airCloset, Inc. (9557) AI Stock Analysis

• Market Cap: ¥2.07B
• Dividend Yield: N/A
• Average Volume (3M): 33.15K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.48
• Revenue Growth: 13.90%
• EPS Growth: -2872.89%
• Country: JP
• Employees: 70
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Specialty Retail
• EPS (TTM): -9.47
• Shares Outstanding: 8,284,200
• 10 Day Avg. Volume: 18,330
• 30 Day Avg. Volume: 33,146
• PEG Ratio: -1.14
• Price to Book (P/B): 6.97
• Price to Sales (P/S): 0.78
• P/FCF Ratio: -14.13
• 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: 53 Neutral
• Price Target: ¥257.00 ▲(4.05% Upside)

The score is held back primarily by weak profitability, negative free cash flow, and high leverage despite revenue growth and strong gross margins. Technical indicators are mixed with a weak longer-term trend and negative MACD, while valuation is pressured by a negative P/E and no dividend yield data.

Positive Factors

Recurring subscription business model

A subscription rental model creates predictable, recurring revenue and higher customer lifetime value versus one-time sales. This supports steady cash inflows, easier demand forecasting, and opportunities for retention, upsell and margin expansion as unit economics scale over months.

High gross margin (~48%)

A near-48% gross margin indicates strong unit economics for the rental and styling service, giving headroom to cover logistics, styling costs and marketing. Sustained gross margins enable operational leverage and a clearer path to improving operating profits if fixed costs are managed.

Revenue growth with strong operating cash flow

Consistent revenue expansion (mid-teens growth) combined with strong operating cash flow (OCF to net income ratio 45.06) shows the business can grow while generating cash from core operations. That supports reinvestment or deleveraging over multiple quarters if trends persist.

Negative Factors

Elevated leverage

A debt-to-equity ratio near 2.8 denotes material indebtedness that constrains strategic flexibility. High leverage increases interest and refinancing risk, limiting ability to fund growth or absorb demand shocks, and can force prioritization of debt service over reinvestment.

Negative free cash flow

Negative free cash flow implies cash outflows (capex, investments, or working capital) exceed operating cash generation. Over months this pressures liquidity, may require external financing, and can exacerbate leverage if cash deficits persist during scaling or margin improvement phases.

Weak net profitability / low ROE

Very low net margin and modest ROE indicate the company struggles to convert healthy gross margins into shareholder returns. Persistent low bottom-line profitability suggests structural cost or efficiency issues that could impair long-term value creation without operational improvements.

airCloset, Inc. Business Overview & Revenue Model

Company Description

airCloset, Inc. provides online fashion rental services in Japan. It also operates airCloset, a fashion rental service for women; and airCloset Mall, a manufacturer's officially monthly rental mall. The company was incorporated in 2014 and is based in Tokyo, Japan.

How the Company Makes Money

airCloset generates revenue primarily through its subscription model, where customers pay a monthly fee to access a rotating selection of rental clothing. This model not only provides a steady stream of income but also encourages customer loyalty and repeat business. Key revenue streams include the subscription fees from individual users, as well as potential partnerships with clothing brands for exclusive rentals or promotions. Additionally, airCloset may benefit from upselling services such as premium memberships or additional rental options, further enhancing its earnings.

airCloset, Inc. Financial Statement Overview

Summary

Revenue growth and a healthy gross margin (47.96%) are positives, but profitability is weak (net margin 0.47%) and free cash flow is negative. Leverage remains high (debt-to-equity 2.76) and ROE is low (4.25%), limiting the overall financial score.

Income Statement

The company has shown consistent revenue growth over the years, with a 7.06% increase in the latest period. Gross profit margin is healthy at 47.96%, indicating effective cost management. However, net profit margin remains low at 0.47%, reflecting challenges in translating revenue growth into net income. The EBIT and EBITDA margins have improved, but remain modest, suggesting room for operational efficiency improvements.

Balance Sheet

The debt-to-equity ratio has improved to 2.76, indicating better leverage management compared to previous years. However, the company still carries significant debt relative to equity. Return on equity is low at 4.25%, suggesting limited profitability on shareholders' investments. The equity ratio of 20.14% indicates a moderate reliance on equity financing.

Cash Flow

Operating cash flow is strong, but free cash flow is negative, indicating high capital expenditures or other cash outflows. The operating cash flow to net income ratio is robust at 45.06, suggesting good cash generation relative to net income. However, the negative free cash flow to net income ratio highlights potential liquidity challenges.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	4.96B	4.96B	4.22B	3.74B	3.39B	2.89B
Gross Profit	2.38B	2.38B	2.00B	1.76B	1.67B	1.46B
EBITDA	626.79M	603.91M	538.93M	80.39M	-12.44M	-144.72M
Net Income	22.88M	23.54M	-53.20M	-354.19M	-378.15M	-344.65M
Balance Sheet
Total Assets	2.75B	2.75B	2.71B	2.50B	2.19B	1.42B
Cash, Cash Equivalents and Short-Term Investments	1.09B	1.09B	1.45B	1.45B	1.14B	789.05M
Total Debt	1.53B	1.53B	1.58B	1.40B	1.45B	885.11M
Total Liabilities	2.20B	2.20B	2.20B	1.95B	1.86B	1.38B
Stockholders Equity	554.44M	554.44M	510.16M	557.91M	323.04M	41.07M
Cash Flow
Free Cash Flow	0.00	-273.38M	-108.64M	-398.50M	-661.29M	-444.11M
Operating Cash Flow	0.00	1.06B	802.95M	479.38M	156.04M	353.48M
Investing Cash Flow	0.00	-1.39B	-778.28M	-907.93M	-1.03B	-797.59M
Financing Cash Flow	0.00	-32.76M	178.06M	540.75M	1.22B	454.23M

airCloset, Inc. Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 247.00
• 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:9557, the sentiment is Negative. The current price of 247 is below the 20-day moving average (MA) of 266.65, below the 50-day MA of 263.04, and below the 200-day MA of 381.62, indicating a bearish trend. The MACD of -3.68 indicates Positive momentum. The RSI at 38.18 is Neutral, neither overbought nor oversold. The STOCH value of 3.41 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:9557.

airCloset, Inc. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
3192	73 Outperform	¥1.96B	4.68	―	―	0.06%	―
3179	66 Neutral	¥22.48B	20.72	―	3.53%	-2.73%	-51.48%
3093	65 Neutral	¥40.35B	13.35	―	2.19%	17.90%	14.14%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
3396	60 Neutral	¥5.73B	10.62	―	1.76%	2.24%	―
9557	53 Neutral	¥2.07B	-17.93	―	―	13.90%	-2872.89%
3556	49 Neutral	¥16.81B	33.79	―	―	-10.83%	―