TETSUJIN Holdings.Inc. (2404) AI Stock Analysis

• Market Cap: ¥6.80B
• Dividend Yield: N/A
• Average Volume (3M): 16.41K
• Price to Earnings (P/E): 10.8
• Beta (1Y): 0.30
• Revenue Growth: 13.78%
• EPS Growth: 8241.99%
• Country: JP
• Employees: 384
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Travel Lodging
• EPS (TTM): 16.92
• Shares Outstanding: 13,817,362
• 10 Day Avg. Volume: 26,200
• 30 Day Avg. Volume: 16,410
• PEG Ratio: <0.01
• Price to Book (P/B): 10.80
• Price to Sales (P/S): 0.88
• P/FCF Ratio: 22.93
• 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: 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: 55 Neutral
• Price Target: ¥540.00 ▲(14.16% Upside)

The score is primarily driven by improving operating performance and cash flow in FY2025, tempered by still-high leverage that increases downside sensitivity. Technical indicators are broadly neutral with slightly soft momentum, and valuation appears moderate with no dividend yield data to provide additional support.

Positive Factors

Material revenue rebound

A 241% revenue rebound in FY2025 signals a durable recovery in core venue demand and stronger customer re‑engagement. Sustained higher volumes can improve fixed‑cost absorption in the karaoke business, supporting steadier top‑line and planning over the next 2–6 months.

Return to profitability

Profitability turning positive with a ~4.2% net margin indicates improved cost control and pricing power. Consistent positive earnings provide operating cushions to reinvest in venues and services and reduce reliance on external financing if maintained over coming quarters.

Improving cash generation

A clear shift to positive operating cash flow (¥682M) and FCF (¥309M) after prior negative years strengthens liquidity and supports deleveraging or targeted reinvestment. Improving cash generation enhances resilience and lowers short‑term refinancing pressure.

Negative Factors

Elevated leverage

Despite improvement, a ~3.5x debt‑to‑equity ratio leaves the company highly leveraged vs peers. High leverage constrains financial flexibility, increases interest and refinancing risk, and magnifies downside sensitivity if demand softens over the medium term.

Thin, volatile margins

Relatively thin margins and historical earnings volatility make profits vulnerable to small demand shocks or cost increases in the travel/lodging leisure segment. Limited margin buffers reduce ability to build reserves or absorb shocks without cutting investment or raising prices.

Weak cash conversion

FCF at ~45% of net income and modest coverage ratios indicate working‑capital or reinvestment needs are material. Slower cash conversion reduces capacity to pay down debt quickly or self‑fund expansion, possibly necessitating external financing in adverse conditions.

TETSUJIN Holdings.Inc. Business Overview & Revenue Model

Company Description

TETSUJIN Holdings, Inc. (2404) is a diversified entertainment services company based in Japan. The company operates primarily in the leisure and amusement sectors, with a strong presence in karaoke entertainment and related services. TETSUJIN Holdings is known for its karaoke chain, providing customers with a comprehensive entertainment experience that combines music, food, and social interaction.

How the Company Makes Money

TETSUJIN Holdings, Inc. generates revenue primarily through its karaoke entertainment facilities spread across Japan. The company makes money by charging customers for time spent in private karaoke rooms, offering a range of pricing plans based on duration and room type. Additionally, TETSUJIN Holdings enhances its revenue through the sale of food and beverages in its karaoke establishments, which are often a significant part of the customer experience. The company may also derive income from related entertainment services and collaborations with other businesses in the leisure sector, although specific partnerships and their financial impact are not detailed.

TETSUJIN Holdings.Inc. Financial Statement Overview

Summary

Strong FY2025 rebound in revenue (+241%) with profitability turning positive and cash flow improving, but the balance sheet remains a key constraint with still-elevated leverage (~3.5x debt-to-equity) and a volatile earnings profile.

Income Statement

Revenue has rebounded strongly, accelerating to +241% in FY2025 after modest growth in prior years, signaling a sharp demand recovery. Profitability has also improved materially: FY2025 net margin rose to ~4.2% from near-breakeven in FY2023–FY2024, and operating results turned solidly positive versus losses in FY2020–FY2022. Offsetting this, margins remain relatively thin for the level of business risk, and the company’s earnings profile has been volatile over the cycle.

Balance Sheet

Leverage remains the key constraint. While debt-to-equity improved dramatically to ~3.5x in FY2025 from extremely high levels (~12–14x) in FY2022–FY2024, it is still elevated and leaves the company less flexible in a downturn. Equity is still relatively small versus the debt load, even after the improvement, although return on equity surged in FY2025 alongside the earnings recovery.

Cash Flow

Cash generation is positive and improving: operating cash flow rose to ¥682M and free cash flow to ¥309M in FY2025, a clear turnaround from negative cash flow in FY2020–FY2021. However, cash conversion is not especially strong relative to earnings, with free cash flow running at ~45% of net income in FY2025 (and operating cash flow coverage ratios still modest across years), suggesting working-capital or reinvestment needs are still meaningful.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	7.85B	8.04B	7.07B	6.59B	5.88B	5.24B
Gross Profit	1.18B	1.16B	987.53M	845.75M	663.39M	748.48M
EBITDA	536.54M	467.82M	253.56M	303.17M	299.70M	-38.84M
Net Income	321.76M	335.72M	4.02M	5.55M	32.34M	-281.61M
Balance Sheet
Total Assets	4.44B	4.55B	4.33B	4.32B	4.50B	4.94B
Cash, Cash Equivalents and Short-Term Investments	943.40M	979.17M	738.61M	880.36M	951.37M	1.44B
Total Debt	2.45B	2.32B	2.65B	2.91B	3.09B	3.52B
Total Liabilities	3.88B	3.89B	4.10B	4.10B	4.28B	4.75B
Stockholders Equity	559.91M	656.08M	223.53M	220.23M	220.85M	190.16M
Cash Flow
Free Cash Flow	0.00	309.06M	221.69M	78.69M	127.06M	-182.41M
Operating Cash Flow	0.00	681.65M	425.90M	217.42M	187.00M	-165.18M
Investing Cash Flow	0.00	-166.46M	-221.38M	-107.54M	-22.91M	228.46M
Financing Cash Flow	0.00	-274.64M	-346.08M	-182.01M	-616.72M	-473.91M

TETSUJIN Holdings.Inc. Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 473.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:2404, the sentiment is Neutral. The current price of 473 is below the 20-day moving average (MA) of 509.30, below the 50-day MA of 487.98, and below the 200-day MA of 509.83, indicating a neutral trend. The MACD of 5.07 indicates Positive momentum. The RSI at 51.52 is Neutral, neither overbought nor oversold. The STOCH value of 20.95 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for JP:2404.

TETSUJIN Holdings.Inc. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
4691	69 Neutral	¥15.41B	5.17	―	1.47%	19.31%	202.53%
9723	69 Neutral	¥7.64B	9.97	―	0.48%	4.02%	-9.38%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
9713	58 Neutral	¥14.02B	5.38	―	0.55%	35.22%	413.40%
2404	55 Neutral	¥6.80B	10.84	―	―	13.78%	8241.99%
9704	55 Neutral	¥12.95B	9.03	32.34%	―	20.16%	1467.54%
9720	53 Neutral	¥6.91B	34.30	―	0.39%	10.52%	-31.01%