Halows Co., Ltd. (2742) AI Stock Analysis

• Market Cap: ¥99.68B
• Dividend Yield: 1.46%
• Average Volume (3M): 21.84K
• Price to Earnings (P/E): 11.1
• Beta (1Y): 0.46
• Revenue Growth: 7.75%
• EPS Growth: -1.68%
• Country: JP
• Employees: 1,305
• Sector: Consumer Defensive
• Sector Strength: 42
• Industry: Grocery Stores
• EPS (TTM): 91.56
• Shares Outstanding: 21,475,700
• 10 Day Avg. Volume: 19,450
• 30 Day Avg. Volume: 21,843
• PEG Ratio: 2.58
• Price to Book (P/B): 1.20
• Price to Sales (P/S): 0.40
• P/FCF Ratio: 21.86
• 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

• Rating: 72 Outperform
• Price Target: ¥5,506.00 ▲(19.83% Upside)

Halows Co., Ltd. has a strong financial foundation with robust revenue growth and profitability. The technical analysis indicates some short-term weakness, but the stock is not oversold. The valuation is reasonable, offering a fair P/E ratio and a modest dividend yield. The absence of earnings call and corporate events data limits additional insights.

Halows Co., Ltd. Business Overview & Revenue Model

Company Description

Halows Co., Ltd. (2742) is a leading Japanese retail company primarily operating in the supermarket sector. The company focuses on providing a wide range of products including groceries, household items, and daily necessities to meet the needs of local communities. With a strong presence in the Chugoku and Shikoku regions of Japan, Halows is committed to offering quality products at competitive prices, ensuring customer satisfaction and convenience.

How the Company Makes Money

Halows Co., Ltd. generates revenue primarily through the sale of consumer goods in its supermarket chain. The company earns money by purchasing products from suppliers and selling them at a markup to customers in its retail stores. A significant portion of its revenue comes from groceries, fresh produce, and household essentials, which are staples for regular consumers. Additionally, Halows benefits from economies of scale due to its extensive network of stores, allowing for cost efficiencies in procurement and distribution. The company may also have partnerships with local producers and suppliers to offer exclusive products, further driving foot traffic and sales. Seasonal promotions and loyalty programs can contribute to increasing customer retention and spending, thereby boosting overall revenue.

Halows Co., Ltd. Financial Statement Overview

Summary

Halows Co., Ltd. demonstrates strong revenue growth and profitability with effective cost management. The company has a solid equity base and conservative leverage, though there are challenges in managing capital expenditures affecting free cash flow.

Income Statement

Halows Co., Ltd. has demonstrated strong revenue growth, with a consistent increase in total revenue over the past years, culminating in a 7.86% growth from 2024 to 2025. The company maintains a healthy gross profit margin of 25.64% and a net profit margin of 4.23% in 2025, indicating effective cost management and profitability. EBIT and EBITDA margins are also solid at 5.82% and 7.94%, respectively, showing operational efficiency. Overall, the income statement reflects a robust growth trajectory and profitability.

Balance Sheet

The balance sheet of Halows Co., Ltd. reveals a strong equity base with a rising stockholders' equity, reaching 62.40% of total assets in 2025, which enhances financial stability. The debt-to-equity ratio has been decreasing over the years, currently at 0.16, which signifies a conservative leverage approach. Return on equity is at 12.65%, indicating good returns for shareholders. However, the high total liabilities to equity ratio still suggests some level of financial risk, albeit well-managed.

Cash Flow

The cash flow statement shows a positive trend in operating cash flow, which increased to ¥15.89 billion in 2025, supporting business operations and growth. However, free cash flow decreased significantly due to a high capital expenditure, impacting the free cash flow to net income ratio. The operating cash flow to net income ratio is favorable at 1.78, reflecting strong cash generation from operations. Despite healthy operational cash flows, the decline in free cash flow suggests potential challenges in managing capital investments effectively.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	217.54B	210.75B	195.44B	174.11B	163.37B	151.94B
Gross Profit	54.99B	54.03B	54.35B	48.00B	44.40B	41.35B
EBITDA	17.18B	16.73B	15.71B	13.32B	12.73B	11.41B
Net Income	9.00B	8.91B	8.59B	6.20B	5.93B	5.50B
Balance Sheet
Total Assets	132.75B	112.87B	104.28B	99.15B	87.27B	90.84B
Cash, Cash Equivalents and Short-Term Investments	26.07B	15.03B	18.14B	17.84B	14.66B	23.25B
Total Debt	11.30B	11.13B	15.14B	19.44B	14.09B	16.89B
Total Liabilities	59.27B	42.44B	41.77B	44.34B	37.87B	46.63B
Stockholders Equity	73.48B	70.43B	62.51B	54.80B	49.40B	44.21B
Cash Flow
Free Cash Flow	0.00	3.88B	5.75B	-562.00M	-4.38B	5.00B
Operating Cash Flow	0.00	15.89B	13.15B	10.62B	3.28B	11.59B
Investing Cash Flow	0.00	-13.76B	-7.25B	-11.52B	-7.82B	-7.56B
Financing Cash Flow	0.00	-5.25B	-5.60B	4.08B	-4.05B	4.68B

