Colowide Co., Ltd. (7616) AI Stock Analysis

• Market Cap: ¥199.28B
• Dividend Yield: 0.29%
• Average Volume (3M): 624.66K
• Price to Earnings (P/E): 74.9
• Beta (1Y): 0.20
• Revenue Growth: 8.99%
• EPS Growth: 61.95%
• Country: JP
• Employees: 4,502
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Restaurants
• EPS (TTM): 22.33
• Shares Outstanding: 106,453,545
• 10 Day Avg. Volume: 416,950
• 30 Day Avg. Volume: 624,660
• PEG Ratio: -1.83
• Price to Book (P/B): 2.15
• Price to Sales (P/S): 0.62
• P/FCF Ratio: 9.60
• 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: 59 Neutral
• Price Target: ¥1,933.00 ▲(11.54% Upside)
• Action: Reiterated Date: 02/19/26
• Date: Action: Reiterated 02/19/26

The score is driven primarily by improving but leveraged financials (strong cash flow offset by balance-sheet risk and thin net profits), supported by constructive technical momentum. These positives are tempered by a very high P/E and low dividend yield.

Positive Factors

Strong cash generation

Consistent positive operating and free cash flow provides durable liquidity to fund store openings, support franchising investments and service debt. Over 2–6 months this cash generation underpins strategic flexibility and reduces reliance on external financing despite thin reported net income.

Healthy gross and EBITDA margins

High gross margin and mid-teens EBITDA margin indicate structural operating efficiency in foodservice and franchise economics. These margins create a buffer to absorb input cost inflation and enable reinvestment in brands, supporting sustainable operating cash flow over the medium term.

Top-line growth and improving operations

Ongoing revenue growth reflects expanding same-store sales and/or network scale from company-operated and franchised locations. Sustained top-line momentum combined with operational improvements supports long-term unit economics and potential for scaled margin improvement across formats.

Negative Factors

Elevated leverage

High leverage limits financial flexibility in a cyclical consumer sector, increasing refinancing and interest risks. Elevated debt magnifies earnings volatility, constrains capital allocation choices and reduces the company's ability to absorb downturns or pursue opportunistic investments over the medium term.

Very thin net profitability

A sub-1% net margin leaves minimal room for error: small cost or traffic shocks can eliminate profits. This restricts retained earnings for growth, weakens resilience against cyclical declines, and undermines the durability of reported earnings despite stronger underlying operating margins.

Cash conversion and debt coverage concern

FCF below net income suggests accounting profits aren't fully converting to discretionary cash, limiting deleveraging ability. Given elevated debt, this gap constrains strategic choices (capex, dividends, buybacks) and leaves the balance sheet exposed to prolonged industry softness.

Colowide Co., Ltd. Business Overview & Revenue Model

Company Description

Colowide Co., Ltd. (7616) is a prominent player in the food and beverage industry, primarily operating in Japan. The company focuses on the development, manufacturing, and distribution of a wide range of products, including ready-to-eat meals, frozen foods, and condiments. Colowide Co., Ltd. is also involved in the restaurant business, managing a variety of dining establishments that cater to diverse consumer preferences.

How the Company Makes Money

Colowide Co., Ltd. generates revenue through multiple streams, including the sale of its food products to retail and wholesale channels, as well as direct sales through its restaurant operations. The company benefits from economies of scale in production, allowing for competitive pricing and increased market share. Additionally, strategic partnerships with suppliers and distributors enhance its supply chain efficiency. The growth of the convenience food sector, driven by consumer demand for quick and easy meal solutions, further contributes to its earnings.

Colowide Co., Ltd. Financial Statement Overview

Summary

Mixed fundamentals: Income Statement is moderate (63) with revenue growth and solid gross/EBITDA margins but very thin net margin and past volatility; Balance Sheet is weak (44) due to elevated leverage and modest ROE; Cash Flow is strong (72) with positive, growing free cash flow, though debt remains a watch item.

