DENTSU SOKEN INC. (4812) AI Stock Analysis

• Market Cap: ¥489.33B
• Dividend Yield: 1.39%
• Average Volume (3M): 90.11K
• Price to Earnings (P/E): 29.2
• Beta (1Y): 0.39
• Revenue Growth: 8.02%
• EPS Growth: 20.57%
• Country: JP
• Employees: 4,413
• Sector: Technology
• Sector Strength: 88
• Industry: Information Technology Services
• EPS (TTM): 61.96
• Shares Outstanding: 65,182,480
• 10 Day Avg. Volume: 107,990
• 30 Day Avg. Volume: 90,113
• PEG Ratio: 8.15
• Price to Book (P/B): 4.17
• Price to Sales (P/S): 2.49
• P/FCF Ratio: 16.28
• 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: Moderate Buy
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 73 Outperform
• Price Target: ¥8,519.00 ▲(6.09% Upside)

DENTSU SOKEN INC. scores well due to its strong financial performance, characterized by robust growth, profitability, and cash flow generation. Technical analysis shows bullish momentum, but overbought indicators suggest caution. Valuation metrics indicate the stock is relatively expensive, which tempers the overall score. The absence of earnings call data and notable corporate events means these factors do not influence the score.

Positive Factors

Cash Flow Generation

The impressive growth in free cash flow indicates strong liquidity and the ability to reinvest in business operations, supporting long-term growth.

Revenue Growth

Consistent revenue growth reflects the company's ability to expand its market presence and adapt to evolving client needs, ensuring sustained business momentum.

Balance Sheet Health

A strong equity position and low leverage enhance financial stability, providing resilience against economic fluctuations and supporting long-term strategic initiatives.

Negative Factors

Valuation Concerns

A high P/E ratio indicates potential overvaluation, which may limit upside potential and attract scrutiny from value-focused investors, impacting long-term investment appeal.

Dividend Yield

A low dividend yield may not attract income-focused investors, potentially limiting the stock's appeal in a competitive market for yield-seeking capital.

Overbought Technical Indicators

Overbought technical indicators suggest potential for a price correction, which could lead to volatility and impact investor sentiment in the medium term.

DENTSU SOKEN INC. Business Overview & Revenue Model

Company Description

DENTSU SOKEN INC. (4812) is a prominent advertising and marketing services company based in Japan, operating under the Dentsu Group. The company specializes in providing integrated marketing solutions, leveraging digital marketing, data analytics, and strategic communication services to enhance brand visibility and engagement for a diverse range of clients. DENTSU SOKEN focuses on sectors including advertising, media planning, public relations, and digital transformation, offering innovative solutions tailored to meet the evolving needs of businesses in a competitive landscape.

How the Company Makes Money

DENTSU SOKEN generates revenue primarily through its advertising and marketing services, which include media buying, campaign management, and digital marketing solutions. The company earns money by charging clients for the development and execution of advertising campaigns, management of media placements, and consulting services related to brand strategy and consumer engagement. Key revenue streams include fees from client contracts, performance-based incentives linked to campaign success, and commissions from media purchases. Additionally, partnerships with technology firms and data analytics providers enhance its service offerings, contributing to its financial performance by enabling more effective marketing strategies that drive client success.

DENTSU SOKEN INC. Financial Statement Overview

Summary

DENTSU SOKEN INC. presents a robust financial profile with strong growth, profitability, and cash flow generation. The company shows consistent revenue and profit growth, efficient operational management, and a solid balance sheet with low leverage. Cash flow metrics further emphasize liquidity strength, making the company well-positioned for future investments and shareholder returns. Overall, DENTSU SOKEN INC. demonstrates financial stability and a positive growth trajectory.

Income Statement

DENTSU SOKEN INC. has demonstrated robust revenue growth with a 7.03% increase from 2023 to 2024. Gross profit margin stands at 36.76% for 2024, highlighting strong operational efficiency. The net profit margin is healthy at 9.90%, with consistent EBIT and EBITDA margins of 13.78% and 16.29%, respectively, indicating stable profitability. Overall, the income statement reflects strong growth and profitability.

