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ZOZO Inc (JP:3092)
:3092

ZOZO (3092) AI Stock Analysis

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ZOZO

(OTC:3092)

Rating:74Outperform
Price Target:
¥1,714.00
▲(11.37%Upside)
ZOZO's overall stock score reflects a strong financial foundation, particularly in income growth and cash flow strength, which are key drivers in its robust financial performance. The technical analysis indicates mixed momentum, with some potential for positive movement. The valuation component suggests the stock might be slightly overvalued, which tempers the overall score. The absence of earnings call data and corporate events means these factors did not influence the final score.

ZOZO (3092) vs. iShares MSCI Japan ETF (EWJ)

ZOZO Business Overview & Revenue Model

Company DescriptionZOZO, Inc. operates online shopping Websites in Japan and internationally. It operates ZOZOTOWN a fashion online shopping website; WEAR, a fashion app; Multi-Size platform to purchases and sells fashion merchandise of various brands; ZOZOUSED, a Website for secondhand/vintage apparel; and PayPay mall, an online shopping mall. In addition, it engages in the advertisement business. The company was formerly known as Start Today Co., Ltd. and changed its name to ZOZO, Inc. in October 2018. ZOZO, Inc. was founded in 1998 and is headquartered in Chiba, Japan. ZOZO, Inc. is a subsidiary of Z Holdings Corporation.
How the Company Makes MoneyZOZO, Inc. generates revenue primarily through the sale of fashion and apparel products on its e-commerce platform, ZOZOTOWN. The company earns money by taking a percentage of sales made through its platform from third-party brands and retailers. Additionally, ZOZO offers a subscription service known as 'ZOZOARIGATO', which provides members with discounts and benefits, contributing to a recurring revenue stream. The company also benefits from its proprietary measurement technology, ZOZOSUIT, which helps customers find better-fitting clothing, thereby improving customer satisfaction and increasing sales. Strategic partnerships with a range of fashion brands and technology advancements further bolster ZOZO's revenue-generating capabilities.

ZOZO Earnings Call Summary

Earnings Call Date:Apr 30, 2025
(Q3-2024)
|
% Change Since: 3.74%|
Next Earnings Date:Jul 30, 2025
Earnings Call Sentiment Neutral
The earnings call presented a mixed picture with strong GMV and profit growth but facing challenges from weather impacts and increased costs. Successful promotions and growth in active members are positive, but the decline in operating margins and logistics challenges present concerns.
Q3-2024 Updates
Positive Updates
Gross Merchandise Value (GMV) Growth
GMV rose by 5.1% year-on-year to JPY 427.1 billion, with GMV excluding other GMV increasing by 7.4% year-on-year to JPY 399.4 billion.
Record High Operating Profit
Operating profit increased by 2.4% to JPY 45.6 billion, achieving record highs for the third quarter with an achievement rate of 76.2% against the company plan.
Promotional Success
Promotions, including Black Friday, were successful and contributed to higher than expected GMV, though their direct impact on GMV was limited.
Increase in Active Members
The number of active members increased by 220,000 to JPY 10.73 million.
Growth in Yahoo! Shopping
Yahoo! Shopping performed well, with active promotions contributing to higher than planned GMV.
Negative Updates
Operating Profit Margin Decline
Operating profit margin decreased by 0.6 points year-on-year to 11.4%.
Warm Winter Impact
Unseasonably warm winter affected sales of outerwear and other winter apparel, leading to lower than planned GMV for ZOZOTOWN.
Inventory and Logistics Challenges
Increased inventory supply and warm winter led to deteriorated stock turnover, increased logistics-related expenses, and lower operating efficiency.
Advertising and Promotional Expenses
Increased promotional expenses impacted operating profit negatively, with a 3.8% year-over-year decrease due to new logistics space expenses.
Average Retail Price Decline
Average retail price decreased by 1.7% year-over-year due to the warm winter and increased markdown ratios.
Yamato Transport Price Hike
Anticipated shipping fee increases from Yamato Transport will affect costs, though the extent of the increase is undisclosed.
Company Guidance
During the third quarter earnings call for ZOZO, detailed financial guidance highlighted several key metrics. The company's gross merchandise value (GMV) increased by 5.1% year-on-year to JPY 427.1 billion, while GMV excluding other GMV rose by 7.4% to JPY 399.4 billion. Operating profit saw a modest rise of 2.4%, reaching JPY 45.6 billion, with an operating profit margin (OPM) of 11.4%, which represented a decrease of 0.6 points from the previous year. The achievement rates against company plans were 74.6% for GMV, excluding other GMV, and 76.2% for operating profits. Despite challenges from abnormal weather, including a warm winter, and rising costs such as logistics space expenses, the company managed effective promotions to maintain GMV growth. The company acknowledged a 0.6-point increase in the SG&A to GMV ratio, driven by factors such as inventory supply challenges and increased expenses related to logistics and cloud services. The average retail price decreased by 1.7% year-on-year, while the average order value increased by 1.8%, illustrating a complex interplay of market dynamics and strategic adjustments.

