Waseda Academy Co., Ltd. (4718) AI Stock Analysis

• Market Cap: ¥38.11B
• Dividend Yield: 2.56%
• Average Volume (3M): 47.20K
• Price to Earnings (P/E): 18.9
• Beta (1Y): 0.53
• Revenue Growth: 7.41%
• EPS Growth: 22.70%
• Country: JP
• Employees: 1,090
• Sector: Consumer Defensive
• Sector Strength: 42
• Industry: Education & Training Services
• EPS (TTM): 30.07
• Shares Outstanding: 19,012,451
• 10 Day Avg. Volume: 31,240
• 30 Day Avg. Volume: 47,196
• PEG Ratio: 1.28
• Price to Book (P/B): 2.49
• Price to Sales (P/S): 1.08
• P/FCF Ratio: 11.64
• 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): 146.1
• Revenue Forecast (FY): ¥37.70B

• Rating: 70 Outperform
• Price Target: ¥2,223.00 ▼(-2.24% Downside)
• Action: Reiterated Date: 10/29/25
• Date: Action: Reiterated 10/29/25

Waseda Academy Co., Ltd. scores well due to its strong financial performance, characterized by consistent growth and a solid balance sheet. The valuation is reasonable, with a fair P/E ratio and a modest dividend yield. However, the technical analysis indicates bearish momentum, which slightly dampens the overall score.

Positive Factors

Recurring tuition-based revenue model

The company's business model relies on recurring tuition and fee income from enrolled students, providing predictable cash inflows tied to multi-month courses and exam-prep cycles. This recurring revenue base supports steady top-line visibility and planning over the next several months.

Very low financial leverage and strong equity base

Extremely low leverage and a high equity ratio grant financial flexibility to invest in programs or weather shocks without refinancing stress. A 15.4% ROE shows efficient capital use, enabling sustainable reinvestment and lower bankruptcy risk over a multi-month horizon.

Strong cash generation with growing free cash flow

Rapid free cash flow growth and operating cash flow well above net income indicate high quality earnings and internal funding capacity. This cash strength supports capital spending, curriculum investment, and dividend/distribution capacity over the medium term.

Negative Factors

Revenue concentration on tuition/enrollment

Dependence on tuition and enrollment concentrates revenue risk: a drop in student intake or retention materially affects revenue. Over 2-6 months this can pressure utilization of classrooms and fixed-cost absorption, limiting revenue resilience absent diversification.

Modest net profit margin

A net margin around 6.7% provides limited cushioning against cost inflation or revenue volatility. With modest absolute profitability, unexpected cost increases or enrollment declines could more quickly erode earnings and cash generation than for higher-margin peers.

Room for improvement in cash management

Although FCF grew strongly, the FCF-to-net-income ratio implies operating cash conversion could be tightened. Improving working capital and collections would enhance liquidity and reduce sensitivity to timing differences, strengthening durable cash reliability.

Waseda Academy Co., Ltd. Business Overview & Revenue Model

Company Description

Waseda Academy Co., Ltd. operates tutoring schools for elementary, middle, and high school students. It operates 180 schools; and 16 franchise schools under the KOBETSU SCHOOL brand. The company was incorporated in 1974 and is headquartered in Tokyo, Japan.

How the Company Makes Money

Waseda Academy primarily generates revenue from tuition and related fees paid by students (and their families) for enrollment in its supplementary education programs. Key revenue streams typically include (1) recurring monthly course tuition for regular classes, (2) fees for seasonal or intensive courses (e.g., during school vacations) and exam-preparation programs, and (3) ancillary charges associated with attendance such as enrollment/administrative fees and other program-related fees. Revenue is driven by student enrollment levels, retention, and the company’s ability to attract students into higher-priced or additional courses as they progress toward entrance exams. Specific information on material partnerships or other significant non-tuition revenue sources is null.

Waseda Academy Co., Ltd. Financial Statement Overview

Summary

Waseda Academy Co., Ltd. exhibits strong financial health with consistent revenue and profit growth, efficient cost management, and robust cash generation. The balance sheet is solid with low leverage, indicating financial stability. However, there is room for improvement in cash flow management.

Income Statement

Waseda Academy Co., Ltd. has demonstrated consistent revenue growth over the past years, with the latest year showing a notable 6.7% increase. The gross profit margin is strong at 31.12%, indicating efficient cost management. Net profit margin has improved to 6.67%, showcasing enhanced profitability. EBITDA and EBIT margins are healthy at 14.12% and 10.12%, respectively, pointing to robust operational performance.

Balance Sheet

The company maintains a strong balance sheet with a low debt-to-equity ratio of 0.03, indicating minimal leverage and financial risk. The return on equity is commendable at 15.4%, reflecting efficient use of equity capital. A solid equity ratio of 62.0% underscores financial stability and a strong asset base.

