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

• Market Cap: ¥1.59B
• Dividend Yield: 2.14%
• Average Volume (3M): 38.27K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.23
• 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): 6.11
• 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: ¥560.00 ▲(19.40% 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

Channel Diversification

Sekido sells cosmetics via both company-operated retail channels and wholesale distribution. This dual-channel model provides structural diversification of revenue sources, helps smooth demand shocks across channels, and supports longer-term resilience in sales mix and partner relationships.

Consumer Beauty Exposure

Operating in the cosmetics/beauty retail sector links Sekido to a large, broadly stable consumer category with structural demand drivers (personal care, repeat purchases). This industry exposure supports persistent baseline demand and opportunities for brand and category expansion over months to years.

Lean Operating Base

A small headcount implies a lean operating structure that can enable quicker cost control, lower fixed overhead, and operational flexibility. Over a multi-month horizon, this can help management adjust store and distribution costs faster versus larger peers when restoring margins or cash flows.

Negative Factors

Severe Leverage

Leverage spiked materially in 2025, indicating increased reliance on debt financing. Such a high debt-to-equity ratio raises refinancing, interest, and covenant risks, constrains strategic flexibility, and amplifies earnings volatility, making recovery and investment harder over the medium term.

Deteriorating Free Cash Flow

Free cash flow deterioration is severe and persistent, indicating operating losses and greater cash burn. This undermines the firm's ability to service debt, invest for growth, or rebuild liquidity without external financing, posing a multi-month structural constraint on recovery options.

Negative Profitability & Revenue Decline

Margins have compressed and net profitability turned negative alongside an 11.6% revenue decline, signaling deteriorating core economics. Sustained margin weakness and shrinking top-line suggest structural pricing, mix, or cost pressures that will slow recovery and limit cash generation over months.

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. makes money primarily by selling cosmetics and beauty-related products to end customers and/or to business customers (e.g., retailers) depending on its channel mix. Its core revenue stream is product sales revenue, generated from (1) retail sales through company-operated stores and other direct-to-consumer channels, and (2) wholesale/distribution sales where the company supplies products to other stores or partners. Earnings are influenced by sales volume, product mix (including the balance of higher- and lower-margin brands/items), purchasing terms with suppliers/brands, and the performance of its store network and distribution operations. Specific information on material partnerships, licensing arrangements, or additional revenue streams (e.g., services, e-commerce breakdown, private-label manufacturing, or overseas operations) is null.

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	3.12B	2.17B	2.71B	2.30B	1.97B	1.73B
EBITDA	28.66M	-198.18M	195.25M	140.60M	283.33M	183.09M
Net Income	-174.76M	-545.38M	36.65M	-46.39M	485.60M	117.37M
Balance Sheet
Total Assets	5.82B	4.77B	5.35B	4.95B	4.27B	3.60B
Cash, Cash Equivalents and Short-Term Investments	304.25M	504.17M	409.32M	593.20M	724.47M	483.82M
Total Debt	3.35B	3.11B	2.76B	2.83B	1.82B	1.45B
Total Liabilities	5.11B	4.54B	4.56B	4.08B	3.25B	3.09B
Stockholders Equity	704.97M	233.41M	786.24M	870.57M	1.03B	510.20M
Cash Flow
Free Cash Flow	0.00	-324.77M	-45.47M	-910.69M	-453.75M	-186.06M
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: Negative
• Last Price: 469.00
• 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:9878, the sentiment is Negative. The current price of 469 is below the 20-day moving average (MA) of 575.90, below the 50-day MA of 556.34, and below the 200-day MA of 691.85, indicating a bearish trend. The MACD of -1.83 indicates Positive momentum. The RSI at 33.77 is Neutral, neither overbought nor oversold. The STOCH value of 19.89 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:9878.

Sekido Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
7606	72 Outperform	¥70.61B	3.05	―	2.73%	10.48%	-34.38%
8214	72 Outperform	¥139.45B	20.46	―	4.49%	2.21%	4.36%
8219	71 Outperform	¥122.90B	24.22	5.53%	6.09%	-1.03%	4.12%
8227	68 Neutral	¥746.94B	16.45	8.48%	2.02%	―	―
2670	66 Neutral	¥616.07B	17.79	12.11%	2.68%	2.99%	5.66%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
9878	41 Neutral	¥1.59B	-3.26	―	2.14%	-25.92%	-1005.20%