Income Statement

TTM (Trailing-Twelve-Months) shows continued top-line growth (revenue up 2.9%), with solid gross profitability (~59%) and a decent EBITDA margin (~12.5%). However, profitability at the bottom line remains thin (net margin ~0.8%), and results have been volatile over the cycle (losses in FY2021 and FY2023, followed by recovery). Overall, the business is growing and has improved operating performance, but earnings quality is held back by very low net income.

Balance Sheet

Leverage is the key constraint: TTM debt-to-equity is elevated (~2.37x) and has historically been even higher (above 3x–5x in prior years), which reduces financial flexibility in a cyclical consumer industry. Equity has improved versus earlier years, but returns on equity are currently modest (TTM ~2.8%), suggesting limited value creation relative to the balance-sheet risk. The balance sheet is serviceable, but debt remains a clear overhang.

Cash Flow

Cash generation is a relative strength. TTM operating cash flow (~¥32.5B) and free cash flow (~¥19.5B) are positive and growing (free cash flow up ~3.0%), indicating the model is producing cash even with slim reported net income. That said, free cash flow compared to net income is below 1x in the latest period, implying accounting profits are not fully translating into incremental free cash flow, and the level of cash flow relative to the company’s debt load remains a watch item.

Breakdown	TTM	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	286.54B	269.16B	241.28B	220.83B	175.63B	168.18B
Gross Profit	169.42B	156.77B	139.37B	124.21B	96.69B	92.66B
EBITDA	36.15B	32.58B	32.12B	17.12B	26.91B	11.85B
Net Income	2.66B	1.25B	2.90B	-6.80B	1.44B	-10.08B
Balance Sheet
Total Assets	345.56B	312.23B	265.12B	261.86B	267.70B	263.99B
Cash, Cash Equivalents and Short-Term Investments	59.60B	71.54B	46.57B	50.70B	48.53B	39.41B
Total Debt	210.28B	177.94B	155.21B	156.56B	160.46B	173.47B
Total Liabilities	251.30B	225.12B	210.98B	211.16B	207.67B	226.18B
Stockholders Equity	83.86B	77.54B	44.95B	42.74B	50.30B	31.09B
Cash Flow
Free Cash Flow	19.55B	17.40B	16.92B	19.56B	18.09B	-1.90B
Operating Cash Flow	32.49B	28.81B	29.88B	28.78B	23.83B	3.42B
Investing Cash Flow	-31.28B	-21.61B	-13.58B	-8.79B	-3.52B	-12.92B
Financing Cash Flow	-6.39B	17.95B	-20.33B	-18.75B	-9.51B	15.89B

Colowide Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 1733.00
• 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:7616, the sentiment is Positive. The current price of 1733 is below the 20-day moving average (MA) of 1833.25, below the 50-day MA of 1789.92, and below the 200-day MA of 1825.39, indicating a bullish trend. The MACD of 17.55 indicates Positive momentum. The RSI at 57.08 is Neutral, neither overbought nor oversold. The STOCH value of 37.40 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:7616.

Colowide Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
7581	72 Outperform	¥342.11B	29.66	9.66%	0.55%	14.33%	36.83%
8153	70 Outperform	¥131.82B	29.00	―	0.70%	5.15%	47.13%
9936	66 Neutral	¥196.15B	21.87	―	1.65%	9.59%	8.08%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
7616	59 Neutral	¥199.28B	74.93	―	0.29%	8.99%	61.95%
2695	58 Neutral	¥148.12B	41.16	―	0.63%	4.32%	11.78%
9861	53 Neutral	¥200.02B	52.43	―	0.69%	10.75%	-14.28%

Colowide Co., Ltd. Corporate Events

Colowide Confirms Strong Nine-Month Earnings as Auditor Review Concludes With No Changes

Colowide Co., Ltd. reported consolidated revenue of ¥217.9 billion for the nine months ended December 31, 2025, an 8.7% year-on-year increase, with business profit up 34.6% to ¥9.6 billion and profit attributable to owners of parent surging 61.9% to ¥3.7 billion. The interim review of these IFRS-based quarterly results by certified public accountants has been completed with no revisions, underscoring improved profitability and a modest strengthening of the balance sheet, as total assets and equity attributable to owners of parent both rose compared with the previous fiscal year-end.

