ESLEAD CORPORATION (8877) AI Stock Analysis

• Market Cap: ¥104.15B
• Dividend Yield: 3.08%
• Average Volume (3M): 19.79K
• Price to Earnings (P/E): 11.0
• Beta (1Y): 0.84
• Revenue Growth: -6.27%
• EPS Growth: -11.07%
• Country: JP
• Employees: 404
• Sector: Real Estate
• Sector Strength: 53
• Industry: Real Estate - Services
• EPS (TTM): 114.84
• Shares Outstanding: 15,465,600
• 10 Day Avg. Volume: 19,110
• 30 Day Avg. Volume: 19,793
• PEG Ratio: 0.28
• Price to Book (P/B): 0.87
• Price to Sales (P/S): 0.67
• P/FCF Ratio: -1.76
• 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: 79 Outperform
• Price Target: ¥7,729.00 ▲(15.19% Upside)

ESLEAD CORPORATION demonstrates strong financial performance with robust revenue growth and profitability, although it faces challenges in cash flow management and high leverage. The technical analysis indicates strong bullish momentum, supported by positive market indicators. The valuation is attractive with a reasonable P/E ratio and a solid dividend yield, making it an appealing investment in the real estate services sector.

Positive Factors

Margin Improvement

Consistent improvement in EBIT and sustained gross/net margins indicate durable operational efficiency and pricing power in ESLEAD's real estate services. Over the medium term this supports cash generation potential, funds reinvestment, and resilience to revenue cyclicality.

Multi-year Revenue CAGR

A multi-year revenue CAGR signals persistent demand and scalable offerings rather than one-off spikes. This longer-term growth trend supports strategic planning, capacity investments, and improves the probability that margins and cash flow will strengthen as scale advantages continue to accrue.

Stable Equity Base

A stable and gradually increasing equity base provides financial footing for operations and growth, helping absorb shocks and maintain lender confidence. This balanced asset structure supports access to capital and underpins medium-term strategic initiatives despite other risks.

Negative Factors

High Leverage

Relatively high debt-to-equity increases sensitivity to interest-rate moves and downturns, raising refinancing and solvency risk. Over months this can constrain strategic flexibility, elevate financing costs, and force trade-offs between growth investments and deleveraging priorities.

Weak Operating Cash Flow

Persistent negative operating and free cash flow point to structural cash-generation issues, limiting the company's ability to self-fund capex, pay down debt, or sustain distributions. Continued cash shortfalls raise reliance on external funding and increase long-term execution risk.

Dependence on Financing

Heavy reliance on financing to cover operational shortfalls is a structural vulnerability: it raises refinancing risk, potential interest burden, and possible dilution if equity raises are needed. Over the medium term this can erode returns and limit strategic optionality.

ESLEAD CORPORATION Business Overview & Revenue Model

Company Description

Eslead Corporation develops and sells family-type and urban condominiums in Japan. The company also rebuilds and sells condominiums. In addition, it is involved in building and condominium management, real estate brokerage, detached house sales, power supply, hotel, and condominium and building cleaning businesses. The company was formerly known as Nihon Eslead Corporation and changed its name to Eslead Corporation in October 2019. The company was founded in 1992 and is headquartered in Osaka, Japan. Eslead Corporation is a subsidiary of Mori Trust Co., Ltd.

How the Company Makes Money

ESLEAD CORPORATION generates revenue primarily through its software development and IT consulting services. The company charges clients for bespoke software solutions and ongoing support, creating a steady stream of income. Additionally, ESLEAD engages in system integration projects, which involve the implementation of complex IT systems for businesses, further contributing to its revenue. Partnerships with technology providers and enterprises enhance their service offerings, allowing for revenue sharing and collaborative projects. Furthermore, the company may also invest in promising startups or technology firms, providing potential returns through equity stakes or profit-sharing agreements.

ESLEAD CORPORATION Financial Statement Overview

Summary

ESLEAD CORPORATION shows strong revenue and profit growth, with solid profitability metrics in the income statement. The balance sheet is stable but exhibits high leverage, which requires careful management. The cash flow statement reveals ongoing challenges in generating positive operating cash flow, indicating a need for strategic improvements in cash management. Overall, the company is on a growth trajectory but must address cash flow inefficiencies and manage leverage prudently.

Income Statement

The company demonstrates strong revenue growth, with a CAGR in revenue over the past five years. Gross profit and net income margins have remained healthy, with the EBIT margin showing consistent improvement. However, the net profit margin has experienced modest fluctuations, indicating potential cost management issues.

Balance Sheet

The balance sheet reflects a stable equity base, with a moderate increase in stockholders' equity over the years. The debt-to-equity ratio is relatively high, signifying increased leverage, which could pose a risk in downturn periods. However, the equity ratio remains satisfactory, indicating a balanced asset structure.

