NETSTARS Co.,Ltd. (5590) AI Stock Analysis

• Market Cap: ¥13.99B
• Dividend Yield: N/A
• Average Volume (3M): 118.17K
• Price to Earnings (P/E): 28.7
• Beta (1Y): 0.68
• Revenue Growth: 25.85%
• EPS Growth: N/A
• Country: JP
• Employees: 223
• Sector: Technology
• Sector Strength: 88
• Industry: Financial - Credit Services
• EPS (TTM): 15.83
• Shares Outstanding: 16,834,800
• 10 Day Avg. Volume: 218,840
• 30 Day Avg. Volume: 118,166
• PEG Ratio: -0.02
• Price to Book (P/B): 2.21
• Price to Sales (P/S): 3.52
• P/FCF Ratio: 7.12
• 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): 44.1
• Revenue Forecast (FY): ¥6.00B

• Rating: 62 Neutral
• Price Target: ¥815.00 ▼(-21.86% Downside)
• Action: Reiterated Date: 02/18/26
• Date: Action: Reiterated 02/18/26

The score is supported primarily by improving financial performance (profitability rebound, strong gross margins, no debt, and positive cash generation). It is held back by weak technicals (price below all key moving averages with negative MACD) and a moderately demanding valuation (P/E 26.53) given the recent history of earnings volatility.

Positive Factors

High Gross Margins

Sustained gross margins near 70%–76% indicate structural product or service economics and pricing power. High gross margins provide durable earnings leverage, allowing the company to absorb SG&A and invest in growth while preserving operating profitability over the medium term.

Conservative Balance Sheet

Zero reported debt materially reduces financial risk and gives management flexibility for strategic investment, M&A, or capital returns. A debt-free position improves resilience in downturns and lowers default/default-related costs, supporting long-term operational stability.

Positive Cash Generation

Consistent positive operating and free cash flow, with FCF roughly matching net income in 2025, shows the business converts profit into cash. This durable cash generation supports reinvestment, working-capital needs and strategic optionality without reliance on external financing.

Negative Factors

Earnings Volatility / Recent Losses

A return from multi-year losses to profitability in 2025 highlights business sensitivity and execution risk. The recent loss history means margins and earnings lack demonstrated consistency, raising the chance that favorable 2025 results could reverse without sustained structural improvements.

Choppy Cash Flow Growth

Although absolute FCF is positive, a ~10% decline in FCF growth and year-to-year variability suggest working-capital swings or one-offs. That reduces predictability of internally generated funds for capex, acquisitions, or payouts, complicating longer-term planning and capital allocation.

Modest Operating Profitability

Margins improved but remain moderate: a ~6% EBIT margin limits the buffer against revenue shocks and constrains return on capital. Given prior losses, modest operating profitability means the company needs sustained revenue growth and margin stability to deliver durable returns to shareholders.

NETSTARS Co.,Ltd. Business Overview & Revenue Model

Company Description

NETSTARS Co.,Ltd. engages in the QR code payment business in Japan. The company offers StarPay, a multi-cashless payment solution that enables integrated application and management of payment services; StarPay-mini, a development platform for mini-apps; and StarPay Order provides cashless and cash register-free ordering system. It also provides regional point service; StarPay-Digital coupon; payment gateway for overseas financial institutions; and inbound promotion services. The company was incorporated in 2009 and is headquartered in Chuo, Japan.

How the Company Makes Money

NETSTARS Co., Ltd. generates revenue primarily through its payment processing services. The company earns transaction fees from merchants who utilize its QR code and mobile payment platforms to facilitate customer payments. Additionally, NETSTARS may receive income from partnerships with financial institutions and technology providers, allowing them to expand their service offerings and reach. The company's revenue model is significantly bolstered by the increasing adoption of cashless payments in Japan and elsewhere, as businesses seek efficient, secure, and convenient payment solutions.

NETSTARS Co.,Ltd. Financial Statement Overview

Summary

Strong 2025 turnaround with ~10% revenue growth, positive net margin (~10%) and EBIT margin (~6%), and consistently high gross margins (~70%–76%). Balance sheet risk is low with zero reported debt and improving equity, while cash flow is consistently positive. Key risk is durability: the company was loss-making through 2024 and cash flow growth was negative in 2025 (~-10%), indicating earnings/cash-flow variability.

Income Statement

Revenue has grown meaningfully over the last several years, including a strong rebound in 2025 (annual revenue growth ~10%). Profitability has improved dramatically: the company moved from net losses in 2021–2024 to solid profitability in 2025 (net margin ~10% and positive EBIT margin ~6%). Gross margins are consistently high (~70%–76%), supporting earnings leverage. The main weakness is volatility—results were loss-making as recently as 2024, so the durability of the turnaround still needs to be proven.

