Econach Holdings Co., Ltd. (3521) AI Stock Analysis

• Market Cap: ¥4.71B
• Dividend Yield: 2.94%
• Average Volume (3M): 40.58K
• Price to Earnings (P/E): 28.1
• Beta (1Y): 0.41
• Revenue Growth: 15.50%
• EPS Growth: -9.91%
• Country: JP
• Employees: 30
• Sector: Real Estate
• Sector Strength: 53
• Industry: Personal Products & Services
• EPS (TTM): 1.28
• Shares Outstanding: 26,466,366
• 10 Day Avg. Volume: 29,390
• 30 Day Avg. Volume: 40,583
• PEG Ratio: 0.21
• Price to Book (P/B): 0.81
• Price to Sales (P/S): 2.02
• P/FCF Ratio: 8.49
• 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: 73 Outperform
• Price Target: ¥199.00 ▲(13.07% Upside)

The overall stock score of 73.4 reflects a strong financial performance, characterized by robust revenue growth and improved profitability. The technical analysis presents mixed signals, with some bearish momentum indicators. The valuation is reasonable, supported by a fair P/E ratio and a solid dividend yield. The absence of earnings call data and corporate events does not impact the score.

Positive Factors

Sustained Revenue Growth

Consistent multi-year revenue growth (599M→1,981M) indicates expanding product adoption and market penetration. Durable top-line expansion provides scale benefits, supports continued margin improvement, and creates capacity to reinvest in distribution, R&D, or new channels over time.

Strong Cash Generation

High and improving cash generation (OCF ¥562M, FCF ¥470M, OCF/NetIncome 2.94) underpins financial flexibility. Sustainable free cash flow enables capex, dividends or buybacks, funds organic growth without heavy borrowing and reduces refinancing risk across business cycles.

Conservative Balance Sheet

Very strong equity base and minimal leverage (equity ratio 80.8%, D/E 0.12) provide resilience and optionality. Low financial risk supports strategic investments, potential M&A or cyclical downturns, and lowers probability of distress while preserving borrowing capacity.

Negative Factors

Low Return on Equity

Despite robust top-line growth, ROE is low at 3.9%, indicating limited efficiency in converting equity into profit. Persistently low ROE can constrain long-term shareholder returns unless management improves asset turnover, margin expansion, or capital allocation.

Negative EPS Trend

Negative EPS growth (~-9.9%) suggests earnings per share have contracted despite revenue gains, potentially from margin mix, one-offs, or dilution. If sustained, weakening EPS undermines earnings quality and investor returns and signals a need for operational or capital allocation fixes.

Limited Organizational Scale

A very small workforce (30 employees) limits operational scale, cross-functional depth, and capacity to execute rapid geographic or product expansion. Over the medium term, limited scale may constrain distribution, R&D, and marketing investments needed to sustain competitive positioning.

Econach Holdings Co., Ltd. Business Overview & Revenue Model

Company Description

Econach Holdings Co.,Ltd. operates in the spa and real estate businesses in Japan. The company also sells and rents real estate properties, as well as owns shares. In addition, it manufactures and sells lace and embroidery products. The company was formerly known as Econach Co., Ltd. and changed its name to Econach Holdings Co.,Ltd. in August 2010. The company was incorporated in 1926 and is headquartered in Tokyo, Japan.

How the Company Makes Money

Econach Holdings generates revenue through multiple streams, primarily by investing in technology startups and holding equity stakes in these companies, which yield returns as these businesses grow and potentially go public or are acquired. Additionally, the company earns revenue from real estate development projects, through sales and leasing of properties, and by providing property management services. In the renewable energy sector, Econach partners with local governments and private entities to develop solar and wind energy projects, receiving income from energy sales and government incentives. Strategic partnerships with established firms in these sectors enhance its market reach and revenue potential.

