Happinet Corporation (7552) AI Stock Analysis

• Market Cap: ¥123.16B
• Dividend Yield: 2.23%
• Average Volume (3M): 115.16K
• Price to Earnings (P/E): 13.3
• Beta (1Y): 0.71
• Revenue Growth: 9.57%
• EPS Growth: 33.85%
• Country: JP
• Employees: 1,081
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Specialty Retail
• EPS (TTM): 76.33
• Shares Outstanding: 48,100,000
• 10 Day Avg. Volume: 82,860
• 30 Day Avg. Volume: 115,156
• PEG Ratio: 4.37
• Price to Book (P/B): 2.04
• Price to Sales (P/S): 0.31
• P/FCF Ratio: 7.09
• 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: 74 Outperform
• Price Target: ¥3,296.00 ▲(11.99% Upside)

The score is primarily supported by strong financial health (notably a debt-free balance sheet, improving profitability, and solid recent free cash flow) and favorable valuation (low P/E with a dividend). These positives are partially offset by weak technicals, with bearish momentum and the price sitting below key moving averages.

Positive Factors

Balance Sheet Health

A debt-free balance sheet enhances financial flexibility and reduces risk, allowing the company to invest in growth opportunities without the burden of interest payments.

Revenue Growth

Consistent revenue growth indicates strong market demand and effective business strategies, which can lead to increased market share and long-term profitability.

Cash Generation

Improved cash generation supports operational stability and provides resources for reinvestment, dividends, or strategic acquisitions, enhancing shareholder value.

Negative Factors

Thin Net Margins

Thin net margins limit the company's ability to absorb cost increases or demand fluctuations, potentially impacting profitability and financial resilience.

Cash Flow Volatility

Volatile cash flow can lead to uncertainty in funding operations and investments, posing risks to financial planning and stability in a low-margin business.

Structural Industry Challenges

Operating in a low-margin industry can constrain profitability and growth, requiring efficient operations and cost management to maintain competitive advantage.

Happinet Corporation Business Overview & Revenue Model

Company Description

Happinet Corporation operates as an entertainment trading company in Japan. The company manufactures and sells toys, playthings, trading cards, and other toys, as well as audio-visual software; and develops and sells video game software and hardware, and related peripheral equipment. It also sells arcade game equipment and amusement-related products; and installs and operates capsule-toy vending machines. The company was formerly known as Tosho Corporation and changed its name to Happinet Corporation in October 1991. Happinet Corporation was founded in 1969 and is headquartered in Tokyo, Japan.

How the Company Makes Money

Happinet Corporation generates revenue through the sale of toys and entertainment products, including video games, DVDs, and CDs. The company's key revenue streams include wholesale distribution to retailers and direct sales through its own channels. Additionally, Happinet benefits from partnerships with major entertainment companies for the distribution of their products in Japan. The company also earns income through its amusement business segment, which involves the planning and development of amusement equipment and facilities. These diversified revenue streams allow Happinet to capitalize on various sectors within the entertainment industry.

Happinet Corporation Financial Statement Overview

Summary

Strong overall fundamentals driven by a very conservative, essentially debt-free balance sheet and consistently growing equity. Revenue has expanded steadily with improving gross and operating profitability, supported by strong recent operating and free cash flow. Key constraints are structurally thin net margins (~1.9% recently) and historical cash-flow volatility (notably weak 2020), which add risk in a low-margin retail/distribution model.

Income Statement

Revenue has expanded steadily from 2021–2025, with 2025 showing a notably strong growth rate versus 2024. Profitability has also improved over time: gross margin has risen from ~10.1% (2020) to ~11.8% (2025), and operating and EBITDA margins have stepped up meaningfully versus 2020–2021 levels. Net margin remains thin (roughly ~1.9% in 2024–2025), which is typical for retail/distribution but leaves less buffer if costs rise or demand softens.

Balance Sheet

The balance sheet is very conservative: reported total debt is effectively zero in recent years, resulting in no meaningful leverage risk. Equity has grown consistently (from ~¥38.2B in 2020 to ~¥55.7B in 2025) alongside rising total assets, supporting financial flexibility. Returns on equity are healthy for a low-leverage profile (roughly ~12% in 2024–2025), though asset growth without sustained profitability improvements could pressure returns over time.

