Universal Entertainment (6425) AI Stock Analysis

• Market Cap: ¥59.43B
• Dividend Yield: N/A
• Average Volume (3M): 314.50K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.05
• Revenue Growth: -14.08%
• EPS Growth: 54.85%
• Country: JP
• Employees: 7,437
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Leisure
• EPS (TTM): -9.99
• Shares Outstanding: 80,195,000
• 10 Day Avg. Volume: 455,620
• 30 Day Avg. Volume: 314,496
• PEG Ratio: 0.03
• Price to Book (P/B): 0.22
• Price to Sales (P/S): 0.64
• P/FCF Ratio: -11.41
• 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): 1,204.07
• Revenue Forecast (FY): ¥25.84T

• Rating: 42 Neutral
• Price Target: ¥744.00 ▼(-18.33% Downside)

Universal Entertainment's stock score is primarily impacted by its poor financial performance and bearish technical indicators. The company's declining revenues and negative profitability, coupled with a lack of positive valuation metrics, present significant risks. The absence of earnings call insights and corporate events further limits any potential positive outlook.

Universal Entertainment Business Overview & Revenue Model

Company Description

Universal Entertainment Corporation (6425) is a Japanese company primarily engaged in the development, manufacturing, and distribution of gaming machines and entertainment products. The company operates in two main sectors: the gaming and amusement machine industry, where it produces pachinko and pachislot machines, and the casino sector, where it is involved in the development and management of integrated resorts. Universal Entertainment also engages in the production of various entertainment-related products and services, aiming to enhance the overall gaming experience.

How the Company Makes Money

Universal Entertainment generates revenue through multiple streams, primarily from the sales of pachinko and pachislot machines to operators in Japan and other markets. In addition to machine sales, the company earns income from the operation of its integrated resort projects, which include hotels, restaurants, and entertainment facilities, particularly in the Philippines. Partnerships with local and international gaming operators further bolster its revenue, allowing for shared resources and expanded market reach. The company also benefits from licensing agreements and potential revenue sharing from its gaming technology innovations, contributing to its overall financial performance.

Universal Entertainment Financial Statement Overview

Summary

Universal Entertainment faces significant financial challenges, with declining revenues and profitability impacting its overall financial health. While the balance sheet shows a relatively stable equity position, the negative cash flow and profitability trends present risks. The company needs to address its revenue decline and improve cash generation to stabilize its financial situation.

Income Statement

Universal Entertainment has shown a significant decline in revenue from 2023 to 2024, with revenue dropping by approximately 29.4%. The Gross Profit Margin decreased from 55.5% in 2023 to 59.5% in 2024, indicating a slight improvement in cost efficiency. However, the Net Profit Margin has turned negative at -12.3% in 2024, from 15.9% in 2023, reflecting a decline in profitability. The EBIT and EBITDA margins have also deteriorated substantially over the year.

Balance Sheet

The company's Debt-to-Equity Ratio has increased slightly, indicating higher leverage, but remains manageable. The Return on Equity (ROE) has turned negative in 2024, from 7.3% in 2023, due to negative net income. The Equity Ratio improved slightly to 58.4% in 2024, suggesting a solid equity base relative to total assets.

Cash Flow

Universal Entertainment's cash flow situation is concerning, with Free Cash Flow turning negative at -7.04 billion in 2024 from a positive 16.28 billion in 2023. The Operating Cash Flow to Net Income ratio indicates challenges in converting profits into cash, as operating cash flow decreased significantly. The Free Cash Flow to Net Income ratio also reflects the company's struggle to maintain positive cash flows.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	125.60B	126.33B	179.00B	141.00B	90.44B	90.87B
Gross Profit	72.61B	75.10B	99.33B	78.34B	46.54B	50.09B
EBITDA	14.14B	30.64B	71.25B	41.23B	14.06B	8.59B
Net Income	-25.97B	-15.57B	28.44B	11.51B	-19.05B	-19.22B
Balance Sheet
Total Assets	594.41B	632.79B	628.01B	596.18B	572.38B	568.50B
Cash, Cash Equivalents and Short-Term Investments	26.16B	24.07B	46.75B	38.07B	31.22B	37.35B
Total Debt	173.68B	187.43B	174.93B	173.53B	171.84B	158.07B
Total Liabilities	242.10B	263.06B	239.62B	246.86B	233.46B	210.93B
Stockholders Equity	352.31B	369.73B	388.39B	349.31B	338.92B	357.58B
Cash Flow
Free Cash Flow	0.00	-7.04B	16.28B	16.43B	-6.92B	-8.78B
Operating Cash Flow	0.00	1.52B	28.02B	24.46B	1.75B	3.11B
Investing Cash Flow	0.00	-13.37B	-10.12B	-9.00B	-7.04B	-18.50B
Financing Cash Flow	0.00	-9.80B	-11.33B	-11.25B	-1.82B	14.44B

Universal Entertainment Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 911.00
• 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:6425, the sentiment is Negative. The current price of 911 is above the 20-day moving average (MA) of 839.10, below the 50-day MA of 921.16, and below the 200-day MA of 1006.32, indicating a bearish trend. The MACD of -49.91 indicates Positive momentum. The RSI at 34.01 is Neutral, neither overbought nor oversold. The STOCH value of 16.01 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:6425.

Universal Entertainment Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
7944	73 Outperform	¥85.64B	14.30	―	4.93%	-1.25%	9.33%
7458	72 Outperform	¥164.67B	9.10	―	3.58%	6.12%	-3.75%
6412	68 Neutral	€198.05B	12.68	5.03%	4.01%	45.31%	-36.42%
7867	63 Neutral	¥291.45B	16.90	―	2.01%	10.50%	27.82%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
4680	61 Neutral	$312.04B	18.83	―	1.65%	11.92%	33.70%
6425	42 Neutral	¥59.43B	―	-1.85%	―	-14.08%	54.85%