Area Quest Inc. (8912) AI Stock Analysis

• Market Cap: ¥2.38B
• Dividend Yield: 1.87%
• Average Volume (3M): 1.27M
• Price to Earnings (P/E): 22.9
• Beta (1Y): 0.16
• Revenue Growth: 6.86%
• EPS Growth: 10.06%
• Country: JP
• Employees: 39
• Sector: Real Estate
• Sector Strength: 53
• Industry: Real Estate - Services
• EPS (TTM): 1.58
• Shares Outstanding: 17,145,800
• 10 Day Avg. Volume: 3,786,950
• 30 Day Avg. Volume: 1,268,763
• PEG Ratio: -2.26
• Price to Book (P/B): 1.88
• Price to Sales (P/S): 1.05
• P/FCF Ratio: 18.59
• 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: Moderate Buy
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 66 Neutral
• Price Target: ¥174.00 ▲(8.75% Upside)

Area Quest Inc. shows strong financial performance with robust revenue growth and operational efficiency. However, technical indicators suggest potential short-term weakness, and the stock appears overvalued based on its P/E ratio. The dividend yield is modest, offering limited income potential.

Positive Factors

Revenue Growth

Strong revenue growth indicates robust demand for Area Quest's products and services, enhancing its market position and potential for future expansion.

Operational Efficiency

Improved operational efficiency suggests effective cost management and resource utilization, which can lead to sustained profitability and competitive advantage.

Cash Generation

Strong cash generation provides financial flexibility for reinvestment, debt reduction, or shareholder returns, supporting long-term business stability.

Negative Factors

Net Profit Margin Pressure

Decreasing net profit margins can signal rising costs or pricing pressures, potentially impacting long-term profitability if not addressed.

Free Cash Flow Conversion

Challenges in converting profits to free cash flow may limit the company's ability to fund growth initiatives or return capital to shareholders.

Return on Equity Decline

A decline in return on equity may indicate reduced efficiency in generating profits from shareholders' equity, affecting investor confidence and valuation.

Area Quest Inc. Business Overview & Revenue Model

Company Description

Area Quest Inc. (8912) is a technology-driven company specializing in geospatial analytics and location-based services. The company operates primarily in the fields of urban planning, environmental monitoring, and transportation logistics. Its core products include advanced mapping software, data analytics platforms, and consulting services designed to help businesses and governments make informed decisions based on geographic data.

How the Company Makes Money

Area Quest Inc. generates revenue through a multi-faceted model that includes software sales, subscription services, and consulting fees. The company earns significant income from licensing its proprietary mapping and analytics software to businesses and government agencies, who utilize the tools for urban development, resource management, and logistical planning. Additionally, Area Quest offers subscription services for ongoing access to its cloud-based data analytics platforms, providing clients with continuous updates and support. Consulting services, which involve tailored solutions and expert advice on geospatial analytics, also contribute to the company's revenue. Key partnerships with government entities and private sector firms enhance its market reach and create opportunities for collaborative projects, further bolstering its earnings.

Area Quest Inc. Financial Statement Overview

Summary

Area Quest Inc. has demonstrated strong revenue growth and improved operational efficiency. The balance sheet is solid with a reasonable level of debt and a strong equity position. Cash flow generation is robust, though there is room for improvement in converting net income to free cash flow.

Income Statement

Area Quest Inc. has demonstrated strong revenue growth, particularly in the latest year with a 78.1% increase. The gross profit margin has remained stable around 29%, indicating consistent cost management. However, the net profit margin has slightly decreased to 4.52% from 5.79% in the previous year, suggesting some pressure on net profitability. The EBIT and EBITDA margins have improved significantly, reflecting better operational efficiency.

Balance Sheet

The company's debt-to-equity ratio is at a manageable level of 0.45, indicating a balanced approach to leveraging. Return on equity has slightly decreased to 8.07%, which is still healthy but shows a slight decline in profitability from equity. The equity ratio stands at 35.1%, suggesting a solid equity base relative to total assets.

Cash Flow

Area Quest Inc. has shown a remarkable improvement in free cash flow, with a significant increase in the latest year. The operating cash flow to net income ratio is healthy at 2.65, indicating strong cash generation relative to net income. However, the free cash flow to net income ratio has decreased, suggesting some challenges in converting profits into free cash flow.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	2.48B	2.48B	2.33B	2.32B	2.18B	2.14B
Gross Profit	712.76M	720.00M	639.43M	672.01M	593.03M	628.62M
EBITDA	417.20M	421.00M	231.41M	348.50M	307.03M	340.78M
Net Income	111.65M	112.00M	134.92M	114.76M	103.62M	141.10M
Balance Sheet
Total Assets	3.95B	3.95B	4.35B	3.81B	3.70B	3.35B
Cash, Cash Equivalents and Short-Term Investments	414.00M	414.00M	642.08M	397.66M	381.79M	443.05M
Total Debt	618.00M	618.00M	703.86M	560.01M	607.32M	596.03M
Total Liabilities	2.57B	2.57B	2.72B	2.19B	2.04B	1.90B
Stockholders Equity	1.39B	1.39B	1.62B	1.62B	1.66B	1.45B
Cash Flow
Free Cash Flow	0.00	140.00M	45.00M	198.44M	11.27M	76.59M
Operating Cash Flow	0.00	297.00M	62.62M	207.32M	184.57M	204.59M
Investing Cash Flow	0.00	-183.00M	375.18M	56.07M	-150.88M	-26.92M
Financing Cash Flow	0.00	-334.00M	-193.39M	-247.52M	-94.95M	-150.71M

Area Quest Inc. Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 160.00
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:8912, the sentiment is Neutral. The current price of 160 is above the 20-day moving average (MA) of 159.00, below the 50-day MA of 164.76, and below the 200-day MA of 162.64, indicating a neutral trend. The MACD of -2.61 indicates Negative momentum. The RSI at 48.46 is Neutral, neither overbought nor oversold. The STOCH value of 68.43 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for JP:8912.

Area Quest Inc. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
9423	77 Outperform	¥2.60B	100.92	―	2.39%	11.80%	-41.76%
9342	68 Neutral	¥2.69B	15.11	―	0.22%	5.29%	22.75%
8912	66 Neutral	¥2.38B	22.86	―	1.87%	6.86%	10.06%
3490	66 Neutral	¥4.18B	6.14	―	1.03%	5.69%	15.12%
Sector *	65 Neutral	$2.17B	12.19	3.79%	4.94%	3.15%	1.96%
3494	65 Neutral	¥3.15B	10.90	―	1.50%	13.14%	34.11%
8836	55 Neutral	¥3.26B	251.11	―	―	10.68%	―