DIGITAL HEARTS HOLDINGS Co., Ltd. (JP:3676)
:3676
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DIGITAL HEARTS HOLDINGS Co., Ltd.
(3676)
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Rating:64Neutral
Price Target:
¥815.00
▼(-10.34% Downside)
Action:Downgraded
Date:05/15/26
The score is driven primarily by solid financial quality (especially cash flow and manageable leverage) and attractive valuation (low P/E and a healthy dividend yield). These positives are partially offset by weak technicals, with the stock trading below major moving averages and negative MACD despite oversold signals.
Positive Factors
Cash generation
Consistently positive operating cash flow and a strong free-cash-flow rebound in 2025 indicate durable internal funding. This supports dividend capacity, subsidiary funding and reinvestment without heavy reliance on markets, improving resilience across multi-month cycles.
Negative Factors
Revenue slowdown
A material slowdown and sharp decline in revenue momentum undermines utilization and pricing leverage for service teams. Persisting top-line weakness can compress margins, reduce FCF generation and limit capacity to invest in scaling or new service offerings.
Read all positive and negative factors
Positive Factors
Negative Factors
Cash generation
Consistently positive operating cash flow and a strong free-cash-flow rebound in 2025 indicate durable internal funding. This supports dividend capacity, subsidiary funding and reinvestment without heavy reliance on markets, improving resilience across multi-month cycles.
Read all positive factors
DIGITAL HEARTS HOLDINGS Co., Ltd. (3676) vs. iShares MSCI Japan ETF (EWJ)
Market Cap
¥15.99B
Dividend Yield2.36%
Average Volume (3M)70.74K
Price to Earnings (P/E)14.1
Beta (1Y)0.80
Revenue Growth-2.06%
EPS Growth87.60%
CountryJP
Employees1,870
SectorTechnology
Sector Strength88
IndustryInformation Technology Services
Share Statistics
EPS (TTM)39.54
Shares Outstanding23,890,800
10 Day Avg. Volume80,220
30 Day Avg. Volume70,740
Financial Highlights & Ratios
PEG Ratio0.18
Price to Book (P/B)1.93
Price to Sales (P/S)0.48
P/FCF Ratio6.35
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
EPS Forecast (FY)92.4
Revenue Forecast (FY)¥41.69B
DIGITAL HEARTS HOLDINGS Co., Ltd. Business Overview & Revenue Model
Company Description
DIGITAL HEARTS HOLDINGS Co., Ltd., together with its subsidiaries, engages in debugging, media, and other businesses. It provides debug testing and reporting services for consumer games, mobile and online games, arcade games, etc.; one-stop soluti...
How the Company Makes Money
The company primarily makes money by charging corporate clients (e.g., game publishers, developers, and digital service operators) service fees for outsourced operational work provided by its subsidiaries. Key revenue streams include: (1) QA/testi...
DIGITAL HEARTS HOLDINGS Co., Ltd. Financial Statement Overview
Summary
Income Statement
56
Neutral
Balance Sheet
67
Positive
Cash Flow
74
Positive
| Breakdown | TTM | Mar 2026 | Mar 2025 | Mar 2024 | Mar 2023 | Mar 2022 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 39.29B | 38.93B | 39.75B | 38.79B | 36.52B | 29.18B |
| Gross Profit | 10.32B | 10.00B | 10.14B | 10.09B | 10.63B | 8.39B |
| EBITDA | 3.08B | 3.56B | 2.70B | 1.91B | 3.18B | 3.49B |
| Net Income | 881.41M | 1.18B | 629.46M | 176.93M | 799.55M | 1.78B |
Balance Sheet | ||||||
| Total Assets | 19.71B | 21.53B | 19.95B | 21.10B | 19.58B | 17.61B |
| Cash, Cash Equivalents and Short-Term Investments | 7.22B | 7.13B | 7.59B | 6.90B | 6.50B | 5.24B |
| Total Debt | 5.39B | 5.67B | 5.25B | 7.13B | 5.13B | 5.59B |
| Total Liabilities | 10.45B | 11.57B | 10.69B | 12.25B | 10.11B | 10.04B |
| Stockholders Equity | 8.97B | 9.63B | 8.95B | 8.42B | 8.81B | 6.99B |
Cash Flow | ||||||
| Free Cash Flow | 0.00 | 2.93B | 2.69B | 946.83M | 1.82B | 2.70B |
| Operating Cash Flow | 0.00 | 3.22B | 3.12B | 1.76B | 2.85B | 3.08B |
| Investing Cash Flow | 0.00 | -3.72B | -147.41M | -2.37B | -1.90B | -2.54B |
| Financing Cash Flow | 0.00 | -97.42M | -2.41B | 934.08M | 141.47M | -546.57M |
DIGITAL HEARTS HOLDINGS Co., Ltd. Technical Analysis
Negative
909.00
Price Trends
833.75
Negative
866.27
Negative
904.50
Negative
Market Momentum
-28.66
Positive
35.24
Neutral
27.45
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:3676, the sentiment is Negative. The current price of 909 is above the 20-day moving average (MA) of 782.90, above the 50-day MA of 833.75, and above the 200-day MA of 904.50, indicating a bearish trend. The MACD of -28.66 indicates Positive momentum. The RSI at 35.24 is Neutral, neither overbought nor oversold. The STOCH value of 27.45 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:3676.
