Science Arts, Inc. (4412) AI Stock Analysis

• Market Cap: ¥18.45B
• Dividend Yield: N/A
• Average Volume (3M): 86.77K
• Price to Earnings (P/E): 111.6
• Beta (1Y): 0.81
• Revenue Growth: 39.66%
• EPS Growth: N/A
• Country: JP
• Employees: 46
• Sector: Technology
• Sector Strength: 88
• Industry: Software - Application
• EPS (TTM): 5.89
• Shares Outstanding: 8,230,000
• 10 Day Avg. Volume: 147,350
• 30 Day Avg. Volume: 86,766
• PEG Ratio: -0.27
• Price to Book (P/B): 8.49
• Price to Sales (P/S): 7.15
• P/FCF Ratio: 43.54
• 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): N/A
• Revenue Forecast (FY): N/A

• Rating: 75 Outperform
• Price Target: ¥2,384.00 ▲(49.84% Upside)
• Action: Upgraded Date: 01/17/26
• Date: Action: Upgraded 01/17/26

The score is driven primarily by strong financial performance (growth, improving profitability, and solid cash flows) and bullish technical trend signals. This is tempered by a very high P/E valuation, which increases downside risk if growth or margins disappoint.

Positive Factors

Revenue growth and margin improvement

Consistent double-digit revenue growth and improving gross and net margins indicate durable product-market fit and scalable economics. Improved profitability enhances internal funding for R&D and distribution, supporting sustained investment in content and platform expansion over the medium term.

Strong free cash flow generation

Material improvement in free cash flow and robust operating cash conversion strengthen the firm's ability to self-fund content development, capex and working capital. Reliable cash generation reduces reliance on external financing and supports strategic initiatives through business cycles.

Conservative leverage and healthy equity ratio

Low debt-to-equity and a healthy equity ratio provide financial flexibility for partnerships, product rollouts or selective M&A without stressing solvency. Conservative leverage lowers default risk and preserves capacity to invest through downturns, aiding long-term stability.

Negative Factors

Small employee base limits scale

A 46-person workforce constrains capacity to scale enterprise sales, deliver customized museum or corporate programs, and run simultaneous product launches. Concentrated human capital increases key-person risk and may slow execution of multi-market expansion over months.

Asset utilization requires monitoring

The noted need to monitor asset utilization suggests potential operational inefficiencies. If asset turnover lags, returns on invested capital and ROE could weaken, limiting the firm’s ability to fund growth internally and pressuring margins over the medium term.

Limited investor guidance and disclosures

Absence of formal guidance, highlights or narrative reduces visibility into management’s roadmap and makes performance harder to model. Over 2–6 months this opacity can elevate perceived execution risk and complicate capital planning and stakeholder decision-making.

Science Arts, Inc. Business Overview & Revenue Model

Company Description

Science Arts, Inc. provides cloud services and software products in Japan. It provides Buddycom, a seamless and scalable communication tool that brings team communications together. The company also offers accessories, such as speaker microphones, headsets, PTT buttons, and smartphones with a PTT button through online store. The company serves airline, railway, bus, logistic, security, construction, taxi, energy, broadcast, event, restaurant, retail, apparel, care, real estate, hotel, medical, manufacture, school, and corporate resilience industries. Science Arts, Inc. was incorporated in 2003 and is based in Tokyo, Japan.

How the Company Makes Money

Science Arts, Inc. generates revenue through multiple streams. Primarily, the company earns money by selling its educational software and interactive learning modules to schools, universities, and educational institutions, often through licensing agreements. Additionally, it profits from partnerships with museums and science centers, where it supplies multimedia exhibits and interactive displays. The company also engages in direct-to-consumer sales via its online platform, offering science-themed merchandise and educational kits. Furthermore, Science Arts, Inc. may collaborate with corporate clients to develop tailored training programs incorporating scientific principles, contributing a significant portion to its overall earnings.

Science Arts, Inc. Financial Statement Overview

Summary

Strong fundamentals overall: income statement strength (revenue growth and improved margins) supported by a stable, low-leverage balance sheet and solid cash generation with improved free cash flow.

Income Statement

Science Arts, Inc. has shown strong revenue growth of 12.94% in the latest year, with a significant improvement in profitability metrics. The gross profit margin is robust, and the net profit margin has turned positive, indicating improved operational efficiency. The EBIT and EBITDA margins have also improved, reflecting better cost management. Overall, the income statement reflects a positive growth trajectory and enhanced profitability.

Balance Sheet

The balance sheet of Science Arts, Inc. is strong, with a low debt-to-equity ratio, indicating conservative leverage. The return on equity has improved significantly, showcasing better utilization of equity capital. The equity ratio is healthy, suggesting a stable financial structure. However, the company should continue to monitor its asset utilization to maintain this stability.

Cash Flow

The cash flow statement shows a remarkable improvement in free cash flow, with a significant growth rate. The operating cash flow to net income ratio is strong, indicating efficient cash generation relative to net income. The free cash flow to net income ratio is positive, reflecting good cash conversion. Overall, the cash flow position is solid, supporting the company's growth and operational needs.

Breakdown	Aug 2025	Aug 2024	Aug 2023	Aug 2022	Aug 2021
Income Statement
Total Revenue	1.65B	1.18B	771.86M	659.99M	365.99M
Gross Profit	996.01M	677.77M	490.24M	435.36M	265.26M
EBITDA	110.25M	-18.74M	-51.64M	15.30M	-93.55M
Net Income	112.17M	-31.85M	-81.34M	9.01M	-95.29M
Balance Sheet
Total Assets	2.09B	953.46M	894.09M	801.13M	351.35M
Cash, Cash Equivalents and Short-Term Investments	1.58B	562.34M	504.76M	663.91M	260.53M
Total Debt	67.23M	89.02M	0.00	0.00	0.00
Total Liabilities	694.97M	477.00M	385.68M	230.52M	117.88M
Stockholders Equity	1.39B	476.56M	508.41M	570.61M	233.46M
Cash Flow
Free Cash Flow	271.77M	-46.38M	-87.88M	95.79M	-98.44M
Operating Cash Flow	290.70M	1.15M	-66.92M	114.25M	-97.69M
Investing Cash Flow	-26.88M	-32.58M	-107.13M	-34.65M	-691.00K
Financing Cash Flow	753.10M	89.02M	14.90M	323.79M	-14.68M

Science Arts, Inc. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 1591.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:4412, the sentiment is Positive. The current price of 1591 is below the 20-day moving average (MA) of 2368.30, below the 50-day MA of 2180.38, and above the 200-day MA of 1560.51, indicating a bullish trend. The MACD of 44.91 indicates Positive momentum. The RSI at 57.62 is Neutral, neither overbought nor oversold. The STOCH value of 61.51 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:4412.

Science Arts, Inc. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
4412	75 Outperform	¥18.45B	111.56	―	―	39.66%	―
3835	75 Outperform	¥19.44B	17.06	―	3.14%	0.50%	-2.92%
3648	74 Outperform	¥21.15B	10.37	―	2.40%	21.57%	129.44%
3853	70 Outperform	¥20.58B	19.00	―	0.82%	―	―
9553	68 Neutral	¥24.10B	45.41	―	―	14.28%	-30.60%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
5027	49 Neutral	¥30.52B	33.52	―	―	20.84%	10.41%