KAPPA.CREATE CO.LTD. (7421) AI Stock Analysis

• Market Cap: ¥77.51B
• Dividend Yield: 0.32%
• Average Volume (3M): 106.15K
• Price to Earnings (P/E): 59.7
• Beta (1Y): 0.36
• Revenue Growth: 0.51%
• EPS Growth: 4.92%
• Country: JP
• Employees: 784
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Restaurants
• EPS (TTM): 8.26
• Shares Outstanding: 49,414,577
• 10 Day Avg. Volume: 72,100
• 30 Day Avg. Volume: 106,146
• PEG Ratio: -2.57
• Price to Book (P/B): 6.51
• Price to Sales (P/S): 0.96
• P/FCF Ratio: 32.38
• 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: 58 Neutral
• Price Target: ¥1,608.00 ▲(4.08% Upside)

KAPPA.CREATE CO.LTD. has a solid financial foundation with consistent revenue growth and improving profitability, which is the most significant factor in its score. However, technical indicators suggest weak momentum, and the high P/E ratio indicates potential overvaluation, which negatively impacts the overall score.

Positive Factors

Revenue Growth

Consistent revenue growth indicates a strong market position and successful business model, enhancing long-term financial stability.

Cash Flow Generation

Growing free cash flow suggests efficient capital management, providing funds for reinvestment and reducing financial risk.

Profitability Metrics

Strong gross profit margins reflect effective cost control, supporting sustained profitability and competitive advantage.

Negative Factors

Earnings Volatility

Fluctuating net profit margins can signal instability in earnings, potentially affecting investor confidence and long-term planning.

EPS Decline

A decline in EPS growth indicates challenges in maintaining profitability, which could impact future earnings potential and stock performance.

Profitability Volatility

Fluctuating cash flows can lead to uncertainty in financial planning and may hinder the company's ability to invest consistently in growth opportunities.

KAPPA.CREATE CO.LTD. Business Overview & Revenue Model

Company Description

Kappa Create Co., Ltd. engages in the management of restaurants. It also processes and sells food products. The company was formerly known as Kappa Create Holdings Co., Ltd. and changed its name to Kappa Create Co., Ltd. in October 2015. Kappa Create Co., Ltd. was founded in 1973 and is headquartered in Yokohama, Japan.

How the Company Makes Money

KAPPA.CREATE generates revenue through multiple streams, primarily by offering design services and consulting to businesses seeking to elevate their brand presence. Key revenue streams include project-based fees for specific design tasks, retainer agreements with clients for ongoing design services, and income from workshops and training sessions related to design skills and branding strategies. Additionally, the company may benefit from strategic partnerships with marketing firms or technology companies, enhancing its service offerings and expanding its client base, thereby contributing to its earnings.

KAPPA.CREATE CO.LTD. Financial Statement Overview

Summary

KAPPA.CREATE CO.LTD. demonstrates consistent revenue growth and improving profitability metrics. The balance sheet is stable with a prudent approach to debt management, and cash flow generation is robust, supporting operations and investments. However, there are areas of volatility in net profit margins and asset base fluctuations.

Income Statement

KAPPA.CREATE CO.LTD. has shown consistent revenue growth over the years, with a notable increase from 2024 to 2025. The gross profit margin remains strong, indicating efficient cost management. However, the net profit margin has fluctuated, reflecting some volatility in profitability. The EBIT and EBITDA margins have improved, suggesting better operational efficiency.

Balance Sheet

The company's balance sheet reveals a stable equity position with a healthy equity ratio. The debt-to-equity ratio is manageable, indicating a balanced approach to leveraging. Return on equity has improved, showcasing enhanced profitability relative to shareholder investments. However, the overall asset base has seen minor fluctuations.

Cash Flow

KAPPA.CREATE CO.LTD. has demonstrated positive operating cash flow, which supports its operational activities. The free cash flow has shown growth, indicating effective capital expenditure management. The operating cash flow to net income ratio suggests strong cash generation relative to net income, although there have been periods of fluctuation.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	73.57B	73.21B	72.20B	70.44B	67.21B	64.88B
Gross Profit	38.49B	38.26B	37.53B	35.72B	33.52B	33.39B
EBITDA	3.87B	3.63B	3.98B	-550.00M	2.96B	623.00M
Net Income	1.21B	1.03B	1.40B	-3.04B	736.00M	-1.15B
Balance Sheet
Total Assets	31.32B	31.07B	30.19B	28.94B	31.65B	32.01B
Cash, Cash Equivalents and Short-Term Investments	8.01B	7.94B	7.94B	7.52B	9.41B	7.92B
Total Debt	8.98B	7.25B	7.46B	6.74B	8.80B	9.01B
Total Liabilities	20.37B	20.18B	20.08B	20.24B	19.92B	21.04B
Stockholders Equity	10.90B	10.85B	10.03B	8.63B	11.63B	10.93B
Cash Flow
Free Cash Flow	0.00	2.18B	3.50B	2.50B	2.46B	-597.00M
Operating Cash Flow	0.00	3.84B	3.55B	2.52B	2.58B	-538.00M
Investing Cash Flow	0.00	-1.94B	-2.49B	-1.15B	306.00M	-604.00M
Financing Cash Flow	0.00	-1.91B	-644.00M	-3.27B	-1.40B	3.13B

KAPPA.CREATE CO.LTD. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 1545.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:7421, the sentiment is Positive. The current price of 1545 is below the 20-day moving average (MA) of 1554.10, above the 50-day MA of 1532.86, and above the 200-day MA of 1528.86, indicating a bullish trend. The MACD of 4.82 indicates Positive momentum. The RSI at 60.39 is Neutral, neither overbought nor oversold. The STOCH value of 63.19 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:7421.

KAPPA.CREATE CO.LTD. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
9828	72 Outperform	¥55.61B	12.34	―	2.41%	6.49%	4.27%
8153	70 Outperform	¥130.74B	31.13	―	0.70%	5.15%	47.13%
8160	63 Neutral	¥71.22B	17.84	―	1.89%	1.49%	―
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
7421	58 Neutral	¥77.51B	59.68	―	0.32%	0.51%	4.92%
2695	58 Neutral	¥133.05B	36.98	―	0.63%	4.32%	11.78%
9887	57 Neutral	¥124.05B	46.03	―	0.37%	20.44%	13.71%