Frontier Management, Inc. (7038) AI Stock Analysis

• Market Cap: ¥8.04B
• Dividend Yield: N/A
• Average Volume (3M): 31.06K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.99
• Revenue Growth: 18.82%
• EPS Growth: -894.46%
• Country: JP
• Employees: 433
• Sector: Industrials
• Sector Strength: 72
• Industry: Specialty Business Services
• EPS (TTM): -12.66
• Shares Outstanding: 11,816,861
• 10 Day Avg. Volume: 22,340
• 30 Day Avg. Volume: 31,060
• PEG Ratio: 0.06
• Price to Book (P/B): 3.11
• Price to Sales (P/S): 0.91
• P/FCF Ratio: -3.30
• 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: Hold
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 42 Neutral
• Price Target: ¥612.00 ▼(-8.38% Downside)

The overall stock score of 42 reflects significant financial and technical challenges. The company's recent financial performance shows declining revenue and cash flow, while technical indicators suggest bearish momentum. The negative P/E ratio and lack of dividend yield further weigh on the stock's valuation. Immediate strategic improvements are necessary to address these issues.

Positive Factors

Strong Cash Position

A strong cash position provides liquidity and operational flexibility, enabling the company to navigate financial challenges and invest in growth opportunities.

Diverse Revenue Streams

Diverse revenue streams reduce dependency on a single income source, enhancing financial stability and resilience against market fluctuations.

Strategic Partnerships

Strategic partnerships expand client base and service offerings, potentially driving long-term revenue growth and competitive positioning.

Negative Factors

Rising Leverage

Increased leverage can strain financial resources and limit flexibility, posing risks if not managed effectively in the long term.

Declining Revenue

Declining revenue indicates potential market challenges or operational inefficiencies, necessitating strategic adjustments to regain growth momentum.

Cash Flow Concerns

Declining cash flows highlight operational challenges and potential liquidity issues, affecting the company's ability to fund operations and growth initiatives.

Frontier Management, Inc. Business Overview & Revenue Model

Company Description

Frontier Management Inc. provides management consulting, merger and acquisition (M&A) advisory, management executive, and business regeneration support services in Japan and internationally. The company also provides a range of business solutions in the areas of business succession, post M&A, cross-border M&A support, and risk and crisis advisory services. It serves retail and wholesale, restaurants and services, consumer product producers, industrial goods manufacturers, infrastructure, finance, information technology, and other markets. Frontier Management Inc. was incorporated in 2007 and is headquartered in Tokyo, Japan.

How the Company Makes Money

Frontier Management generates revenue primarily through management fees charged to the senior living communities it operates. These fees are typically calculated as a percentage of the total revenue generated by each community. Additionally, the company may earn revenue from ancillary services provided within these communities, such as wellness programs, dining services, and housekeeping. Strategic partnerships with healthcare providers and third-party service vendors also contribute to earnings by enhancing service offerings and driving occupancy rates. The company's focus on operational efficiency and resident satisfaction helps maintain high occupancy levels, further boosting its revenue streams.

Frontier Management, Inc. Financial Statement Overview

Summary

The company faces financial challenges with recent declines in revenue, profitability, and cash flow, contrasting with its previous growth trajectory. The robust cash position offers some stability, but rising leverage and declining equity ratio are concerning. Strategic focus on improving operational efficiency and revenue growth is essential to reverse the current negative trends.

Income Statement

The company experienced a significant revenue decline from 2023 to 2024, falling from ¥10.03 billion to ¥9.27 billion. The gross profit margin has declined alongside the revenue, indicating cost management challenges. Additionally, the net loss in 2024 is a concern, as it reflects negative profitability trends. Historical growth from 2019 to 2022 was robust, but recent performance shows volatility, emphasizing the need for strategic adjustments.

Balance Sheet

The balance sheet highlights a strong cash position with significant cash reserves outstripping total debt, resulting in a negative net debt. This provides liquidity and operational flexibility. However, the debt-to-equity ratio has increased from 2023 to 2024, indicating higher leverage. The equity ratio dropped, pointing towards rising liabilities relative to assets, which could pose future financial risks if not managed properly.

