HS Holdings Co.,Ltd. (8699) AI Stock Analysis

• Market Cap: ¥47.85B
• Dividend Yield: 0.83%
• Average Volume (3M): 34.04K
• Price to Earnings (P/E): 2.6
• Beta (1Y): 0.49
• Revenue Growth: 24.64%
• EPS Growth: 33.45%
• Country: JP
• Employees: 530
• Sector: Financial
• Sector Strength: 70
• Industry: Financial - Capital Markets
• EPS (TTM): 119.10
• Shares Outstanding: 40,953,500
• 10 Day Avg. Volume: 26,010
• 30 Day Avg. Volume: 34,036
• PEG Ratio: 0.07
• Price to Book (P/B): 0.30
• Price to Sales (P/S): 0.67
• P/FCF Ratio: 9.61
• 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: Hold
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 68 Neutral
• Price Target: ¥1,092.00 ▼(-9.23% Downside)

HS Holdings Co., Ltd. has a strong valuation with a low P/E ratio, suggesting potential undervaluation. However, the technical analysis indicates bearish momentum, and financial performance shows stability but highlights challenges in revenue growth and operational efficiency. These factors collectively result in a moderate overall stock score.

Positive Factors

Balance Sheet Strength

A low debt-to-equity ratio indicates minimal leverage, providing financial stability and flexibility to invest in growth opportunities without the burden of high interest obligations.

Cash Flow Improvement

Improving free cash flow enhances the company's ability to fund operations, invest in new projects, and return capital to shareholders, supporting long-term growth and stability.

High Equity Ratio

A high equity ratio indicates that a significant portion of the company's assets are financed by equity, reducing financial risk and providing a strong foundation for future investments.

Negative Factors

Revenue Decline

A decline in revenue growth can hinder the company's ability to expand its market presence and invest in new opportunities, potentially impacting long-term profitability and competitiveness.

Operational Efficiency Challenges

Operational inefficiencies, as indicated by a negative EBIT margin, can erode profitability and limit the company's ability to effectively manage costs, impacting overall financial health.

Cash Conversion Inefficiencies

Inefficiencies in cash conversion can constrain the company's liquidity, limiting its ability to reinvest in the business and potentially affecting its capacity to meet financial obligations.

HS Holdings Co.,Ltd. Business Overview & Revenue Model

Company Description

HS Holdings Co.,Ltd. provides merger and acquisition intermediary services in Japan. It offers merger and acquisition consulting and brokerage, business succession consulting, business investment management, venture investment, and business revitalization consulting services. The company was formerly known as Sawada Holdings Co., Ltd. HS Holdings Co.,Ltd. was founded in 1958 and is based in Tokyo, Japan.

How the Company Makes Money

HS Holdings Co., Ltd. generates revenue through multiple streams, including equity investments, real estate development, and the provision of manufacturing services. The company primarily earns income from dividends and capital gains on its investments in various sectors. Additionally, HS Holdings has established significant partnerships with industry leaders, enhancing its market reach and operational efficiency. The real estate segment contributes to its revenue through rental income and property sales, while the manufacturing division generates profit through the production and sale of goods to both domestic and international clients. Overall, the company's diverse portfolio helps mitigate risks and stabilize its earnings.

HS Holdings Co.,Ltd. Financial Statement Overview

Summary

HS Holdings Co., Ltd. exhibits a mixed financial performance. The income statement reflects profitability but highlights challenges in revenue growth and operational efficiency. The balance sheet is strong, with low leverage and high equity, indicating financial stability. Cash flow performance is improving, although there are inefficiencies in cash conversion. Overall, the company is financially stable but needs to address revenue and operational challenges to enhance its financial health.

Income Statement

The income statement shows a mixed performance. The gross profit margin for the latest period is 21.0%, indicating reasonable profitability. However, the company experienced a significant decline in revenue from the previous year, with a revenue growth rate of -25.0%. The net profit margin stands at 32.0%, which is strong, but the negative EBIT margin of -2.8% highlights operational challenges. Overall, the company demonstrates profitability but faces revenue and operational efficiency issues.

Balance Sheet

The balance sheet is robust with a low debt-to-equity ratio of 0.02, indicating minimal leverage and financial stability. The return on equity is strong at 14.0%, reflecting efficient use of equity to generate profits. Additionally, the equity ratio is high at 74.9%, suggesting a solid financial structure with a significant proportion of assets financed by equity. Overall, the balance sheet reveals a strong financial position with low leverage and high equity.

Cash Flow

The cash flow statement shows improvement in free cash flow, with a positive free cash flow of 2,711 million yen, compared to a negative figure in the previous year. The operating cash flow to net income ratio is 0.37, indicating moderate cash generation relative to net income. However, the free cash flow to net income ratio is 0.22, suggesting some inefficiencies in converting income into cash. Overall, cash flow performance is improving but still faces challenges in cash conversion.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	38.35B	38.71B	50.48B	78.28B	62.49B	58.15B
Gross Profit	22.94B	36.99B	42.20B	55.39B	40.66B	32.49B
EBITDA	103.00M	16.06B	17.04B	34.58B	21.21B	12.02B
Net Income	12.69B	12.10B	9.46B	11.37B	6.54B	-3.02B
Balance Sheet
Total Assets	114.57B	115.33B	98.77B	621.73B	577.45B	499.59B
Cash, Cash Equivalents and Short-Term Investments	17.85B	18.05B	18.40B	149.69B	88.14B	92.32B
Total Debt	2.69B	1.31B	1.14B	78.04B	63.64B	54.48B
Total Liabilities	27.30B	28.63B	26.36B	540.32B	503.02B	428.25B
Stockholders Equity	86.72B	86.37B	71.87B	59.63B	52.54B	54.58B
Cash Flow
Free Cash Flow	0.00	2.71B	-26.63B	15.12B	-7.47B	74.81B
Operating Cash Flow	0.00	4.53B	-25.59B	18.50B	-4.79B	77.64B
Investing Cash Flow	0.00	-6.05B	-8.10B	-17.94B	-7.66B	-8.70B
Financing Cash Flow	0.00	-287.00M	12.13B	2.58B	-1.72B	-14.75B

HS Holdings Co.,Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 1203.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:8699, the sentiment is Positive. The current price of 1203 is above the 20-day moving average (MA) of 1193.10, above the 50-day MA of 1089.88, and above the 200-day MA of 1022.18, indicating a bullish trend. The MACD of 41.83 indicates Positive momentum. The RSI at 56.71 is Neutral, neither overbought nor oversold. The STOCH value of 7.93 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:8699.

HS Holdings Co.,Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
8707	81 Outperform	¥75.40B	9.24	―	5.75%	10.85%	30.77%
8704	72 Outperform	¥27.55B	7.45	―	3.91%	-11.56%	-26.01%
8622	71 Outperform	¥32.31B	14.88	5.54%	5.47%	-1.80%	-1.02%
8699	68 Neutral	¥47.85B	2.60	―	0.83%	24.64%	33.45%
Sector *	68 Neutral	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%
8614	66 Neutral	¥43.09B	15.47	―	4.86%	6.40%	41.18%
8708	64 Neutral	¥43.34B	16.39	―	4.36%	1.14%	-16.88%