Koei Tecmo Holdings Co., Ltd. (3635) AI Stock Analysis

• Market Cap: ¥704.12B
• Dividend Yield: 2.46%
• Average Volume (3M): 2.17M
• Price to Earnings (P/E): 18.9
• Beta (1Y): 0.44
• Revenue Growth: -1.05%
• EPS Growth: 6.49%
• Country: JP
• Employees: 2,531
• Sector: Communication Services
• Sector Strength: 97
• Industry: Electronic Gaming & Multimedia
• EPS (TTM): 23.38
• Shares Outstanding: 336,096,920
• 10 Day Avg. Volume: 1,095,000
• 30 Day Avg. Volume: 2,165,733
• PEG Ratio: 1.46
• Price to Book (P/B): 3.28
• Price to Sales (P/S): 7.47
• P/FCF Ratio: 18.93
• 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: ¥2,500.00
• Price Target Upside: 28.14% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 1
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 76 Outperform
• Price Target: ¥2,351.00 ▲(20.50% Upside)

Koei Tecmo Holdings Co., Ltd. scores well due to its strong financial performance and positive technical indicators. The company's robust revenue growth and profitability are key strengths, while the technical analysis suggests short-term momentum. The valuation is reasonable, with a fair P/E ratio and a decent dividend yield. The absence of recent earnings call data and corporate events means these factors do not influence the score.

Positive Factors

Strong Financial Health

The company's robust financial health, characterized by strong revenue growth and high profitability, supports long-term stability and growth potential.

Low Leverage Profile

A low leverage profile enhances financial stability, reducing risk and providing flexibility for future investments and growth initiatives.

High Profitability

High profitability ensures strong cash generation, enabling reinvestment in growth opportunities and providing a buffer against economic downturns.

Negative Factors

Revenue Growth Decline

A decline in revenue growth could indicate challenges in market expansion or product adoption, potentially impacting future earnings.

Cost Pressures

Cost pressures can erode margins and profitability, necessitating effective cost management strategies to maintain financial performance.

Equity Financing Reliance

Reliance on equity financing may dilute shareholder value and indicates a need for optimizing capital structure to enhance returns.

Koei Tecmo Holdings Co., Ltd. Business Overview & Revenue Model

Company Description

Koei Tecmo Holdings Co., Ltd., together with its subsidiaries, operates as an entertainment company in Japan, North America, Europe, rest of Asia, and internationally. The company operates through Entertainment, Amusement, and Real Estate segments. The Entertainment segment develops and sells entertainment contents. It offers software for personal computers and gaming consoles. The Amusement segment develops commercial amusements; and manages amusement arcades. The Real Estate segment engages in the operation, management, and lease of real estate properties. It is also involved in the venture capital and other activities. The company was founded in 2009 and is headquartered in Yokohama, Japan. Koei Tecmo Holdings Co., Ltd. is a subsidiary of Koyu Holdings Co., Ltd.

How the Company Makes Money

Koei Tecmo generates revenue primarily through the sale of video games across multiple platforms, including consoles, PC, and mobile devices. The company's revenue model includes direct sales of physical and digital copies of games, downloadable content (DLC), and in-game purchases. Additionally, Koei Tecmo earns money through licensing agreements and partnerships, which may involve collaborations with other media franchises or adaptations into other forms of entertainment such as anime or merchandise. Significant partnerships with hardware manufacturers and distribution platforms also contribute to its earnings by expanding its market reach. The company may also benefit from seasonal sales and promotional events that boost game sales.

Koei Tecmo Holdings Co., Ltd. Financial Statement Overview

Summary

Koei Tecmo Holdings Co., Ltd. exhibits strong financial health with robust revenue growth, high profitability, and effective cash flow management. The company maintains a low leverage profile, enhancing its financial stability. Minor areas for improvement include optimizing equity financing and addressing cost pressures.

Income Statement

Koei Tecmo Holdings Co., Ltd. has demonstrated strong revenue growth over the years, with a notable 9.38% increase in the most recent year. The company maintains high profitability with a consistent gross profit margin above 60% and a net profit margin around 45%. The EBIT and EBITDA margins also reflect strong operational efficiency. However, the slight decline in gross profit margin from previous years indicates potential cost pressures.

Balance Sheet

The company's balance sheet is robust, with a low debt-to-equity ratio, indicating prudent financial management and low leverage risk. The return on equity is healthy, reflecting efficient use of equity capital. However, the equity ratio suggests a moderate reliance on equity financing, which could be optimized further.

