INEST,Inc. (7111) AI Stock Analysis

• Market Cap: ¥3.64B
• Dividend Yield: N/A
• Average Volume (3M): 63.15K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.02
• Revenue Growth: 25.57%
• EPS Growth: -129.92%
• Country: JP
• Employees: 588
• Sector: Industrials
• Sector Strength: 72
• Industry: Specialty Business Services
• EPS (TTM): -33.55
• Shares Outstanding: 7,306,432
• 10 Day Avg. Volume: 67,070
• 30 Day Avg. Volume: 63,152
• PEG Ratio: -1.02
• Price to Book (P/B): 1.09
• Price to Sales (P/S): 0.28
• P/FCF Ratio: 6.60
• 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: 43 Neutral
• Price Target: ¥481.00 ▼(-6.42% Downside)
• Action: Reiterated Date: 02/18/26
• Date: Action: Reiterated 02/18/26

The score is driven primarily by weak near-term financial performance, especially the shift to TTM losses and negative operating/free cash flow. Technicals add downside risk with the stock in a broad downtrend and bearish momentum. Valuation is also pressured by a negative P/E and no dividend yield data.

Positive Factors

High gross margins

Sustained gross margins near 85% indicate durable unit economics and strong pricing or product differentiation. This margin cushion supports long-term profitability if operating costs are controlled, enabling investment in growth or margin recovery after short-term shocks.

Historic cash-generation capability

Prior annual results show the business can produce substantial operating and free cash flow, demonstrating the operating model's capacity to fund capex, deleveraging, or strategic initiatives. That historical cash-generation track record supports medium-term financial flexibility despite recent volatility.

Rapid revenue scale-up

Triple-digit revenue expansion over several years signals successful market penetration and scalable offerings. A larger revenue base improves potential operating leverage, bargaining power with suppliers/customers, and competitive position, helping sustain growth if execution normalizes.

Negative Factors

Negative operating and free cash flow (TTM)

Current TTM negative operating and free cash flow reduce the company's internal funding capacity and raise reliance on external financing. Persistent negative cash generation impedes reinvestment, increases liquidity risk, and can force cost cuts or asset sales, constraining medium-term strategic options.

Earnings volatility and recent net loss

Volatile earnings and a recent sizeable TTM net loss undermine predictability of returns and erode retained equity. Inconsistent profitability complicates planning, weakens stakeholder confidence, and increases the risk that structural cost issues or execution gaps hamper sustainable margin recovery.

Balance-sheet pressure & declining equity

While leverage improved versus prior periods, declining equity and only mid-tier balance-sheet quality reduce financial resilience. Combined with earnings and cash-flow weakness, the balance-sheet trend elevates refinancing and solvency risk and limits the company's ability to absorb further operational shocks.

INEST,Inc. Business Overview & Revenue Model

Company Description

INEST, Inc. engages in the marketing and solutions support business for corporate enterprises and individual consumers. It engages in the development of marketing solutions that provide product planning and development, sales, support, and business processing support; and subscription-based products, as well as digital marketing services. The company was formerly known as Universal Solution Systems Inc. and changed name to INEST, Inc. in July 2016. INEST, Inc. was founded in 1996 and is headquartered in Toshima, Japan.

How the Company Makes Money

INEST, Inc. generates revenue primarily through subscription-based models for its software solutions, which provide clients with continuous access to its platforms, regular updates, and customer support. Key revenue streams include licensing fees from businesses that utilize its software for operational management and analytics, as well as consultancy services offered to assist clients in implementing and optimizing these technologies. Additionally, INEST, Inc. often partners with other technology firms and industry leaders to enhance its product offerings, expand its market reach, and drive collaborative innovations, which contribute significantly to its overall earnings.

INEST,Inc. Financial Statement Overview

Summary

Despite strong long-term revenue growth and very high gross margins (~85%+), results are unstable: TTM revenue is down ~2.4%, TTM net income is a loss (-243M), and cash flow deteriorated sharply with negative TTM operating cash flow (-148M) and free cash flow (-253M). The balance sheet is only mid-tier with moderate leverage (debt-to-equity ~0.76) but declining equity adds pressure.

Income Statement

Revenue scale improved substantially over the past several years (annual revenue rising from 6.6B in 2022 to 19.0B in 2025), but the near-term trajectory is weakening with TTM (Trailing-Twelve-Months) revenue down ~2.4%. Profitability is mixed: gross margin remains exceptionally high (~85%+), yet operating and bottom-line results are thin and volatile, swinging from profits (e.g., 2023 net income 450M) to losses (TTM net loss 243M). Overall, strong gross economics are being diluted by operating costs and inconsistent execution.

Balance Sheet

Leverage is moderate for the profile: TTM debt is 5.42B against equity of 4.56B (debt-to-equity ~0.76), an improvement versus the prior annual period (~1.10). However, equity has declined from 2025 annual to TTM, and returns to shareholders are currently negative in TTM, reflecting pressure on profitability. Asset base is meaningful (TTM assets 10.6B), but the combination of declining equity and earnings volatility keeps balance-sheet quality only mid-tier.

Cash Flow

Cash generation weakened materially: TTM (Trailing-Twelve-Months) operating cash flow is negative (-148M) and free cash flow is also negative (-253M), reversing the strong positive cash flow seen in the latest annual report (operating cash flow 924M; free cash flow 814M). Cash flow has been highly volatile historically (e.g., negative operating cash flow in 2022, very low cash generation in 2024), which raises execution and working-capital risk. While prior periods show the business can generate cash, the current TTM profile is a clear red flag.