Cash Flow

Cash generation is solid in recent periods: operating cash flow improved to ~¥18.1B in 2025 (vs. ~¥8.4B in 2024), with free cash flow also rising to ~¥16.0B. Free cash flow has generally tracked earnings well (free cash flow to net income ~0.83–0.90 in 2021–2025), indicating decent earnings quality. The main weakness is volatility—2020 showed negative operating and free cash flow—and cash flow relative to revenue remains modest, implying working-capital swings can meaningfully impact year-to-year cash results.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	377.99B	364.42B	350.46B	307.25B	282.44B	259.31B
Gross Profit	45.78B	43.06B	38.88B	32.41B	29.36B	26.07B
EBITDA	14.29B	12.99B	11.43B	7.51B	6.72B	5.13B
Net Income	7.70B	6.76B	6.58B	3.56B	3.55B	2.59B
Balance Sheet
Total Assets	129.89B	121.45B	113.42B	94.28B	85.33B	82.96B
Cash, Cash Equivalents and Short-Term Investments	26.36B	41.01B	29.68B	27.87B	23.36B	21.77B
Total Debt	0.00	0.00	0.00	0.00	0.00	0.00
Total Liabilities	72.18B	65.78B	62.12B	49.06B	41.83B	41.99B
Stockholders Equity	57.71B	55.67B	51.30B	45.21B	43.49B	40.97B
Cash Flow
Free Cash Flow	0.00	15.99B	6.97B	5.73B	3.13B	9.26B
Operating Cash Flow	0.00	18.12B	8.36B	6.74B	3.71B	10.26B
Investing Cash Flow	0.00	-2.80B	-5.08B	-773.00M	-1.24B	-1.53B
Financing Cash Flow	0.00	-3.99B	-1.48B	-1.45B	-1.10B	-1.22B

Happinet Corporation Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 2943.00
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Positive
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:7552, the sentiment is Negative. The current price of 2943 is above the 20-day moving average (MA) of 2856.25, above the 50-day MA of 2940.04, and below the 200-day MA of 2959.44, indicating a bearish trend. The MACD of -64.83 indicates Positive momentum. The RSI at 26.81 is Positive, neither overbought nor oversold. The STOCH value of 6.68 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:7552.

Happinet Corporation Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
7552	74 Outperform	¥123.16B	13.29	―	2.23%	9.57%	33.85%
3093	65 Neutral	¥40.35B	13.35	―	2.19%	17.90%	14.14%
2751	64 Neutral	¥44.94B	24.83	―	0.26%	15.30%	-15.97%
3028	63 Neutral	¥81.68B	15.60	―	2.11%	6.04%	93.19%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
8281	60 Neutral	¥47.62B	-47.79	―	3.31%	0.88%	-138.66%
8165	45 Neutral	¥9.71B	3.20	―	―	-4.10%	―

Happinet Corporation Corporate Events

Happinet Corporation Enhances Stock Benefit Trust Contributions

Happinet Corporation has announced its decision to make additional contributions to its Stock Benefit Trusts, namely the Board Benefit Trust (BBT) and the J-ESOP Plan. This move is aimed at continuing these plans by funding the acquisition of shares needed for future benefits, potentially impacting the company’s stock market operations and providing long-term benefits for stakeholders.

Happinet Corporation Announces Share Split and Dividend Policy Changes

Happinet Corporation has announced a share split to lower stock prices and attract more investors, doubling its total issued shares to 48,100,000. The company is also revising its dividend forecasts, effectively increasing the year-end dividend by ¥5 per share, and changing its shareholder return policy to target a 40% dividend payout ratio, with a stable annual dividend increase of ¥10 per share.

Happinet Corporation Reports Strong Financial Growth for First Half of 2025

Happinet Corporation reported a significant increase in its financial performance for the six months ended September 30, 2025, with a 62% rise in consolidated operating results compared to the previous year. The company’s strong financial results indicate a robust market position and potential positive implications for stakeholders, reflecting effective management strategies and market demand.