Balance Sheet

The company maintains a strong equity position with an equity ratio of 61.89% and a favorable debt-to-equity ratio of 0.04, indicating low leverage. Return on equity is solid at 16.58%, showcasing effective use of shareholder funds. The balance sheet suggests financial stability with a low risk of solvency issues.

Cash Flow

DENTSU SOKEN INC. exhibits impressive cash flow performance with a remarkable free cash flow growth rate of 119.16% from 2023 to 2024. The operating cash flow to net income ratio is particularly strong at 1.57, and free cash flow to net income ratio stands at 1.55, indicating excellent cash generation relative to net income. The cash flow statement underscores the company's strong liquidity and capacity for reinvestment.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	158.65B	152.64B	142.61B	129.05B	112.08B	108.68B
Gross Profit	57.83B	56.12B	51.78B	46.79B	40.02B	37.47B
EBITDA	25.95B	25.21B	24.18B	20.78B	16.19B	13.85B
Net Income	15.55B	15.12B	14.66B	12.60B	8.94B	7.36B
Balance Sheet
Total Assets	150.44B	147.33B	133.33B	121.89B	108.19B	97.15B
Cash, Cash Equivalents and Short-Term Investments	5.64B	62.31B	58.03B	53.76B	50.15B	40.04B
Total Debt	2.54B	1.96B	2.10B	1.92B	1.96B	2.88B
Total Liabilities	55.58B	56.14B	50.36B	48.02B	42.72B	37.56B
Stockholders Equity	94.85B	91.19B	82.97B	73.84B	65.45B	59.56B
Cash Flow
Free Cash Flow	0.00	23.39B	10.67B	9.03B	14.54B	8.10B
Operating Cash Flow	0.00	23.72B	13.05B	11.91B	16.98B	9.99B
Investing Cash Flow	0.00	-11.89B	-2.36B	-3.13B	-2.81B	-3.23B
Financing Cash Flow	0.00	-7.98B	-6.70B	-5.42B	-4.46B	-3.94B

DENTSU SOKEN INC. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 8030.00
• 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:4812, the sentiment is Positive. The current price of 8030 is above the 20-day moving average (MA) of 7669.50, above the 50-day MA of 7081.00, and above the 200-day MA of 6576.02, indicating a bullish trend. The MACD of 262.56 indicates Positive momentum. The RSI at 60.33 is Neutral, neither overbought nor oversold. The STOCH value of 70.37 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:4812.

DENTSU SOKEN INC. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
3788	76 Outperform	¥24.73B	32.44	―	1.52%	7.83%	49.73%
4812	73 Outperform	¥489.33B	29.20	―	1.39%	8.02%	20.57%
4722	73 Outperform	¥188.65B	18.46	―	2.11%	9.29%	1.18%
9746	72 Outperform	¥211.88B	17.54	―	2.68%	10.98%	8.69%
3923	71 Outperform	¥445.78B	47.25	―	0.36%	25.00%	62.07%
8056	64 Neutral	¥563.82B	21.71	―	1.95%	10.42%	28.75%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%

DENTSU SOKEN INC. Corporate Events

DENTSU SOKEN INC. Reports Robust Q3 Financial Growth

DENTSU SOKEN INC. reported a strong financial performance for the third quarter of FY2025, with significant increases in net sales and profits compared to the previous year. The company achieved a 7.9% rise in net sales and a 16.3% increase in net profit, indicating robust growth and effective operational strategies. The forecast for the full fiscal year remains positive, with expectations of continued growth in sales and profits, reinforcing the company’s strong market position and potential for future success.

The most recent analyst rating on (JP:4812) stock is a Buy with a Yen7386.00 price target. To see the full list of analyst forecasts on DENTSU SOKEN INC. stock, see the JP:4812 Stock Forecast page.