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Rhythm Co., Ltd. (JP:7769)
:7769
Japanese Market
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Rhythm Co., Ltd. (7769) AI Stock Analysis

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JP:7769

Rhythm Co., Ltd.

(7769)

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Outperform 74 (OpenAI - 4o)
Rating:74Outperform
Price Target:
¥3,713.00
▲(12.52% Upside)
Rhythm Co., Ltd. achieves a solid overall stock score driven by strong financial performance and reasonable valuation. Technical analysis presents mixed signals, with a slight bearish trend in the short term. The absence of earnings call and corporate events data limits further insights.

Rhythm Co., Ltd. (7769) vs. iShares MSCI Japan ETF (EWJ)

Rhythm Co., Ltd. Business Overview & Revenue Model

Company DescriptionRhythm Co., Ltd. (7769) is a leading Japanese company specializing in the design, manufacturing, and distribution of timepieces, including watches and clock mechanisms. The company operates primarily in the consumer electronics sector, focusing on creating innovative and high-quality products that cater to both domestic and international markets. Rhythm Co. is well-known for its precision engineering and commitment to craftsmanship, offering a diverse range of timekeeping products suited for various lifestyles and preferences.
How the Company Makes MoneyRhythm Co., Ltd. generates revenue primarily through the sale of its watches and clock mechanisms. The company's revenue model is multifaceted, with key revenue streams including direct sales to consumers through retail outlets and online platforms, as well as wholesale distribution to third-party retailers. Additionally, Rhythm Co. benefits from partnerships with various brands and manufacturers, allowing them to expand their product offerings and reach new customer segments. The company also invests in research and development to innovate and improve its product lines, ensuring competitiveness in the market, which contributes to sustained earnings growth.

Rhythm Co., Ltd. Financial Statement Overview

Summary
Rhythm Co., Ltd. demonstrates strong revenue growth and improved profitability with a healthy gross profit margin and increased net profit margin. The balance sheet is solid with low leverage and high equity ratio, though ROE has declined slightly. Cash flow is robust, supporting investment and expansion, despite some constraints in free cash flow relative to net income.
Income Statement
85
Very Positive
Rhythm Co., Ltd. demonstrates strong revenue growth over recent years, with a notable increase from ¥27.3 billion in 2021 to ¥32.7 billion in 2025. The gross profit margin remains healthy at approximately 20%, reflecting efficient cost management. Net profit margin has improved significantly, reaching 2.3% in 2025, signaling enhanced profitability. The EBIT and EBITDA margins have also increased, indicating stronger operational performance.
Balance Sheet
78
Positive
The company maintains a solid balance sheet with a decreasing debt-to-equity ratio, which stood at 0.24 in 2025, showcasing prudent financial leverage. The equity ratio is robust at 69.4%, indicating strong financial stability. However, a slight decrease in ROE from 3.8% in 2024 to 2.4% in 2025 suggests room for improvement in generating returns on equity.
Cash Flow
80
Positive
Rhythm Co., Ltd. enjoys a positive free cash flow trajectory, with a remarkable growth of 68.9% from 2024 to 2025, reflecting effective capital management. The operating cash flow to net income ratio of 3.2 in 2025 indicates strong cash generation relative to income, although the free cash flow to net income ratio is more modest at 1.6, suggesting potential constraints on discretionary cash.
BreakdownTTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue32.90B32.67B32.60B31.23B30.00B27.30B
Gross Profit6.98B6.59B6.67B6.78B6.81B6.34B
EBITDA3.51B2.61B2.22B2.46B2.77B556.00M
Net Income2.03B758.00M477.00M794.00M1.03B-1.26B
Balance Sheet
Total Assets45.34B45.09B43.57B39.74B38.29B35.70B
Cash, Cash Equivalents and Short-Term Investments13.51B13.52B11.04B9.90B9.94B10.28B
Total Debt8.75B7.65B5.56B4.66B4.58B5.28B
Total Liabilities14.77B13.78B12.43B10.87B11.29B10.66B
Stockholders Equity30.57B31.31B31.14B28.87B27.00B25.02B
Cash Flow
Free Cash Flow0.001.20B710.00M94.00M300.00M1.15B
Operating Cash Flow0.002.44B2.46B1.19B1.25B1.85B
Investing Cash Flow0.00-1.46B-2.14B-1.07B-876.00M-585.00M
Financing Cash Flow0.001.32B150.00M-467.00M-1.20B-686.00M

