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DLE, Inc. (JP:3686)
:3686
Japanese Market

DLE, Inc. (3686) AI Stock Analysis

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JP

DLE, Inc.

(3686)

Rating:47Neutral
Price Target:
¥139.00
▼(-2.11%Downside)
DLE, Inc. faces significant financial challenges with persistent losses and negative cash flows, which weigh heavily on its overall score. While technical analysis shows positive momentum, the unattractive valuation due to ongoing financial losses limits the stock's appeal. Improvements in profitability and cash flow generation are crucial.

DLE, Inc. (3686) vs. iShares MSCI Japan ETF (EWJ)

DLE, Inc. Business Overview & Revenue Model

Company DescriptionDLE, Inc. (3686) is a Japanese company primarily engaged in the entertainment sector. The company specializes in producing and distributing animated content, with a focus on digital animation. DLE, Inc. creates original animated series and films, and collaborates with various partners to bring its content to a global audience. The company also explores opportunities in the licensing and merchandising of its intellectual properties.
How the Company Makes MoneyDLE, Inc. generates revenue through multiple streams primarily centered around its animated content. Key revenue sources include the production and distribution of animated series and films, which are sold to broadcasters and streaming platforms both in Japan and internationally. The company also earns income from licensing its original content for use in various media formats, as well as through merchandising deals that leverage its popular animated characters. Additionally, DLE, Inc. engages in partnerships and collaborations with other entertainment entities to expand its reach and monetize its intellectual properties more effectively.

DLE, Inc. Financial Statement Overview

Summary
DLE, Inc. is growing its revenue but is struggling significantly with profitability and cash flow. Despite a strong equity position, negative net income and cash flow issues highlight operational inefficiencies and financial risks.
Income Statement
35
Negative
DLE, Inc. shows a consistent increase in revenue over the years, indicating growth in its core operations. However, the company has been struggling with profitability, as evidenced by negative net income and significant EBIT losses. The gross profit margin remains relatively stable, but the net profit margin is deeply negative, showcasing ongoing challenges in managing operational costs.
Balance Sheet
45
Neutral
The company's balance sheet reflects a strong equity position, with a healthy equity ratio indicating financial stability. However, the persistent negative net income impacts the return on equity, which remains unfavorable. The debt-to-equity ratio is low, suggesting limited leverage risk, which is a positive aspect amidst overall financial challenges.
Cash Flow
30
Negative
DLE, Inc. has faced significant cash flow issues, as seen in consistently negative operating and free cash flows. The company's ability to generate cash from operations is weak, and this poses a risk to its financial flexibility. The free cash flow to net income ratio is also negative, highlighting the company’s ongoing struggles with cash flow generation.
BreakdownTTMMar 2025Mar 2024Mar 2023Mar 2022Mar 2021
Income Statement
Total Revenue1.91B1.98B1.71B2.02B1.64B1.12B
Gross Profit578.95M745.33M551.17M596.34M566.82M435.78M
EBITDA-671.49M-676.42M-544.07M-499.32M-194.18M-607.16M
Net Income-646.52M-728.50M-520.66M-582.32M-311.41M-510.93M
Balance Sheet
Total Assets2.81B2.63B3.62B3.18B3.58B3.89B
Cash, Cash Equivalents and Short-Term Investments720.00M587.87M1.01B1.42B2.08B2.59B
Total Debt20.00M25.00M1.00M12.71M63.02M138.34M
Total Liabilities859.00M770.20M672.63M398.99M415.38M508.87M
Stockholders Equity1.89B1.81B2.85B2.67B3.14B3.37B
Cash Flow
Free Cash Flow0.00-438.52M-466.15M-489.19M-270.73M-529.57M
Operating Cash Flow0.00-433.61M-418.41M-434.51M-240.94M-458.53M
Investing Cash Flow0.0016.58M6.01M-222.52M-209.39M-736.52M
Financing Cash Flow0.0024.00M-11.71M10.00M-67.65M-152.26M

DLE, Inc. Technical Analysis

Technical Analysis Sentiment
Positive
Last Price142.00
Price Trends
50DMA
140.90
Positive
100DMA
132.82
Positive
200DMA
129.01
Positive
Market Momentum
MACD
0.49
Positive
RSI
47.27
Neutral
STOCH
8.89
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:3686, the sentiment is Positive. The current price of 142 is below the 20-day moving average (MA) of 149.15, above the 50-day MA of 140.90, and above the 200-day MA of 129.01, indicating a neutral trend. The MACD of 0.49 indicates Positive momentum. The RSI at 47.27 is Neutral, neither overbought nor oversold. The STOCH value of 8.89 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:3686.

DLE, Inc. Peers Comparison

Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
75
Outperform
¥9.23B16.75
3.77%4.74%84.68%
74
Outperform
¥13.50B40.20
2.15%9.55%-49.89%
72
Outperform
¥6.49B8.38
3.31%-6.82%-4.67%
68
Neutral
¥12.86B20.50
0.90%-4.12%115.46%
65
Neutral
¥2.94B15.05
-20.82%
61
Neutral
$40.70B-0.98-11.97%3.93%2.03%-69.70%
47
Neutral
¥6.14B
16.03%-27.98%
* Communication Services Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
JP:3686
DLE, Inc.
144.00
-25.00
-14.79%
JP:3929
SocialWire Co., Ltd.
254.00
-15.00
-5.58%
JP:4308
J-Stream Inc.
373.00
9.39
2.58%
JP:4317
Ray Corporation
452.00
31.61
7.52%
JP:4347
Broadmedia Corporation
1,905.00
129.22
7.28%
JP:4772
Stream Media Corporation
112.00
-30.72
-21.52%
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: May 27, 2025