Japan Animal Referral Medical Center Co., Ltd. (6039) AI Stock Analysis

• Market Cap: ¥20.69B
• Dividend Yield: 0.64%
• Average Volume (3M): 24.65K
• Price to Earnings (P/E): 23.7
• Beta (1Y): 0.53
• Revenue Growth: 18.22%
• EPS Growth: 47.81%
• Country: JP
• Employees: 256
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Personal Products & Services
• EPS (TTM): 20.26
• Shares Outstanding: 14,391,000
• 10 Day Avg. Volume: 16,500
• 30 Day Avg. Volume: 24,646
• PEG Ratio: 0.20
• Price to Book (P/B): 1.61
• Price to Sales (P/S): 1.27
• P/FCF Ratio: 15.99
• 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): 46.38
• Revenue Forecast (FY): ¥6.20B

• Rating: 79 Outperform
• Price Target: ¥1,664.00 ▲(41.62% Upside)
• Action: Reiterated Date: 02/21/26
• Date: Action: Reiterated 02/21/26

The score is driven primarily by strong financial performance (rapid revenue growth, improving margins, and materially better cash flow) and a clear positive technical trend (price above key moving averages with positive MACD). This is partially offset by a less attractive valuation profile (P/E 23.55 and a low 0.51% dividend yield).

Positive Factors

Consistent Revenue Growth

Sustained 23.6% revenue growth indicates expanding demand for specialized referral services and stronger market penetration. Persistent top-line expansion supports long-term reinvestment in facilities and talent, enabling economies of scale and continued product/service development over months to years.

Strong and Improving Margins

Robust gross and operating margins reflect efficient clinical operations and pricing power in specialized veterinary care. Margin expansion provides durable earnings quality, funds reinvestment, and cushions against cost inflation, supporting long-term profitability even as the business scales.

Solid Cash Generation & FCF Turnaround

Material improvement in operating cash flow and return to positive free cash flow demonstrates sustainable cash conversion. Reliable cash generation enhances balance sheet flexibility for capex, debt repayment, or strategic expansion without reliance on external financing over the medium term.

Negative Factors

Moderate Leverage

A debt-to-equity ratio near 0.84 signals meaningful leverage that raises interest and refinancing risks. In adverse demand or cost environments this level of debt could constrain capital allocation, limit strategic flexibility, and increase vulnerability to rate or cash-flow shocks over several quarters.

Referral-Dependent Business Model

Dependence on referrals concentrates customer sourcing and requires sustained relationships with general clinicians. That structure can slow scalable, broad-market growth, create variability tied to referring clinics' networks, and necessitate continuous investment in reputation and partnerships for durable expansion.

Limited Operational Scale

A relatively small workforce implies constrained physical and personnel capacity, which can limit geographic expansion and throughput of high-complexity cases. Scaling will require meaningful hiring and facility investment, exposing near-term execution and cost risks as the company grows.

Japan Animal Referral Medical Center Co., Ltd. Business Overview & Revenue Model

Company Description

Japan Animal Referral Medical Center Co., Ltd. owns and operates medical centers for animals in Japan. Its veterinary hospital provides advanced medical care service for dogs and cats. The company's medical center comprises cardiology, respiratory, urology, gastroenterology, oncology, neurology, orthopedics, ophthalmology, radiology and imaging, and anesthesiology departments. It also provides professional training services, such as clinical training and treatment; and conducts research and development projects, including genetic testing, immunotherapy, and regenerative medicine. Japan Animal Referral Medical Center Co., Ltd. was incorporated in 2005 and is headquartered in Kawasaki, Japan.

How the Company Makes Money

The company generates revenue primarily through the provision of specialized veterinary services, including consultations, diagnostic testing, surgical procedures, and hospitalizations. Key revenue streams come from referral fees paid by primary care veterinarians for specialized services, as well as direct payments from pet owners seeking advanced medical care for their animals. Additionally, Japan Animal Referral Medical Center may engage in partnerships with pet health insurance providers, which can facilitate reimbursements and attract more clients. The company's focus on high-quality, specialized care enables it to charge premium prices, contributing significantly to its earnings.

Japan Animal Referral Medical Center Co., Ltd. Financial Statement Overview

Summary

Strong fundamentals supported by 23.6% revenue growth, improving profitability (net margin 9.9%, EBIT margin 13.7%, EBITDA margin 25.0%), and significantly better cash generation (operating cash flow 1.37B yen; free cash flow turned positive to 418.7M yen). Balance sheet is solid with a 47.4% equity ratio and 12.6% ROE, though leverage is moderate (debt-to-equity 0.84).

