Rakuten (4755) AI Stock Analysis

• Market Cap: ¥2.00T
• Dividend Yield: N/A
• Average Volume (3M): 12.39M
• Price to Earnings (P/E): ―
• Beta (1Y): 1.17
• Revenue Growth: 11.45%
• EPS Growth: 42.34%
• Country: JP
• Employees: 29,334
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Specialty Retail
• EPS (TTM): -12.37
• Shares Outstanding: 2,169,972,200
• 10 Day Avg. Volume: 10,950,400
• 30 Day Avg. Volume: 12,385,006
• PEG Ratio: 0.20
• Price to Book (P/B): 1.99
• Price to Sales (P/S): 0.81
• P/FCF Ratio: 1.95
• 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: ¥1,052.47
• Price Target Upside: 14.10% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 7
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 46 Neutral
• Price Target: ¥920.00 ▼(-0.26% Downside)

Rakuten's overall stock score is primarily influenced by its financial performance, which highlights significant challenges in profitability and leverage. Technical analysis suggests a neutral to bearish trend, while valuation metrics indicate concerns due to negative earnings and lack of dividends. The absence of earnings call insights and corporate events leaves these areas unaddressed.

Positive Factors

Revenue Growth

Consistent revenue growth indicates a strong market position and effective business model, supporting long-term expansion and resilience.

Cash Flow Management

Stable cash flow management suggests effective financial operations, enabling the company to sustain operations and invest in growth despite profitability challenges.

Market Diversification

Diverse operations across multiple sectors mitigate risk and provide multiple revenue streams, enhancing long-term business stability and growth potential.

Negative Factors

High Leverage

High leverage increases financial risk, potentially limiting flexibility and increasing vulnerability to economic downturns, impacting long-term financial health.

Profitability Challenges

Ongoing profitability issues highlight challenges in cost management and pricing power, which could hinder sustainable growth and shareholder value creation.

Declining Gross Profit Margin

A significant drop in gross profit margin suggests increased cost pressures, which can erode competitiveness and affect long-term profitability.

Rakuten Business Overview & Revenue Model

Company Description

Rakuten Group, Inc. offers internet services in Japan and internationally. It operates through three segments: Internet Services, FinTech, and Mobile segments. The Internet Services segment operates Rakuten Ichiba, an internet shopping mall; Rakuten Books, an online bookstore; Rakuten Travel, an internet travel site; Rakuten Gora, an online golf course reservation service; Rakuten Fashion, an online fashion store; Rakuma, a flea market app; Rakuten Rewards, which offers online cash-back services; and Rakuten 24, an internet shopping site that sells medical supplies and daily necessities. It also offers mobile messaging and VoIP, performance marketing, and e-book services. The FinTech segment issues credit cards; offers internet banking, general and life insurance, and payment services; and operates online securities trading platform. The Mobile segment provides mobile communication, optical broadband line, and power supply services. The company was formerly known as Rakuten, Inc. and changed its name to Rakuten Group, Inc. in April 2021. Rakuten Group, Inc. was incorporated in 1997 and is headquartered in Tokyo, Japan.

How the Company Makes Money

Rakuten generates revenue through several key streams. The primary source is its e-commerce platform, where it earns income from transaction fees charged to merchants for selling products on its marketplace. Additionally, Rakuten operates a loyalty program, Rakuten Super Points, which enhances customer retention and drives sales. The company also has a significant presence in fintech, generating revenue through its banking and insurance services, where it earns fees and commissions from financial products. Furthermore, Rakuten provides digital content services, including streaming and subscription services, contributing to its revenue. Strategic partnerships, such as collaborations with major brands and expansion into international markets, also bolster its earnings.

Rakuten Financial Statement Overview

Summary

Rakuten demonstrates strong revenue growth but faces significant profitability and leverage challenges. The high debt levels and negative returns on equity suggest financial risk, while cash flow management appears relatively robust. The company needs to focus on improving profitability and reducing leverage to enhance financial stability.

Income Statement

Rakuten's revenue has shown consistent growth, with a TTM increase of 2.59%. However, profitability remains a concern, as evidenced by negative net profit margins and EBIT margins over the periods. The gross profit margin has decreased significantly from 38.15% in 2023 to 14.05% in the TTM, indicating pressure on cost management. Despite a positive EBITDA margin in the TTM, the overall profitability metrics suggest challenges in achieving sustainable profits.

Balance Sheet

The company's balance sheet reflects high leverage, with a TTM debt-to-equity ratio of 6.59, indicating significant reliance on debt financing. The return on equity remains negative, highlighting ongoing challenges in generating shareholder value. The equity ratio has decreased, suggesting a higher proportion of assets financed by debt. These factors point to potential financial risk if not managed carefully.

Cash Flow

Rakuten's cash flow performance shows mixed results. The TTM free cash flow has declined by 42.40%, but the operating cash flow to net income ratio remains relatively stable at 0.84, indicating decent cash generation relative to net losses. The free cash flow to net income ratio is strong at 0.82, suggesting effective cash management despite profitability issues.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	2.45T	2.28T	2.07T	1.93T	1.68T	1.46T
Gross Profit	369.12B	316.29B	790.31B	585.31B	542.63B	562.57B
EBITDA	446.55B	289.41B	146.60B	-108.83B	6.47B	52.07B
Net Income	-163.38B	-162.44B	-339.47B	-375.91B	-133.83B	-114.20B
Balance Sheet
Total Assets	26.97T	26.51T	22.63T	20.44T	16.83T	12.52T
Cash, Cash Equivalents and Short-Term Investments	5.33T	6.17T	5.13T	4.86T	4.69T	3.30T
Total Debt	5.45T	5.46T	4.80T	4.91T	3.40T	2.49T
Total Liabilities	25.81T	25.28T	21.54T	19.57T	15.71T	11.90T
Stockholders Equity	812.72B	927.87B	836.57B	813.73B	1.09T	608.74B
Cash Flow
Free Cash Flow	164.53B	947.64B	373.04B	-697.36B	172.07B	656.32B
Operating Cash Flow	230.78B	1.19T	724.19B	-257.95B	582.71B	1.04T
Investing Cash Flow	-806.56B	-921.72B	-597.42B	-952.41B	-611.83B	-303.35B
Financing Cash Flow	11.56B	757.47B	291.96B	1.49T	1.40T	808.11B