Breakdown	TTM	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	18.87B	18.96B	10.52B	7.94B	6.63B	4.89B
Gross Profit	16.14B	16.17B	9.33B	7.50B	6.16B	4.29B
EBITDA	411.00M	693.00M	527.00M	402.00M	265.00M	183.00M
Net Income	-243.00M	42.00M	-149.00M	450.00M	-58.00M	202.00M
Balance Sheet
Total Assets	10.58B	13.67B	13.23B	8.07B	6.82B	6.65B
Cash, Cash Equivalents and Short-Term Investments	2.22B	1.67B	1.71B	2.79B	1.37B	1.67B
Total Debt	5.42B	5.44B	5.14B	2.52B	2.59B	2.30B
Total Liabilities	6.02B	8.72B	8.31B	4.50B	4.38B	4.47B
Stockholders Equity	4.56B	4.93B	4.88B	3.58B	2.44B	2.17B
Cash Flow
Free Cash Flow	-253.00M	814.00M	-15.00M	181.00M	-720.00M	288.00M
Operating Cash Flow	-148.00M	924.00M	21.00M	231.00M	-523.00M	302.00M
Investing Cash Flow	1.08B	-212.00M	-2.35B	-61.00M	-316.00M	828.00M
Financing Cash Flow	-280.00M	-624.00M	2.28B	85.00M	544.00M	-28.00M

INEST,Inc. Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 514.00
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:7111, the sentiment is Negative. The current price of 514 is below the 20-day moving average (MA) of 527.60, below the 50-day MA of 527.22, and below the 200-day MA of 688.69, indicating a bearish trend. The MACD of -13.64 indicates Positive momentum. The RSI at 41.55 is Neutral, neither overbought nor oversold. The STOCH value of 38.25 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:7111.

INEST,Inc. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
2480	80 Outperform	¥6.10B	15.93	―	2.26%	-2.61%	-4.16%
2304	76 Outperform	¥4.92B	7.92	―	4.62%	10.60%	36.51%
7812	76 Outperform	¥6.03B	7.00	―	3.77%	-2.05%	27.50%
7883	71 Outperform	¥5.78B	34.76	―	2.50%	-0.82%	29.25%
6092	66 Neutral	¥5.80B	-32.35	―	1.54%	3.37%	-27.47%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
7111	43 Neutral	¥3.64B	-14.96	―	―	25.57%	-129.92%

INEST,Inc. Corporate Events

INEST Posts Nine‑Month Loss but Maintains Profit Forecast for Full Year

INEST, Inc. reported consolidated revenue of ¥12,970 million for the nine months to December 31, 2025, a slight 0.7% year‑on‑year decline, and swung to an operating loss of ¥236 million, with a net loss attributable to owners of the parent of ¥373 million. Despite the loss and a decision to pay no interim or year‑end dividends for the fiscal year ending March 31, 2026, the company’s equity ratio improved to 43.1% as total assets fell, and management maintained its full‑year forecast, projecting ¥17,000 million in revenue, a return to operating profit of ¥250 million, and a modest net profit, signaling confidence in a recovery in profitability.

The most recent analyst rating on (JP:7111) stock is a Sell with a Yen555.00 price target. To see the full list of analyst forecasts on INEST,Inc. stock, see the JP:7111 Stock Forecast page.

INEST Posts Nine-Month Loss but Targets Full-Year Profit Amid Reverse Split and Stronger Equity Base

INEST, Inc. reported consolidated revenue of ¥12,970 million for the nine months to December 31, 2025, down 0.7% year on year, and swung to an operating loss of ¥236 million with a net loss attributable to owners of the parent of ¥373 million. Despite the losses and a planned full-year revenue decline of 10.3%, the company projects a return to profitability for the full fiscal year ending March 31, 2026, forecasting operating profit of ¥250 million and net profit of ¥45 million, while maintaining its policy of paying no dividends for the period.

Total assets fell to ¥10,583 million from ¥13,671 million at the previous fiscal year-end, yet the equity ratio improved to 43.1%, indicating a stronger capital structure even as the balance sheet contracted. The company also executed a one-for-fifteen reverse stock split in October 2025, which, together with its conservative dividend stance and modest profit outlook, suggests a focus on capital efficiency and balance-sheet discipline as it seeks to stabilize earnings after consecutive loss-making periods.

The most recent analyst rating on (JP:7111) stock is a Sell with a Yen555.00 price target. To see the full list of analyst forecasts on INEST,Inc. stock, see the JP:7111 Stock Forecast page.

INEST, Inc. Reports First Half Financial Results and Reverse Stock Split

INEST, Inc. reported its consolidated financial results for the first half of the fiscal year ending March 31, 2026, showing a revenue increase of 4.3% year-on-year to 9,089 million yen. Despite the revenue growth, the company experienced a loss attributable to owners of the parent amounting to 128 million yen. The company also conducted a reverse stock split at a ratio of 15 shares to 1 share on October 1, 2025. The financial forecast for the full fiscal year anticipates a revenue decline of 10.3% to 17,000 million yen, with an operating profit increase of 19.7% to 250 million yen.

The most recent analyst rating on (JP:7111) stock is a Hold with a Yen722.00 price target. To see the full list of analyst forecasts on INEST,Inc. stock, see the JP:7111 Stock Forecast page.