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TRADE WORKS Co.,Ltd (JP:3997)
:3997
Japanese Market

TRADE WORKS Co.,Ltd (3997) AI Stock Analysis

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JP

TRADE WORKS Co.,Ltd

(3997)

Rating:47Neutral
Price Target:
¥1,257.00
▲(2.28%Upside)
TRADE WORKS Co., Ltd has strong revenue growth but faces significant challenges with profitability and cash flow, leading to a lower financial performance score. Technical analysis shows neutral momentum, providing some stability, while valuation metrics indicate the stock is not currently attractive due to negative earnings. The absence of earnings call and corporate event data limits the assessment to these factors.

TRADE WORKS Co.,Ltd (3997) vs. iShares MSCI Japan ETF (EWJ)

TRADE WORKS Co.,Ltd Business Overview & Revenue Model

Company DescriptionTRADE WORKS Co., Ltd. is a Japanese company primarily engaged in the information technology sector, offering a comprehensive suite of services and solutions tailored to meet the needs of businesses. The company specializes in providing IT consulting, system development, and support services, with a focus on leveraging cutting-edge technology to optimize business operations and enhance productivity. TRADE WORKS serves a diverse range of industries, helping clients navigate the complexities of digital transformation and IT infrastructure management.
How the Company Makes MoneyTRADE WORKS Co., Ltd. generates revenue through its diverse portfolio of IT services and solutions. The company earns money by providing consulting services that help businesses strategize and implement technology-driven processes. Additionally, system development and integration services contribute significantly to its revenue, as clients engage TRADE WORKS to design, develop, and deploy customized software solutions that address specific business needs. The company also offers IT support and maintenance services, creating a steady stream of income from ongoing client engagements. Partnerships with technology providers and a focus on innovation further enhance TRADE WORKS' value proposition, attracting a wide range of clients seeking reliable and efficient IT solutions.

TRADE WORKS Co.,Ltd Financial Statement Overview

Summary
TRADE WORKS Co., Ltd shows strong revenue growth but struggles with profitability and cash flow management. The negative net income and free cash flow raise concerns about long-term financial sustainability. The company needs to improve operational efficiency and maintain cash reserves to support growth and stability.
Income Statement
45
Neutral
The company has experienced a significant revenue growth from 2023 to 2024, with a revenue growth rate of 22.33%. However, profitability metrics are concerning, with a negative net profit margin of -3.29% for 2024 due to negative net income, and a negative EBIT margin of -1.20%. Despite positive EBITDA margin of 2.72%, the declining profitability raises concerns about operational efficiency and cost management.
Balance Sheet
55
Neutral
The balance sheet shows a moderate debt-to-equity ratio of 0.66, indicating a manageable level of debt. The equity ratio stands at 44.00%, reflecting a solid equity base relative to total assets. However, the decline in stockholders' equity from 2023 to 2024 is a potential concern, indicating challenges in retaining earnings. Overall, the balance sheet reflects moderate financial stability.
Cash Flow
40
Negative
Cash flow analysis reveals a concerning decline in free cash flow, which remains negative at -13 million JPY in 2024. The operating cash flow to net income ratio is positive at 1.84, suggesting that operating activities are generating cash, but the negative free cash flow growth rate and high capital expenditure could strain liquidity.
BreakdownDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue4.59B3.75B3.27B2.55B2.11B
Gross Profit786.15M753.00M832.23M699.74M507.24M
EBITDA83.77M171.00M415.48M374.67M180.61M
Net Income-151.69M-53.00M200.30M189.97M73.31M
Balance Sheet
Total Assets2.90B3.04B2.18B2.10B1.81B
Cash, Cash Equivalents and Short-Term Investments804.14M615.00M688.29M802.55M836.00M
Total Debt848.00M585.00M9.69M0.000.00
Total Liabilities1.63B1.66B715.46M392.78M278.54M
Stockholders Equity1.28B1.39B1.46B1.71B1.53B
Cash Flow
Free Cash Flow-13.00M-217.00M390.02M24.21M423.11M
Operating Cash Flow278.45M-207.00M399.77M53.23M477.78M
Investing Cash Flow-397.30M-404.75M-252.60M-78.58M-54.84M
Financing Cash Flow307.94M514.00M-261.42M-8.10M-9.21M

TRADE WORKS Co.,Ltd Technical Analysis

Technical Analysis Sentiment
Negative
Last Price1229.00
Price Trends
50DMA
1263.02
Negative
100DMA
1307.99
Negative
200DMA
1266.27
Negative
Market Momentum
MACD
-2.57
Positive
RSI
46.48
Neutral
STOCH
32.42
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:3997, the sentiment is Negative. The current price of 1229 is below the 20-day moving average (MA) of 1288.65, below the 50-day MA of 1263.02, and below the 200-day MA of 1266.27, indicating a bearish trend. The MACD of -2.57 indicates Positive momentum. The RSI at 46.48 is Neutral, neither overbought nor oversold. The STOCH value of 32.42 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:3997.

TRADE WORKS Co.,Ltd Peers Comparison

Overall Rating
UnderperformOutperform
Sector (63)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
77
Outperform
¥4.79B18.08
1.71%10.32%-2.85%
75
Outperform
¥4.77B11.18
1.40%13.25%16826.25%
72
Outperform
¥4.34B10.58
5.02%3.98%-12.31%
63
Neutral
$33.79B5.85-11.85%1.81%5.29%-18.24%
59
Neutral
¥5.17B48.58
-5.20%133.74%
49
Neutral
¥4.84B
0.43%-9.76%3.53%
47
Neutral
¥4.90B
1.63%15.59%32.56%
* Technology Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
JP:3997
TRADE WORKS Co.,Ltd
1,257.00
309.58
32.68%
JP:2375
GiG Works, Inc.
236.00
-291.39
-55.25%
JP:3839
ODK Solutions Company, Ltd.
588.00
2.07
0.35%
JP:3920
Internetworking & Broadband Consulting Co., Ltd.
856.00
374.51
77.78%
JP:4076
CNS Co.,Ltd.
1,503.00
-232.86
-13.41%
JP:6942
Sophia Holdingus Co., Ltd.
1,116.00
25.00
2.29%
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: Jul 02, 2025