ORO Co. Ltd. (3983) AI Stock Analysis

• Market Cap: ¥29.33B
• Dividend Yield: 1.45%
• Average Volume (3M): 62.97K
• Price to Earnings (P/E): 17.4
• Beta (1Y): 0.78
• Revenue Growth: 5.48%
• EPS Growth: 5.36%
• Country: JP
• Employees: 546
• Sector: Technology
• Sector Strength: 88
• Industry: Software - Application
• EPS (TTM): 42.29
• Shares Outstanding: 15,949,053
• 10 Day Avg. Volume: 75,140
• 30 Day Avg. Volume: 62,970
• PEG Ratio: -2.70
• Price to Book (P/B): 3.19
• Price to Sales (P/S): 3.98
• P/FCF Ratio: 16.54
• 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): 128.4
• Revenue Forecast (FY): ¥9.10B

• Rating: 72 Outperform
• Price Target: ¥2,014.00 ▼(-3.08% Downside)
• Action: Reiterated Date: 02/18/26
• Date: Action: Reiterated 02/18/26

The score is supported primarily by strong profitability and a conservative balance sheet, with reasonable valuation and dividend yield providing additional support. It is held back by weak technical momentum (below major moving averages with negative MACD) and fundamental trajectory concerns around slower 2025 growth, some margin softening, and operating cash flow lagging operating profit.

Positive Factors

High gross & EBIT margins

Sustained gross margins around 60–67% and EBIT margins near 32–38% indicate strong product economics and pricing power typical of enterprise application software. These durable margins provide ongoing cash to fund R&D, customer success, and shareholder returns, and help the business resist cyclical revenue swings.

Conservative balance sheet & strong ROE

Low leverage and a conservative capital structure give financial flexibility to weather downturns, invest in product development, or pursue M&A without stressing liquidity. Coupled with ROE in the high-teens to mid-20s, this signals efficient capital use and a durable capacity to generate shareholder returns over multiple quarters.

Solid free cash flow conversion

Free cash flow that closely tracks net income (0.87–0.99x) points to high earnings quality and reliable cash generation. Over 2–6 months this supports consistent investment in products and operations, funds dividends or buybacks, and reduces reliance on external financing for organic growth initiatives.

Negative Factors

Sharp revenue growth slowdown

A drop from low‑teens annual growth to roughly 2.6% in 2025 materially reduces the company’s growth runway and optionality. Persistently slower top-line expansion can limit operating leverage, slow user adoption momentum, and make it harder to scale fixed-cost investments profitably over the medium term.

Margin compression in 2025

A decline in net margin from ~26% to ~23% suggests rising cost pressure or a less profitable revenue mix. If this persists, it erodes the company’s ability to convert revenue into cash and weakens the buffer for reinvestment and dividends, making long‑term profitability targets harder to sustain.

OCF lags operating profit

Operating cash flow coverage around 0.71 indicates timing or working‑capital strains versus reported operating profit. Persistent gaps reduce liquidity flexibility, can constrain investment cadence or dividend policies, and raise questions about the durability of reported earnings if collection/timing issues are structural.

ORO Co. Ltd. Business Overview & Revenue Model

Company Description

ORO Co. Ltd. (3983) is a leading company specializing in the development and production of high-quality electronic components and systems. Operating primarily in the technology sector, ORO focuses on providing innovative solutions for various industries, including telecommunications, automotive, and consumer electronics. The company is renowned for its cutting-edge research and development capabilities, which enable it to deliver a diverse range of products, including semiconductors, sensors, and integrated circuits.

How the Company Makes Money

null

ORO Co. Ltd. Financial Statement Overview

Summary

Strong fundamentals overall: consistently high gross margins (~60–67%) and solid EBIT margins (~32–38%) support profitability, while the balance sheet remains conservative with low leverage and healthy ROE (~18–24%). Key risks are the sharp slowdown in 2025 revenue growth (~2.6%), margin step-down in 2025 (net margin ~26% to ~23%), and operating cash flow trailing operating profit (coverage ~0.71 in 2025).

Income Statement

Revenue has grown steadily since 2021 (with only a small decline in 2020), but growth decelerated sharply in 2025 (2025 annual growth ~2.6% vs. low-teens in prior years). Profitability remains a key strength: gross margins are consistently strong (~60–67%) and operating profitability is high (EBIT margin ~32–38% over the period). The main weakness is the 2025 step-down in margins and earnings versus 2024 (net margin fell from ~26% to ~23%), suggesting some cost pressure and/or a less favorable mix despite higher revenue.

