HEROZ, Inc. (4382) AI Stock Analysis

• Market Cap: ¥12.62B
• Dividend Yield: N/A
• Average Volume (3M): 86.28K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.20
• Revenue Growth: 16.29%
• EPS Growth: 93.98%
• Country: JP
• Employees: 256
• Sector: Technology
• Sector Strength: 88
• Industry: Software - Application
• EPS (TTM): -0.76
• Shares Outstanding: 15,209,725
• 10 Day Avg. Volume: 78,110
• 30 Day Avg. Volume: 86,280
• PEG Ratio: 0.95
• Price to Book (P/B): 3.07
• Price to Sales (P/S): 2.40
• P/FCF Ratio: -71.19
• 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: Hold
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 43 Neutral
• Price Target: ¥916.00 ▲(8.79% Upside)

HEROZ, Inc. faces significant challenges, with financial performance hindered by profitability and cash flow issues. Technical analysis indicates bearish momentum, and valuation metrics are unattractive due to negative earnings. The lack of earnings call data and corporate events further limits positive outlook.

Positive Factors

Revenue Growth

Consistent revenue growth indicates strong demand for HEROZ's AI solutions and gaming products, supporting long-term business expansion.

Business Model Diversification

Diversified revenue sources reduce dependency on a single market, enhancing resilience and providing multiple growth avenues.

Strong Capital Structure

A strong equity base provides financial stability and flexibility to invest in growth opportunities without excessive reliance on debt.

Negative Factors

Profitability Challenges

Ongoing profitability issues can hinder reinvestment in growth and innovation, affecting long-term competitiveness and shareholder value.

Cash Flow Management Issues

Poor cash flow management limits the company's ability to fund operations and growth initiatives, potentially leading to liquidity constraints.

Rising Leverage

Increasing leverage can elevate financial risk, reducing the company's ability to withstand economic downturns and invest in future growth.

HEROZ, Inc. Business Overview & Revenue Model

Company Description

HEROZ, Inc. (4382) is a Japanese technology company specializing in artificial intelligence and machine learning solutions. The company operates primarily in the sectors of gaming, finance, and healthcare, providing advanced AI algorithms and data analytics services. HEROZ is known for its development of AI-based applications, including those used in board games like shogi, as well as its financial services that leverage AI for investment and risk management.

How the Company Makes Money

HEROZ generates revenue through multiple streams, primarily by offering AI-driven software solutions and services to various industries. Key revenue streams include licensing fees for their AI technologies, subscription fees for access to their cloud-based platforms, and consulting services for businesses looking to implement AI solutions. Additionally, the company has formed significant partnerships with other technology firms and financial institutions, enhancing its market reach and credibility. Their success in the competitive AI landscape is bolstered by ongoing research and development investments, ensuring the continuous improvement of their products and services.

HEROZ, Inc. Financial Statement Overview

Summary

HEROZ, Inc. is experiencing revenue growth but faces significant challenges in profitability and cash flow management. The balance sheet is relatively strong, but increasing leverage and negative returns on equity highlight potential risks. Improvement in margins and cash flow generation is needed for financial stability.

Income Statement

HEROZ, Inc. has shown a positive revenue growth rate of 11.2% in the latest year, indicating a strong top-line performance. However, the company is struggling with profitability, as evidenced by a negative net profit margin of -3.0% and a declining EBIT margin. The gross profit margin has decreased slightly, which may suggest rising costs or pricing pressures.

Balance Sheet

The company's debt-to-equity ratio has increased to 0.44, indicating a rise in leverage, but it remains at a manageable level. The return on equity is negative at -3.8%, reflecting the company's current unprofitability. However, the equity ratio is strong, suggesting a solid capital structure with a high proportion of equity financing.

Cash Flow

HEROZ, Inc. faces challenges in cash flow management, with a negative free cash flow and a concerning free cash flow to net income ratio of -0.91. The operating cash flow to net income ratio is low, indicating potential issues in converting earnings into cash. The free cash flow growth rate is not meaningful due to negative values.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	5.56B	5.93B	4.84B	2.98B	1.48B	1.56B
Gross Profit	2.53B	2.69B	2.39B	1.35B	558.99M	705.26M
EBITDA	334.86M	566.25M	-343.40M	-168.66M	240.52M	367.03M
Net Income	-393.13M	-177.71M	-1.13B	-574.33M	49.40M	207.15M
Balance Sheet
Total Assets	7.95B	8.15B	7.69B	8.67B	6.64B	6.55B
Cash, Cash Equivalents and Short-Term Investments	2.90B	1.73B	2.74B	3.80B	3.66B	5.55B
Total Debt	1.86B	2.05B	1.40B	1.50B	0.00	0.00
Total Liabilities	2.75B	2.95B	2.55B	2.59B	194.63M	143.50M
Stockholders Equity	4.70B	4.64B	4.79B	5.87B	6.44B	6.40B
Cash Flow
Free Cash Flow	0.00	-200.24M	20.80M	387.11M	186.17M	-18.82M
Operating Cash Flow	0.00	219.03M	464.00M	483.38M	198.15M	360.70M
Investing Cash Flow	0.00	-479.27M	-1.22B	-144.47M	-2.09B	-384.52M
Financing Cash Flow	0.00	664.63M	-303.96M	-200.78M	1.00K	15.25M

HEROZ, Inc. Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 842.00
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:4382, the sentiment is Negative. The current price of 842 is below the 20-day moving average (MA) of 868.30, below the 50-day MA of 938.12, and below the 200-day MA of 1028.08, indicating a bearish trend. The MACD of -30.95 indicates Positive momentum. The RSI at 36.70 is Neutral, neither overbought nor oversold. The STOCH value of 9.76 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:4382.

HEROZ, Inc. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
4495	78 Outperform	¥15.14B	23.59	―	1.19%	23.67%	24.95%
4011	67 Neutral	¥10.40B	60.60	―	―	34.56%	4.59%
4168	64 Neutral	¥10.78B	13.65	―	0.72%	9.78%	-23.98%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
3905	57 Neutral	¥48.08B	-21.83	―	―	27.58%	-1.50%
4382	43 Neutral	¥12.62B	-172.24	―	―	16.29%	93.98%
4192	41 Neutral	¥10.63B	-26.77	―	―	22.18%	28.27%

HEROZ, Inc. Corporate Events

HEROZ, Inc. Revises Earnings Forecast for Subsidiary Vario Secure

HEROZ, Inc. announced a revision of the full-year earnings forecast for its subsidiary, Vario Secure Inc., for the fiscal year ending February 2026. The revised forecast indicates a decrease in expected net sales and income, with significant percentage drops across various financial metrics. This adjustment reflects challenges that may impact the company’s financial performance and stakeholder expectations.

HEROZ, Inc. Completes Restricted Stock Compensation Issuance

HEROZ, Inc. has completed the payment procedures for issuing new shares as restricted stock compensation, a decision made by its Board of Directors on August 22, 2025. This issuance involves 33,257 common shares at 1,116 yen each, totaling 37,114,812 yen, allocated to directors, executive officers, and employees, potentially impacting the company’s equity structure and aligning stakeholder interests.

HEROZ, Inc. Reports Strong Quarterly Growth Amid AI Expansion

HEROZ, Inc. reported a positive financial performance for the three months ended July 31, 2025, with significant year-on-year growth in net sales and profits. The company achieved a 7.9% increase in net sales and a notable rise in operating and ordinary profits, reflecting its strong market positioning and effective operational strategies. Despite a slight loss attributable to the owners of the parent, the company’s financial outlook remains optimistic with a forecasted increase in net sales and profits for the full year ending April 30, 2026.