The company’s equity attributable to owners of parent increased to ¥83.9 billion, lifting net assets per share to ¥642.48 despite a slight decline in the equity ratio to 24.3%. This combination of higher earnings, stronger comprehensive income, and confirmed audited figures suggests a solid recovery trajectory for Colowide’s restaurant operations, offering greater visibility and assurance to investors and other stakeholders regarding the stability of its financial performance.

The most recent analyst rating on (JP:7616) stock is a Hold with a Yen1759.00 price target. To see the full list of analyst forecasts on Colowide Co., Ltd. stock, see the JP:7616 Stock Forecast page.

Colowide Confirms Reviewed Nine-Month Results with Strong Profit Growth

Colowide Co., Ltd. reported that its quarterly consolidated financial statements for the nine months ended December 31, 2025, have completed an interim review by certified public accountants with no changes from the figures disclosed on February 10, 2026. For the period from April 1 to December 31, 2025, the company posted revenue of ¥217.9 billion, up 8.7% year on year, with business profit rising 34.6% to ¥9.6 billion, EBITDA climbing 15.8%, and profit attributable to owners of the parent surging 61.9% to ¥3.7 billion, while total assets and equity also increased, signaling improved profitability and a stronger balance sheet without plans for a dividend payment or a financial results briefing.

The company’s operating profit under IFRS reached ¥9.2 billion, reflecting better cost control and higher efficiency compared to the previous year and supporting a notable rise in basic earnings per share to ¥29.46. Equity attributable to owners of the parent rose to ¥83.9 billion, and total assets expanded to ¥345.6 billion, though the equity ratio edged slightly lower to 24.3%, indicating ongoing leverage but also balance sheet growth as Colowide continues to consolidate its financial position in a competitive restaurant sector.

The most recent analyst rating on (JP:7616) stock is a Hold with a Yen1759.00 price target. To see the full list of analyst forecasts on Colowide Co., Ltd. stock, see the JP:7616 Stock Forecast page.

Colowide Subsidiary Atom Slashes FY2026 Forecast, Warns of Deeper Loss

Colowide announced that its consolidated subsidiary Atom Corporation has revised downward its earnings forecast for the fiscal year ending March 31, 2026, and indicated it will assess and promptly disclose any material impact on Colowide’s consolidated results. The move underscores the pressure on the group’s profitability amid a challenging operating environment for restaurant operators.

Atom now projects full-year revenue of ¥30.09 billion and a net loss of ¥1.209 billion, reversing a previously expected slight profit and widening losses compared with the prior year. Management cited persistently high raw material, labor, and energy costs alongside weak customer traffic and cautious consumer spending, and is responding with pricing realignments, new and seasonal products, brand-strengthening initiatives, and development of new formats tailored to regional demand to reinforce its earnings base.

The most recent analyst rating on (JP:7616) stock is a Hold with a Yen1759.00 price target. To see the full list of analyst forecasts on Colowide Co., Ltd. stock, see the JP:7616 Stock Forecast page.

Colowide Posts Strong Nine-Month Earnings and Signals Continued Profit Growth

Colowide Co., Ltd. reported solid growth for the nine months ended December 31, 2025, with revenue up 8.7% year on year to ¥217.9 billion and business profit jumping 34.6% to ¥9.6 billion. Profit attributable to owners of the parent rose 61.9% to ¥3.7 billion, while total assets expanded to ¥345.6 billion and equity attributable to owners increased, though the equity ratio edged down slightly.

The company maintained a conservative shareholder return stance, keeping the interim dividend at zero but forecasting a year-end dividend of ¥5 per common share, matching the prior fiscal year’s total payout. For the full year ending March 31, 2026, Colowide forecasts continued top-line and profit growth, projecting a 7.2% rise in revenue and a 21.5% increase in business profit, underscoring management’s expectations of sustained earnings momentum within a competitive restaurant market.

The most recent analyst rating on (JP:7616) stock is a Hold with a Yen1759.00 price target. To see the full list of analyst forecasts on Colowide Co., Ltd. stock, see the JP:7616 Stock Forecast page.