Cave Interactive Co., Ltd. (3760) AI Stock Analysis

• Market Cap: ¥5.24B
• Dividend Yield: 1.29%
• Average Volume (3M): 26.20K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.01
• Revenue Growth: 4.29%
• EPS Growth: -123.59%
• Country: JP
• Employees: 171
• Sector: Communication Services
• Sector Strength: 97
• Industry: Electronic Gaming & Multimedia
• EPS (TTM): -47.30
• Shares Outstanding: 6,693,500
• 10 Day Avg. Volume: 43,080
• 30 Day Avg. Volume: 26,200
• PEG Ratio: -0.31
• Price to Book (P/B): 1.05
• Price to Sales (P/S): 0.47
• P/FCF Ratio: -25.35
• 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: Hold
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 49 Neutral
• Price Target: ¥800.00 ▲(3.09% Upside)

The overall stock score is primarily impacted by the company's strong revenue growth but is weighed down by profitability and cash flow challenges. Technical indicators suggest bearish momentum, and valuation metrics indicate potential overvaluation.

Positive Factors

Revenue Growth

The company demonstrates a strong upward revenue trajectory, indicating effective market expansion and product adoption, which are crucial for long-term growth.

Stable Balance Sheet

A stable balance sheet with low leverage suggests financial prudence, providing the company with flexibility to invest in growth opportunities and weather economic fluctuations.

Market Position in Niche Genre

Cave Interactive's strong position in the niche shmup genre provides a competitive advantage, fostering a dedicated fan base and ensuring sustained demand for its unique game offerings.

Negative Factors

Profitability Challenges

Inconsistent profitability margins and negative free cash flow highlight operational inefficiencies, potentially hindering long-term financial health and investment capacity.

Declining Return on Equity

A declining return on equity indicates reduced efficiency in generating shareholder returns, which could impact investor confidence and the company's ability to attract capital.

Cost Management Issues

Decreasing gross profit margins suggest potential cost management issues, which could erode profitability if not addressed, affecting long-term competitiveness.

Cave Interactive Co., Ltd. Business Overview & Revenue Model

Company Description

Cave Interactive Co., Ltd. (3760) is a Japanese video game developer and publisher known for creating a variety of interactive entertainment products across multiple platforms. The company specializes in developing mobile games, console titles, and PC games, with a focus on high-quality graphics and engaging gameplay experiences. Cave Interactive is particularly recognized for its expertise in the shoot 'em up (shmup) genre, and it has a dedicated fan base for its unique game mechanics and intricate level designs.

How the Company Makes Money

Cave Interactive generates revenue primarily through the sale of its video games across various platforms, including mobile, console, and PC. The company monetizes its games through direct sales, in-game purchases, and downloadable content (DLC). Additionally, Cave Interactive earns income from partnerships with other game developers and publishers, collaborating on joint ventures and licensing agreements to expand its market reach. The success of their titles, especially in the niche shmup genre, along with strategic marketing and community engagement, significantly contributes to their overall earnings.

Cave Interactive Co., Ltd. Financial Statement Overview

Summary

Cave Interactive Co., Ltd. shows strong revenue growth but faces challenges in profitability and cash flow management. The balance sheet is stable with low leverage, but declining return on equity and negative free cash flow are concerns.

Income Statement

Cave Interactive Co., Ltd. has shown significant revenue growth over the years, particularly in the most recent periods, indicating a strong upward trajectory. However, the company's profitability margins, such as the net profit margin and EBIT margin, have been inconsistent, with recent declines. The gross profit margin has also decreased, suggesting potential cost management issues.

Balance Sheet

The company's balance sheet reflects a stable financial position with a manageable debt-to-equity ratio, indicating low leverage. However, the return on equity has decreased significantly, pointing to reduced efficiency in generating returns for shareholders. The equity ratio remains strong, suggesting a solid capital structure.

Cash Flow

Cash flow analysis reveals challenges, with negative free cash flow and a declining free cash flow growth rate. The operating cash flow to net income ratio is positive but relatively low, indicating potential issues in converting income into cash. The free cash flow to net income ratio is negative, highlighting cash flow management concerns.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	13.88B	13.97B	12.27B	6.96B	1.41B	1.70B
Gross Profit	5.49B	5.23B	5.45B	3.44B	677.71M	793.74M
EBITDA	1.90B	55.80M	2.13B	2.97B	-901.39M	-234.60M
Net Income	1.28B	246.49M	1.48B	2.58B	-936.99M	-244.97M
Balance Sheet
Total Assets	14.24B	13.25B	14.36B	13.49B	1.38B	1.42B
Cash, Cash Equivalents and Short-Term Investments	5.31B	6.20B	6.34B	6.39B	1.06B	904.44M
Total Debt	1.11B	1.25B	983.92M	1.10B	206.51M	209.72M
Total Liabilities	6.47B	6.98B	7.57B	8.40B	361.06M	359.27M
Stockholders Equity	7.05B	6.22B	6.09B	4.42B	997.56M	1.03B
Cash Flow
Free Cash Flow	0.00	-257.72M	-916.03M	1.68B	-520.33M	-485.48M
Operating Cash Flow	0.00	922.45M	569.09M	2.54B	-480.60M	-299.32M
Investing Cash Flow	0.00	-1.35B	-703.00M	1.28B	44.29M	-186.16M
Financing Cash Flow	0.00	279.65M	31.00M	1.85B	583.50M	287.31M

Cave Interactive Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 776.00
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:3760, the sentiment is Negative. The current price of 776 is below the 20-day moving average (MA) of 794.20, below the 50-day MA of 844.80, and below the 200-day MA of 932.83, indicating a bearish trend. The MACD of -17.34 indicates Negative momentum. The RSI at 36.37 is Neutral, neither overbought nor oversold. The STOCH value of 34.55 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:3760.

Cave Interactive Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
3904	73 Outperform	¥6.93B	14.52	―	0.72%	12.70%	2207.66%
Sector *	60 Neutral	$48.67B	4.58	-11.27%	4.14%	2.83%	-41.78%
3932	60 Neutral	¥38.22B	50.95	―	4.09%	-15.30%	39.61%
3656	51 Neutral	¥12.61B	-1.73	―	―	-14.71%	-38.87%
3851	51 Neutral	¥4.13B	-17.78	―	0.61%	-13.35%	-258.79%
3760	49 Neutral	¥5.24B	-11.62	―	1.29%	4.29%	-123.59%
3911	48 Neutral	¥10.23B	5.66	―	―	11.15%	―