Cash Flow

The company has faced challenges in generating positive operating cash flow, with consistent negative free cash flow over the years. This highlights potential inefficiencies in managing operating expenses or capital expenditures. However, financing activities have been robust, supporting liquidity needs despite operational cash shortfalls.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	84.49B	94.77B	80.29B	79.91B	74.60B	69.00B
Gross Profit	20.94B	23.81B	20.35B	18.13B	17.05B	14.58B
EBITDA	12.15B	15.10B	12.18B	9.90B	9.00B	7.28B
Net Income	7.25B	9.33B	7.52B	6.15B	5.43B	4.51B
Balance Sheet
Total Assets	232.96B	227.03B	168.95B	135.87B	114.32B	104.88B
Cash, Cash Equivalents and Short-Term Investments	30.94B	31.24B	16.24B	26.55B	27.72B	31.85B
Total Debt	147.57B	140.88B	86.63B	62.35B	44.63B	37.45B
Total Liabilities	158.03B	153.57B	102.08B	74.90B	58.62B	53.74B
Stockholders Equity	74.94B	73.46B	66.87B	60.97B	55.70B	51.14B
Cash Flow
Free Cash Flow	0.00	-36.30B	-32.80B	-17.87B	-10.36B	-798.48M
Operating Cash Flow	0.00	-35.44B	-32.21B	-12.86B	-9.37B	-9.06M
Investing Cash Flow	0.00	-1.05B	-603.22M	-4.82B	-1.06B	-799.88M
Financing Cash Flow	0.00	51.34B	22.51B	16.71B	6.41B	12.99B

ESLEAD CORPORATION Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 6710.00
• 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:8877, the sentiment is Neutral. The current price of 6710 is below the 20-day moving average (MA) of 7003.00, above the 50-day MA of 6671.80, and above the 200-day MA of 5316.95, indicating a neutral trend. The MACD of 78.81 indicates Positive momentum. The RSI at 43.75 is Neutral, neither overbought nor oversold. The STOCH value of 17.40 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for JP:8877.

ESLEAD CORPORATION Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
8877	79 Outperform	¥104.15B	10.95	―	3.08%	-6.27%	-11.07%
3465	77 Outperform	¥100.01B	8.47	―	2.93%	20.83%	57.13%
2986	76 Outperform	¥75.65B	13.18	―	5.71%	8.07%	12.06%
8818	71 Outperform	¥89.48B	20.19	―	2.19%	4.72%	47.55%
Sector *	65 Neutral	$2.17B	12.19	3.79%	4.94%	3.15%	1.96%
8841	64 Neutral	¥78.24B	50.36	1.46%	1.18%	6.40%	230.12%
3252	62 Neutral	¥68.27B	16.31	―	2.89%	-3.09%	-35.66%

ESLEAD CORPORATION Corporate Events

ESLEAD Posts Higher Nine-Month Earnings and Confirms Strong Full-Year Outlook with Higher Dividends

ESLEAD CORPORATION reported consolidated net sales of ¥82.5 billion for the nine months ended December 31, 2025, up 10.5% year on year, with operating profit rising 12.2% to ¥14.1 billion and profit attributable to owners of parent increasing 2.3% to ¥8.0 billion, resulting in slightly higher basic earnings per share of ¥515.94. The company’s financial position strengthened as total assets expanded to ¥253.0 billion and equity reached ¥78.4 billion, while management maintained its full-year forecast for fiscal 2026, projecting double-digit growth in sales and profits and signaling confidence through a planned significant dividend increase to a total of ¥240 per share for the year, underscoring a continued emphasis on shareholder returns.

The most recent analyst rating on (JP:8877) stock is a Buy with a Yen7809.00 price target. To see the full list of analyst forecasts on ESLEAD CORPORATION stock, see the JP:8877 Stock Forecast page.

ESLEAD Secures ¥30 Billion Syndicated Loan to Support Shift to Income-Focused Property Strategy

ESLEAD CORPORATION has signed a ¥30 billion committed syndicated loan agreement with several major Japanese banks, including Sumitomo Mitsui Banking Corporation as arranger, to secure long-term funding for its transition toward a business model focused on generating rental income and maximizing capital gains from held properties. The loan, collateralized by real estate and maturing in 2030, includes financial covenants requiring the company to maintain a minimum level of consolidated net assets and to avoid recording ordinary losses for two consecutive fiscal years, underscoring lenders’ emphasis on balance-sheet strength and earnings stability while the company executes its strategic shift, though ESLEAD currently sees no need to revise its earnings forecast for the fiscal year ending March 31, 2026.

The most recent analyst rating on (JP:8877) stock is a Buy with a Yen6492.00 price target. To see the full list of analyst forecasts on ESLEAD CORPORATION stock, see the JP:8877 Stock Forecast page.