Sekido Co., Ltd. (9878) AI Stock Analysis

• Market Cap: ¥1.96B
• Dividend Yield: 2.14%
• Average Volume (3M): 38.27K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.21
• Revenue Growth: -25.92%
• EPS Growth: -1005.20%
• Country: JP
• Employees: 61
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Apparel - Retail
• EPS (TTM): -35.27
• Shares Outstanding: 3,167,228
• 10 Day Avg. Volume: 26,690
• 30 Day Avg. Volume: 38,273
• PEG Ratio: <0.01
• Price to Book (P/B): 7.24
• Price to Sales (P/S): 0.19
• P/FCF Ratio: -4.39
• 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: 41 Neutral
• Price Target: ¥590.00 ▲(25.80% Upside)
• Action: Reiterated Date: 12/11/25
• Date: Action: Reiterated 12/11/25

Sekido Co., Ltd. is facing significant financial and operational challenges, with negative profitability and high leverage being the most critical issues. The technical analysis suggests a bearish trend, and the valuation metrics indicate potential risks. Immediate strategic actions are needed to improve the company's financial health.

Positive Factors

Diversified Sales Channels

Dual sales channels (company-operated retail and wholesale distribution) provide revenue diversification that can smooth demand swings, preserve access to brand assortments, and allow shifts between higher-margin direct sales and volume-driven wholesale, supporting medium-term revenue resilience.

Focused Market Niche

Concentration in cosmetics and beauty retail in Japan targets a recurring-purchase consumer category where brand loyalty and repeat sales are common; structurally, consumables-driven retail tends to generate steadier demand over months, aiding recovery if operational fixes and marketing are executed.

Lean Operating Footprint

A compact workforce implies a relatively low fixed-cost base and agility to implement cost controls or restructurings. This structural lean staffing supports faster margin recovery potential if revenue stabilizes and management prioritizes efficiency and targeted investments in higher-return channels.

Negative Factors

High Financial Leverage

The surge in leverage to a 15.8 debt-to-equity ratio materially constrains financial flexibility. Elevated debt increases interest burden and refinancing risk, reducing the company's ability to fund working capital, invest in growth, or withstand prolonged demand weakness over the coming months.

Severe Cash Flow Deterioration

Free cash flow collapse to -324.8m signals acute cash burn and weak cash conversion. Persistent negative FCF undermines ability to service debt, invest in e-commerce or store upgrades, or absorb shocks; without sustainable cash generation, solvency and creditor pressures are durable risks.

Declining Profitability and Revenues

Margins have moved into negative territory and revenue is falling, with gross margin also contracting. Structural profit erosion and declining sales reduce internal cash generation and make deleveraging or reinvestment harder, implying the company needs operational fixes to restore sustainable profitability.

Sekido Co., Ltd. Business Overview & Revenue Model

Company Description

SEKIDO Co., Ltd. operates fashion stores. Its stores offer bags, wallets, watches, and jewelry products under the Pomerance brand; and distributes cosmetics products under the MEDIHEAL brand. The company was founded in 1956 and is headquartered in Tokyo, Japan.

How the Company Makes Money

Sekido Co., Ltd. generates revenue through multiple key streams, primarily by selling its electronic components and systems to manufacturers in various industries, including telecommunications and automotive. The company benefits from long-term contracts with major clients, ensuring a steady flow of income. Additionally, Sekido invests in research and development to innovate new products, which helps maintain a competitive edge and opens up new market opportunities. Partnerships with technology firms and collaborations on projects further enhance its market presence and contribute to earnings. The company's revenue is also bolstered by after-sales services and maintenance contracts, providing ongoing support to clients and generating recurring revenue.

Sekido Co., Ltd. Financial Statement Overview

Summary

Sekido Co., Ltd. is facing severe financial challenges, with declining revenues, negative profitability margins, and high financial leverage. The balance sheet shows increased debt and reduced equity, while cash flow issues further strain the company's financial health.

Income Statement

Sekido Co., Ltd. has faced significant challenges in maintaining profitability. The gross profit margin has declined from 32.6% in 2024 to 30.1% in 2025. The net profit margin has turned negative, dropping from 0.6% in 2024 to -7.8% in 2025, indicating a substantial decrease in profitability. Revenue growth has been inconsistent, with a decline of 11.6% from 2024 to 2025. EBIT and EBITDA margins have also turned negative, reflecting operational difficulties.

Balance Sheet

The balance sheet shows a high debt-to-equity ratio of 15.8 in 2025, up from 2.9 in 2024, indicating increased financial leverage and potential risk. Return on equity has turned negative, dropping from 5.1% in 2024 to -295.4% in 2025, reflecting poor profitability relative to shareholder equity. The equity ratio has decreased significantly, indicating a reduced proportion of equity financing.

Cash Flow

Sekido Co., Ltd. has experienced negative free cash flow growth, with free cash flow deteriorating from -58.8 million in 2024 to -324.8 million in 2025. The operating cash flow to net income ratio is negative, indicating challenges in converting income into cash. The free cash flow to net income ratio is also negative, highlighting cash flow difficulties.

Breakdown	TTM	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	10.23B	7.49B	8.48B	7.04B	7.73B	6.77B
Gross Profit	3.19B	2.25B	2.77B	2.33B	1.97B	1.73B
EBITDA	20.43M	-353.27M	163.40M	122.28M	499.60M	166.16M
Net Income	-174.00M	-581.82M	36.65M	-46.39M	485.60M	117.37M
Balance Sheet
Total Assets	5.82B	4.77B	5.31B	4.95B	4.27B	3.60B
Cash, Cash Equivalents and Short-Term Investments	508.00M	504.17M	409.32M	593.20M	724.47M	483.82M
Total Debt	3.35B	3.11B	2.71B	2.80B	1.82B	1.45B
Total Liabilities	5.11B	4.57B	4.38B	4.07B	3.25B	3.09B
Stockholders Equity	704.00M	196.96M	935.09M	870.57M	1.03B	510.20M
Cash Flow
Free Cash Flow	0.00	-324.77M	-58.77M	-916.92M	-473.64M	-190.48M
Operating Cash Flow	0.00	-107.42M	8.42M	-842.77M	-374.96M	-183.24M
Investing Cash Flow	0.00	-144.23M	-54.53M	-99.04M	177.21M	-37.77M
Financing Cash Flow	0.00	346.49M	-130.67M	810.51M	442.39M	133.33M

Sekido Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 469.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Negative
• MACD: Negative
• RSI: Negative
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:9878, the sentiment is Positive. The current price of 469 is below the 20-day moving average (MA) of 553.50, below the 50-day MA of 527.60, and below the 200-day MA of 701.23, indicating a neutral trend. The MACD of 15.18 indicates Negative momentum. The RSI at 74.80 is Negative, neither overbought nor oversold. The STOCH value of 87.92 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:9878.

Sekido Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
9271	76 Outperform	¥8.27B	11.58	―	―	30.82%	77.42%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
8013	57 Neutral	¥2.46B	152.63	―	―	2.54%	―
7615	55 Neutral	¥2.98B	-9.17	―	―	-8.52%	80.07%
2778	52 Neutral	¥1.87B	-27.35	―	―	-6.40%	-590.11%
7603	47 Neutral	¥3.79B	-1.60	―	―	-7.88%	-11.22%
9878	41 Neutral	¥1.96B	-1.82	―	2.14%	-25.92%	-1005.20%