Balance Sheet

The balance sheet looks conservative with low leverage overall (debt-to-equity mostly ~3–12% historically), though debt increased in 2025 (to ~10% debt-to-equity) from 2024’s unusually low level. Equity has expanded materially over time, supporting a larger asset base. Returns on equity remain strong (~18–24%), albeit trending down from earlier years and modestly lower in 2025, indicating profitability is still solid but less powerful than the peak period.

Cash Flow

Cash generation is generally healthy: free cash flow closely tracks net income (roughly ~0.87–0.99x), indicating earnings quality is solid and cash conversion is strong. Free cash flow was essentially flat in 2024 and grew in 2025, but the year-to-year path has been somewhat uneven (notably a decline in 2022). A key watch item is that operating cash flow has not consistently covered operating profitability (coverage ratio below 1.0 across the period, improving from 2020–2022 levels but still ~0.71 in 2025), pointing to working-capital or timing headwinds.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	8.31B	7.90B	7.03B	6.21B	5.51B
Gross Profit	5.46B	5.28B	4.67B	3.99B	3.32B
EBITDA	2.98B	3.08B	2.95B	2.67B	2.33B
Net Income	1.90B	2.07B	1.84B	1.62B	1.42B
Balance Sheet
Total Assets	13.75B	13.69B	12.50B	11.08B	9.42B
Cash, Cash Equivalents and Short-Term Investments	10.06B	9.90B	8.71B	6.83B	5.91B
Total Debt	1.07B	335.83M	415.53M	479.15M	596.75M
Total Liabilities	3.39B	3.41B	3.62B	3.74B	3.51B
Stockholders Equity	10.36B	10.28B	8.88B	7.33B	5.91B
Cash Flow
Free Cash Flow	2.00B	2.42B	2.42B	1.40B	2.06B
Operating Cash Flow	2.02B	2.49B	2.52B	1.60B	2.09B
Investing Cash Flow	-101.77M	-163.78M	-129.76M	-278.49M	-34.89M
Financing Cash Flow	-1.77B	-1.18B	-517.74M	-436.09M	-2.09B

ORO Co. Ltd. Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 2078.00
• 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:3983, the sentiment is Negative. The current price of 2078 is above the 20-day moving average (MA) of 1907.65, above the 50-day MA of 2027.50, and below the 200-day MA of 2395.68, indicating a bearish trend. The MACD of -35.03 indicates Negative momentum. The RSI at 46.89 is Neutral, neither overbought nor oversold. The STOCH value of 75.15 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:3983.

ORO Co. Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
4481	78 Outperform	¥59.62B	13.98	―	3.34%	11.81%	18.17%
4477	73 Outperform	¥33.96B	20.10	―	―	27.97%	-5.25%
3983	72 Outperform	¥29.33B	17.42	―	1.45%	5.48%	5.36%
9553	68 Neutral	¥23.68B	15.25	―	―	14.28%	-30.60%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
3905	52 Neutral	¥44.07B	16.46	―	―	27.58%	-1.50%
5027	49 Neutral	¥26.49B	39.28	―	―	20.84%	10.41%

ORO Co. Ltd. Corporate Events

ORO Co. Launches Up to ¥1 Billion Share Buyback to Boost Capital Efficiency

ORO Co., Ltd., a Tokyo-listed digital solutions and information services company, has approved a share repurchase program aimed at enhancing shareholder returns and boosting capital efficiency. The board has authorized the buyback of up to 650,000 common shares, representing 4.17% of shares outstanding excluding treasury stock, for a total consideration of up to 1 billion yen through market purchases on the Tokyo Stock Exchange between March 18 and September 30, 2026.

The company intends to cancel all shares acquired under the program, except those earmarked for restricted stock compensation and other corporate purposes, a move that could reduce the overall share count and support earnings per share over time. This planned cancellation underscores management’s commitment to disciplined capital allocation and may strengthen ORO’s positioning with investors seeking clearer returns of capital and improved balance-sheet efficiency, with specific timing of the cancellation to be disclosed later.

The most recent analyst rating on (JP:3983) stock is a Hold with a Yen1964.00 price target. To see the full list of analyst forecasts on ORO Co. Ltd. stock, see the JP:3983 Stock Forecast page.

ORO Posts Stable ZAC Cloud License Growth in February FY2026

ORO Co., Ltd. reported monthly metrics for its ZAC cloud solution for February in the FY2026/12 period, indicating 351.1 thousand active licenses, up slightly from January. The company recorded 2.1 thousand new licenses and 1.0 thousand additional licenses from existing customers, offset by 2.6 thousand canceled or decreased licenses, with management noting these figures are preliminary and subject to revision when full financial results are released.