Cash Flow

The cash flow situation is concerning, with a significant decline in both operating and free cash flows in 2024. This decline follows a previously positive trend, indicating operational challenges. The operating cash flow to net income ratio is negative, reflecting cash flow inefficiency. Historically, the company maintained positive cash flows, but recent cash flow strains highlight potential liquidity issues.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	10.48B	9.27B	10.03B	7.92B	5.74B	5.19B
Gross Profit	4.35B	4.26B	5.53B	4.69B	3.49B	3.11B
EBITDA	-883.73M	-588.72M	1.35B	959.94M	552.31M	614.99M
Net Income	-1.11B	-694.00M	780.68M	556.72M	338.71M	420.51M
Balance Sheet
Total Assets	18.33B	14.17B	10.87B	5.66B	3.82B	3.79B
Cash, Cash Equivalents and Short-Term Investments	8.76B	9.79B	6.36B	3.22B	1.79B	1.90B
Total Debt	5.67B	1.40B	1.59B	777.70M	0.00	0.00
Total Liabilities	7.76B	3.42B	4.05B	2.64B	1.37B	1.34B
Stockholders Equity	2.35B	2.70B	3.76B	2.96B	2.45B	2.45B
Cash Flow
Free Cash Flow	0.00	-2.55B	181.19M	1.16B	286.14M	453.63M
Operating Cash Flow	0.00	-2.52B	225.00M	1.25B	316.81M	456.10M
Investing Cash Flow	0.00	-63.85M	-1.38B	-486.91M	-31.52M	-59.30M
Financing Cash Flow	0.00	4.30B	3.79B	646.53M	-404.76M	-230.68M

Frontier Management, Inc. Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 668.00
• 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:7038, the sentiment is Negative. The current price of 668 is below the 20-day moving average (MA) of 672.85, below the 50-day MA of 691.88, and below the 200-day MA of 695.77, indicating a neutral trend. The MACD of -4.91 indicates Negative momentum. The RSI at 48.18 is Neutral, neither overbought nor oversold. The STOCH value of 78.59 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:7038.

Frontier Management, Inc. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
6580	75 Outperform	¥14.98B	25.02	―	0.67%	32.31%	105.04%
7318	69 Neutral	¥27.21B	11.58	―	―	72.32%	1424.97%
7371	66 Neutral	¥7.90B	22.73	―	1.91%	-0.42%	39.35%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
7038	42 Neutral	¥8.04B	-7.24	―	―	18.82%	-894.46%

Frontier Management, Inc. Corporate Events

Frontier Management Inc. Reports Increased Sales but Faces Profitability Challenges

Frontier Management Inc. reported a significant increase in net sales by 30.1% for the nine months ending September 30, 2025, compared to the previous year. However, the company experienced a net loss, with operating and ordinary profits both in the negative, reflecting challenges in profitability despite increased sales. The company also announced the addition of four new companies to its consolidation scope, which may impact future financial outcomes.

The most recent analyst rating on (JP:7038) stock is a Hold with a Yen696.00 price target. To see the full list of analyst forecasts on Frontier Management, Inc. stock, see the JP:7038 Stock Forecast page.

Frontier Management Revises Earnings Forecast Amid Restructuring Challenges

Frontier Management Inc. has revised its consolidated earnings forecast for the fiscal year ending December 2025, anticipating a decrease in revenue and profits compared to initial expectations. The company attributes this revision to challenges in its Consulting Advisory and M&A Advisory businesses, as well as extraordinary losses from restructuring expenses. Despite these setbacks, Frontier Management plans to implement strategic measures, including project development, solution investment, and recruitment, to drive future growth.

The most recent analyst rating on (JP:7038) stock is a Hold with a Yen696.00 price target. To see the full list of analyst forecasts on Frontier Management, Inc. stock, see the JP:7038 Stock Forecast page.

Frontier Management Inc. Reports FY2025 Q3 Results and Strategic Acquisition

Frontier Management Inc. has announced its FY2025 Q3 financial results, highlighting the acquisition of HobbyLink Japan Ltd. by its subsidiary, Frontier Capital Inc. This acquisition is part of FMI’s strategy to enhance corporate value through investments, expanding its portfolio in the hobby and toy market. The move is expected to strengthen FMI’s market positioning and offer new growth opportunities in the investment business segment.

The most recent analyst rating on (JP:7038) stock is a Hold with a Yen696.00 price target. To see the full list of analyst forecasts on Frontier Management, Inc. stock, see the JP:7038 Stock Forecast page.

Frontier Management Inc. Announces Subsidiary Restructuring

Frontier Management Inc. announced a significant organizational restructuring involving its subsidiaries, including a merger and absorption-type split. This reorganization, effective November 30, 2025, aims to streamline operations and enhance management efficiency within its subsidiaries, particularly focusing on HobbyLink Japan and Eagle Invesco. The restructuring is expected to optimize the company’s operational capabilities and strengthen its market position.

The most recent analyst rating on (JP:7038) stock is a Hold with a Yen696.00 price target. To see the full list of analyst forecasts on Frontier Management, Inc. stock, see the JP:7038 Stock Forecast page.