Hikari Business Form Co., Ltd. (3948) AI Stock Analysis

• Market Cap: ¥7.37B
• Dividend Yield: 3.13%
• Average Volume (3M): 3.62K
• Price to Earnings (P/E): 36.4
• Beta (1Y): 0.44
• Revenue Growth: -2.81%
• EPS Growth: 57.37%
• Country: JP
• Employees: 392
• Sector: Industrials
• Sector Strength: 72
• Industry: Specialty Business Services
• EPS (TTM): 4.71
• Shares Outstanding: 5,815,294
• 10 Day Avg. Volume: 6,940
• 30 Day Avg. Volume: 3,616
• PEG Ratio: -0.32
• Price to Book (P/B): 0.43
• Price to Sales (P/S): 0.50
• P/FCF Ratio: 32.01
• 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: 65 Neutral
• Price Target: ¥1,478.00 ▲(16.19% Upside)

The overall stock score of 65 reflects a balance between stable financial health and positive technical indicators, offset by valuation concerns. The company's strong equity position and low leverage provide financial stability, but challenges in revenue growth and profitability need addressing. Technical analysis suggests bullish momentum, though the high P/E ratio raises valuation concerns.

Positive Factors

Strong Equity Position

A strong equity position with low leverage enhances financial stability, providing a solid foundation for future growth and resilience against economic fluctuations.

Financial Stability

A high equity ratio signifies financial stability, ensuring the company can sustain operations and invest in growth opportunities without relying heavily on debt.

Cash Generation Ability

Strong cash generation relative to net income indicates efficient operations, providing the company with the liquidity needed to fund strategic initiatives and withstand economic challenges.

Negative Factors

Declining Revenue

Negative revenue growth suggests difficulty in sustaining market demand, which could impact long-term profitability and market position if not addressed.

Decreasing Profit Margins

Decreasing profit margins indicate rising costs or pricing pressures, which can erode profitability and require strategic adjustments to improve efficiency.

Reduced Cash Flow

Negative free cash flow growth limits the company's ability to reinvest in business expansion and return value to shareholders, potentially hindering long-term growth prospects.

Hikari Business Form Co., Ltd. Business Overview & Revenue Model

Company Description

Hikari Business Form Co., Ltd. provides printing services in Japan. The company provides data print, mailing, business process outsourcing, business forms printing, and various tool creating services, as well as web solutions. It also engages in the planning, production, commercial printing, and redesigning services. The company was incorporated in 1968 and is headquartered in Hachioji, Japan.

How the Company Makes Money

Hikari Business Form Co., Ltd. generates revenue primarily through the sale of its printed business forms and related products. The company's revenue model is based on direct sales to businesses, including both large corporations and small to medium enterprises. Key revenue streams include bulk orders of customized forms, ongoing contracts for regular supplies, and value-added services such as design and printing consultations. Additionally, the company may benefit from strategic partnerships with other businesses in the supply chain, enhancing its distribution capabilities and expanding its customer base. Factors contributing to its earnings include the demand for efficient business operations that require printed documentation, as well as the company's reputation for reliability and quality in the printing industry.

Hikari Business Form Co., Ltd. Financial Statement Overview

Summary

Hikari Business Form Co., Ltd. exhibits stable financial health with strong equity but faces challenges in revenue growth and profitability. While leverage is low and financial stability is evident, declining margins and cash flow highlight areas for improvement. Strategic initiatives may be required to enhance revenue streams and optimize operational efficiency to ensure long-term success.

Income Statement

The income statement shows declining revenue and profitability over the years. Gross profit margin has decreased from 22.68% in 2019 to 20.39% in 2024. Similarly, net profit margin has dropped from 3.98% to 2.04% over the same period. Revenue growth has been negative in recent years, indicating challenges in maintaining sales levels. EBIT and EBITDA margins have also shown a downward trend. These figures suggest a need for strategic improvement to regain growth and profitability.

Balance Sheet

The balance sheet reflects a strong equity position, with a debt-to-equity ratio of 0.02 in 2024, indicating low leverage. Return on equity has decreased from 4.21% in 2019 to 1.73% in 2024, showing reduced profitability on equity. However, the equity ratio remains high at 84.12% in 2024, highlighting a solid financial structure. Despite challenges in profitability, the company maintains financial stability with substantial equity backing.

Cash Flow

Cash flow analysis indicates a notable decline in free cash flow from 2019 to 2024. Operating cash flow to net income ratio is healthy, suggesting good cash generation relative to net income. However, free cash flow growth rate is negative, reflecting reduced cash available for reinvestment and dividends. The company may need to focus on improving cash generation to support future initiatives.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	7.92B	9.88B	11.99B	9.57B	7.26B
Gross Profit	1.61B	2.72B	3.45B	2.53B	1.72B
EBITDA	632.79M	1.35B	2.17B	1.54B	801.43M
Net Income	161.25M	748.02M	1.27B	819.21M	354.54M
Balance Sheet
Total Assets	11.10B	11.38B	11.88B	10.80B	9.52B
Cash, Cash Equivalents and Short-Term Investments	3.81B	4.01B	4.13B	3.18B	2.18B
Total Debt	186.84M	198.14M	334.98M	529.15M	546.96M
Total Liabilities	1.76B	1.95B	2.96B	2.89B	2.32B
Stockholders Equity	9.34B	9.43B	8.92B	7.91B	7.20B
Cash Flow
Free Cash Flow	124.57M	381.68M	1.51B	1.07B	696.10M
Operating Cash Flow	224.51M	471.31M	1.59B	1.10B	750.44M
Investing Cash Flow	32.73M	2.04M	-252.46M	250.46M	137.41M
Financing Cash Flow	-430.77M	-574.55M	-403.67M	-371.08M	-352.52M

Hikari Business Form Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 1272.00
• 50DMA: Negative
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:3948, the sentiment is Positive. The current price of 1272 is below the 20-day moving average (MA) of 1278.00, below the 50-day MA of 1284.52, and above the 200-day MA of 1092.09, indicating a neutral trend. The MACD of -1.70 indicates Negative momentum. The RSI at 50.67 is Neutral, neither overbought nor oversold. The STOCH value of 81.92 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:3948.

Hikari Business Form Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
7811	83 Outperform	¥16.19B	8.88	―	3.76%	7.07%	79.18%
7919	68 Neutral	¥3.28B	7.11	―	3.97%	0.62%	-24.08%
7946	67 Neutral	¥1.29B	24.06	―	1.61%	3.07%	-32.45%
3948	65 Neutral	¥7.37B	36.41	―	3.13%	-2.81%	57.37%
7805	64 Neutral	¥3.30B	7.41	―	1.95%	-1.00%	105.56%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
7916	61 Neutral	¥5.21B	9.59	―	2.99%	-1.30%	―