Future Corporation (4722) AI Stock Analysis

• Market Cap: ¥161.03B
• Dividend Yield: 2.22%
• Average Volume (3M): 123.85K
• Price to Earnings (P/E): 13.8
• Beta (1Y): 0.37
• Revenue Growth: 9.29%
• EPS Growth: 1.18%
• Country: JP
• Employees: 3,499
• Sector: Technology
• Sector Strength: 88
• Industry: Information Technology Services
• EPS (TTM): 42.80
• Shares Outstanding: 95,328,000
• 10 Day Avg. Volume: 103,480
• 30 Day Avg. Volume: 123,853
• PEG Ratio: 1.12
• Price to Book (P/B): 2.80
• Price to Sales (P/S): 2.31
• P/FCF Ratio: 25.06
• 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): 148.95
• Revenue Forecast (FY): ¥87.03B

• Rating: 67 Neutral
• Price Target: ¥1,933.00 ▼(-3.40% Downside)
• Action: Downgraded Date: 02/07/26
• Date: Action: Downgraded 02/07/26

The score is driven primarily by strong fundamentals (profitability, ROE, and conservative leverage), partially offset by weaker recent cash-flow conversion. Technicals are the main drag, with a clear downtrend and very weak momentum despite oversold readings. Valuation is reasonable with a moderate P/E and a ~2.6% dividend yield.

Positive Factors

High ROE / Profitability

Sustained ~18.7% ROE indicates the company converts shareholder capital into profit efficiently. For an IT services firm this level of return reflects durable pricing power, disciplined capital allocation, and the ability to generate shareholder value across business cycles.

Conservative Leverage / Strong Balance Sheet

Low leverage provides financial flexibility for investments, acquisitions, or shareholder returns while lowering solvency risk. A conservatively positioned balance sheet helps the company withstand downturns and fund strategic initiatives without forcing dilutive financing.

Steady Revenue Growth & Healthy Margins

Consistent top-line growth combined with high gross and operating margins signals a scalable business model with differentiated services. Strong margins sustain free cash flow potential and provide room to invest in R&D, talent, and client retention over the medium term.

Negative Factors

Weaker Cash Conversion

Declining operating cash flow and a drop to ~0.51 coverage of operating profit indicate working-capital or timing stress. If persistent, weaker cash conversion increases variability in free cash flow, constraining reinvestment, debt servicing flexibility, and sustainable shareholder returns.

Margin Compression Risk

Eroding gross and net margins point to rising input costs, pricing pressure, or mix shifts. Structural or prolonged margin compression would reduce operating leverage, lower ROE and cash generation, and limit the firm's ability to fund growth or maintain return-focused capital allocation.

Increase in Absolute Debt Since 2023

A shift from zero debt to a positive absolute debt balance introduces new fixed obligations and refinancing risk. Even with low leverage today, the change in capital structure could raise interest sensitivity and reduce optionality if macro rates rise or cash flows weaken.

Future Corporation Business Overview & Revenue Model

Company Description

Future Corporation provides IT consulting and services primarily in Japan. The company offers its services in digital marketing, IT education, e-commerce, and various other fields. The company was formerly known as Future Architect, Inc. and changed its name to Future Corporation in April 2016. Future Corporation was founded in 1989 and is headquartered in Tokyo, Japan.

How the Company Makes Money

Future Corporation generates revenue through the sale of its consumer electronics, which include smart devices, wearable technology, and home automation systems. The company also earns money from its software development segment by licensing its proprietary software and offering subscription-based services for cloud computing and data analytics. Additionally, Future Corporation has significant investments in renewable energy projects, providing sustainable energy solutions to businesses and governments, which contribute to its earnings. Strategic partnerships with technology firms and energy providers further bolster its revenue streams by expanding its market reach and enhancing its product offerings.

Future Corporation Financial Statement Overview

Summary

Strong profitability and returns with steady revenue growth and low leverage (healthy margins and ~18.7% ROE; debt-to-equity ~0.24). Main offset is weaker cash conversion in 2025 as operating cash flow declined and covered a smaller share of operating profit, adding variability risk.

Income Statement

Revenue has grown steadily across the period, accelerating in 2025 (annual revenue growth ~4.7% vs. low/near-flat growth in 2024). Profitability is strong for IT services, with 2025 gross margin ~45.6% and net margin ~15.4%, and operating profitability remaining healthy (EBIT margin ~22.9%). The main weakness is mild margin compression from 2024 to 2025 (gross and net margins dipped), suggesting some cost pressure despite higher scale.

Balance Sheet

The balance sheet looks conservatively positioned with modest leverage: 2025 debt-to-equity is ~0.24 and equity has grown meaningfully versus prior years. Returns remain strong and consistent, with return on equity around ~18.7% in 2025 (similar to 2024), indicating solid profitability on the capital base. A watch item is the increase in absolute debt since 2023 (when debt was reported at zero), though overall leverage remains very manageable.

