Japan Communications Inc. (9424) AI Stock Analysis

• Market Cap: ¥23.36B
• Dividend Yield: N/A
• Average Volume (3M): 3.03M
• Price to Earnings (P/E): 23.3
• Beta (1Y): 0.95
• Revenue Growth: 30.15%
• EPS Growth: 31.28%
• Country: JP
• Employees: 131
• Sector: Communication Services
• Sector Strength: 97
• Industry: Telecommunications Services
• EPS (TTM): 1.58
• Shares Outstanding: 166,838,750
• 10 Day Avg. Volume: 2,726,290
• 30 Day Avg. Volume: 3,033,013
• PEG Ratio: -0.73
• Price to Book (P/B): 6.16
• Price to Sales (P/S): 2.55
• P/FCF Ratio: 34.95
• 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: 74 Outperform
• Price Target: ¥164.00 ▲(12.33% Upside)

Japan Communications Inc. has a strong financial foundation with robust revenue growth and profitability. The technical indicators suggest a neutral market sentiment, while the valuation is moderate. The absence of earnings call data and corporate events means these factors do not influence the score.

Positive Factors

Revenue Growth

Strong revenue growth indicates increasing demand for the company's services, supporting long-term business expansion and market penetration.

Cash Flow Generation

Robust cash flow generation enhances financial flexibility, enabling strategic investments and sustaining operations without excessive debt.

Profitability

A strong net profit margin reflects efficient cost management and operational effectiveness, contributing to sustainable profitability.

Negative Factors

Debt Levels

Rising debt levels could strain financial resources, potentially impacting the company's ability to invest in growth and manage economic downturns.

Operating Efficiency

Decreasing operating margins may indicate challenges in maintaining cost efficiency, which could pressure future profitability if not addressed.

Operational Efficiency

Operational efficiency is crucial for sustaining long-term performance; inefficiencies could erode margins and competitive positioning.

Japan Communications Inc. Business Overview & Revenue Model

Company Description

Japan Communications Inc., a mobile virtual network operator (MVNO), provides mobile services in Japan. It develops and sells network security solutions; operates FinTech platform; and researches and develops technologies for MVNO and MVNE. The company was founded in 1996 and is headquartered in Tokyo, Japan.

How the Company Makes Money

Japan Communications generates revenue primarily through subscription fees from its mobile communication services, including both voice and data plans. The company operates a business model centered around being a mobile virtual network operator (MVNO), which allows it to offer competitive pricing without the heavy infrastructure costs associated with traditional network operators. Key revenue streams include monthly service fees from customers, sales of SIM cards, and ancillary services such as international calling and data packages. Additionally, strategic partnerships with established telecom operators enable Japan Communications to access broader network coverage and improve service offerings, further enhancing its revenue potential.

Japan Communications Inc. Financial Statement Overview

Summary

Japan Communications Inc. demonstrates solid financial health with strong revenue growth and profitability. The balance sheet is stable, with a prudent level of leverage and high return on equity. Cash flow generation is robust, supporting the company's growth trajectory. However, attention should be paid to maintaining operational efficiency and managing debt levels to sustain long-term performance.

Income Statement

Japan Communications Inc. shows strong revenue growth with a 7.26% increase in TTM, supported by a solid gross profit margin of 41.02%. The net profit margin is healthy at 9.15%, indicating efficient cost management. However, the EBIT and EBITDA margins have slightly decreased compared to previous years, suggesting potential pressure on operating efficiency.

Balance Sheet

The company maintains a moderate debt-to-equity ratio of 0.51, reflecting a balanced approach to leverage. Return on equity is robust at 24.85%, showcasing effective use of shareholder funds. The equity ratio stands at 54.05%, indicating a strong capital structure. However, the increase in total debt over the past year could pose a risk if not managed carefully.

Cash Flow

Operating cash flow is strong, with a coverage ratio of 0.58, and free cash flow has grown by 9.28% in TTM. The free cash flow to net income ratio of 0.77 indicates good cash conversion efficiency. Despite these strengths, the operating cash flow to net income ratio suggests room for improvement in cash generation relative to earnings.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	10.61B	9.24B	7.40B	6.07B	4.63B	3.50B
Gross Profit	4.21B	3.84B	3.26B	2.62B	1.85B	1.27B
EBITDA	1.45B	1.17B	1.72B	859.28M	324.82M	-257.69M
Net Income	1.05B	849.37M	1.37B	690.68M	294.11M	-273.59M
Balance Sheet
Total Assets	7.89B	7.34B	4.41B	3.04B	1.94B	1.86B
Cash, Cash Equivalents and Short-Term Investments	3.22B	4.30B	2.52B	1.58B	928.69M	1.03B
Total Debt	1.89B	2.04B	53.83M	17.21M	0.00	9.60M
Total Liabilities	3.52B	3.47B	1.43B	1.51B	1.16B	1.52B
Stockholders Equity	4.26B	3.82B	2.89B	1.50B	720.41M	302.35M
Cash Flow
Free Cash Flow	927.44M	672.92M	855.30M	701.17M	-247.15M	363.98M
Operating Cash Flow	1.25B	930.18M	1.07B	851.34M	21.97M	419.62M
Investing Cash Flow	-2.02B	-1.10B	-213.28M	-200.85M	-271.76M	-53.91M
Financing Cash Flow	1.82B	1.96B	75.00M	-1.16M	150.45M	6.42M

Japan Communications Inc. Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 146.00
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:9424, the sentiment is Negative. The current price of 146 is below the 20-day moving average (MA) of 146.10, above the 50-day MA of 144.04, and below the 200-day MA of 151.93, indicating a bearish trend. The MACD of -1.61 indicates Positive momentum. The RSI at 41.00 is Neutral, neither overbought nor oversold. The STOCH value of 9.14 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:9424.

Japan Communications Inc. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
3834	80 Outperform	¥19.74B	12.48	―	3.53%	5.03%	-9.55%
4390	80 Outperform	¥38.56B	11.98	―	1.28%	-7.46%	11.57%
9445	75 Outperform	¥9.47B	10.29	―	3.85%	1.75%	24.87%
9424	74 Outperform	¥23.36B	23.27	―	―	30.15%	31.28%
3934	73 Outperform	¥11.88B	12.57	―	2.10%	13.64%	44.55%
9419	64 Neutral	¥3.19B	24.36	―	―	-3.76%	-67.98%
Sector *	60 Neutral	$48.67B	4.58	-11.27%	4.14%	2.83%	-41.78%