The latest data suggest ORO is maintaining a broadly stable base of ZAC users, with new and additional licenses collectively balancing churn and modestly expanding total active contracts. For stakeholders, this monthly disclosure offers an early view into demand momentum and customer retention ahead of formal earnings, helping to gauge the health and trajectory of the firm’s core cloud business.

The most recent analyst rating on (JP:3983) stock is a Hold with a Yen1964.00 price target. To see the full list of analyst forecasts on ORO Co. Ltd. stock, see the JP:3983 Stock Forecast page.

ORO Reports Preliminary January License Metrics for ZAC Cloud Service

ORO Co., Ltd. reported January 2026 operating metrics for its ZAC cloud solution, disclosing 350.5 thousand active licenses. The month saw 1.1 thousand new licenses, 1.6 thousand additional licenses from existing clients, and 5.2 thousand licenses cancelled or decreased, with all figures presented as preliminary and subject to revision.

The reported data offer investors and stakeholders a snapshot of current usage trends and customer dynamics within ORO’s core cloud business. While net license volumes appear pressured by cancellations, the continued acquisition of new and additional licenses indicates ongoing engagement with the ZAC platform as the company refines its official financial disclosures.

The most recent analyst rating on (JP:3983) stock is a Buy with a Yen2525.00 price target. To see the full list of analyst forecasts on ORO Co. Ltd. stock, see the JP:3983 Stock Forecast page.

ORO Co. Ltd. Releases FY2025 Results and Three-Year Outlook

ORO Co. Ltd. has released its financial results highlights for the fiscal year ending December 2025, outlining performance metrics and key developments in its business segments. The company also presented a mid-term business outlook covering FY2026 to FY2028, signaling its strategic direction and growth plans over the next three years, which are expected to shape its operational focus and market positioning.

While detailed figures are not provided in the excerpt, the disclosure of results and a multi-year outlook suggests ORO is aiming to communicate transparency and long-term strategy to investors. The emphasis on business segment topics and future planning indicates ongoing efforts to strengthen its competitive standing in the IT services market and provide clearer expectations for stakeholders.

The most recent analyst rating on (JP:3983) stock is a Buy with a Yen2525.00 price target. To see the full list of analyst forecasts on ORO Co. Ltd. stock, see the JP:3983 Stock Forecast page.

ORO Co. Lifts Dividend as Revenue Rises but Profit Slips, Eyes Double-Digit Growth in 2026

ORO Co., Ltd. reported a 5.2% year-on-year increase in consolidated revenue to ¥8.3 billion for the fiscal year ended December 31, 2025, while operating profit fell 2.6% and profit attributable to owners of the parent declined 8.5%, reflecting pressure on margins despite top-line growth. The company maintained a solid financial position with an equity ratio above 75% and operating cash flow of ¥2.0 billion, while rewarding shareholders by raising the annual dividend from ¥35 to ¥50 per share and forecasting double-digit growth in revenue and profit for 2026, alongside a maintained ¥50 total dividend split between interim and year-end payments.

Looking ahead to the fiscal year ending December 31, 2026, ORO projects revenue of ¥9.57 billion and a 13.2% rise in profit attributable to owners of the parent to ¥2.15 billion, signaling confidence in business expansion despite recent earnings softness. The firm’s commitment to higher shareholder returns, combined with stable cash generation and no changes in consolidation scope or accounting policies, suggests a strategy focused on balancing growth investments with capital efficiency and an increasingly shareholder-friendly stance.

The most recent analyst rating on (JP:3983) stock is a Buy with a Yen2525.00 price target. To see the full list of analyst forecasts on ORO Co. Ltd. stock, see the JP:3983 Stock Forecast page.

ORO’s ZAC Cloud Licenses Climb to 353,000 in December 2025

In its December 2025 monthly disclosure, ORO Co., Ltd. reported that active ZAC cloud solution licenses rose to 353,000, up from 346,800 in November, reflecting continued expansion of its installed base. The company saw a sharp increase in newly acquired licenses in December, alongside modest additional licenses from existing customers and higher cancellations, indicating solid demand momentum for its flagship cloud service while also highlighting some churn as the business scales.

The most recent analyst rating on (JP:3983) stock is a Buy with a Yen2410.00 price target. To see the full list of analyst forecasts on ORO Co. Ltd. stock, see the JP:3983 Stock Forecast page.