting consistent product delivery and strategic continuity.

Negative Factors

Deteriorating Cash Generation

Near-zero operating cash flow and negative free cash flow in 2025 materially raise funding and execution risk. Persistent weak cash conversion undermines self-funding of growth, increases reliance on external financing, and constrains the company's ability to invest without diluting stakeholders.

Margin Compression

A sharp decline in net margin halves prior profitability, reducing earnings resilience and the buffer against rising costs or competitive price pressure. Sustained margin weakness will compress cash returns and limit the company's ability to reinvest while maintaining ROE.

Cooling Returns on Equity

ROE roughly halving year-over-year signals reduced capital efficiency and execution strain. Lower returns can force higher investment to sustain growth, compress shareholder returns over the medium term, and reflect structural margin or operating challenges that may persist.

CTW Cayman Class A Business Overview & Revenue Model

Company Description

CTW Cayman operates a web-based gaming platform in Japan and Singapore. The company's flagship HTML5-based G123.jp platform offers free-to-play games which removes common barriers to gameplay, such as downloads, installations, and mandatory registrations, ensuring that seamless, instant access is available to players worldwide across different types of devices, including mobile devices beyond just PCs. It provides access to IP-related content for game development, online game distribution, game development support, game marketing and advertising services, and customer support services. In addition, the company owns art and design, and research and development centers. The company was founded in 2013 and is headquartered in Tokyo, Japan. CTW Cayman operates as a subsidiary of CTW (BVI) LTD.

How the Company Makes Money

CTW Cayman Class A Financial Statement Overview

Summary

Strong 2025 revenue growth (~18.6%) and a stable balance sheet with manageable leverage (~0.25 debt-to-equity) are positives, but profitability weakened sharply (net margin down to ~4.2% from ~8.7%) and cash generation deteriorated materially (near-breakeven operating cash flow and negative free cash flow), increasing execution and funding-risk concerns.

Income Statement

Revenue growth accelerated strongly in 2025 (annual revenue up ~18.6%), indicating solid demand momentum. Profitability, however, weakened meaningfully: net margin fell to ~4.2% (from ~8.7% in 2024) and operating profitability also compressed, suggesting higher costs and/or heavier investment spending. Overall, the top-line trajectory is a clear positive, but the recent step-down in margins is the key watch item.

Balance Sheet

Leverage looks manageable, with debt-to-equity staying low-to-moderate (~0.25 in 2025) and equity building over time, supporting balance-sheet resilience. Returns on equity remain positive (~13.8% in 2025) but have cooled versus 2024 (~25.1%), consistent with the profitability pressure seen in the income statement. Overall, the capital structure appears stable with moderate financial risk.

Cash Flow

Cash generation deteriorated sharply in 2025: operating cash flow dropped to near breakeven (~$0.1M) and free cash flow turned negative (~-$0.5M) versus positive free cash flow in 2023–2024. Cash flow also failed to keep pace with earnings in 2025 (operating cash flow to net income ~0.01), raising questions around working-capital needs and the quality/timing of cash conversion. While prior years were healthier, the latest year shows notable volatility and funding risk if the trend persists.

Breakdown	Jul 2025	Jul 2024	Jul 2023	Dec 2019	Dec 2018
Income Statement
Total Revenue	90.37M	68.42M	62.94M	8.16B	8.49B
Gross Profit	68.33M	52.21M	45.89M	5.72B	5.73B
EBITDA	8.97M	10.36M	7.74M	4.21B	4.04B
Net Income	3.83M	5.98M	3.40M	1.83B	1.67B
Balance Sheet
Total Assets	46.50M	43.94M	38.28M	20.33B	20.58B
Cash, Cash Equivalents and Short-Term Investments	12.37M	14.46M	14.85M	2.00M	5.00M
Total Debt	7.01M	7.31M	7.68M	1.19B	5.96B
Total Liabilities	23.20M	20.10M	19.40M	21.00B	10.71B
Stockholders Equity	27.65M	23.84M	18.88M	10.12B	9.87B
Cash Flow
Free Cash Flow	-473.29K	877.19K	2.42M	3.36B	2.75B
Operating Cash Flow	111.38K	1.59M	2.56M	3.33B	3.79B
Investing Cash Flow	-1.18M	-1.17M	-485.24K	-1.72B	-1.15B
Financing Cash Flow	-1.11M	0.00	0.00	-1.61B	-2.63B

CTW Cayman Class A Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
MSGM	65 Neutral	$20.80M	39.13	44.93%	―	11.38%	-94.39%
Sector *	60 Neutral	$48.67B	4.58	-11.27%	4.14%	2.83%	-41.78%
GAME	53 Neutral	$27.49M	-0.27	-52.37%	―	―	―
CTW	52 Neutral	$90.48M	22.87	14.87%	―	―	―
GIGM	50 Neutral	$17.24M	-13.61	-3.14%	―	10.15%	67.65%
SKLZ	45 Neutral	$50.01M	-0.68	-48.34%	―	-8.99%	-117.83%
BHAT	44 Neutral	$509.25K	>-0.01	-14.99%	―	-53.11%	82.68%

CTW Cayman Class A Corporate Events

CTW Cayman Grants 2 Million Stock Options Under 2025 Equity Incentive Plan

On December 17, 2025, CTW Cayman granted stock options to purchase an aggregate of 2,000,000 Class A ordinary shares to certain employees under its 2025 Equity Incentive Plan, according to a filing dated December 22, 2025. The move signals the company’s continued use of equity-based compensation to incentivize and retain staff, potentially aligning employee interests more closely with shareholder value and influencing future share-based compensation expenses and dilution for existing investors.