ZOZO Financial Statement Overview

Summary
ZOZO demonstrates a robust financial performance with strong revenue growth and high profitability margins. The company has a stable balance sheet with low leverage and strong cash flow generation, indicating financial flexibility and capacity for growth. However, the high ROE suggests potential challenges in sustaining high returns.
Income Statement
86
Very Positive
ZOZO has demonstrated strong revenue growth with a 8.19% increase from 2024 to 2025. The company maintains high profitability, evident from a gross profit margin of 90.84% and a net profit margin of 21.28% in 2025. EBIT and EBITDA margins further reinforce its operational efficiency at 30.39% and 32.65%, respectively. The consistent upward trajectory in revenue and profitability metrics highlights a robust and expanding business model in the specialty retail sector.
Balance Sheet
78
Positive
The balance sheet reflects a stable financial position with a low debt-to-equity ratio of 0.20 in 2025, indicating prudent leverage. The return on equity stands at a strong 45.92%, showcasing effective utilization of shareholder funds. An equity ratio of 52.56% highlights a healthy proportion of equity financing. The company’s solid equity base and effective debt management are key strengths, though the high ROE may indicate potential future challenges in sustaining such returns.
Cash Flow
82
Very Positive
ZOZO's cash flow profile is strong, with a significant free cash flow growth rate of 66.48% from 2024 to 2025. The operating cash flow to net income ratio of 1.33 in 2025 suggests efficient cash generation relative to net earnings. The free cash flow to net income ratio of 1.22 indicates robust cash availability for reinvestment or debt reduction. Overall, the company’s cash flow metrics suggest strong liquidity and financial flexibility.
BreakdownTTMMar 2025Mar 2024Mar 2023Mar 2022Mar 2021
Income Statement
Total Revenue210.52B213.13B197.02B183.42B166.20B147.37B
Gross Profit193.41B193.57B183.15B171.34B156.17B140.03B
EBITDA69.90B69.58B64.34B59.10B52.01B46.54B
Net Income47.81B45.35B44.34B39.53B34.49B30.93B
Balance Sheet
Total Assets178.32B187.81B161.86B155.74B127.28B125.66B
Cash, Cash Equivalents and Short-Term Investments67.13B91.49B69.75B74.13B65.52B61.65B
Total Debt20.00B20.00B20.00B20.40B20.20B20.00B
Total Liabilities89.44B89.09B77.12B79.05B72.18B70.15B
Stockholders Equity88.88B98.72B84.74B76.57B54.95B55.44B
Cash Flow
Free Cash Flow0.0055.31B33.23B27.40B38.56B41.44B
Operating Cash Flow0.0060.11B42.59B36.67B39.90B44.79B
Investing Cash Flow0.00-6.29B-9.88B-10.59B-1.28B-4.65B
Financing Cash Flow0.00-32.08B-37.14B-17.74B-34.82B-12.12B

ZOZO Technical Analysis

Technical Analysis Sentiment
Negative
Last Price1539.00
Price Trends
50DMA
1530.24
Negative
100DMA
1530.40
Negative
200DMA
1574.51
Negative
Market Momentum
MACD
0.21
Positive
RSI
45.40
Neutral
STOCH
43.21
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:3092, the sentiment is Negative. The current price of 1539 is below the 20-day moving average (MA) of 1547.58, above the 50-day MA of 1530.24, and below the 200-day MA of 1574.51, indicating a bearish trend. The MACD of 0.21 indicates Positive momentum. The RSI at 45.40 is Neutral, neither overbought nor oversold. The STOCH value of 43.21 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:3092.

