Forval Telecom, Inc. (9445) AI Stock Analysis

• Market Cap: ¥9.47B
• Dividend Yield: 3.85%
• Average Volume (3M): 2.47K
• Price to Earnings (P/E): 10.3
• Beta (1Y): 0.26
• Revenue Growth: 1.75%
• EPS Growth: 24.87%
• Country: JP
• Employees: 302
• Sector: Communication Services
• Sector Strength: 97
• Industry: Telecommunications Services
• EPS (TTM): 17.65
• Shares Outstanding: 16,757,700
• 10 Day Avg. Volume: 1,810
• 30 Day Avg. Volume: 2,470
• PEG Ratio: -4.61
• Price to Book (P/B): 2.32
• Price to Sales (P/S): 0.30
• P/FCF Ratio: 4.05
• 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: 75 Outperform
• Price Target: ¥640.00 ▲(8.47% Upside)

The score is driven primarily by strengthened financial performance (deleveraging to zero debt, improved profitability, and better cash generation) and supportive valuation (low P/E and solid dividend yield). Technical indicators are neutral to slightly weak, limiting upside in the overall score.

Positive Factors

Debt Reduction

Eliminating debt strengthens the balance sheet, reducing financial risk and increasing flexibility for future investments or challenges.

Profitability Improvement

Rising net income indicates effective cost management and operational efficiency, enhancing long-term shareholder value.

Cash Generation

Strong cash generation supports sustainable operations and potential for reinvestment, dividends, or debt reduction.

Negative Factors

Margin Compression

Compressed margins may limit profitability growth, affecting the company's ability to invest in new opportunities or withstand cost pressures.

Cash Flow Volatility

Volatile cash flows can hinder strategic planning and investment, posing challenges in maintaining consistent financial health.

Historical Revenue Volatility

Past revenue volatility suggests potential challenges in maintaining consistent growth, impacting long-term strategic stability.

Forval Telecom, Inc. Business Overview & Revenue Model

Company Description

Forval Telecom,Inc. provides various telecommunications carrier services in Japan. The company is also involved in the security certification acquisition consulting business. In addition, it provides IP & mobile solutions; business support solutions; and supply of electricity. The company was incorporated in 1995 and is based in Tokyo, Japan. Forval Telecom,Inc. operates as a subsidiary of Forval Corporation.

How the Company Makes Money

Forval Telecom, Inc. generates revenue primarily through the provision of telecommunication services such as internet connectivity, which includes broadband and fiber-optic services. The company also earns income by providing IT solutions and consulting services to businesses, helping them implement and manage their IT infrastructure. Additionally, Forval Telecom may engage in partnerships with other technology providers to enhance its service offerings, contributing to its revenue through collaborative ventures. The company's focus on both individual and corporate clients helps diversify its income streams and mitigate risks associated with any single market segment.

Forval Telecom, Inc. Financial Statement Overview

Summary

Financials are solid overall, led by a much stronger balance sheet (debt reduced to zero and equity growth) and improving profitability since 2023. Cash generation improved notably in 2025 with free cash flow closely matching net income, but margins have compressed versus earlier highs and cash flow has been uneven historically.

Income Statement

Revenue has been broadly stable with modest growth in the latest year (2025 annual revenue growth ~3.2%) after a small decline in 2024. Profitability improved materially from 2023 into 2025 (net income rose from ~¥0.38B in 2023 to ~¥0.73B in 2025), but margins have compressed versus earlier highs—gross margin fell from ~27.3% (2022) to ~23.1% (2025) and net margin eased to ~2.9% (2025) from ~4.0% (2022). The 2020 loss highlights historical volatility, though results since then have remained profitable.

Balance Sheet

Leverage has improved sharply: total debt declined from ~¥4.0B (2020) to ¥0 in 2025, driving debt-to-equity down from ~2.58x (2020) to 0.0x (2025). Equity has also increased (from ~¥1.57B in 2020 to ~¥3.32B in 2025), strengthening the capital base. Return on equity remains solid (about 22% in 2025), though it has come down from the peak levels seen in 2022–2024, suggesting profitability is good but not accelerating.

Cash Flow

Cash generation is strong in the most recent year: operating cash flow rose to ~¥1.93B (2025) from ~¥0.91B (2023), and free cash flow was very close to net income in 2025 (free cash flow to net income ~0.98), indicating earnings are translating well into cash. However, cash flow has been somewhat uneven across the period (including negative free cash flow in 2020 and a weak 2023), and operating cash flow has not consistently covered total obligations at a high level based on the provided coverage ratio (improving to ~0.28 in 2025 from ~0.11 in 2023).

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	25.40B	25.68B	23.12B	24.75B	21.80B	21.73B
Gross Profit	5.86B	5.94B	5.78B	5.25B	5.95B	5.73B
EBITDA	1.55B	1.59B	1.63B	975.85M	1.66B	930.53M
Net Income	906.55M	732.97M	750.41M	378.38M	868.03M	456.07M
Balance Sheet
Total Assets	9.31B	10.36B	10.30B	11.05B	11.05B	11.76B
Cash, Cash Equivalents and Short-Term Investments	774.00M	893.76M	1.02B	1.04B	1.30B	1.54B
Total Debt	0.00	0.00	1.30B	1.73B	2.16B	3.83B
Total Liabilities	5.94B	7.04B	7.38B	8.59B	8.71B	10.00B
Stockholders Equity	3.37B	3.32B	2.91B	2.44B	2.32B	1.74B
Cash Flow
Free Cash Flow	0.00	1.90B	1.53B	505.82M	1.34B	981.42M
Operating Cash Flow	0.00	1.93B	1.62B	907.89M	1.69B	1.25B
Investing Cash Flow	0.00	-420.92M	-936.11M	-446.91M	27.32M	-244.86M
Financing Cash Flow	0.00	-1.64B	-713.40M	-720.32M	-1.95B	-499.61M

Forval Telecom, Inc. Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 590.00
• 50DMA: Negative
• 100DMA: Negative
• 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:9445, the sentiment is Neutral. The current price of 590 is above the 20-day moving average (MA) of 569.70, above the 50-day MA of 569.80, and above the 200-day MA of 538.01, indicating a neutral trend. The MACD of -1.47 indicates Positive momentum. The RSI at 48.14 is Neutral, neither overbought nor oversold. The STOCH value of 54.17 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for JP:9445.

Forval Telecom, Inc. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
9445	75 Outperform	¥9.47B	10.29	―	3.85%	1.75%	24.87%
3934	73 Outperform	¥11.88B	12.57	―	2.10%	13.64%	44.55%
4415	67 Neutral	¥7.40B	17.00	―	―	39.18%	27.87%
3776	66 Neutral	¥11.86B	28.13	―	1.01%	17.19%	-43.91%
9419	64 Neutral	¥3.19B	24.36	―	―	-3.76%	-67.98%
9428	63 Neutral	¥12.24B	14.85	―	1.47%	10.12%	21.04%
Sector *	60 Neutral	$48.67B	4.58	-11.27%	4.14%	2.83%	-41.78%