Arent, Inc. (5254) AI Stock Analysis

• Market Cap: ¥25.07B
• Dividend Yield: N/A
• Average Volume (3M): 28.11K
• Price to Earnings (P/E): 45.6
• Beta (1Y): 1.01
• Revenue Growth: 40.99%
• EPS Growth: -36.76%
• Country: JP
• Employees: 153
• Sector: Technology
• Sector Strength: 88
• Industry: Software - Application
• EPS (TTM): 12.66
• Shares Outstanding: 6,954,295
• 10 Day Avg. Volume: 24,360
• 30 Day Avg. Volume: 28,110
• PEG Ratio: -9.95
• Price to Book (P/B): 6.46
• Price to Sales (P/S): 7.70
• P/FCF Ratio: 38.88
• 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): N/A
• Revenue Forecast (FY): N/A

• Rating: 58 Neutral
• Price Target: ¥3,749.00 ▲(27.91% Upside)

Arent, Inc.'s overall stock score is primarily influenced by its strong financial performance, which is offset by bearish technical indicators and a high P/E ratio. The lack of dividend yield further impacts the valuation. Despite solid financial health, the stock faces challenges in market momentum and valuation.

Positive Factors

High Revenue Growth

Sustained double-digit revenue growth demonstrates strong product demand and market traction, enabling scale economies and continued R&D investment. Over 2–6 months this underpins durable top-line expansion and supports longer-term margin and cash-generation improvements.

Strong Profitability Margins

Robust gross and operating margins indicate pricing power and efficient cost structure in core software businesses. High margin profile supports sustainable free cash flow, funding reinvestment and strategic initiatives while absorbing competitive or cyclical pressures over the medium term.

Conservative Capital Structure

Very low leverage and a high equity base provide financial flexibility for capex, acquisitions, or downturns without stressing cash flow. This conservative structure reduces refinancing risk and preserves optionality for strategic investments over the next several quarters.

Negative Factors

Declining EPS Growth

A sharp decline in EPS growth despite revenue gains suggests margin erosion, one-off charges, or dilution that could impair earnings quality. If EPS recovery lags, it may constrain retained earnings and limit capacity to fund growth or returns over a multi-quarter horizon.

Slowing Equity Growth

Slower growth in shareholders' equity can signal reduced retained earnings or higher payouts/charges, limiting internal funding for R&D and capex. Persisting decline would weaken the balance sheet expansion needed to support sustained organic growth and strategic initiatives.

Slight Decline in Operating Cash Flow

A dip in operating cash flow, even with strong free cash flow metrics, may indicate working-capital pressure or rising operating costs. Continued OCF weakness could impair cash conversion and limit reinvestment or buffer for shocks over the medium term.

Arent, Inc. Business Overview & Revenue Model

Company Description

Arent Inc. engages in the development of SaaS based solutions for construction industry in Japan. The company offers Lightning BIM software for architecture and structure industry; and PlantStream software for plant industry. It also provides consulting services. The company was incorporated in 2012 and is headquartered in Tokyo, Japan.

How the Company Makes Money

Arent, Inc. generates revenue through multiple streams, including the sale of proprietary technology products, offering engineering and consulting services, and entering into long-term contracts with clients for customized solutions. The company benefits from strategic partnerships with key industry players, which enhance its market presence and provide access to new customer segments. Additionally, Arent, Inc. capitalizes on research and development initiatives, allowing it to introduce new products and maintain a competitive edge in the market.

Arent, Inc. Financial Statement Overview

Summary

Arent, Inc. demonstrates strong financial performance with significant revenue growth and healthy profitability metrics. The balance sheet is robust with low leverage, and cash flow generation is strong. Minor concerns exist regarding net income and equity growth, but overall financial health is solid.

Income Statement

Arent, Inc. has demonstrated strong revenue growth with a 26.18% increase in the latest year, indicating robust demand for its software applications. The company maintains healthy profitability metrics, with a gross profit margin of 63.36% and a net profit margin of 15.72%. The EBIT margin is also strong at 41.97%, showcasing efficient operational management. However, the slight decline in net income compared to the previous year suggests potential cost pressures or increased competition.

Balance Sheet

The balance sheet of Arent, Inc. reflects a solid financial position with a low debt-to-equity ratio of 0.067, indicating conservative leverage. The return on equity is commendable at 13.20%, reflecting effective use of shareholder funds. The equity ratio stands at 78.89%, highlighting a strong equity base relative to total assets. However, the decrease in stockholders' equity growth compared to previous years could be a concern if it continues.

Cash Flow

Arent, Inc. shows strong cash flow management with a significant increase in free cash flow, marked by an 'Infinity' growth rate due to a low base effect. The operating cash flow to net income ratio of 1.31 indicates efficient cash generation relative to net income. The free cash flow to net income ratio of 1.26 further underscores the company's ability to convert profits into cash. However, the slight decline in operating cash flow compared to the previous year warrants monitoring.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	4.03B	4.03B	2.94B	2.02B	1.01B	722.03M
Gross Profit	2.55B	2.55B	1.70B	1.07B	501.99M	360.99M
EBITDA	1.24B	1.18B	991.61M	547.98M	36.74M	74.14M
Net Income	632.57M	633.50M	658.16M	317.98M	-48.05M	-19.52M
Balance Sheet
Total Assets	6.08B	6.08B	5.06B	4.52B	3.06B	2.18B
Cash, Cash Equivalents and Short-Term Investments	3.83B	3.83B	3.85B	3.21B	1.93B	1.22B
Total Debt	322.77M	322.77M	394.71M	565.02M	813.23M	1.10B
Total Liabilities	1.28B	1.28B	935.19M	1.05B	1.07B	1.34B
Stockholders Equity	4.80B	4.80B	4.12B	3.46B	1.98B	832.61M
Cash Flow
Free Cash Flow	0.00	797.72M	829.71M	823.00M	150.67M	226.71M
Operating Cash Flow	0.00	827.55M	850.22M	833.68M	170.71M	239.57M
Investing Cash Flow	0.00	-828.21M	-43.30M	-454.62M	-368.34M	-971.16M
Financing Cash Flow	0.00	-19.55M	-168.81M	904.64M	906.69M	1.01B

Arent, Inc. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 2931.00
• 50DMA: Positive
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:5254, the sentiment is Positive. The current price of 2931 is below the 20-day moving average (MA) of 3541.25, below the 50-day MA of 3121.26, and below the 200-day MA of 4337.69, indicating a neutral trend. The MACD of 134.77 indicates Positive momentum. The RSI at 63.98 is Neutral, neither overbought nor oversold. The STOCH value of 39.62 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:5254.

Arent, Inc. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
3763	82 Outperform	¥46.00B	15.98	―	1.92%	20.81%	68.06%
3771	77 Outperform	¥32.83B	13.42	―	2.93%	11.53%	23.23%
3835	75 Outperform	¥20.08B	17.06	―	3.14%	0.50%	-2.92%
4058	72 Outperform	¥26.45B	23.66	―	0.52%	50.92%	46.61%
4826	70 Outperform	¥32.78B	18.29	―	2.83%	4.51%	75.35%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
5254	58 Neutral	¥25.07B	45.63	―	―	40.99%	-36.76%