Cash Flow

Koei Tecmo Holdings shows strong cash flow management, with a high operating cash flow to net income ratio, indicating effective conversion of income into cash. The free cash flow growth has been impressive, although it experienced volatility in earlier years. The free cash flow to net income ratio is consistently high, underscoring solid cash generation relative to profits.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	80.34B	83.15B	84.58B	78.42B	72.76B	60.37B
Gross Profit	49.63B	52.39B	55.30B	57.10B	50.60B	39.07B
EBITDA	41.96B	51.90B	30.31B	40.78B	36.08B	25.95B
Net Income	30.06B	37.63B	33.79B	30.93B	35.36B	29.55B
Balance Sheet
Total Assets	243.40B	209.83B	245.80B	210.89B	219.80B	190.67B
Cash, Cash Equivalents and Short-Term Investments	41.21B	44.49B	70.09B	20.61B	45.42B	17.23B
Total Debt	35.92B	467.00M	46.54B	47.34B	48.15B	41.00M
Total Liabilities	56.28B	20.41B	70.25B	68.20B	81.70B	25.54B
Stockholders Equity	187.12B	189.42B	175.55B	142.68B	138.10B	165.13B
Cash Flow
Free Cash Flow	0.00	32.82B	34.80B	28.80B	23.47B	28.14B
Operating Cash Flow	0.00	34.37B	36.60B	29.69B	24.82B	29.73B
Investing Cash Flow	0.00	40.97B	-24.86B	-21.39B	-13.17B	-12.29B
Financing Cash Flow	0.00	-63.17B	-15.47B	-16.59B	-4.56B	-19.40B

Koei Tecmo Holdings Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 1951.00
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:3635, the sentiment is Negative. The current price of 1951 is below the 20-day moving average (MA) of 2070.10, below the 50-day MA of 2063.49, and below the 200-day MA of 2123.87, indicating a bearish trend. The MACD of -27.14 indicates Positive momentum. The RSI at 35.76 is Neutral, neither overbought nor oversold. The STOCH value of 8.71 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:3635.

Koei Tecmo Holdings Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
2432	78 Outperform	$296.15B	9.23	17.98%	2.71%	34.16%	―
3635	76 Outperform	¥704.12B	18.94	―	2.46%	-1.05%	6.49%
9697	69 Neutral	$1.66T	27.40	26.66%	1.16%	45.17%	81.91%
6460	68 Neutral	¥503.91B	31.75	4.45%	2.04%	-8.73%	-55.81%
3765	64 Neutral	$132.80B	31.02	3.38%	2.38%	-3.12%	-63.07%
Sector *	60 Neutral	$48.67B	4.58	-11.27%	4.14%	2.83%	-41.78%
9684	57 Neutral	$1.05T	45.47	6.70%	1.85%	-12.02%	126.06%

Koei Tecmo Holdings Co., Ltd. Corporate Events

Koei Tecmo Reports Decline in Sales and Profits for First Half of 2025

Koei Tecmo Holdings Co., Ltd. reported a decline in net sales and profits for the six months ended September 30, 2025, compared to the previous year. Despite the decrease in sales and profits, the company saw a significant increase in comprehensive income, indicating potential long-term financial health. The company’s equity-to-asset ratio decreased, reflecting changes in its financial structure, while the forecast for the fiscal year ending March 31, 2026, shows a moderate growth in net sales.

Koei Tecmo Revises Earnings Forecast Upward Amid Strong Game Sales

Koei Tecmo Holdings Co., Ltd. has revised its consolidated earnings forecast for the interim period ending September 30, 2025, due to increased sales of console and PC games and reduced outsourcing and advertising costs. The company anticipates higher net sales and operating profit, with significant improvements in ordinary profit and profit attributable to owners of the parent, while maintaining its full-year forecast unchanged.

Koei Tecmo Achieves Compliance with Prime Market Criteria

Koei Tecmo Holdings Co., Ltd. has successfully met all the Tokyo Stock Exchange’s Prime Market listing maintenance criteria as of September 2025. This achievement underscores the company’s commitment to maintaining high governance standards and securing growth capital, thereby enhancing its market position and investor trust.

Koei Tecmo Adjusts Stock Option Exercise Price Amid Treasury Share Disposal

Koei Tecmo Holdings Co., Ltd. announced an adjustment to the exercise price for its share acquisition rights due to the disposal of treasury shares through a third-party allotment. This adjustment reflects the difference between the payment per share and the market price, impacting the company’s stock option terms and conditions.

Koei Tecmo Announces Treasury Share Disposal for Strategic Investment

Koei Tecmo Holdings Co., Ltd. has announced the disposal of 3,260,000 treasury shares through a third-party allotment, with the allottee subscribing to all available shares. The proceeds, amounting to approximately ¥5.7 billion, will be invested in the company’s human capital and sustainable development of new game titles, with plans to allocate the funds to its subsidiary by March 2028.

Koei Tecmo Adjusts Stock Option Exercise Prices Amid Treasury Share Disposal

Koei Tecmo Holdings Co., Ltd. announced an adjustment to the exercise price for its share acquisition rights due to the disposal of treasury shares through a public offering. This adjustment reflects the difference between the market price and the amount paid per share, impacting the company’s stock options and potentially influencing its financial strategy and shareholder value.

Koei Tecmo Announces Share Disposal and Secondary Offering Prices

Koei Tecmo Holdings Co., Ltd. has announced the determination of disposal and selling prices for its treasury shares and a secondary offering of common stock. The company aims to dispose of treasury shares through a public offering and a secondary offering, with a set price of ¥1,827.5 per share, raising significant capital. This move is expected to impact the company’s financial strategy and market positioning by enhancing its capital base and potentially increasing shareholder value.