Rhythm Co., Ltd. Technical Analysis

Technical Analysis Sentiment
Neutral
Last Price3300.00
Price Trends
50DMA
3313.70
Positive
100DMA
3295.80
Positive
200DMA
3508.95
Negative
Market Momentum
MACD
-0.65
Positive
RSI
48.41
Neutral
STOCH
39.39
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:7769, the sentiment is Neutral. The current price of 3300 is below the 20-day moving average (MA) of 3336.00, below the 50-day MA of 3313.70, and below the 200-day MA of 3508.95, indicating a neutral trend. The MACD of -0.65 indicates Positive momentum. The RSI at 48.41 is Neutral, neither overbought nor oversold. The STOCH value of 39.39 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for JP:7769.

Rhythm Co., Ltd. Peers Comparison

Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
75
Outperform
¥10.18B21.075.29%3.88%0.84%
74
Outperform
¥27.38B13.362.20%-2.63%148.45%
71
Outperform
¥25.81B12.403.02%38.13%94.39%
64
Neutral
$35.08B22.352.37%3.55%19.89%-11.30%
61
Neutral
$18.38B12.79-2.54%3.03%1.52%-15.83%
52
Neutral
¥24.72B75.110.62%2.98%-42.40%
46
Neutral
¥6.22B4.62%-1.15%47.80%
* Consumer Cyclical Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
JP:7769
Rhythm Co., Ltd.
3,320.00
-563.62
-14.51%
JP:7937
Tsutsumi Jewelry Co
2,263.00
265.95
13.32%
JP:7638
NEW ART HOLDINGS Co., Ltd.
1,456.00
132.81
10.04%
JP:7872
Estelle Holdings Co., Ltd.
585.00
2.56
0.44%
JP:8139
Nagahori Corporation
1,612.00
118.79
7.96%
JP:9904
Verite Co., Ltd.
373.00
24.13
6.92%

Rhythm Co., Ltd. Corporate Events

Rhythm Co., Ltd. Achieves Compliance with Tokyo Prime Market Listing Criteria
Jul 31, 2025

Rhythm Co., Ltd. has announced its compliance with the Tokyo Prime Market’s Listing Criteria as of June 30, 2025, after previously being non-compliant in terms of Tradable Share Market Capitalization and Tradable Share Ratio. This compliance follows strategic changes in major shareholders and aligns with the company’s Medium-Term Management Plan 2027, focusing on sustainable growth and improved corporate value.

Rhythm Co., Ltd. Announces Change in Major Shareholders
Jun 30, 2025

Rhythm Co., Ltd. has announced a significant change in its major shareholders, with Kankuro Ueshima and two other joint holders no longer qualifying as major shareholders. This change is expected to help the company meet the Tokyo Stock Exchange’s Continued Listing Criteria regarding tradable share ratio and market capitalization.

Rhythm Co., Ltd. Addresses Non-Compliance with TSE Listing Criteria
Jun 27, 2025

Rhythm Co., Ltd. announced it is currently not in compliance with the Tokyo Stock Exchange Prime Market’s continued listing criteria due to issues with its tradable share ratio and market capitalization. The company has outlined a plan to address these issues by March 31, 2026, to avoid potential delisting. This includes measures to increase the ratio of tradable shares and market capitalization, in collaboration with major shareholders. The company is also focused on improving performance and enhancing corporate value as part of its Medium-Term Management Plan 2027.

Rhythm Co., Ltd. Enhances Shareholder Value with Share Repurchase
Jun 24, 2025

Rhythm Co., Ltd. has successfully repurchased 291,500 of its own shares through the Tokyo Stock Exchange’s Off-Auction Own Share Repurchase Trading System, at a total cost of ¥999,845,000. This move is part of the company’s strategy to increase corporate value and expand shareholder returns, and it may lead to changes in major shareholders, which will be disclosed if acknowledged.

