THECOO Inc. (4255) AI Stock Analysis

• Market Cap: ¥4.23B
• Dividend Yield: N/A
• Average Volume (3M): 4.48K
• Price to Earnings (P/E): 24.2
• Beta (1Y): 0.06
• Revenue Growth: 12.56%
• EPS Growth: N/A
• Country: JP
• Employees: 124
• Sector: Technology
• Sector Strength: 88
• Industry: Software - Application
• EPS (TTM): 30.41
• Shares Outstanding: 2,101,105
• 10 Day Avg. Volume: 4,430
• 30 Day Avg. Volume: 4,476
• PEG Ratio: -0.08
• Price to Book (P/B): 9.31
• Price to Sales (P/S): 1.04
• P/FCF Ratio: 9.26
• 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): 192.9
• Revenue Forecast (FY): ¥6.70B

• Rating: 66 Neutral
• Price Target: ¥2,205.00 ▼(-0.14% Downside)
• Action: Reiterated Date: 02/18/26
• Date: Action: Reiterated 02/18/26

The score is driven primarily by improving financial performance (return to profitability, strong recent revenue growth, better free cash flow, and low leverage). Offsetting this, technicals show weaker near-term momentum (below 20DMA/50DMA and low RSI), and valuation at ~24.5x earnings is not clearly cheap without additional income support.

Positive Factors

Return to profitability

The company achieved a clear profitability inflection in 2025 after prior losses, demonstrating the business can generate operating profit. This reduces reliance on external financing, supports sustainable reinvestment and gives management runway to focus on growth rather than survival.

Strong recent revenue growth

A +40.8% revenue increase in the latest year indicates solid demand and market traction for the company's products. Durable revenue expansion can enable operating leverage, margin improvement and better cash conversion if management sustains sales execution and controls costs.

Very low leverage / conservative balance sheet

Zero reported debt and an improved equity position provide financial flexibility and lower bankruptcy risk. A low-leverage structure supports capital allocation optionality, resilience in downturns and the ability to invest in growth or M&A without immediate refinancing pressure.

Negative Factors

Inconsistent cash generation

Although cash flow improved in 2025, the company has a history of negative operating and free cash flows in several prior years. This inconsistency raises execution risk: sustained capital generation must persist across cycles to fund growth and avoid recurring external financing needs.

Historic earnings volatility and prior multi-year losses

The recent profit rebound follows several consecutive loss-making years, reflecting operational sensitivity and potential structural margin pressures. Past sizable losses imply the business model and cost structure have exhibited volatility, so earnings durability remains uncertain.

Small scale and limited liquidity

A small workforce and low average trading volume signal limited scale and market liquidity. This constrains capacity to scale quickly, may limit talent depth and complicates capital raises or strategic initiatives, increasing execution and financing risk during growth phases.

THECOO Inc. Business Overview & Revenue Model

Company Description

THECOO, Inc. engages in the management and operation of fan community platform in Japan. It operates Fanicon, a membership-based fan community app that encourages the activities of icons together with them; and Studio Coup, an influencer office specializing in game commentators; iCON Suite that visualizes the value of influencers; iCON CAST that connects YouTuber and companies. The company also operates RIPPLY for influencer marketing. In addition, the company offers online advertising consultation services. THECOO, Inc. was incorporated in 2014 and is headquartered in Tokyo, Japan.

How the Company Makes Money

THECOO Inc. generates revenue through multiple streams, primarily by selling software licenses and subscriptions for its cloud-based applications. Additionally, the company offers consulting services that include system integration, customization, and ongoing technical support, which contribute significantly to its earnings. Another key revenue stream comes from maintenance contracts for its software products, providing a steady income from existing clients. Strategic partnerships with other tech firms and service providers enhance its offerings and expand its market reach, while also contributing to revenue through collaborative projects and co-developed solutions.

THECOO Inc. Financial Statement Overview

Summary

Financials reflect a meaningful turnaround: profitability returned in 2025 alongside strong revenue growth and improved free cash flow, supported by a low/zero-debt balance sheet. The main risk is historical volatility, including prior losses and inconsistent cash generation, which reduces confidence that the improvement is fully durable.

Income Statement

The business shows a clear profitability inflection: after multiple loss-making years (2020–2024), it returned to positive earnings in 2025 (annual report), with solid operating profit and net income. Revenue growth is strong in the latest year (+40.8%) and has generally been healthy over time, though 2023 saw a notable contraction. Profitability remains a key watch item because the track record includes sizable losses (especially 2023), indicating the model can be volatile through cycles.

Balance Sheet

The balance sheet looks conservatively financed, highlighted by very low debt historically and zero reported debt in 2025 (annual report). Equity has improved versus 2024, supporting financial flexibility. The main weakness is that equity has been volatile over the period (higher in 2021–2022, then lower in 2023–2024), reflecting the impact of prior losses and indicating less stability than the low leverage alone might suggest.

Cash Flow

Cash generation improved meaningfully, with positive operating cash flow and strong free cash flow in 2025 (annual report), building on a rebound in 2024. However, cash flow has not been consistent historically (negative operating and free cash flow in 2023, and negative free cash flow in 2022 and 2020), so the recent strength needs to be sustained across periods to be viewed as fully durable.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	3.43B	4.83B	4.33B	3.81B	4.28B	3.48B
Gross Profit	1.55B	2.23B	1.83B	1.51B	1.67B	1.29B
EBITDA	153.95M	253.63M	-18.76M	-516.00M	-394.85M	-67.36M
Net Income	106.92M	174.50M	-69.00M	-764.00M	-488.47M	-109.20M
Balance Sheet
Total Assets	2.59B	3.35B	2.67B	2.37B	3.00B	3.22B
Cash, Cash Equivalents and Short-Term Investments	1.54B	2.04B	1.60B	1.52B	1.84B	2.04B
Total Debt	0.00	0.00	4.51M	25.86M	55.30M	106.72M
Total Liabilities	2.20B	2.81B	2.32B	1.94B	1.82B	1.52B
Stockholders Equity	392.25M	540.86M	354.39M	423.00M	1.19B	1.70B
Cash Flow
Free Cash Flow	0.00	543.87M	103.63M	-289.00M	-31.69M	147.54M
Operating Cash Flow	0.00	549.97M	225.41M	-267.00M	188.66M	275.37M
Investing Cash Flow	0.00	-102.00M	-131.26M	-28.09M	-344.91M	-127.99M
Financing Cash Flow	0.00	-4.30M	-21.04M	-29.10M	-55.92M	1.30B

THECOO Inc. Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 2208.00
• 50DMA: Negative
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:4255, the sentiment is Neutral. The current price of 2208 is above the 20-day moving average (MA) of 2153.50, above the 50-day MA of 2168.92, and above the 200-day MA of 1340.87, indicating a neutral trend. The MACD of -46.11 indicates Positive momentum. The RSI at 41.85 is Neutral, neither overbought nor oversold. The STOCH value of 10.26 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for JP:4255.

THECOO Inc. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
4255	66 Neutral	¥4.23B	24.16	―	―	12.56%	―
5244	65 Neutral	¥9.71B	7.81	―	1.20%	12.21%	6.86%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
4174	55 Neutral	¥2.78B	-134.48	―	3.41%	18.78%	-134.64%
2138	51 Neutral	¥6.55B	-15.11	―	―	-12.37%	12.44%
4199	48 Neutral	¥3.44B	-17.64	―	―	-5.44%	-242.43%
4424	45 Neutral	¥1.76B	-5.67	―	―	-20.74%	36.84%