Axial Retailing, Inc. (8255) AI Stock Analysis

• Market Cap: ¥120.70B
• Dividend Yield: 2.53%
• Average Volume (3M): 106.62K
• Price to Earnings (P/E): 12.0
• Beta (1Y): 0.24
• Revenue Growth: 5.57%
• EPS Growth: 27.41%
• Country: JP
• Employees: 2,661
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Department Stores
• EPS (TTM): 33.32
• Shares Outstanding: 93,552,155
• 10 Day Avg. Volume: 94,400
• 30 Day Avg. Volume: 106,616
• PEG Ratio: 0.45
• Price to Book (P/B): 0.98
• Price to Sales (P/S): 0.31
• P/FCF Ratio: 18.84
• 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): 100.5
• Revenue Forecast (FY): ¥299.10B

• Rating: 77 Outperform
• Price Target: ¥1,394.00 ▲(20.90% Upside)
• Action: Reiterated Date: 02/05/26
• Date: Action: Reiterated 02/05/26

The score is driven primarily by strong financial resilience (notably the very low leverage and improving profitability) and supportive technical trend signals (price above major moving averages with positive MACD). Valuation further supports the outlook with a moderate P/E and a solid dividend yield, while uneven cash-flow conversion and slight margin pressure cap the score.

Positive Factors

Very low leverage / strong balance sheet

Exceptionally low leverage and steadily expanding equity provide durable financial flexibility. With debt-to-equity near 0.02–0.05 historically and ~0.023 TTM, the company can fund capex, absorb shocks, pursue opportunistic M&A, and sustain dividends without stressing solvency over the medium term.

Steady revenue growth and improving operating margin

Consistent top-line growth coupled with rising operating margin signals durable operational improvement and scale benefits. Improved EBIT margin reflects better cost control or mix shifts, supporting sustainable earnings power and resilience in the department-store model over the next several quarters.

Positive cash generation with FCF rebound

Strong operating cash flow and a notable free-cash-flow rebound enhance long-term funding capacity. Robust cash generation enables reinvestment in omnichannel capabilities, inventory optimization, and shareholder returns, and provides a buffer against cyclical retail pressures despite prior year variability.

Negative Factors

Uneven cash-flow conversion

Material divergence between reported profits and cash generation raises earnings-quality risk. Persistent working-capital swings or reinvestment needs that depress conversion can limit free cash available for strategic initiatives, constrain capital allocation choices, and increase sensitivity to seasonal retail cycles.

Slight gross margin decline and modest net margin

A meaningful dip in gross margin combined with low net margin reduces the company's capacity to absorb input cost inflation or to compete on price while maintaining returns. Continued margin pressure would limit reinvestment, weaken return on capital, and compress room for margin recovery initiatives.

Revenue momentum showing signs of flattening

Decelerating revenue growth undermines operating leverage potential in retail. If top-line momentum stalls, the company faces greater dependence on cost cuts or mix improvement to sustain profit growth, increasing execution risk in a competitive department-store landscape over the medium term.

Axial Retailing, Inc. Business Overview & Revenue Model

Company Description

Axial Retailing Inc. operates a chain of supermarkets in Japan. As of March 31, 2021, it operated a network of 129 stores. The company was formerly known as Harashin Narus Holdings Co Ltd. and changed its name to Axial Retailing Inc. in October 2013. Axial Retailing Inc. was incorporated in 1967 and is based in Nagaoka, Japan.

How the Company Makes Money

Axial Retailing generates revenue through a multi-faceted business model that includes direct sales from its retail stores and e-commerce platform. Key revenue streams include the sale of branded and private-label products, with a significant portion of earnings derived from high-demand categories such as electronics and fashion. The company also engages in promotional partnerships with manufacturers and brands, which can provide additional revenue through co-marketing initiatives and exclusive product launches. Seasonal promotions and loyalty programs further enhance customer retention and drive sales growth. Furthermore, Axial Retailing invests in data analytics to optimize inventory management and pricing strategies, which helps to maximize profit margins.

Axial Retailing, Inc. Financial Statement Overview

Summary

Steady multi-year revenue growth and improving operating margin support the score, and the balance sheet is exceptionally conservative (very low debt-to-equity and rising equity). Offsetting factors are uneven cash-flow conversion and a recent slight gross margin dip, which add some quality-of-earnings risk.

Income Statement

Axial Retailing shows steady top-line expansion, with revenue rising from 246.5B (FY2022) to 281.9B (FY2025) and further to 293.7B in TTM (Trailing-Twelve-Months). Profitability is solid for a department-store model: gross margin is stable but slightly down in the latest TTM (~27.0% vs ~29% in FY2023–FY2024), while operating profitability has improved versus earlier years (EBIT margin ~4.45% TTM vs ~3.80% in FY2023). Net margin remains modest (~3.28% TTM), but net income has grown versus FY2023–FY2024, indicating improving scale and/or cost control. Key watch-out is the very low reported revenue growth rate in TTM, suggesting momentum may be flattening.

Balance Sheet

The balance sheet is a clear strength. Leverage is very low with debt-to-equity around ~0.02–0.05 across the period and ~0.023 in TTM (Trailing-Twelve-Months), giving the company significant financial flexibility. Equity has expanded consistently (about 69.0B in FY2021 to 92.8B in TTM), and returns on equity are healthy around ~10–12% recently (10.6% TTM). The main weakness is limited insight into liquidity and working-capital risk from the provided fields, but based on the low leverage and rising equity base, solvency risk appears contained.