ZOZO Peers Comparison

Overall Rating
UnderperformOutperform
Sector (66)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
74
Outperform
$1.36T30.1248.74%2.35%8.18%3.02%
66
Neutral
£1.81B11.446.20%3.00%0.63%-17.57%
$11.84B-22.97%
$9.84B38.8528.00%1.37%
$3.00B27.6621.33%
$2.59B12.054.20%2.82%
69
Neutral
¥233.52B25.38
3.04%2.74%38.73%
* Consumer Cyclical Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
JP:3092
ZOZO
1,539.00
216.58
16.38%
RKUNF
Rakuten
5.51
0.59
11.99%
MONOF
MonotaRO Co
14.17
2.80
24.63%
MRCIF
Mercari
18.15
5.13
39.40%
YMDAF
Yamada Denki Co
3.08
0.46
17.56%
JP:8282
K'S Holdings Corporation
1,451.00
-36.74
-2.47%

ZOZO Corporate Events

ZOZO, Inc. Outlines Relationship with Controlling Shareholder LY Corporation
Jun 26, 2025

ZOZO, Inc. announced its relationship with its controlling shareholder, LY Corporation, which holds a 51.5% indirect ownership. The company maintains operational independence despite this influence, with LY Corporation providing strategic advice through appointed directors. This relationship includes collaborations like ZOZOTOWN’s presence on Yahoo! JAPAN Shopping and the use of PayPay services, indicating a strong integration within the parent company’s ecosystem.

The most recent analyst rating on (JP:3092) stock is a Hold with a Yen4600.00 price target. To see the full list of analyst forecasts on ZOZO stock, see the JP:3092 Stock Forecast page.

ZOZO Announces Share Repurchase Status
Jun 3, 2025

ZOZO, Inc. has announced the status of its share repurchase program, which was approved during a Board Meeting on April 30, 2025. The company acquired 2,630,200 shares of its common stock for approximately 4.02 billion yen through market purchases on the Tokyo Stock Exchange between May 1 and May 31, 2025. This move is part of a larger plan to repurchase up to 10 million shares by September 1, 2025, with a total budget of up to 10 billion yen. The repurchase is expected to impact the company’s stock value and shareholder returns positively.

The most recent analyst rating on (JP:3092) stock is a Hold with a Yen4600.00 price target. To see the full list of analyst forecasts on ZOZO stock, see the JP:3092 Stock Forecast page.

ZOZO Announces Director Nominees for Upcoming Shareholders Meeting
May 16, 2025

ZOZO, Inc. announced the nomination of candidates for its Board of Directors to be proposed at the upcoming 27th Ordinary General Meeting of Shareholders. The company has resolved to reappoint several key figures to their current positions, including the President & CEO, CFO, and COO, as well as other directors. Additionally, a new candidate has been nominated for the position of Substitute Audit and Supervisory Committee member. This move is part of ZOZO’s ongoing efforts to maintain leadership stability and continuity in its governance structure.

The most recent analyst rating on (JP:3092) stock is a Hold with a Yen4600.00 price target. To see the full list of analyst forecasts on ZOZO stock, see the JP:3092 Stock Forecast page.

ZOZO Announces Share Repurchase Plan to Enhance Shareholder Returns
Apr 30, 2025

ZOZO, Inc. has announced a share repurchase plan as part of its strategy to return profits to shareholders, aiming to maintain a total return ratio of over 80% over a five-year average. The company plans to repurchase up to 10 million shares, representing 1.12% of its outstanding shares, for a total of up to 10 billion yen, between May 1 and September 1, 2025, through market purchases on the Tokyo Stock Exchange.

ZOZO, Inc. Reports Stable Growth in FY2025 Financial Results
Apr 30, 2025

ZOZO, Inc. reported its consolidated financial results for the fiscal year ended March 31, 2025, showing an increase in net sales by 8.2% to 213,131 million yen and a slight rise in profit attributable to owners of parents by 2.3% to 45,346 million yen. The company also completed a three-for-one stock split on April 1, 2025, which is expected to impact earnings per share calculations. The financial results indicate a stable growth trajectory, with improvements in cash flow from operating activities and a forecasted continued growth in the fiscal year ending March 31, 2026, with net sales expected to rise by 5.1%.

ZOZO Acquires LYST LTD to Boost Global Expansion
Apr 9, 2025

ZOZO, Inc. has announced its acquisition of LYST LTD, a leading global fashion shopping platform, to make it a wholly owned subsidiary. This strategic move is aimed at accelerating ZOZO’s growth in the global market by leveraging Lyst’s AI-driven fashion discovery platform, which features over 27,000 brands. The acquisition aligns with ZOZO’s mission to inspire and provide better fashion choices worldwide, enhancing its industry positioning and potentially transforming the fashion shopping experience.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Jun 26, 2025