EBRAINS,INC. (6599) AI Stock Analysis

• Market Cap: ¥4.75B
• Dividend Yield: 1.57%
• Average Volume (3M): 14.69K
• Price to Earnings (P/E): 14.1
• Beta (1Y): 0.39
• Revenue Growth: 4.40%
• EPS Growth: 35.86%
• Country: JP
• Employees: 116
• Sector: Technology
• Sector Strength: 88
• Industry: Computer Hardware
• EPS (TTM): 55.02
• Shares Outstanding: 1,536,000
• 10 Day Avg. Volume: 3,910
• 30 Day Avg. Volume: 14,686
• PEG Ratio: -1.99
• Price to Book (P/B): 0.73
• Price to Sales (P/S): 0.87
• P/FCF Ratio: 9.20
• 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: 72 Outperform
• Price Target: ¥3,502.00 ▲(37.01% Upside)
• Action: Reiterated Date: 02/14/26
• Date: Action: Reiterated 02/14/26

The score is driven primarily by strong financial performance—especially the very low-debt balance sheet and solid cash generation—partly offset by weakening profitability versus the 2023 peak and uneven revenue growth. Technical indicators are mixed-to-weak with the stock below key short- and mid-term moving averages, while valuation is reasonable with a moderate P/E and modest dividend yield.

Positive Factors

Low debt / strong balance sheet

Near-zero debt and rising equity materially lower financial risk and give durable balance-sheet flexibility. This supports capital allocation for R&D, dividends or opportunistic M&A, and improves resilience through downturns while returns on equity remain positive despite recent moderation.

Consistent free cash flow generation

Free cash flow near parity with net income across periods indicates strong cash conversion and high earnings quality. Reliable cash generation supports internal funding of operations and investment, sustains dividend capacity, and reduces dependence on external financing.

Top-line rebound in 2025

A revenue rebound in 2025 after a 2024 dip indicates the business retains the ability to recover demand and restore growth. If sustained, this supports better capacity utilization and potential margin recovery, reinforcing medium-term revenue momentum and strategic planning.

Negative Factors

Uneven revenue growth

Uneven top-line performance reduces forecasting visibility and weakens operating leverage. Persistent variability in revenue complicates long-term resource allocation, increases the risk of under- or over-investment, and can magnify profit volatility across economic cycles.

Margin erosion since 2023 peak

A multi-year decline in margins signals structural pressure—whether from cost inflation, pricing erosion, or mix shifts. Sustained margin contraction reduces free cash flow, limits reinvestment and shareholder returns, and can impair competitiveness unless addressed strategically.

Volatile cash coverage / working-capital swings

Intermittent volatility in cash coverage—driven by working-capital timing—makes free cash less predictable despite overall strength. That unpredictability can constrain liquidity management, slow strategic action during downturns, and complicate reliable dividend or buyback policies.

EBRAINS,INC. Business Overview & Revenue Model

Company Description

Ebrains, Inc. designs, develops, produces, and sells industrial electronics and industrial computers designed for information, communications, control, video, and measurement fields. It offers CompactPCI products; advancedTCA backplane products; backplanes, DIN racks, universal boards, card extenders, unit power supplies, cabinets, and related devices; industrial system chassis with CPU boards and various I/O boards; custom backplanes/custom racks and chassis designed on commission; and custom backplanes/custom racks/custom chassis on commission. The company was incorporated in 1973 and is headquartered in Hachioji, Japan.

How the Company Makes Money

EBRAINS, INC. generates revenue through a diversified business model that includes licensing fees for its proprietary software solutions, subscription services for continuous access to its AI platforms, and consulting fees for personalized implementation and integration services. The company also engages in strategic partnerships with industry leaders to co-develop and market new technology solutions, thereby expanding its market reach and enhancing its revenue streams. Additionally, EBRAINS may receive funding through research grants and collaboration agreements aimed at innovative technology advancements.

EBRAINS,INC. Financial Statement Overview

Summary

Financials are solid overall, led by an exceptionally strong balance sheet (near-zero debt, rising equity). Cash flow is consistently positive with generally good free-cash-flow quality, while the main risk is uneven revenue growth and margin/earnings softening versus the 2023 peak.

Income Statement

Revenue growth has been uneven (strong rebound in 2025 after a slight 2024 decline), while profitability has softened from the 2023 peak. Gross, operating, and net margins remain healthy for the period but have trended down over the last two years, with net income also stepping down from 2023 levels—suggesting some margin pressure despite stable scale.

Balance Sheet

The balance sheet is a clear strength: debt is essentially zero in recent years and leverage is minimal even historically, reducing financial risk. Equity has steadily increased and returns on equity remain positive (though down from the 2023 high), indicating solid capital strength with slightly moderating profitability on that capital.

Cash Flow

Free cash flow has been consistently strong relative to net income (roughly near 1x across years), supporting earnings quality. However, cash generation versus accounting profit has been volatile at times (notably weaker coverage in 2021–2023 before improving in 2024–2025), which points to working-capital or timing swings that can introduce variability.

Breakdown	TTM	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	3.92B	4.03B	3.99B	4.26B	3.92B	3.20B
Gross Profit	851.20M	864.49M	911.14M	1.05B	927.64M	680.52M
EBITDA	497.59M	492.15M	511.44M	671.70M	550.21M	320.03M
Net Income	318.66M	313.41M	332.06M	426.20M	345.38M	200.17M
Balance Sheet
Total Assets	5.97B	5.90B	5.67B	5.60B	5.18B	4.58B
Cash, Cash Equivalents and Short-Term Investments	2.80B	2.73B	2.39B	1.92B	1.75B	1.53B
Total Debt	0.00	0.00	0.00	0.00	28.02M	66.02M
Total Liabilities	1.18B	1.12B	1.17B	1.41B	1.39B	1.13B
Stockholders Equity	4.79B	4.79B	4.50B	4.20B	3.79B	3.45B
Cash Flow
Free Cash Flow	0.00	379.61M	496.77M	226.05M	261.89M	126.22M
Operating Cash Flow	0.00	382.20M	505.42M	247.38M	267.96M	152.63M
Investing Cash Flow	0.00	-3.48M	-34.46M	-34.74M	2.90M	-18.09M
Financing Cash Flow	0.00	-57.34M	-40.81M	-61.22M	-65.16M	113.36M

EBRAINS,INC. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 2556.00
• 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:6599, the sentiment is Positive. The current price of 2556 is below the 20-day moving average (MA) of 2912.90, below the 50-day MA of 2856.96, and above the 200-day MA of 2479.64, indicating a bullish trend. The MACD of 67.24 indicates Negative momentum. The RSI at 65.49 is Neutral, neither overbought nor oversold. The STOCH value of 77.58 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:6599.

EBRAINS,INC. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
6734	73 Outperform	¥5.05B	13.85	―	1.89%	33.70%	36.99%
6599	72 Outperform	¥4.75B	14.14	―	1.57%	4.40%	35.86%
6840	66 Neutral	¥5.11B	12.80	―	―	20.86%	―
6803	63 Neutral	¥3.86B	7.60	―	1.08%	7.21%	―
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
6731	47 Neutral	¥4.40B	-3.98	―	―	-13.93%	―
7709	46 Neutral	¥2.42B	-8.34	―	―	-23.14%	-829.31%