Lead Real Estate Co., Ltd. Sponsored ADR (LRE) AI Stock Analysis

• Market Cap: $18.83M
• Dividend Yield: 3.4%
• Average Volume (3M): 122.37K
• Price to Earnings (P/E): 4.4
• Beta (1Y): 0.81
• Revenue Growth: 0.11%
• EPS Growth: 39.20%
• Country: US
• Employees: 70
• Sector: Real Estate
• Sector Strength: 53
• Industry: Real Estate - Development
• EPS (TTM): N/A
• Shares Outstanding: 13,641,900
• 10 Day Avg. Volume: 106,657
• 30 Day Avg. Volume: 122,369
• PEG Ratio: -0.04
• Price to Book (P/B): 0.71
• Price to Sales (P/S): 0.20
• P/FCF Ratio: 4.67
• Enterprise Value/Market Cap: 4.79
• Enterprise Value/Revenue: <0.01
• Enterprise Value/Gross Profit: 0.03
• Enterprise Value/Ebitda: 0.09
• 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: 58 Neutral
• Price Target: $1.50 ▼(-6.25% Downside)
• Action: Reiterated Date: 01/21/26
• Date: Action: Reiterated 01/21/26

The score is held back primarily by weak financial performance, driven by a severe revenue drop and poor cash flow conversion alongside high leverage. These risks are partially offset by attractive valuation (low P/E and dividend yield) and a modestly positive technical setup with neutral momentum.

Positive Factors

Diversified revenue streams

Multiple revenue lines—property sales, leasing and property management fees—create structural resilience versus single-source models. Recurring rental and management fees provide steady cash flow while sales drive growth, reducing cyclicality risk over the next several months.

Healthy return on equity

ROE around 16% indicates the company can generate solid profits from shareholder capital even amid revenue pressure. This efficiency supports longer-term ability to reinvest, service equity holders and attract financing if margins and asset utilization remain stable.

Experienced CFO appointment

Hiring a seasoned finance executive is a structural governance improvement. Strengthened financial oversight, capital-markets engagement and corporate planning can materially improve cash management, disclosure and deleveraging efforts over the medium term.

Negative Factors

Severe revenue decline

A near-total revenue collapse undermines operational scale and the business model’s core cash engines. Even with margin improvements, such a steep top-line shock erodes long-term contracts, reduces bargaining power with suppliers and risks asset underutilization for months.

Weak cash generation

Extremely poor free cash flow and inability to convert income into cash limit the firm’s capacity to fund operations, capital expenditure or debt servicing internally. This structural cash constraint increases reliance on external financing and hampers strategic flexibility.

High leverage

Elevated debt relative to equity raises interest burden and refinancing risk. Combined with weak cash generation and revenue stress, high leverage materially increases the chance of covenant pressure or constrained investment, weighing on financial stability over the medium term.

Lead Real Estate Co., Ltd. Sponsored ADR Business Overview & Revenue Model

Company Description

Lead Real Estate Co., Ltd, together with its subsidiaries, develops and sells luxury residential properties. The company develops single-family homes and condominiums. It operates hotels in Tokyo and leases apartment building units in Japan and Dallas, Texas. The company was incorporated in 2001 and is headquartered in Tokyo, Japan.

How the Company Makes Money

Lead Real Estate Co., Ltd. generates revenue through multiple streams, primarily from property sales, rental income, and property management fees. The company earns significant income by developing residential and commercial properties and then selling them to investors or end-users. Additionally, LRE leases properties to tenants, providing a steady cash flow through rental agreements. The company also offers property management services, charging fees for managing properties on behalf of owners. Strategic partnerships with local governments and other real estate firms enhance its market reach and operational efficiency, contributing to its overall earnings.

Lead Real Estate Co., Ltd. Sponsored ADR Financial Statement Overview

Summary

Financials are pressured by an extreme revenue decline (revenue growth -99.35%) and weak cash conversion (operating cash flow to net income ratio 0; free cash flow growth -101.26%). Profitability margins have improved and ROE is decent (16.22%), but high leverage (debt-to-equity 2.58) and cash flow weakness keep the score low.

Income Statement

The income statement shows a significant decline in revenue, with a drastic drop in revenue growth rate to -99.35% in the latest year. Margins such as gross profit margin (19.79%) and net profit margin (4.49%) are moderate but have improved compared to previous years. However, the sharp revenue decline is a major concern.