Cash Flow

Waseda Academy has shown significant growth in free cash flow, with a growth rate of 46.6% year-over-year. The operating cash flow to net income ratio is robust at 1.66, indicating strong cash generation relative to net earnings. However, the free cash flow to net income ratio of 1.39 suggests potential for improved cash management.

Breakdown	TTM	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	35.55B	35.07B	32.87B	30.73B	28.55B	25.45B
Gross Profit	11.11B	10.92B	9.93B	8.82B	7.87B	6.68B
EBITDA	4.93B	4.89B	4.12B	3.57B	3.06B	2.12B
Net Income	2.41B	2.34B	2.13B	1.55B	1.11B	529.11M
Balance Sheet
Total Assets	22.15B	24.49B	23.45B	21.51B	20.08B	18.91B
Cash, Cash Equivalents and Short-Term Investments	6.91B	8.12B	7.67B	6.31B	5.21B	5.31B
Total Debt	466.36M	482.68M	520.86M	551.73M	609.56M	1.11B
Total Liabilities	7.99B	9.30B	9.19B	8.97B	8.64B	7.91B
Stockholders Equity	14.15B	15.18B	14.26B	12.53B	11.43B	11.00B
Cash Flow
Free Cash Flow	0.00	3.25B	2.70B	2.37B	2.04B	1.63B
Operating Cash Flow	0.00	3.89B	3.64B	2.91B	2.65B	1.90B
Investing Cash Flow	0.00	-1.34B	-2.36B	-1.13B	-1.70B	-439.73M
Financing Cash Flow	0.00	-2.12B	-761.14M	-687.86M	-1.04B	1.95B

Waseda Academy Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 2274.00
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:4718, the sentiment is Negative. The current price of 2274 is above the 20-day moving average (MA) of 2028.70, above the 50-day MA of 2093.34, and below the 200-day MA of 2397.92, indicating a bearish trend. The MACD of -15.60 indicates Negative momentum. The RSI at 44.25 is Neutral, neither overbought nor oversold. The STOCH value of 59.07 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:4718.

Waseda Academy Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
4668	78 Outperform	¥17.68B	13.55	―	3.81%	9.96%	252.72%
9470	75 Outperform	¥44.43B	28.75	―	2.28%	7.30%	60.93%
4714	71 Outperform	¥32.97B	14.97	―	5.00%	―	―
4718	70 Outperform	¥38.11B	18.91	―	2.56%	7.41%	22.70%
9795	70 Outperform	¥40.64B	8.14	―	3.55%	4.95%	9.43%
4678	64 Neutral	¥2.31B	1.39	―	3.34%	1.92%	71.20%
Sector *	62 Neutral	$20.33B	14.63	-3.31%	3.23%	1.93%	-12.26%

Waseda Academy Co., Ltd. Corporate Events

Waseda Academy Digitizes March Shareholder Benefits With E-Money Vouchers

Waseda Academy will digitize part of its shareholder benefits program by replacing the March record-date QUO CARD with an electronic money voucher that can be exchanged for various e-payment apps, while maintaining the existing September shareholder benefit coupons. The change, effective from the March 31, 2026 record date, keeps benefit values unchanged but is intended to improve convenience, support long-term shareholding, and strengthen the appeal of its stock to investors, though shareholders must observe validity periods when exchanging and using the new digital benefits.

Under the revised scheme, shareholders holding at least 100 shares for less than three years will receive an electronic voucher worth ¥1,000, rising to ¥2,000 for those holding for three years or more, aligned with the current benefit levels. Eligibility for the long-term benefit continues to require being listed under the same shareholder number in the registry at both March 31 and September 30 for at least seven consecutive periods, encouraging stable ownership and potentially enhancing the company’s investor base profile.

The most recent analyst rating on (JP:4718) stock is a Buy with a Yen2222.00 price target. To see the full list of analyst forecasts on Waseda Academy Co., Ltd. stock, see the JP:4718 Stock Forecast page.

Waseda Academy Lifts Nine-Month Profit and Confirms Full-Year Growth Outlook

Waseda Academy reported solid growth for the nine months ended December 31, 2025, with net sales rising 7.4% year on year to ¥27.52 billion and profit attributable to owners of parent increasing 7.9% to ¥1.61 billion, while operating profit grew 4.1%. The company’s financial position remained sound, with total assets expanding to ¥26.35 billion and an equity ratio of 59.7%, and it maintained its dividend stance with a planned full-year dividend of ¥55 per share, including a higher interim dividend of ¥20. For the full fiscal year ending March 31, 2026, Waseda Academy left its forecasts unchanged, projecting a 7.5% increase in net sales to ¥37.68 billion and a 10.7% rise in profit attributable to owners of parent to ¥2.59 billion, underscoring steady demand for its education services and continued earnings growth for shareholders.

The most recent analyst rating on (JP:4718) stock is a Buy with a Yen2287.00 price target. To see the full list of analyst forecasts on Waseda Academy Co., Ltd. stock, see the JP:4718 Stock Forecast page.