Allied Telesis Holdings KK (6835) AI Stock Analysis

• Market Cap: $24.67B
• Dividend Yield: 0.85%
• Average Volume (3M): 435.20K
• Price to Earnings (P/E): 5.5
• Beta (1Y): 0.44
• Revenue Growth: 6.43%
• EPS Growth: 368.06%
• Country: JP
• Employees: 1,879
• Sector: Technology
• Sector Strength: 88
• Industry: Communication Equipment
• EPS (TTM): 10.77
• Shares Outstanding: 107,715,744
• 10 Day Avg. Volume: 524,630
• 30 Day Avg. Volume: 435,196
• PEG Ratio: 0.01
• Price to Book (P/B): 0.58
• Price to Sales (P/S): 0.23
• P/FCF Ratio: 2.23
• Enterprise Value/Market Cap: 0.39
• Enterprise Value/Revenue: 0.19
• Enterprise Value/Gross Profit: 0.34
• Enterprise Value/Ebitda: 2.01
• 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: 80 Outperform
• Price Target: ¥269.00 ▲(14.47% Upside)

Allied Telesis Holdings KK's strong financial performance and attractive valuation are the primary drivers of its high stock score. The company's robust revenue and profit growth, coupled with a low P/E ratio, make it an appealing investment. Technical indicators suggest positive momentum, although caution is advised due to potential overbought conditions.

Positive Factors

Revenue Growth

Consistent revenue growth indicates strong market demand and effective sales strategies, supporting long-term business expansion.

Cash Flow Management

Improved cash flow management enhances financial flexibility, enabling strategic investments and debt reduction, securing future growth.

Leverage Reduction

Reduced leverage lowers financial risk and interest expenses, strengthening the balance sheet and supporting sustainable growth.

Negative Factors

Industry Competition

High competition in the communication equipment industry may pressure margins and require continuous innovation to maintain market position.

Past Cash Flow Volatility

Historical cash flow volatility may indicate potential challenges in maintaining consistent cash generation, impacting long-term stability.

Asset Financing Balance

While balanced, the approach to asset financing may limit aggressive expansion opportunities, potentially affecting growth in dynamic markets.

Allied Telesis Holdings KK Business Overview & Revenue Model

Company Description

Allied Telesis Holdings KK (6835) is a global provider of networking solutions, specializing in the development of innovative hardware and software products for enterprise and service provider networks. The company operates primarily in the telecommunications and network infrastructure sectors, offering a range of products including Ethernet switches, routers, and network management software. Allied Telesis is known for its commitment to quality and reliability, catering to various industries such as education, healthcare, and government.

How the Company Makes Money

Allied Telesis generates revenue primarily through the sale of networking equipment and software solutions. The company's key revenue streams include direct sales to end customers, distribution through global partners, and ongoing service and support contracts. Additionally, Allied Telesis benefits from strategic partnerships with technology providers and system integrators, which help expand its market reach and enhance product offerings. The company also invests in research and development to innovate and meet the evolving needs of its clients, thereby maintaining a competitive edge in the market.

Allied Telesis Holdings KK Financial Statement Overview

Summary

Allied Telesis Holdings KK demonstrates a solid financial performance with strong revenue and profit growth, improved leverage ratios, and robust cash flow generation. The income statement shows impressive growth and profitability trends, while the balance sheet reflects a stable financial position with reduced leverage. Cash flow stability and growth are commendable, indicating effective cash management.

Income Statement

Allied Telesis Holdings KK has shown impressive revenue growth over the years, with a notable increase from ¥29.38 billion in 2020 to ¥48.46 billion in 2024. The gross profit margin remains strong, consistently above 50%, indicating effective cost management. The net profit margin has improved significantly, rising from 0.63% in 2020 to 7.43% in 2024, reflecting enhanced profitability. EBIT and EBITDA margins have also increased, showing operational efficiency gains. Overall, the income statement displays strong growth and profitability trends.

Balance Sheet

The company's balance sheet reflects a robust equity base, with stockholders' equity growing consistently to reach ¥19.45 billion in 2024. The debt-to-equity ratio has improved, down from 2.05 in 2020 to 0.39 in 2024, indicating reduced leverage. Return on equity has shown positive trends, supported by increasing net income. However, the total assets to equity ratio indicates a balanced approach to asset financing. Overall, the balance sheet is stable with a positive trajectory towards lower leverage.

Cash Flow

Allied Telesis' cash flows reflect a significant turnaround in free cash flow, which has grown from negative figures in earlier years to ¥5.09 billion in 2024. The operating cash flow to net income ratio is strong, suggesting effective conversion of income to cash. The company has shown resilience in cash flow management, despite past volatility. The free cash flow to net income ratio is also favorable, indicating healthy cash generation relative to earnings. Overall, cash flow stability and growth are commendable.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	49.72B	48.46B	44.39B	41.50B	33.27B	29.38B
Gross Profit	28.35B	27.90B	25.04B	24.21B	20.63B	17.92B
EBITDA	4.77B	6.74B	3.19B	12.86B	2.02B	1.40B
Net Income	3.74B	3.60B	1.09B	8.61B	1.37B	185.90M
Balance Sheet
Total Assets	44.01B	46.49B	45.50B	41.64B	28.88B	25.77B
Cash, Cash Equivalents and Short-Term Investments	15.62B	14.26B	10.70B	9.05B	4.72B	4.06B
Total Debt	3.61B	7.67B	9.69B	6.56B	8.81B	10.09B
Total Liabilities	25.56B	27.03B	28.03B	25.87B	22.68B	21.43B
Stockholders Equity	18.45B	19.45B	17.47B	15.77B	6.20B	4.34B
Cash Flow
Free Cash Flow	0.00	5.09B	-954.62M	7.12B	2.19B	377.59M
Operating Cash Flow	0.00	5.74B	-74.37M	8.41B	2.54B	913.11M
Investing Cash Flow	0.00	2.88B	-967.43M	-1.45B	-423.31M	-542.79M
Financing Cash Flow	0.00	-5.44B	2.58B	-4.25B	-1.62B	782.77M

Allied Telesis Holdings KK Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 235.00
• 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:6835, the sentiment is Positive. The current price of 235 is above the 20-day moving average (MA) of 221.95, above the 50-day MA of 215.84, and above the 200-day MA of 185.64, indicating a bullish trend. The MACD of 5.86 indicates Negative momentum. The RSI at 59.32 is Neutral, neither overbought nor oversold. The STOCH value of 55.92 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:6835.

Allied Telesis Holdings KK Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
6718	81 Outperform	¥45.37B	16.95	―	4.59%	0.63%	-24.87%
6835	80 Outperform	$24.67B	5.50	24.14%	0.85%	6.43%	368.06%
6820	74 Outperform	¥40.09B	17.18	―	2.98%	-0.90%	-13.24%
6287	73 Outperform	¥74.56B	10.30	9.15%	3.34%	4.82%	55.73%
6675	67 Neutral	¥29.32B	9.10	―	2.55%	20.13%	33.43%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%