DIGITAL HEARTS HOLDINGS Co., Ltd. Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
74 Outperform | ¥18.63B | 18.44 | ― | 0.90% | 12.34% | 2.41% | |
69 Neutral | ¥18.98B | 26.70 | ― | 2.13% | -5.40% | -37.51% | |
64 Neutral | ¥15.99B | 14.07 | ― | 2.36% | -2.06% | 87.60% | |
63 Neutral | ¥8.54B | 14.04 | ― | 0.95% | 10.61% | -1.13% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% | |
60 Neutral | ¥20.39B | 9.79 | ― | 1.72% | 58.85% | 1630.07% | |
45 Neutral | ¥10.43B | -3.06 | ― | 5.03% | -6.49% | -402.49% |
* Technology Sector Average
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DIGITAL HEARTS HOLDINGS Co., Ltd. Corporate Events
Digital Hearts Holdings Lifts Profit and Dividend, Forecasts Renewed Growth for FY 2027
May 13, 2026
Digital Hearts Holdings reported consolidated net sales of ¥38.9 billion for the year ended March 31, 2026, a slight 2.1% decline from the prior year, but boosted profitability with operating income up 8.1% to ¥2.6 billion and profit att...
DIGITAL HEARTS Books Goodwill Impairment as China Game Slowdown Hits DHX Business
May 13, 2026
DIGITAL HEARTS HOLDINGS has booked extraordinary losses for the year ended March 31, 2026, primarily due to an impairment of 238 million yen on goodwill related to its DHX marketing support business, where reduced marketing spending by key Chinese...
DIGITAL HEARTS Clarifies Segment Reporting in FY2026 Results Materials
May 13, 2026
DIGITAL HEARTS HOLDINGS Co., Ltd. released presentation materials for the fiscal year ended March 31, 2026, outlining how it reports earnings by business segment. The company clarified that segment net sales figures include inter-segment sales or ...
DIGITAL HEARTS to Boost Stake in G-angle, Paving Way to Full Ownership
Mar 19, 2026
DIGITAL HEARTS HOLDINGS has resolved to acquire an additional 28.4% stake in creative studio G-angle Co., Ltd., raising its holding from 5.1% to a level that makes G-angle an equity-method affiliate and setting terms for the future purchase of the...
Digital Hearts Drops AGEST Spin-Off Plan Amid Weak IT Valuations, Shifts to Alternative Shareholder Returns
Mar 2, 2026
DIGITAL HEARTS HOLDINGS has decided to withdraw its planned share-distribution-type spin-off and stock market listing of its consolidated subsidiary AGEST, Inc., despite having prepared the transaction as a major form of shareholder return. Manage...
DIGITAL HEARTS HOLDINGS Revamps Strategy, Drops Spin-Off Plan
Mar 2, 2026
DIGITAL HEARTS HOLDINGS announced strategic changes aimed at maximizing corporate value, centered on withdrawing its previously planned spin-off listing initiative. The company is also introducing new shareholder return measures, signaling a shift...
Digital Hearts Adopts Progressive Dividend Policy and Launches New Shareholder Benefits
Mar 2, 2026
DIGITAL HEARTS HOLDINGS has revised its shareholder return policy after canceling the planned share-distribution-type spin-off and listing of its subsidiary AGEST Inc., citing current equity market conditions. In place of the spin-off, the company...
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.