Rakuten Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 922.40
• 50DMA: Negative
• 100DMA: Negative
• 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:4755, the sentiment is Negative. The current price of 922.4 is below the 20-day moving average (MA) of 958.70, below the 50-day MA of 964.71, and above the 200-day MA of 894.90, indicating a neutral trend. The MACD of -16.95 indicates Positive momentum. The RSI at 37.27 is Neutral, neither overbought nor oversold. The STOCH value of 39.65 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:4755.

Rakuten Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
4385	74 Outperform	¥525.83B	18.62	31.11%	―	4.83%	106.29%
9843	72 Outperform	¥1.57T	18.04	―	1.11%	―	―
3048	66 Neutral	¥296.49B	15.60	11.17%	2.61%	5.63%	25.64%
3092	65 Neutral	¥1.01T	21.76	47.74%	2.82%	6.80%	0.62%
9831	64 Neutral	¥455.72B	14.08	4.18%	2.57%	1.26%	14.65%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
4755	46 Neutral	¥2.00T	-12.19	-21.14%	―	11.45%	42.34%

Rakuten Corporate Events

Rakuten Announces Shareholder Benefits with Free Mobile Service

Rakuten Group, Inc. has announced a shareholder benefit program for the 29th fiscal year, offering qualified shareholders a six-month free subscription to its Rakuten Mobile service, with an option for an additional six months if certain conditions are met. This initiative aims to express gratitude to shareholders and provide them with a deeper understanding of Rakuten Mobile, a key business area for the company, thereby potentially strengthening shareholder engagement and loyalty.

The most recent analyst rating on (JP:4755) stock is a Hold with a Yen950.00 price target. To see the full list of analyst forecasts on Rakuten stock, see the JP:4755 Stock Forecast page.

Rakuten Reports Revenue Growth Amidst Ongoing Losses

Rakuten Group, Inc. reported a 10.5% increase in revenue for the nine months ending September 30, 2025, compared to the previous year. Despite this growth, the company faced a net loss of 151,294 million yen, reflecting ongoing challenges in achieving profitability. The company’s EBITDA showed a significant increase of 42.5%, indicating improvements in cash flow generation. However, the consolidated equity ratio decreased slightly, highlighting potential concerns about financial stability. The dividend per share remains undecided, signaling uncertainty in shareholder returns.

The most recent analyst rating on (JP:4755) stock is a Hold with a Yen1035.00 price target. To see the full list of analyst forecasts on Rakuten stock, see the JP:4755 Stock Forecast page.

Rakuten Securities Reports Strong Financial Growth for 2025

Rakuten Securities, Inc. reported its financial results for the nine months ending September 30, 2025, showing a notable increase in operating revenue and net income compared to the previous year. This growth highlights the company’s strong performance and potential positive impact on its market positioning within the financial services sector.

The most recent analyst rating on (JP:4755) stock is a Hold with a Yen850.00 price target. To see the full list of analyst forecasts on Rakuten stock, see the JP:4755 Stock Forecast page.

Rakuten Restructures with Strategic Company Split

Rakuten Group, Inc. announced a strategic decision to exclude Rakuten STAY, Inc. from its previously planned absorption-type mergers due to its independent business nature. Instead, Rakuten will transfer the Oyado business and shares of Rakuten STAY Operations, Inc. and Yufuin Kutsuroginosato Co., Ltd. to itself through a company split. This move aims to create synergies, reduce administrative costs, and improve operational efficiency, aligning with Rakuten’s broader strategy of optimizing its organizational structure and enhancing its ecosystem.

The most recent analyst rating on (JP:4755) stock is a Hold with a Yen850.00 price target. To see the full list of analyst forecasts on Rakuten stock, see the JP:4755 Stock Forecast page.

Rakuten Issues Unsecured Undated Bonds to Enhance Financial Flexibility

Rakuten Group, Inc. has announced the issuance of unsecured undated bonds with interest payment deferral and optional redemption clauses, structured to receive a 50% equity credit from rating agencies. The proceeds from these bonds will be used to redeem or repurchase existing USD-denominated subordinated notes, enhancing Rakuten’s financial flexibility and potentially strengthening its market position.

The most recent analyst rating on (JP:4755) stock is a Hold with a Yen850.00 price target. To see the full list of analyst forecasts on Rakuten stock, see the JP:4755 Stock Forecast page.

Rakuten Group Issues Share Options to Subsidiary Employees

Rakuten Group, Inc. has announced the issuance of share options to employees of its subsidiaries as part of a performance-linked compensation package. This initiative aims to align employee interests with shareholder gains, enhance motivation, and retain talent by offering share acquisition rights that are exercisable in stages over several years. The move is designed to boost corporate and shareholder value by fostering a sense of unity among employees and making them potential shareholders.

The most recent analyst rating on (JP:4755) stock is a Hold with a Yen850.00 price target. To see the full list of analyst forecasts on Rakuten stock, see the JP:4755 Stock Forecast page.