Digital Holdings, Inc. (2389) AI Stock Analysis

• Market Cap: ¥18.22B
• Dividend Yield: 3.5%
• Average Volume (3M): 52.73K
• Price to Earnings (P/E): 8.1
• Beta (1Y): 0.62
• Revenue Growth: -9.56%
• EPS Growth: 127.51%
• Country: JP
• Employees: 970
• Sector: Communication Services
• Sector Strength: 75
• Industry: Advertising Agencies
• EPS (TTM): 114.58
• Shares Outstanding: 17,459,908
• 10 Day Avg. Volume: 54,430
• 30 Day Avg. Volume: 52,733
• PEG Ratio: 0.08
• Price to Book (P/B): 0.72
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 3.77
• 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: ¥1,458.00
• Price Target Upside: 18.83% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 0

• Rating: 61 Neutral
• Price Target: ¥1,311.00 ▲(6.85%Upside)

The stock score is primarily driven by strong financial stability and attractive valuation metrics. The solid balance sheet and low leverage provide a foundation for financial resilience, while the low P/E ratio and high dividend yield suggest potential undervaluation. Technical analysis presents a neutral outlook, with no significant bullish or bearish signals. The absence of earnings call and corporate event data slightly limits the evaluation scope.

Digital Holdings, Inc. Business Overview & Revenue Model

Company Description

Digital Holdings, Inc. (2389) operates in the digital marketing and advertising sector, focusing on providing comprehensive solutions for businesses looking to enhance their online presence. The company's core services include digital advertising, content creation, data analytics, and digital strategy consulting. Leveraging advanced technology and industry expertise, Digital Holdings, Inc. helps clients optimize their marketing efforts to achieve greater reach and engagement.

How the Company Makes Money

Digital Holdings, Inc. generates revenue primarily through the provision of digital marketing services, which include digital advertising campaigns, search engine optimization (SEO), and social media management. The company charges clients based on the scope and scale of marketing projects, often utilizing a combination of flat fees, performance-based pricing, and subscription models. Additionally, Digital Holdings, Inc. partners with leading technology platforms to offer integrated marketing solutions, thereby expanding its service offerings and client base. Key revenue streams also include analytics services, where the company provides data-driven insights to optimize clients' marketing strategies, and consulting fees for strategic advisory services.

Digital Holdings, Inc. Financial Statement Overview

Summary

Digital Holdings, Inc. demonstrates financial stability with a strong balance sheet, supported by low leverage and high liquidity. However, the income statement reveals challenges in revenue consistency and profit growth, while the cash flow statement highlights improved cash generation despite historical volatility.

Income Statement

The company has experienced erratic revenue performance with a decline in recent years. Gross and net profit margins have fluctuated, with the latest year showing some recovery in net income after previous declines. EBIT and EBITDA margins have improved in the latest period, indicating better operational efficiency but remain challenged overall.

Balance Sheet

The balance sheet is solid, with a high equity ratio and low debt-to-equity ratio, indicating financial stability and low leverage. The company maintains strong cash reserves, supporting its liquidity position. Stockholders' equity has remained stable, providing a strong capital base.

Cash Flow

Cash flow generation has been inconsistent, with negative free cash flow in previous years turning positive in the latest period. Operating cash flow has shown significant improvement, but historical volatility poses concerns. The company has managed to improve free cash flow to net income ratios recently.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	16.16B	16.26B	16.92B	98.52B	88.77B
Gross Profit	10.02B	10.95B	11.21B	25.23B	17.79B
EBITDA	1.96B	856.00M	20.00M	11.65B	3.86B
Net Income	1.34B	237.00M	5.72B	10.23B	3.75B
Balance Sheet
Total Assets	48.22B	50.28B	55.96B	69.73B	71.43B
Cash, Cash Equivalents and Short-Term Investments	25.31B	24.41B	33.33B	46.32B	48.75B
Total Debt	4.08B	5.00B	5.17B	9.04B	10.83B
Total Liabilities	15.15B	16.39B	19.72B	28.80B	31.42B
Stockholders Equity	30.69B	29.33B	29.83B	32.67B	31.19B
Cash Flow
Free Cash Flow	6.92B	-3.79B	-8.18B	10.97B	1.22B
Operating Cash Flow	6.92B	-3.44B	-7.61B	12.13B	2.18B
Investing Cash Flow	395.00M	-1.27B	4.70B	2.99B	1.57B
Financing Cash Flow	-4.68B	-3.06B	-8.56B	-4.83B	2.95B

Digital Holdings, Inc. Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 1227.00
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:2389, the sentiment is Negative. The current price of 1227 is above the 20-day moving average (MA) of 1206.75, below the 50-day MA of 1255.20, and below the 200-day MA of 1243.87, indicating a neutral trend. The MACD of -1.84 indicates Negative momentum. The RSI at 46.98 is Neutral, neither overbought nor oversold. The STOCH value of 51.46 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:2389.

Digital Holdings, Inc. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
6535	81 Outperform	¥35.72B	13.11		4.04%	14.35%	-5.35%
7068	79 Outperform	¥13.81B	14.32		1.76%	3.41%	117.22%
2491	67 Neutral	¥26.08B	5.42		6.67%	5.36%	32.46%
2461	63 Neutral	¥32.33B	24.99		5.53%	-5.88%	15.11%
2389	61 Neutral	¥18.22B	8.12		3.50%	-9.56%	127.51%
4499	60 Neutral	¥28.37B	185.63		―	10.17%	―
Sector *	59 Neutral	C$3.40B	8.25	-17.94%	5.39%	-1.07%	-31.28%

Digital Holdings, Inc. Corporate Events

Digital Holdings Reports Q1 2025 Financial Results with Profit Surge

Digital Holdings, Inc. reported its consolidated financial results for the first quarter of 2025, showing a decline in revenue by 14.6% compared to the previous year. Despite the revenue drop, the company saw a significant increase in ordinary profit and profit attributable to owners, indicating improved operational efficiency. The company maintains its forecast for the fiscal year 2025, with expectations of a decrease in revenue and operating profit but a substantial rise in ordinary profit and profit attributable to owners, reflecting strategic adjustments in its operations.