Cash Flow

Cash generation is positive, with 2025 free cash flow of ~¥7.0B and free cash flow running at ~81% of net income, which is generally supportive of earnings quality. However, cash conversion weakened recently: operating cash flow fell in 2025 (~¥8.7B) versus 2024 (~¥10.7B), and operating cash flow covered only about half of operating profit in 2025 (coverage ~0.51), down from 2024 (~0.67). This indicates more working-capital or timing drag and adds variability risk despite solid profitability.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	72.57B	75.99B	69.88B	59.32B	53.74B	48.70B
Gross Profit	33.03B	34.69B	33.70B	28.81B	26.66B	22.55B
EBITDA	18.05B	20.85B	17.43B	15.01B	13.47B	10.33B
Net Income	10.03B	11.71B	10.32B	9.22B	9.24B	6.37B
Balance Sheet
Total Assets	93.21B	97.49B	92.05B	66.04B	57.86B	54.48B
Cash, Cash Equivalents and Short-Term Investments	34.75B	32.80B	32.37B	28.21B	27.65B	22.43B
Total Debt	16.43B	15.00B	17.86B	0.00	0.00	0.00
Total Liabilities	34.30B	34.73B	36.56B	14.66B	13.03B	12.68B
Stockholders Equity	58.91B	62.76B	55.49B	51.39B	44.83B	41.80B
Cash Flow
Free Cash Flow	0.00	7.02B	9.54B	6.07B	8.40B	8.59B
Operating Cash Flow	0.00	8.66B	10.68B	7.57B	10.17B	9.61B
Investing Cash Flow	0.00	-1.39B	-20.41B	-3.03B	-1.01B	-1.69B
Financing Cash Flow	0.00	-6.88B	13.81B	-3.90B	-3.02B	-2.50B

Future Corporation Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 2001.00
• 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:4722, the sentiment is Neutral. The current price of 2001 is above the 20-day moving average (MA) of 1809.85, above the 50-day MA of 1904.93, and below the 200-day MA of 2096.47, indicating a neutral trend. The MACD of -35.82 indicates Negative momentum. The RSI at 47.33 is Neutral, neither overbought nor oversold. The STOCH value of 55.76 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for JP:4722.

Future Corporation Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
2317	76 Outperform	¥160.18B	14.15	―	2.30%	13.82%	37.07%
9715	75 Outperform	¥153.08B	10.80	11.52%	2.76%	4.00%	38.72%
3923	74 Outperform	¥314.79B	26.25	―	0.22%	25.00%	62.07%
4722	67 Neutral	¥161.03B	13.77	―	2.22%	9.29%	1.18%
9682	66 Neutral	¥181.68B	15.39	18.89%	2.78%	11.90%	60.66%
4725	65 Neutral	¥32.65B	10.11	10.34%	4.82%	-3.03%	38.83%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%

Future Corporation Corporate Events

Future Corporation Lifts Earnings on Strong DX and Core Banking System Demand

Future Corporation reported solid growth for the fiscal year ended December 31, 2025, with net sales rising 8.8% to ¥75.99 billion, operating profit up 10.3% to ¥16.18 billion and profit attributable to owners of parent increasing 13.5% to ¥11.71 billion, despite a challenging macroeconomic backdrop marked by global geopolitical tensions, domestic inflation, and labor shortages. Performance was driven primarily by the IT Consulting & Services segment, where Future Architect’s expansion of IP-based offerings, including successful live operation of its cloud-based Next-Generation Banking System at Shimane Bank and new implementations for additional regional banks, underpinned higher sales and earnings, while other group companies such as FutureOne, Future Artisan, and Future SecureWave contributed through stronger ERP, PLM/DX consulting, and security service demand; the results highlight the company’s strengthening position as a DX and AI-enabled solutions partner to financial institutions and industry clients, although some units like Future Inspace saw declines after the completion of large projects.

The most recent analyst rating on (JP:4722) stock is a Buy with a Yen2311.00 price target. To see the full list of analyst forecasts on Future Corporation stock, see the JP:4722 Stock Forecast page.

Future Corporation Posts Strong FY25 Non-Consolidated Profit on Financial-Sector Growth and Higher Dividends

Future Corporation reported a significant year-on-year improvement in its non-consolidated results for the fiscal year ended FY25, with net sales rising 29.3% to ¥2.819 billion and operating revenue increasing 11.2% to ¥10.975 billion. Operating profit grew 4.3% to ¥7.372 billion, while profit climbed 25.6% to ¥8.296 billion, lifting basic earnings per share to ¥93.58; the company attributed the stronger performance primarily to robust new business in the financial sector within its technology division and higher dividends received from group companies, underscoring the growing contribution of financial-sector transactions and internal group earnings to its overall profitability.

The most recent analyst rating on (JP:4722) stock is a Buy with a Yen2311.00 price target. To see the full list of analyst forecasts on Future Corporation stock, see the JP:4722 Stock Forecast page.

Future Corporation Delivers Higher Earnings and Dividends, Forecasts Steady Growth for 2026

Future Corporation reported solid growth for the fiscal year ended December 31, 2025, with net sales rising 8.8% year-on-year to ¥75.99 billion and operating profit increasing 10.3% to ¥16.18 billion. Profit attributable to owners of the parent climbed 13.5% to ¥11.71 billion, lifting basic earnings per share to ¥132.11 and equity to ¥62.76 billion, while the equity ratio improved to 64.4%. Cash flows from operating activities remained positive at ¥8.66 billion, and the company continued to return cash to shareholders, raising the annual dividend from ¥42.00 to ¥46.00 per share for 2025 and projecting a further increase to ¥48.00 in 2026. For the fiscal year ending December 31, 2026, Future forecasts continued, albeit moderating, growth, with full-year net sales expected to rise 6.1% to ¥80.60 billion and operating profit to increase 8.2% to ¥17.50 billion, signaling confidence in its earnings power despite changes in accounting policies and a more measured profit trajectory.

The most recent analyst rating on (JP:4722) stock is a Buy with a Yen2311.00 price target. To see the full list of analyst forecasts on Future Corporation stock, see the JP:4722 Stock Forecast page.