G-FACTORY Co., Ltd. (3474) AI Stock Analysis

• Market Cap: ¥3.62B
• Dividend Yield: N/A
• Average Volume (3M): 3.48K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.37
• Revenue Growth: 3.36%
• EPS Growth: -430.12%
• Country: JP
• Employees: 340
• Sector: Real Estate
• Sector Strength: 53
• Industry: Real Estate - Services
• EPS (TTM): -6.37
• Shares Outstanding: 6,839,000
• 10 Day Avg. Volume: 3,370
• 30 Day Avg. Volume: 3,483
• PEG Ratio: 0.64
• Price to Book (P/B): 3.36
• Price to Sales (P/S): 0.61
• P/FCF Ratio: -29.31
• 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: 43 Neutral
• Price Target: ¥552.00 ▼(-8.46% Downside)
• Action: Reiterated Date: 02/18/26
• Date: Action: Reiterated 02/18/26

The score is primarily constrained by weak financial performance: multi-year operating losses, negative net income, and a 2025 deterioration in operating/free cash flow. Technicals also lean bearish with the stock below key moving averages and negative MACD, while valuation remains challenged due to loss-making earnings and no stated dividend support.

Positive Factors

Strong revenue growth

Sustained top-line expansion since 2021 indicates solid demand for the company’s restaurant-opening and support services. Durable revenue growth improves scale economics, broadens client relationships, and gives management runway to focus on margin recovery and operational improvements over the coming 2–6 months.

High gross margins

Consistently mid-to-high 40% gross margins provide a structural cushion to absorb fixed costs and support path-to-profitability. If the company controls SG&A and realizes operating leverage as revenue scales, these margins make sustainable profitability and stronger cash conversion achievable over a multi-month horizon.

Fee-based recurring model

A fee-based model with recurring operational support creates predictable revenue streams and client stickiness. This structural revenue characteristic reduces customer churn sensitivity, supports steady cash inflows, and enables upsell and cross-sell opportunities as restaurant chains expand their portfolios.

Negative Factors

Persistent operating losses

Multi-year operating losses despite robust revenue signal structural issues in cost structure, scale economics or recurring one-time charges. Ongoing losses erode retained earnings, reduce reinvestment capacity, and can force reliance on external capital, weighing on strategic flexibility over the next several months.

Weakening cash generation

The recent reversal to negative operating and free cash flow indicates volatile cash conversion and raises near-term funding risk. Sustained negative cash generation can necessitate external financing or asset sales, limiting investment in growth and making operations more vulnerable to market or demand shocks.

Eroding shareholder equity

Declining equity and negative ROE reflect accumulated losses that reduce the company’s financial buffer. A weakened balance sheet constrains borrowing capacity, increases refinancing and covenant risk, and reduces resilience to adverse events, hampering strategic initiatives in the medium term.

G-FACTORY Co., Ltd. Business Overview & Revenue Model

Company Description

G-Factory Co.,Ltd. engages in the provision of management support services for restaurants. The company also manages restaurants. It serves companies that are developing store-type services, such as restaurants. The company was incorporated in 2003 and is headquartered in Tokyo, Japan.

How the Company Makes Money

G-FACTORY generates revenue through multiple streams, primarily from the sale of its electronic components and systems to automotive manufacturers and industrial clients. The company benefits from long-term contracts and partnerships with key players in the automotive sector, ensuring a steady demand for its products. Additionally, G-FACTORY engages in research and development to create cutting-edge technologies, allowing it to charge premium prices for advanced solutions. The company also explores opportunities in after-sales services and support, which contribute to its overall earnings by providing ongoing maintenance and upgrades for its products.

G-FACTORY Co., Ltd. Financial Statement Overview

Summary

Despite strong revenue growth and healthy gross margins, the company has recorded negative operating profit from 2023–2025 with net losses persisting, and cash flow reliability weakened (operating and free cash flow turning negative in 2025). Leverage is moderate, but declining equity and negative ROE signal pressured financial quality.

Income Statement

Revenue has expanded strongly since 2021 (including a sharp step-up in 2022 and continued growth through 2025), and gross margins have been consistently healthy around the mid-to-high 40% range. However, profitability has deteriorated meaningfully: operating profit has been negative from 2023–2025, and net losses persisted in 2023–2025 after profits in 2021–2022. The pattern suggests the core cost structure has worsened (or one-time charges increased) despite solid top-line momentum.

Balance Sheet

Leverage looks moderate for the sector, with debt-to-equity generally around ~0.65–0.68 in recent years (improved from ~1.0+ in 2020–2021). That said, equity has trended down from 2022 to 2025 alongside losses, and returns on equity turned negative in 2023–2024, signaling weakening balance-sheet earning power. Overall asset base has also declined versus the 2022 peak, which reduces financial flexibility if profitability does not recover.

Cash Flow

Cash generation has become less reliable. Operating cash flow was positive in 2021–2024 but turned slightly negative in 2025, and free cash flow swung from positive in 2024 to meaningfully negative in 2025. The company also had a large free-cash-flow deficit in 2023, highlighting volatility in cash conversion and/or investment needs. While 2024 showed improvement, the 2025 reversal raises near-term funding and execution risk if losses persist.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	6.39B	6.47B	6.35B	5.60B	4.74B	3.64B
Gross Profit	3.05B	3.06B	3.06B	2.63B	2.21B	1.60B
EBITDA	-75.98M	142.40M	252.00M	188.62M	624.33M	618.40M
Net Income	-586.91M	-251.68M	-332.89M	-194.00M	271.49M	292.94M
Balance Sheet
Total Assets	4.16B	3.97B	4.37B	4.56B	4.88B	4.67B
Cash, Cash Equivalents and Short-Term Investments	1.26B	1.23B	1.45B	1.50B	2.22B	2.24B
Total Debt	860.81M	780.74M	937.71M	1.12B	1.29B	1.52B
Total Liabilities	2.81B	2.79B	2.90B	2.83B	2.98B	3.13B
Stockholders Equity	1.33B	1.17B	1.45B	1.71B	1.89B	1.53B
Cash Flow
Free Cash Flow	0.00	-134.26M	70.30M	-398.00M	17.87M	282.79M
Operating Cash Flow	0.00	-7.32M	248.34M	96.64M	533.45M	543.51M
Investing Cash Flow	0.00	-73.57M	-160.98M	-504.00M	-468.13M	-35.02M
Financing Cash Flow	0.00	-151.44M	-180.93M	-234.00M	-256.35M	-98.12M

G-FACTORY Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 603.00
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Positive
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:3474, the sentiment is Negative. The current price of 603 is above the 20-day moving average (MA) of 569.00, above the 50-day MA of 588.54, and below the 200-day MA of 605.55, indicating a bearish trend. The MACD of -8.55 indicates Positive momentum. The RSI at 22.08 is Positive, neither overbought nor oversold. The STOCH value of 2.38 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:3474.

G-FACTORY Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
2991	67 Neutral	¥15.91B	6.50	―	1.47%	20.82%	9.86%
Sector *	65 Neutral	$2.17B	12.19	3.79%	4.94%	3.15%	1.96%
2980	64 Neutral	¥47.45B	19.15	―	0.45%	-8.33%	-36.89%
3252	62 Neutral	¥73.66B	9.56	―	2.89%	-3.09%	-35.66%
5532	61 Neutral	¥19.06B	18.67	―	―	23.19%	44.46%
5527	59 Neutral	¥9.45B	8.70	―	3.45%	28.82%	672.17%
3474	43 Neutral	¥3.62B	-14.33	―	―	3.36%	-430.12%