Income Statement

The company has demonstrated strong revenue growth with an increase from 4.27 billion to 5.28 billion yen (23.6% growth). Gross profit margin stands at 34.7%, indicating efficient cost management. Net profit margin has improved to 9.9%, reflecting effective control over expenses. Both EBIT and EBITDA margins are solid at 13.7% and 25.0%, respectively, showing strong operational performance.

Balance Sheet

The balance sheet shows a healthy equity ratio of 47.4%, signifying a stable financial structure. The debt-to-equity ratio is at 0.84, which is manageable yet indicates a reliance on debt financing. Return on equity is robust at 12.6%, indicating efficient use of equity to generate profits.

Cash Flow

Operating cash flow has increased significantly to 1.37 billion yen, with a strong operating cash flow to net income ratio of 2.63, highlighting effective cash generation relative to earnings. Free cash flow has improved from a negative position to 418.7 million yen, demonstrating improved cash management and capital expenditure control.

Breakdown	TTM	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	5.50B	5.28B	4.27B	3.87B	2.98B	2.85B
Gross Profit	1.97B	1.83B	1.46B	1.44B	1.11B	994.66M
EBITDA	1.40B	1.32B	977.87M	967.61M	676.97M	649.81M
Net Income	598.27M	520.98M	337.22M	380.66M	286.94M	285.19M
Balance Sheet
Total Assets	9.09B	8.75B	8.77B	8.58B	7.11B	5.84B
Cash, Cash Equivalents and Short-Term Investments	1.22B	1.11B	1.34B	1.92B	1.07B	1.21B
Total Debt	3.86B	3.48B	3.86B	3.98B	3.92B	3.07B
Total Liabilities	4.86B	4.61B	4.96B	4.87B	4.60B	3.51B
Stockholders Equity	4.23B	4.15B	3.81B	3.71B	2.51B	2.34B
Cash Flow
Free Cash Flow	0.00	418.70M	-155.41M	68.98M	-44.36M	438.89M
Operating Cash Flow	0.00	1.37B	899.78M	810.92M	557.57M	504.39M
Investing Cash Flow	0.00	-994.38M	-985.86M	-784.07M	-1.43B	-69.57M
Financing Cash Flow	0.00	-608.03M	-392.32M	820.59M	722.09M	-469.43M

Japan Animal Referral Medical Center Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 1175.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:6039, the sentiment is Positive. The current price of 1175 is below the 20-day moving average (MA) of 1322.90, below the 50-day MA of 1260.82, and above the 200-day MA of 891.27, indicating a bullish trend. The MACD of 55.37 indicates Negative momentum. The RSI at 58.65 is Neutral, neither overbought nor oversold. The STOCH value of 70.35 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:6039.

Japan Animal Referral Medical Center Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
6039	79 Outperform	¥20.69B	23.70	―	0.64%	18.22%	47.81%
7523	73 Outperform	¥14.89B	10.37	―	2.67%	1.90%	7.25%
7358	68 Neutral	¥13.79B	12.14	―	2.82%	7.95%	13.67%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
9262	61 Neutral	¥9.06B	12.65	―	2.04%	10.87%	14.80%
2438	56 Neutral	¥6.39B	-24.07	―	2.01%	-0.15%	-270.19%
7074	44 Neutral	¥1.81B	-8.65	―	―	-21.04%	76.41%

Japan Animal Referral Medical Center Co., Ltd. Corporate Events

Japan Animal Referral Medical Center Delivers Strong Nine-Month Earnings and Confirms Growth Outlook

Japan Animal Referral Medical Center reported strong results for the nine months ended December 31, 2025, with net sales rising 18.2% year on year to ¥4,660 million and profit attributable to owners of parent jumping 65.0% to ¥675 million, supported by a significant improvement in operating profit margins. The company strengthened its balance sheet, lifting its equity ratio to 51.0%, maintained its dividend forecast despite a recent five-for-one share split, and reiterated its full-year guidance, signaling continued earnings growth and a stable shareholder return policy.

For the full fiscal year ending March 31, 2026, JARMeC projects net sales of ¥6,100 million and profit attributable to owners of parent of ¥730 million, implying double-digit growth across key metrics and an increase in basic earnings per share to ¥56.48 on a post-split basis. The combination of robust interim performance, conservative financial management, and unchanged forecasts suggests sustained demand for advanced veterinary care and underpins the company’s positioning in Japan’s specialty animal medical services market.

The most recent analyst rating on (JP:6039) stock is a Buy with a Yen1460.00 price target. To see the full list of analyst forecasts on Japan Animal Referral Medical Center Co., Ltd. stock, see the JP:6039 Stock Forecast page.