Halows Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 4595.00
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:2742, the sentiment is Negative. The current price of 4595 is below the 20-day moving average (MA) of 4772.00, below the 50-day MA of 4970.89, and above the 200-day MA of 4522.97, indicating a neutral trend. The MACD of -94.32 indicates Negative momentum. The RSI at 37.65 is Neutral, neither overbought nor oversold. The STOCH value of 63.72 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:2742.

Halows Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
9823	―	¥81.44B	15.02	―	3.54%	17.13%	-6.33%
9974	―	¥154.41B	12.48	―	1.68%	10.13%	23.77%
7508	―	¥52.93B	10.19	―	3.24%	12.94%	5.50%
8167	―	¥59.28B	10.52	―	3.25%	4.92%	19.73%
8198	―	¥115.20B	10.55	―	1.90%	2.30%	26.52%
2742	―	¥99.68B	11.05	―	1.46%	7.75%	-1.68%
Sector *	―	$20.33B	14.63	-3.31%	3.23%	1.93%	-12.26%

Halows Co., Ltd. Corporate Events

Halows Co., Ltd. Completes Allotment of New Shares for Director Compensation

Halows Co., Ltd. has completed the allotment of new shares as restricted stock compensation, a decision made by the Board of Directors on May 29, 2025. This issuance involves 5,600 common shares at a price of 4,720 yen per share, intended as remuneration for its directors, excluding certain committee members and part-time directors. This move is aimed at aligning the interests of the directors with the company’s performance, potentially impacting the company’s governance and stakeholder relations.

Halows Co., Ltd. Completes Strategic Share Repurchase

Halows Co., Ltd. has completed the repurchase of 75,000 of its own shares through the Tokyo Stock Exchange’s off-auction trading system, as part of a strategic move to adapt to changing business environments. This acquisition, valued at 359,625,000 yen, reflects the company’s commitment to executing flexible capital policies, potentially impacting its financial strategy and shareholder value.

Halows Co., Ltd. Announces Share Repurchase Plan

Halows Co., Ltd. announced a decision by its Board of Directors to repurchase up to 75,000 of its own shares through the Tokyo Stock Exchange’s off-auction trading system. This move is intended to allow the company to implement flexible capital policies in response to changing business conditions, potentially impacting its market positioning and shareholder value.

Halows Co., Ltd. Reports Growth in Q1 2025 Financial Results and Announces Dividend Increase

Halows Co., Ltd. reported an increase in its non-consolidated financial results for the three months ended May 31, 2025, with operating revenues rising by 8.6% year-on-year. The company also announced a forecasted increase in annual dividends for the fiscal year ending February 28, 2026, indicating a positive outlook for stakeholders.

Halows Finalizes Stock Compensation Options for Directors

Halows Co., Ltd. has finalized the issuance details of stock compensation-type stock options for its directors, excluding those on the Audit and Supervisory Committee and outside directors. This decision, made by the Board of Directors, involves 66 stock acquisition rights, with a total of 6,600 common shares underlying these rights. The move is part of the company’s strategy to align director incentives with shareholder interests.

Halows Co., Ltd. Announces New Share Issuance for Director Compensation

Halows Co., Ltd. has announced the issuance of new shares as part of a restricted stock compensation plan aimed at enhancing corporate value and aligning the interests of its directors with those of shareholders. The plan involves issuing 5,600 common shares to eight eligible directors, with a transfer restriction period set for 50 years, to incentivize long-term commitment and shared value creation.

Halows Co., Ltd. Finalizes Stock Options for Directors

Halows Co., Ltd. has announced the finalization of issuing stock compensation-type stock options to its directors, excluding those on the Audit and Supervisory Committee and outside directors. This move aims to enhance the directors’ motivation to improve the company’s medium- and long-term performance and corporate value, potentially impacting the company’s operational efficiency and stakeholder confidence.