Rhythm Co., Ltd. Announces Share Repurchase to Enhance Shareholder Value
Jun 23, 2025

Rhythm Co., Ltd. has announced the acquisition and repurchase of its own shares as part of its strategy to enhance corporate value and improve shareholder returns. The company will execute this repurchase through the ToSTNeT-3 system at the Tokyo Stock Exchange, with a maximum acquisition of 291,500 shares valued at up to ¥1 billion, aiming to boost capital efficiency and meet continued listing criteria.

Rhythm Co., Ltd. Records Extraordinary Income from Asset Transfer
Jun 23, 2025

Rhythm Co., Ltd. has successfully completed the transfer of fixed assets, resulting in an extraordinary income gain of ¥567 million. This transaction, finalized on June 23, 2025, is expected to positively impact the company’s financial results for the first quarter of FY2025, enhancing its financial positioning.

Rhythm Co., Ltd. Expands Shareholder Returns and Sets New Dividend Forecast
Jun 23, 2025

Rhythm Co., Ltd. announced measures to expand shareholder returns, including changes to its dividend policy, a new shareholder benefit plan, and the acquisition of its own shares. The company aims to improve corporate value and meet listing criteria by increasing its tradable share ratio and market capitalization. Additionally, Rhythm Co., Ltd. has entered into an agreement with major shareholders regarding voting rights and shareholding ratios, and has set a dividend forecast for the fiscal year ending March 31, 2026.

Rhythm Co., Ltd. Announces Positive Fiscal Year Forecast Amid Trade Uncertainties
Jun 23, 2025

Rhythm Co., Ltd. has released its consolidated forecast for the fiscal year ending March 31, 2026, indicating a positive outlook despite uncertainties from trade customs issues. The company expects significant sales growth in its livingware business, driven by strong mobile fan sales and improved profitability from structural reforms. Additionally, the precision parts business is seeing stable orders, particularly in air condition-related components, although automotive market sales remain sluggish. The company anticipates exceeding its Medium-Term Management Plan targets due to extraordinary income from real estate sales.

Rhythm Co., Ltd. Reports Extraordinary Income from Asset Transfer
Jun 23, 2025

Rhythm Co., Ltd. has announced the transfer of fixed assets, resulting in an extraordinary income gain of ¥567 million. This transaction, finalized on June 23, 2025, will be reflected in the company’s financial results for the first quarter of FY2025, potentially impacting its financial outlook positively.

Rhythm Co., Ltd. Updates on Subsidiary Trade Name Changes
May 30, 2025

Rhythm Co., Ltd. has completed the change of trade names for some of its consolidated subsidiaries, while others, such as PT. RHYTHM KYOSHIN INDONESIA, are still pending due to procedural delays. The company continues to update stakeholders on the progress of these changes, which are part of its strategic restructuring efforts to unify branding across its global operations.

Rhythm Co., Ltd. Announces Fixed Asset Transfer and Extraordinary Income
May 14, 2025

Rhythm Co., Ltd. has announced plans to transfer its fixed assets to enhance capital efficiency and strengthen its financial position. The transfer is expected to generate approximately ¥0.56 billion in extraordinary income, which will be recorded as a gain on the sale of fixed assets in the company’s financial results for the first quarter of FY2026.

Rhythm Co., Ltd. Reports Financial Results for Fiscal Year 2025
May 14, 2025

Rhythm Co., Ltd. reported a slight increase in net sales for the fiscal year ending March 31, 2025, with a significant rise in profit attributable to owners of the parent. Despite a decrease in comprehensive income, the company improved its cash flows from financing activities and increased its year-end dividend, indicating a positive outlook for stakeholders.

Rhythm Co., Ltd. Reports Discrepancy in Financial Forecasts
May 14, 2025

Rhythm Co., Ltd. announced a discrepancy between its forecasted and actual financial results for the fiscal year ended March 31, 2025. Despite stable net sales due to increased demand for Livingware and air-conditioning products, profits fell short of expectations due to rising purchase and raw material costs, exacerbated by the yen’s depreciation, impacting the company’s financial performance.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Oct 11, 2025