Econach Holdings Co., Ltd. Financial Statement Overview

Summary

Econach Holdings Co., Ltd. exhibits a robust financial position with strong revenue growth, improved profitability margins, low leverage, and healthy cash flows. The company's focus on operational efficiency and prudent financial management has resulted in improved financial health. However, there is room for further improvement in return on equity to optimize shareholder returns.

Income Statement

The company has demonstrated strong revenue growth over recent years, particularly from 2021 to 2025, with revenue increasing from ¥599M to ¥1,981M. Gross profit margins have been solid, improving significantly to 25.7% in 2025. Net profit margins have also improved, reaching 9.7% in 2025. The EBIT margin has substantially improved as well, reaching 17.2% in 2025. The EBITDA margin stands strong at 33.0%, indicating healthy operational efficiency. Overall, the income statement reflects a robust financial performance with consistent growth and improved profitability.

Balance Sheet

The company has a strong equity position, with an equity ratio of 80.8% in 2025, indicating financial stability. The debt-to-equity ratio is low at 0.12, suggesting low leverage and reduced financial risk. Return on equity has improved to 3.9% in 2025, showing that the company is generating returns on equity, albeit at a moderate rate. The balance sheet reflects stability with a strong equity base and low financial risk, although the ROE could be improved further.

Cash Flow

Operating cash flow has been consistently positive, with a notable increase to ¥562M in 2025, reflecting strong cash generation from operations. The free cash flow improved significantly to ¥470M in 2025. The operating cash flow to net income ratio is healthy at 2.94, indicating efficient cash generation relative to net income. The free cash flow to net income ratio stands at 2.45, suggesting strong cash flow relative to earnings. Overall, the cash flow statement reflects strong cash generation and financial flexibility.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	2.01B	1.98B	1.89B	1.41B	751.44M	599.08M
Gross Profit	543.95M	509.25M	338.06M	196.24M	54.04M	-47.97M
EBITDA	652.74M	653.85M	499.09M	382.17M	212.96M	-17.28M
Net Income	193.88M	191.56M	96.19M	51.05M	-22.00M	-158.46M
Balance Sheet
Total Assets	5.92B	6.09B	6.01B	6.11B	6.10B	5.41B
Cash, Cash Equivalents and Short-Term Investments	1.37B	1.50B	1.23B	1.01B	1.93B	1.21B
Total Debt	554.32M	600.67M	794.29M	939.80M	1.06B	1.17B
Total Liabilities	1.10B	1.17B	1.28B	1.48B	1.52B	1.70B
Stockholders Equity	4.82B	4.92B	4.73B	4.63B	4.58B	3.72B
Cash Flow
Free Cash Flow	78.13M	470.43M	364.50M	-1.22B	-48.71M	-134.19M
Operating Cash Flow	112.88M	562.90M	505.49M	-25.13M	134.41M	-52.34M
Investing Cash Flow	-35.04M	-95.09M	-140.85M	-778.09M	-184.39M	-81.86M
Financing Cash Flow	-51.82M	-194.62M	-146.02M	-118.40M	774.35M	416.60M

Econach Holdings Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 176.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:3521, the sentiment is Positive. The current price of 176 is below the 20-day moving average (MA) of 181.40, above the 50-day MA of 172.54, and above the 200-day MA of 159.16, indicating a neutral trend. The MACD of 1.42 indicates Positive momentum. The RSI at 50.13 is Neutral, neither overbought nor oversold. The STOCH value of 19.58 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:3521.

Econach Holdings Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
3521	73 Outperform	¥4.71B	28.10	―	2.94%	15.50%	-9.91%
4445	71 Outperform	¥4.80B	15.14	―	―	0.63%	178.02%
Sector *	65 Neutral	$2.17B	12.19	3.79%	4.94%	3.15%	1.96%
3238	63 Neutral	¥4.03B	7.34	―	3.41%	31.33%	174.39%
8944	58 Neutral	¥4.82B	-13.84	―	2.51%	86.49%	83.40%
8836	55 Neutral	¥2.88B	221.57	―	―	10.68%	―
3474	49 Neutral	¥3.70B	-6.73	―	―	3.36%	-430.12%