Charle Co., Ltd. (9885) AI Stock Analysis

• Market Cap: ¥5.62B
• Dividend Yield: 2.23%
• Average Volume (3M): 9.05K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.41
• Revenue Growth: -0.67%
• EPS Growth: -453.71%
• Country: JP
• Employees: 227
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Apparel - Manufacturers
• EPS (TTM): -161.79
• Shares Outstanding: 16,086,250
• 10 Day Avg. Volume: 10,000
• 30 Day Avg. Volume: 9,046
• PEG Ratio: 0.02
• Price to Book (P/B): 0.36
• Price to Sales (P/S): 0.52
• P/FCF Ratio: -1.91
• 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: 43 Neutral
• Price Target: ¥364.00 ▲(2.82% Upside)
• Action: Reiterated Date: 10/11/25
• Date: Action: Reiterated 10/11/25

Charle Co., Ltd. receives an overall stock score of 43, primarily driven by weak financial performance with significant concerns in revenue decline, net losses, and negative cash flows, despite a strong balance sheet. Technical analysis indicates a lack of momentum, and valuation is neutral due to a negative P/E ratio offset by a modest dividend yield. The financial performance carries the most weight in this assessment.

Positive Factors

Strong Balance Sheet

A strong balance sheet with low debt and high equity provides financial stability and flexibility, allowing the company to weather economic challenges and invest in growth opportunities.

Substantial Cash Reserves

Having substantial cash reserves ensures liquidity and the ability to meet short-term obligations, which is crucial for operational stability and strategic investments.

Diversified Revenue Streams

Diversified revenue streams reduce dependency on a single source, enhancing resilience against market fluctuations and providing multiple growth avenues.

Negative Factors

Declining Revenue Growth

Negative revenue growth indicates challenges in market competitiveness or demand, necessitating strategic changes to reverse the trend and ensure long-term viability.

Negative Cash Flow

Negative cash flow highlights operational inefficiencies and can limit the company's ability to invest in growth or manage debt, impacting long-term sustainability.

Shrinking Profit Margins

Shrinking profit margins and net losses indicate cost pressures and pricing challenges, which can erode profitability and require strategic adjustments to improve efficiency.

Charle Co., Ltd. Business Overview & Revenue Model

Company Description

Charle Co.,Ltd. engages in the sale of apparel, cosmetics, health foods, etc. It primarily sells women's underwear, innerwear, and leg knits, as well as men's and kids clothing; and skin, body, and hair care products. The company sells its products through mail order and door-to-door channels. Charle Co.,Ltd. was founded in 1975 and is headquartered in Kobe, Japan.

How the Company Makes Money

The company generates revenue through multiple key streams, primarily by selling electronic components and systems to manufacturers and businesses in various sectors. Its revenue model includes direct sales, long-term contracts with clients, and partnerships with other technology firms for co-development projects. Additionally, Charle Co., Ltd. benefits from providing after-sales services and support, which creates recurring income. Significant partnerships with industry leaders enhance its market presence, allowing for increased sales and collaborative innovation, further contributing to its overall earnings.

Charle Co., Ltd. Financial Statement Overview

Summary

Charle Co., Ltd. shows a mixed financial picture. The balance sheet is a strength with a score of 75, reflecting low debt and a high equity ratio. However, the income statement (score of 25) indicates declining revenue and significant net losses, while the cash flow statement (score of 20) reveals alarming negative operating and free cash flows. This results in a low overall score due to operational and profitability concerns.

Income Statement

Charle Co., Ltd. shows a concerning trend in its income statement for the latest annual report (2025-03-31). Total revenue declined to 11.55 billion from 13.17 billion in the prior year, reflecting a revenue growth rate of -12.3%. Profitability metrics are weak, with a gross profit margin of 44.0% but a significant net loss of -1.01 billion, resulting in a net profit margin of -8.8%. EBIT and EBITDA margins are also negative at -8.3% and -4.4%, respectively, indicating operational challenges. While the gross margin remains decent, the overall profitability and revenue decline highlight significant weaknesses.

Balance Sheet

The balance sheet of Charle Co., Ltd. as of 2025-03-31 reflects a relatively strong financial position. The company maintains a low debt-to-equity ratio of 0.001, indicating minimal leverage and low financial risk. Stockholders' equity stands at 16.85 billion, with an equity ratio of 87.5%, showcasing a solid capital base relative to total assets of 19.26 billion. Additionally, net debt is negative at -8.30 billion, supported by strong cash reserves of 8.31 billion. While the balance sheet is stable, a slight decline in equity compared to the prior year suggests a need to monitor asset and equity trends.

Cash Flow

Cash flow performance for Charle Co., Ltd. in the latest annual report (2025-03-31) is weak. Operating cash flow is negative at -1.80 billion, a sharp decline from 1.51 billion in the prior year. Free cash flow is also deeply negative at -3.14 billion, reflecting a significant drop from 1.10 billion previously, with a growth rate of -384.8%. The inability to generate positive cash flow from operations and the high capital expenditure pose risks to liquidity. While the company has substantial cash reserves, the negative cash flow trajectory is a major concern.

Breakdown	TTM	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	11.98B	11.55B	13.17B	13.26B	15.56B	13.77B
Gross Profit	5.26B	5.08B	6.56B	6.76B	8.71B	6.16B
EBITDA	-493.00M	-482.00M	1.05B	787.00M	2.30B	-217.00M
Net Income	-902.00M	-1.01B	585.00M	-740.00M	1.02B	-1.33B
Balance Sheet
Total Assets	19.65B	19.27B	21.40B	20.50B	22.16B	20.65B
Cash, Cash Equivalents and Short-Term Investments	7.23B	8.31B	12.70B	11.24B	13.25B	11.11B
Total Debt	391.00M	13.00M	26.00M	60.00M	110.00M	176.00M
Total Liabilities	2.95B	2.42B	3.07B	2.69B	3.34B	2.70B
Stockholders Equity	16.60B	16.85B	18.32B	17.81B	18.81B	17.95B
Cash Flow
Free Cash Flow	0.00	-3.14B	1.24B	-1.05B	2.88B	-1.14B
Operating Cash Flow	0.00	-1.80B	1.51B	-733.00M	3.00B	-1.04B
Investing Cash Flow	0.00	-2.68B	117.00M	-1.08B	-639.00M	3.32B
Financing Cash Flow	0.00	-509.00M	-160.00M	-193.00M	-225.00M	-219.00M

Charle Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 354.00
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:9885, the sentiment is Negative. The current price of 354 is below the 20-day moving average (MA) of 354.60, below the 50-day MA of 358.98, and below the 200-day MA of 370.35, indicating a bearish trend. The MACD of -1.93 indicates Positive momentum. The RSI at 42.54 is Neutral, neither overbought nor oversold. The STOCH value of 29.29 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:9885.

Charle Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
3608	68 Neutral	¥49.54B	7.26	18.28%	6.12%	-6.22%	679.61%
8011	67 Neutral	¥37.54B	13.45	―	5.23%	―	―
8029	66 Neutral	¥18.57B	12.71	3.89%	3.76%	-6.03%	-9.66%
7126	63 Neutral	¥4.83B	4.07	―	2.36%	2.14%	-0.39%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
8166	47 Neutral	¥3.93B	1.99	―	―	-5.25%	-77.53%
9885	43 Neutral	¥5.62B	-0.54	―	2.23%	-0.67%	-453.71%