Cash Flow

Cash generation is positive but somewhat uneven year-to-year. TTM (Trailing-Twelve-Months) operating cash flow is strong at 16.35B and free cash flow is 11.94B, with a sharp rebound versus FY2025 free cash flow (4.63B). However, conversion is mixed: free cash flow is meaningfully below net income in most years and is ~73% of net income in TTM, implying ongoing reinvestment needs and/or working-capital swings. Also, operating cash flow relative to operating profit is moderate (coverage ~0.43 TTM), indicating cash realization is not consistently matching reported operating earnings.

Breakdown	TTM	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	293.67B	281.87B	270.22B	254.97B	246.45B	256.35B
Gross Profit	79.16B	76.72B	79.14B	74.83B	72.40B	73.95B
EBITDA	19.02B	18.43B	16.22B	14.80B	15.24B	16.96B
Net Income	9.63B	9.01B	7.44B	6.36B	7.07B	8.28B
Balance Sheet
Total Assets	144.47B	135.30B	131.39B	122.76B	116.86B	113.82B
Cash, Cash Equivalents and Short-Term Investments	29.20B	21.89B	21.02B	19.54B	18.45B	17.02B
Total Debt	2.13B	2.31B	2.55B	2.85B	3.21B	3.26B
Total Liabilities	51.62B	46.00B	48.09B	44.05B	42.80B	44.82B
Stockholders Equity	92.84B	89.29B	83.30B	78.70B	74.06B	69.00B
Cash Flow
Free Cash Flow	11.94B	4.63B	5.40B	2.91B	3.01B	6.80B
Operating Cash Flow	16.35B	11.82B	17.10B	12.59B	9.43B	14.45B
Investing Cash Flow	-4.77B	-7.67B	-11.86B	-9.29B	-5.80B	-7.63B
Financing Cash Flow	-6.59B	-3.28B	-3.75B	-2.21B	-2.21B	-2.17B

Axial Retailing, Inc. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 1153.00
• 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:8255, the sentiment is Positive. The current price of 1153 is below the 20-day moving average (MA) of 1259.80, below the 50-day MA of 1200.70, and above the 200-day MA of 1138.89, indicating a bullish trend. The MACD of 26.10 indicates Positive momentum. The RSI at 57.43 is Neutral, neither overbought nor oversold. The STOCH value of 57.73 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:8255.

Axial Retailing, Inc. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
8255	77 Outperform	¥120.70B	11.99	―	2.53%	5.57%	27.41%
8244	65 Neutral	¥73.49B	11.20	―	1.09%	7.55%	89.45%
8260	64 Neutral	¥5.76B	7.02	―	1.33%	-3.57%	33.78%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
8247	60 Neutral	¥2.23B	10.14	―	―	-3.35%	-63.96%
8237	57 Neutral	¥146.72B	161.18	―	0.83%	1.38%	-87.76%
8254	46 Neutral	¥2.41B	28.48	―	―	-6.41%	51.66%

Axial Retailing, Inc. Corporate Events

Axial Retailing Lifts Nine-Month Profit but Keeps Cautious Full-Year Outlook

Axial Retailing reported consolidated net sales of ¥222.9 billion for the nine months ended December 31, 2025, up 5.6% year on year, with operating profit rising 9.1% to ¥10.1 billion and profit attributable to owners of parent increasing 9.7% to ¥7.0 billion; basic earnings per share climbed to ¥79.04, while total assets and net assets also expanded, although the equity-to-asset ratio edged down to 64.3% from 66.0%. Despite this solid interim performance and an increased interim dividend of ¥13 per share, the company maintained its full-year forecast for fiscal 2026, projecting only modest 1.5% net sales growth and declines in profit and earnings per share versus the prior year, signaling management’s cautious outlook on earnings momentum even as it plans a slight year-on-year increase in total annual dividends to ¥29 per share.

The most recent analyst rating on (JP:8255) stock is a Buy with a Yen1341.00 price target. To see the full list of analyst forecasts on Axial Retailing, Inc. stock, see the JP:8255 Stock Forecast page.

Axial Retailing Inc. Announces Interim Dividend Increase

Axial Retailing Inc. announced a resolution by its Board of Directors to distribute an interim dividend of 13.00 yen per share from retained earnings, with a record date of September 30, 2025. This decision reflects a strategic move to enhance shareholder value, marking an increase from the previous year’s interim dividend, and aligns with the company’s ongoing commitment to stable financial performance and investor returns.

The most recent analyst rating on (JP:8255) stock is a Buy with a Yen1236.00 price target. To see the full list of analyst forecasts on Axial Retailing, Inc. stock, see the JP:8255 Stock Forecast page.

Axial Retailing Inc. Reports Interim Dividend from Subsidiaries

Axial Retailing Inc. has announced the receipt of an interim dividend totaling 4,238 million yen from eight of its consolidated subsidiaries. This dividend will be recorded as operating revenue in the company’s non-consolidated financial statements for the fiscal year ending March 2026, but it will not affect the consolidated financial results for the same period.

The most recent analyst rating on (JP:8255) stock is a Buy with a Yen1236.00 price target. To see the full list of analyst forecasts on Axial Retailing, Inc. stock, see the JP:8255 Stock Forecast page.