Balance Sheet

The balance sheet indicates high leverage with a debt-to-equity ratio of 2.58, which is a slight improvement from previous years. Return on equity is decent at 16.22%, suggesting some efficiency in generating profits from equity. However, the high debt levels pose a risk to financial stability.

Cash Flow

Cash flow analysis reveals challenges, with a negative free cash flow growth rate of -101.26%. The operating cash flow to net income ratio is 0, indicating issues in converting income to cash. The free cash flow to net income ratio is 0.24, showing limited cash generation relative to net income.

Breakdown	TTM	Jun 2025	Jun 2024	Jun 2023	Jun 2022	Jun 2021
Income Statement
Total Revenue	19.27B	125.93M	18.95B	17.44B	14.69B	11.26B
Gross Profit	3.32B	24.92M	2.95B	2.76B	2.44B	1.49B
EBITDA	1.06B	10.60M	1.08B	1.03B	904.86M	481.20M
Net Income	572.33M	5.66M	626.96M	611.92M	551.62M	279.49M
Balance Sheet
Total Assets	17.22B	142.77M	17.22B	15.82B	12.42B	9.41B
Cash, Cash Equivalents and Short-Term Investments	1.30B	18.39M	1.30B	786.37M	403.11M	480.32M
Total Debt	11.60B	90.06M	11.60B	11.37B	8.80B	5.93B
Total Liabilities	12.98B	107.94M	12.98B	13.07B	10.22B	7.77B
Stockholders Equity	4.24B	34.89M	4.24B	2.75B	2.21B	1.64B
Cash Flow
Free Cash Flow	-418.32M	5.29M	-655.96M	-2.36B	-3.47B	-414.89M
Operating Cash Flow	1.88B	22.14M	1.57B	-1.12B	-2.93B	-244.66M
Investing Cash Flow	-2.31B	-17.52M	-2.24B	-1.26B	-19.08M	-160.43M
Financing Cash Flow	995.96M	4.65M	1.18B	2.55B	2.85B	555.60M

Lead Real Estate Co., Ltd. Sponsored ADR Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 1.60
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For LRE, the sentiment is Positive. The current price of 1.6 is above the 20-day moving average (MA) of 1.30, above the 50-day MA of 1.40, and above the 200-day MA of 1.53, indicating a neutral trend. The MACD of -0.01 indicates Negative momentum. The RSI at 52.16 is Neutral, neither overbought nor oversold. The STOCH value of 39.22 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for LRE.

Lead Real Estate Co., Ltd. Sponsored ADR Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
AXR	72 Outperform	$136.29M	23.89	8.04%	―	-27.32%	-15.12%
Sector *	65 Neutral	$2.17B	12.19	3.79%	4.94%	3.15%	1.96%
LRE	58 Neutral	$18.83M	4.36	18.83%	3.40%	0.11%	39.20%
ARL	53 Neutral	$276.20M	523.69	0.95%	―	-0.58%	―
AMBR	48 Neutral	$242.64M	2.08	―	―	-75.38%	―

Lead Real Estate Co., Ltd. Sponsored ADR Corporate Events

Lead Real Estate Names Veteran Finance Executive Ken Takahashi as CFO to Support Next Growth Phase

On December 3, 2025, Lead Real Estate Co., Ltd. saw the resignation of Chief Financial Officer Daisuke Takahashi for personal reasons, with the company stating there were no disagreements related to operations, policies or practices. Effective January 1, 2026, the company appointed veteran finance executive Ken Takahashi as its new CFO, a move formally announced on January 6, 2026. Ken Takahashi brings extensive senior-level experience in financial management, accounting, capital markets and corporate strategy from roles at Fujimoto Holdings, PIP group companies, KPMG Peat Marwick, Nikko Group’s venture capital operations and Mirai Asset Management. Management has framed his appointment as a key step in strengthening financial oversight, capital markets engagement and corporate planning as the luxury real estate and extended-stay hotel operator enters its next phase of growth, signaling an intent to deepen financial discipline and enhance value creation for stakeholders.

The most recent analyst rating on (LRE) stock is a Hold with a $1.50 price target. To see the full list of analyst forecasts on Lead Real Estate Co., Ltd. Sponsored ADR stock, see the LRE Stock Forecast page.