Alue Co., Ltd. (7043) AI Stock Analysis

• Market Cap: ¥2.03B
• Dividend Yield: 0.66%
• Average Volume (3M): 4.16K
• Price to Earnings (P/E): 6.6
• Beta (1Y): 0.02
• Revenue Growth: 14.27%
• EPS Growth: N/A
• Country: JP
• Employees: 195
• Sector: Industrials
• Sector Strength: 72
• Industry: Staffing & Employment Services
• EPS (TTM): 39.71
• Shares Outstanding: 2,554,400
• 10 Day Avg. Volume: 8,190
• 30 Day Avg. Volume: 4,156
• PEG Ratio: -0.03
• Price to Book (P/B): 1.87
• Price to Sales (P/S): 0.73
• P/FCF Ratio: 4.92
• 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: 64 Neutral
• Price Target: ¥861.00 ▼(-17.37% Downside)
• Action: Reiterated Date: 02/18/26
• Date: Action: Reiterated 02/18/26

The score is driven primarily by improved financial performance (restored profitability and strong recent free cash flow) and a supportive low P/E valuation. These positives are tempered by weak technical momentum (below key moving averages with negative MACD) and the company’s history of cyclical earnings and cash flow volatility.

Positive Factors

High gross margin & profit recovery

A ~63% gross margin and return to operating profit indicate durable pricing power in training/consulting services. High gross margins provide operating leverage as revenue grows, supporting sustained operating profitability, reinvestment in programs, and resilience to cost fluctuations over months.

Improved cash generation

Recent solid operating and free cash flow conversion shows the company can turn reported earnings into cash. This strengthens liquidity and funds debt service, investments, or working-capital needs without relying on external financing, improving durable financial flexibility over the medium term.

Manageable leverage and stronger equity base

Leverage near one-third of equity and an improving equity base reduce solvency risk and give capacity for counter-cyclical spending or strategic investment. Lower relative debt versus the 2020 peak enhances balance-sheet resilience and supports medium-term stability if profitability persists.

Negative Factors

Cyclical earnings and cash flow volatility

Recurring swings to losses and negative cash flow undermine predictability of earnings and capital allocation. For a services firm dependent on corporate training budgets, cyclical demand produces lumpy revenue and cash, increasing the need for liquidity buffers and raising execution risk through downturns.

Moderate net margin

Despite high gross margins, a ~6.7% net margin suggests meaningful SG&A or overhead absorption. Moderate net profitability limits retained earnings and free cash growth, reducing the firm's ability to self-fund expansion or absorb revenue shocks without cutting costs or raising external funds.

Demand and working-capital sensitivity

A service-based model tied to client engagements exposes revenue and collections to corporate spending cycles. Working-capital swings and booking variability can strain liquidity in slower periods, forcing reliance on credit or delaying investments unless the firm secures longer-term contracts or diversifies demand sources.

Alue Co., Ltd. Business Overview & Revenue Model

Company Description

Alue Co.,Ltd. provides educational services for working adults using human resource development data and machine learning technology primarily in Japan. Its services include level-specific training, global human resource development, thematic training, and e-training services. The company was incorporated in 2003 and is based in Tokyo, Japan.

How the Company Makes Money

Alue makes money primarily by charging client organizations for human-resources development services. Its revenue model is service-based and typically includes (1) fees for designing and delivering corporate training programs (e.g., leadership/management training and other professional skill development delivered in group sessions or other formats) and (2) fees for related organizational development or training/HRD consulting services, where the company supports clients with program design, implementation, and improvement of training frameworks. The company’s earnings are therefore driven by the volume of training/consulting engagements, contract size and duration, and the mix between standardized training offerings versus customized, higher-value projects. Specific information on major partnerships or customer concentration is null.

Alue Co., Ltd. Financial Statement Overview

Summary

Income statement and cash flow show a meaningful rebound: return to operating profit and positive net income with strong gross margin (~63%), plus solid free cash flow conversion in the latest period. Offsetting this, results have been cyclical historically (loss/negative cash flow in 2020 and 2024), and net margin remains moderate (~6.7%). Balance sheet leverage is manageable (debt ~1/3 of equity) but debt rose versus 2023.

Income Statement

Profitability has improved materially after last year’s loss: the latest annual period shows a return to solid operating profit and positive net income, supported by a strong gross margin (~63%). Revenue growth re-accelerated (~8.6% vs. ~2.0% prior year), and operating margins rebounded meaningfully versus 2024. Offsetting this, earnings quality looks somewhat cyclical across the history (losses in 2020 and 2024), and net margin remains moderate (~6.7%) versus the company’s stronger years (2021–2022).

Balance Sheet

Leverage appears manageable with debt at roughly one-third of equity in the latest period, and equity has grown versus prior years—signs of improving balance sheet resilience. The company has also reduced leverage meaningfully from the 2020 peak (when debt exceeded equity). The main watch-out is that debt levels have not consistently trended down year-over-year (debt ticked up versus 2023), so maintaining profitability is important to keep leverage contained.

Cash Flow

Cash generation strengthened sharply in the latest period, with operating cash flow and free cash flow both solidly positive and free cash flow roughly matching net income—an encouraging sign of earnings translating into cash. However, cash flow has been volatile historically (negative operating and free cash flow in 2024 and 2020), which adds execution risk and suggests working-capital and/or demand sensitivity that could pressure liquidity in weaker years.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	3.35B	3.64B	3.09B	3.03B	2.77B	2.40B
Gross Profit	2.03B	2.28B	1.83B	1.86B	1.77B	1.50B
EBITDA	205.95M	426.79M	-10.78M	126.92M	276.11M	316.57M
Net Income	59.29M	242.21M	-73.71M	56.85M	166.87M	183.29M
Balance Sheet
Total Assets	2.27B	2.40B	1.90B	1.72B	1.86B	2.02B
Cash, Cash Equivalents and Short-Term Investments	1.29B	1.30B	822.65M	986.86M	1.10B	1.33B
Total Debt	682.21M	467.03M	448.84M	214.15M	397.61M	667.09M
Total Liabilities	1.01B	987.02M	717.47M	466.47M	652.61M	982.43M
Stockholders Equity	1.25B	1.42B	1.18B	1.26B	1.20B	1.04B
Cash Flow
Free Cash Flow	0.00	539.38M	-46.01M	132.76M	89.42M	351.32M
Operating Cash Flow	0.00	539.65M	-37.30M	133.10M	90.02M	365.85M
Investing Cash Flow	0.00	-69.93M	-218.84M	-52.35M	-48.21M	-60.54M
Financing Cash Flow	0.00	1.54M	76.01M	-201.21M	-286.18M	-285.63M

Alue Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 1042.00
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Positive
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:7043, the sentiment is Negative. The current price of 1042 is above the 20-day moving average (MA) of 873.65, above the 50-day MA of 911.40, and above the 200-day MA of 906.49, indicating a bearish trend. The MACD of -31.41 indicates Positive momentum. The RSI at 24.88 is Positive, neither overbought nor oversold. The STOCH value of 34.27 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:7043.

Alue Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
7089	75 Outperform	¥8.13B	9.23	―	―	21.37%	93.71%
4377	67 Neutral	¥33.65B	30.08	―	0.39%	41.23%	50.13%
7043	64 Neutral	¥2.03B	6.56	―	0.66%	14.27%	―
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
3900	51 Neutral	¥10.68B	426.22	―	2.24%	32.39%	-127.51%
9331	44 Neutral	¥1.35B	30.71	―	―	3.33%	-80.47%