Digital Garage (4819) AI Stock Analysis

• Market Cap: ¥131.93B
• Dividend Yield: 1.93%
• Average Volume (3M): 127.34K
• Price to Earnings (P/E): 40.3
• Beta (1Y): 0.77
• Revenue Growth: 19.61%
• EPS Growth: N/A
• Country: JP
• Employees: 1,087
• Sector: Technology
• Sector Strength: 88
• Industry: Information Technology Services
• EPS (TTM): N/A
• Shares Outstanding: 47,713,833
• 10 Day Avg. Volume: 124,770
• 30 Day Avg. Volume: 127,340
• PEG Ratio: 0.13
• Price to Book (P/B): 2.83
• Price to Sales (P/S): 6.63
• P/FCF Ratio: 12.71
• 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: 55 Neutral
• Price Target: ¥3,030.00 ▲(7.64% Upside)

Digital Garage's overall stock score reflects strong financial performance, particularly in revenue and cash flow growth, but is tempered by bearish technical indicators and a high valuation. The lack of earnings call data and corporate events further limits the score.

Positive Factors

Revenue Growth

The consistent revenue growth indicates a positive trajectory, suggesting strong demand for Digital Garage's services and potential for market expansion.

Cash Flow Performance

Robust cash generation capabilities enhance financial flexibility, allowing for reinvestment in growth opportunities and resilience against economic fluctuations.

Stable Debt Levels

A stable debt-to-equity ratio indicates prudent financial management, reducing risk and ensuring long-term financial stability.

Negative Factors

Profitability Margins

Low net profit margins suggest challenges in translating revenue growth into bottom-line profitability, which may affect long-term earnings potential.

Gross Profit Margin Decline

A declining gross profit margin can indicate rising costs or pricing pressures, potentially impacting future profitability and competitive positioning.

Earnings Call Data Absence

Lack of earnings call data limits transparency and investor insight into management's strategic direction and operational performance.

Digital Garage Business Overview & Revenue Model

Company Description

Digital Garage (4819) is a leading technology and digital marketing company based in Japan, specializing in providing innovative solutions in the fields of digital advertising, e-commerce, and data analytics. The company operates across various sectors, including fintech, marketing technology, and digital content, offering a diverse range of products and services such as digital marketing platforms, online payment solutions, and data-driven insights for businesses looking to enhance their online presence and performance.

How the Company Makes Money

Digital Garage generates revenue through multiple streams, primarily by offering digital marketing services, which include SEO, SEM, and social media marketing to businesses seeking to improve their online visibility. Additionally, the company earns income from its fintech solutions, such as online payment processing and financial technology services. Key partnerships with e-commerce platforms and tech firms enhance its service offerings and expand its reach, while subscription-based models for its software and analytics tools provide a steady income. Furthermore, Digital Garage may benefit from performance-based revenue models where they earn commissions or fees based on the success of their marketing campaigns.

Digital Garage Financial Statement Overview

Summary

Digital Garage's financial performance is mixed. Positive cash flow developments are overshadowed by income statement volatility and high leverage, indicating financial risks. Stabilizing revenue and improving cost efficiency are crucial for future profitability.

Income Statement

The company has experienced volatility in its financial performance. Gross profit margin has decreased over the years, highlighting cost management challenges. The net profit margin is negative in the latest period, indicating recent operational inefficiencies. Revenue growth has been inconsistent, with recent declines, suggesting potential market challenges.

Balance Sheet

The balance sheet shows a reasonable equity ratio, indicating some level of asset financing through equity, which is a positive sign. However, high debt-to-equity levels in recent years highlight significant leverage, posing potential financial risk. Return on equity has been unstable due to fluctuating net income.

Cash Flow

Cash flow analysis reveals a strong turnaround in operating cash flow in the latest year, suggesting improved cash generation capacity. Free cash flow has also turned positive, which is a positive indicator for financial flexibility. However, the cash flow to net income ratios have been inconsistent, indicating potential cash flow management issues.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	35.52B	32.20B	31.38B	30.07B	72.95B	40.48B
Gross Profit	18.09B	19.25B	20.70B	19.98B	62.44B	29.78B
EBITDA	9.26B	-5.69B	10.30B	-5.31B	31.50B	14.79B
Net Income	3.23B	-7.19B	5.81B	-9.32B	30.33B	9.79B
Balance Sheet
Total Assets	220.40B	226.34B	231.43B	216.27B	231.61B	178.30B
Cash, Cash Equivalents and Short-Term Investments	108.98B	111.29B	119.42B	121.29B	121.64B	86.07B
Total Debt	59.83B	61.63B	67.34B	52.70B	49.93B	45.62B
Total Liabilities	142.90B	148.65B	139.29B	134.19B	134.39B	115.22B
Stockholders Equity	75.29B	75.42B	89.25B	80.14B	95.74B	62.13B
Cash Flow
Free Cash Flow	12.85B	16.79B	-13.95B	11.29B	4.20B	3.84B
Operating Cash Flow	13.24B	17.39B	-11.03B	13.47B	7.06B	7.05B
Investing Cash Flow	-7.44B	-10.04B	-8.76B	1.63B	-7.98B	-864.00M
Financing Cash Flow	-8.46B	-14.92B	15.93B	-5.21B	6.24B	-914.00M

Digital Garage Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 2815.00
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:4819, the sentiment is Negative. The current price of 2815 is below the 20-day moving average (MA) of 2999.35, below the 50-day MA of 3177.74, and below the 200-day MA of 3988.29, indicating a bearish trend. The MACD of -99.92 indicates Positive momentum. The RSI at 34.48 is Neutral, neither overbought nor oversold. The STOCH value of 17.71 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:4819.

Digital Garage Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
2317	76 Outperform	¥188.44B	18.12	―	2.31%	13.82%	37.07%
3636	75 Outperform	¥76.94B	11.98	―	3.40%	5.28%	28.90%
9715	75 Outperform	¥140.90B	10.28	11.52%	2.82%	4.00%	38.72%
4722	73 Outperform	¥172.54B	16.89	―	2.26%	9.29%	1.18%
9682	66 Neutral	¥193.44B	17.04	18.89%	2.81%	11.90%	60.66%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
4819	55 Neutral	¥131.93B	40.34	4.18%	1.93%	19.61%	―