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

• Market Cap: ¥4.90B
• Dividend Yield: 1.63%
• Average Volume (3M): 7.68K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.54
• Revenue Growth: 15.59%
• EPS Growth: 32.56%
• Country: JP
• Employees: 254
• Sector: Technology
• Sector Strength: 88
• Industry: Information Technology Services
• EPS (TTM): -27.23
• Shares Outstanding: 3,901,800
• 10 Day Avg. Volume: 4,680
• 30 Day Avg. Volume: 7,680
• PEG Ratio: 4.12
• Price to Book (P/B): 2.53
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 9.49
• 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

• Rating: 47 Neutral
• 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 Business Overview & Revenue Model

Company Description

TRADE 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 Money

TRADE 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

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

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

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.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	4.59B	3.75B	3.27B	2.55B	2.11B
Gross Profit	786.15M	753.00M	832.23M	699.74M	507.24M
EBITDA	83.77M	171.00M	415.48M	374.67M	180.61M
Net Income	-151.69M	-53.00M	200.30M	189.97M	73.31M
Balance Sheet
Total Assets	2.90B	3.04B	2.18B	2.10B	1.81B
Cash, Cash Equivalents and Short-Term Investments	804.14M	615.00M	688.29M	802.55M	836.00M
Total Debt	848.00M	585.00M	9.69M	0.00	0.00
Total Liabilities	1.63B	1.66B	715.46M	392.78M	278.54M
Stockholders Equity	1.28B	1.39B	1.46B	1.71B	1.53B
Cash Flow
Free Cash Flow	-13.00M	-217.00M	390.02M	24.21M	423.11M
Operating Cash Flow	278.45M	-207.00M	399.77M	53.23M	477.78M
Investing Cash Flow	-397.30M	-404.75M	-252.60M	-78.58M	-54.84M
Financing Cash Flow	307.94M	514.00M	-261.42M	-8.10M	-9.21M

TRADE WORKS Co.,Ltd Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 1229.00
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: 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

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
3839	77 Outperform	¥4.79B	18.08		1.71%	10.32%	-2.85%
3920	75 Outperform	¥4.77B	11.18		1.40%	13.25%	16826.25%
4076	72 Outperform	¥4.34B	10.58		5.02%	3.98%	-12.31%
Sector *	63 Neutral	$33.79B	5.85	-11.85%	1.81%	5.29%	-18.24%
6942	59 Neutral	¥5.17B	48.58		―	-5.20%	133.74%
2375	49 Neutral	¥4.84B	―		0.43%	-9.76%	3.53%
3997	47 Neutral	¥4.90B	―		1.63%	15.59%	32.56%