Balance Sheet

The balance sheet appears conservatively positioned with zero reported debt across all periods, which materially reduces financial risk. Equity is sizable and has generally trended upward by 2025, supporting stability. Returns have improved alongside the earnings rebound, with positive return on equity in 2025 (~6%), but this follows several years of negative returns, highlighting that profitability consistency remains the key watch item.

Cash Flow

Cash generation is a clear strength: operating cash flow and free cash flow are positive and large in absolute terms in every year shown, and free cash flow closely tracks net income when profitable (2025 free cash flow is ~99% of net income). However, free cash flow growth turned negative in 2025 (down ~10%), and cash flows have been choppy year-to-year, suggesting variability in underlying cash conversion and/or working-capital dynamics.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	4.34B	4.79B	3.90B	3.72B	2.99B	1.96B
Gross Profit	3.35B	3.67B	2.98B	2.62B	1.86B	1.03B
EBITDA	553.83M	538.48M	138.29M	-136.78M	-435.81M	-925.84M
Net Income	305.08M	485.02M	-37.62M	-347.69M	-572.53M	-1.02B
Balance Sheet
Total Assets	38.27B	38.35B	35.74B	28.36B	21.58B	18.51B
Cash, Cash Equivalents and Short-Term Investments	36.41B	36.21B	33.88B	26.52B	19.75B	16.89B
Total Debt	0.00	0.00	0.00	0.00	0.00	0.00
Total Liabilities	31.07B	30.72B	28.63B	21.29B	15.12B	11.50B
Stockholders Equity	7.19B	7.63B	7.11B	7.07B	6.46B	7.01B
Cash Flow
Free Cash Flow	2.62B	2.36B	7.51B	5.83B	2.81B	6.77B
Operating Cash Flow	2.62B	2.38B	7.51B	6.01B	3.22B	7.06B
Investing Cash Flow	-58.00M	-111.55M	-200.56M	-187.02M	-377.98M	-642.60M
Financing Cash Flow	0.00	66.00M	9.92M	933.50M	-600.00K	4.32B

NETSTARS Co.,Ltd. Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 1043.00
• 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:5590, the sentiment is Neutral. The current price of 1043 is above the 20-day moving average (MA) of 824.90, above the 50-day MA of 909.18, and above the 200-day MA of 999.91, indicating a neutral trend. The MACD of -30.87 indicates Negative momentum. The RSI at 47.31 is Neutral, neither overbought nor oversold. The STOCH value of 49.24 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for JP:5590.

NETSTARS Co.,Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
8771	84 Outperform	¥83.00B	22.18	―	2.02%	13.52%	7.75%
7191	81 Outperform	¥26.83B	16.28	―	2.50%	16.70%	22.23%
7383	64 Neutral	¥53.71B	27.84	―	―	13.25%	1251.39%
5590	62 Neutral	¥13.99B	28.67	―	―	25.85%	―
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
5258	57 Neutral	¥9.94B	-23.00	―	―	12.25%	-1134.27%
7199	56 Neutral	¥74.17B	15.43	―	2.44%	15.20%	-16.02%

NETSTARS Co.,Ltd. Corporate Events

NETSTARS Swings to Profit and Projects Strong Growth for 2026

NETSTARS reported strong growth for the year ended December 31, 2025, with net sales rising 22.7% to ¥4.79 billion and a return to profitability, posting ¥293 million in operating profit and ¥485 million in profit attributable to owners of the parent after a loss in the previous year. The company improved earnings per share to ¥28.99, maintained an equity ratio of 19.9% as total assets increased to ¥38.35 billion, and generated solid operating cash flow of ¥2.38 billion, while continuing its no-dividend policy.

For 2026, NETSTARS forecasts a further 20.3% increase in net sales to ¥5.76 billion and a 70.8% jump in operating profit to ¥500 million, with ordinary profit expected to climb nearly 60% and profit attributable to owners of the parent to edge up to ¥493 million. These projections, alongside stable capital structure metrics and unchanged accounting policies, suggest a trajectory of continued top-line expansion and margin recovery that may bolster its competitive footing in Japan’s cashless payments ecosystem, though shareholders will not see near-term returns via dividends.

The most recent analyst rating on (JP:5590) stock is a Buy with a Yen954.00 price target. To see the full list of analyst forecasts on NETSTARS Co.,Ltd. stock, see the JP:5590 Stock Forecast page.

NETSTARS Co., Ltd. Reports Strong Financial Turnaround for Nine Months Ending September 2025

NETSTARS Co., Ltd. reported a significant improvement in its financial performance for the nine months ending September 30, 2025, with net sales increasing by 23.6% year-on-year to 3,367 million yen. The company also achieved a turnaround from losses in the previous year to a profit attributable to owners of the parent amounting to 219 million yen, reflecting a positive shift in its operational efficiency and market positioning.