ASAKUMA CO.,LTD. (7678) AI Stock Analysis

• Market Cap: ¥25.95B
• Dividend Yield: N/A
• Average Volume (3M): 4.19K
• Price to Earnings (P/E): 60.9
• Beta (1Y): 0.34
• Revenue Growth: N/A
• EPS Growth: N/A
• Country: JP
• Employees: 107
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Restaurants
• EPS (TTM): 16.77
• Shares Outstanding: 5,385,020
• 10 Day Avg. Volume: 1,810
• 30 Day Avg. Volume: 4,193
• PEG Ratio: 0.14
• Price to Book (P/B): 7.01
• Price to Sales (P/S): 2.58
• P/FCF Ratio: 622.10
• 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: 65 Neutral
• Price Target: ¥5,230.00 ▲(7.50% Upside)

ASAKUMA CO.,LTD.'s stock score is primarily driven by strong financial performance, characterized by robust revenue growth and profitability, and a stable balance sheet. However, the high P/E ratio suggests potential overvaluation, and the significant decline in free cash flow raises concerns about future cash generation. Technical indicators show a neutral trend, adding moderate support to the overall score.

Positive Factors

Revenue & Profitability Trends

Sustained 15.8% revenue growth alongside a 54% gross margin signals durable product pricing power and cost control. Improving net margin to 6.8% indicates the business is translating top-line gains into bottom-line profit, supporting reinvestment and long-term earnings resiliency.

Balance Sheet Strength

A 70.4% equity ratio and negligible 0.03 debt-to-equity reflect very low leverage, giving the company financial flexibility to fund operations, weather cyclical downturns, or invest in growth without material refinancing risk. ROE of 18.5% shows efficient equity use.

Diversified Distribution & Product Mix

Multiple channels (direct retail, online, wholesale, partnerships) and mixed product lines (apparel, home textiles) reduce concentration risk and seasonality impact. This distribution diversity supports stable revenue streams and provides durable routes for scaling and market expansion.

Negative Factors

Free Cash Flow Collapse

A 91.5% drop in free cash flow is a substantial structural concern: it limits internal funding for capex, working capital, dividends, and strategic initiatives. Sustained weak FCF could force external financing or curtail investment, impairing long-term growth execution.

Poor Cash Conversion

Weak cash conversion ratios suggest earnings quality and working capital pressures: only modest cash generated relative to reported income. Over time this can strain liquidity, increase reliance on financing, and reduce capacity to self-fund growth or absorb shocks.

Thin Operating Margins

Low EBIT/EBITDA margins despite a strong gross margin indicate elevated operating expenses or weak operating leverage. This compresses profitability scalability and leaves limited buffer versus cost inflation or margin pressure, constraining durable free cash generation.

ASAKUMA CO.,LTD. Business Overview & Revenue Model

Company Description

Asakuma Co.,Ltd, together with its subsidiary Asakuma Succession Co., Ltd., engages in the restaurant management and franchise business in Japan. It operates restaurants under the Steak no Asakuma name; Motsuyaki Izakaya under the Ebisu San name; Indonesian cuisine restaurant under the Surabaya name; and the Indonesian style Izakaya under the Wayambari name. The company was incorporated in 1948 and is based in Nagoya, Japan. Asakuma Co.,Ltd operates as a subsidiary of Tempos Holdings Co., Ltd.

How the Company Makes Money

ASAKUMA CO.,LTD. generates revenue through multiple streams, primarily from the sale of its textile products. The company sells its apparel and home goods through a combination of direct-to-consumer retail outlets and online platforms, allowing it to reach a broad customer base. Additionally, ASAKUMA may engage in wholesale distribution to department stores and boutiques, further diversifying its revenue sources. Partnerships with retailers and collaborations with fashion designers can also enhance brand visibility and drive sales. Seasonal collections and limited-edition releases contribute to revenue fluctuations, while ongoing investments in marketing and supply chain efficiency support overall profitability.

ASAKUMA CO.,LTD. Financial Statement Overview

Summary

ASAKUMA CO.,LTD. exhibits strong revenue growth and profitability, supported by efficient cost management and operational efficiency. The balance sheet reflects financial stability with low leverage and strong equity. However, the significant decline in free cash flow highlights potential challenges in cash generation, which could impact future investments and growth.

Income Statement

ASAKUMA CO.,LTD. has demonstrated strong revenue growth with a 15.8% increase from 2024 to 2025. The gross profit margin is robust at 54.0%, indicating efficient cost management. The net profit margin improved significantly to 6.8%, reflecting enhanced profitability. EBIT and EBITDA margins are healthy at 2.2% and 2.7%, respectively, showing operational efficiency.

Balance Sheet

The company maintains a strong equity position with an equity ratio of 70.4%, indicating financial stability. The debt-to-equity ratio is low at 0.03, suggesting minimal leverage risk. Return on equity stands at 18.5%, showcasing effective use of equity to generate profits.

Cash Flow

Free cash flow decreased by 91.5% from 2024 to 2025, which may indicate challenges in cash generation. However, the operating cash flow to net income ratio is 0.55, suggesting moderate cash conversion efficiency. The free cash flow to net income ratio is 0.06, indicating limited free cash flow relative to net income.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	7.54B	8.35B	7.21B	6.20B	5.25B	6.38B
Gross Profit	4.33B	4.51B	4.20B	3.68B	3.07B	3.70B
EBITDA	244.88M	221.32M	257.00M	88.87M	348.88M	-1.30B
Net Income	166.83M	567.97M	156.58M	-12.18M	60.12M	-1.58B
Balance Sheet
Total Assets	3.83B	4.36B	3.75B	3.31B	3.88B	4.00B
Cash, Cash Equivalents and Short-Term Investments	2.08B	2.06B	2.05B	1.73B	2.00B	1.83B
Total Debt	91.30M	80.35M	94.00M	105.20M	507.83M	882.94M
Total Liabilities	1.26B	1.29B	1.24B	934.74M	1.46B	1.78B
Stockholders Equity	2.57B	3.07B	2.50B	2.37B	2.41B	2.22B
Cash Flow
Free Cash Flow	0.00	34.59M	409.20M	157.54M	518.77M	-706.38M
Operating Cash Flow	0.00	314.91M	580.80M	307.16M	609.13M	-626.49M
Investing Cash Flow	0.00	-288.00M	-187.20M	-140.87M	-102.37M	4.60M
Financing Cash Flow	0.00	2.92M	-12.00M	-430.54M	-321.32M	711.72M

ASAKUMA CO.,LTD. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 4865.00
• 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:7678, the sentiment is Positive. The current price of 4865 is above the 20-day moving average (MA) of 4795.50, above the 50-day MA of 4638.90, and above the 200-day MA of 4328.77, indicating a bullish trend. The MACD of 55.97 indicates Positive momentum. The RSI at 66.43 is Neutral, neither overbought nor oversold. The STOCH value of 65.77 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:7678.

ASAKUMA CO.,LTD. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
7678	65 Neutral	¥25.95B	60.86	―	―	―	―
9979	63 Neutral	¥24.93B	23.00	―	1.20%	3.89%	-12.08%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
3178	60 Neutral	¥24.91B	24.88	―	0.81%	0.32%	10.22%
2882	57 Neutral	¥23.57B	152.15	―	0.78%	8.86%	-17.71%
9850	52 Neutral	¥23.17B	67.59	―	0.62%	7.64%	-65.84%