Mercari (MCARY)
OTHER OTC:MCARY
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Mercari
(OTC:MCARY)
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Rating:64Neutral
Price Target:
$12.00
▲(26.72% Upside)
Action:ReiteratedDate:02/18/26
The score is held back primarily by weak cash generation (negative operating and free cash flow) and higher leverage despite strong profitability. Offsetting that risk, technicals are clearly bullish with price above major moving averages and positive momentum indicators. Valuation appears moderate based on the P/E.
Positive Factors
High margins & ROE
Sustained high gross and operating margins plus a ~29% ROE indicate strong unit economics and pricing power in Mercari's core marketplace. Durable margins provide internal capacity to fund product development and marketing even if top-line growth slows, supporting long-term profitability.
Negative Factors
Negative operating & free cash flow
Persistent negative OCF and FCF materially reduce financial flexibility and force reliance on external funding to sustain operations and investments. Over multiple periods this cash burn raises refinancing and capital-allocation risk, limiting the company's ability to self-fund growth or weather downturns.
Read all positive and negative factors
Positive Factors
Negative Factors
High margins & ROE
Sustained high gross and operating margins plus a ~29% ROE indicate strong unit economics and pricing power in Mercari's core marketplace. Durable margins provide internal capacity to fund product development and marketing even if top-line growth slows, supporting long-term profitability.
Read all positive factors
Mercari (MCARY) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$3.68B
Dividend YieldN/A
Average Volume (3M)14.00
Price to Earnings (P/E)22.7
Beta (1Y)0.53
Revenue Growth5.63%
EPS Growth111.35%
CountryUS
Employees2,080
SectorConsumer Cyclical
Sector Strength84
IndustrySpecialty Retail
Share Statistics
EPS (TTM)0.11
Shares Outstanding329,941,000
10 Day Avg. Volume44
30 Day Avg. Volume14
Financial Highlights & Ratios
PEG Ratio0.18
Price to Book (P/B)4.44
Price to Sales (P/S)2.29
P/FCF Ratio-35.96
Enterprise Value/Market Cap180.32
Enterprise Value/Revenue3.21
Enterprise Value/Gross Profit4.39
Enterprise Value/Ebitda16.96
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
EPS Forecast (FY)N/A
Revenue Forecast (FY)N/A
Mercari Business Overview & Revenue Model
Company Description
Mercari, Inc. engages in the planning, development, and operation of the Mercari marketplace applications in Japan and the United States. Mercari, Inc. was incorporated in 2013 and is based in Tokyo, Japan....
How the Company Makes Money
Mercari generates revenue primarily through transaction fees charged on sales made through its platform. When a seller lists an item and completes a sale, Mercari typically takes a percentage of the transaction as a commission, which serves as the...
Mercari Earnings Call Summary
Earnings Call Date:Aug 05, 2025
(Q4-2025)
| % Change Since: |
Next Earnings Date:May 11, 2026
Earnings Call Sentiment Neutral
The earnings call presented a mix of strong financial performance and significant challenges. Record profitability across all segments and notable fintech growth were overshadowed by underwhelming revenue growth and challenges in the U.S. market.Positive Updates
Record High Core Operating Profit
Mercari reported a core operating profit of JPY 27.5 billion, significantly exceeding forecasts with a 46% year-on-year growth.
Negative Updates
Revenue Growth Challenge
Overall revenue growth was only 3%, reaching JPY 192.6 billion, falling short of forecasts.
Read all updates
Q4-2025 Updates
Positive
Negative
Record High Core Operating Profit
Mercari reported a core operating profit of JPY 27.5 billion, significantly exceeding forecasts with a 46% year-on-year growth.
Read all positive updates
Company Guidance
During Mercari's FY 2025 Full Year Financial Results Presentation, the company revealed that their core operating profit reached JPY 27.5 billion, surpassing forecasts with a year-on-year growth of 46%. However, revenue was JPY 192.6 billion, marking a 3% increase, but fell short of expectations due to a slowdown in marketplace and U.S. business growth. Despite these challenges, all three core segments—Marketplace, Fintech, and U.S.—achieved profitability, with cross-border transaction GMV surpassing JPY 90 billion and Mercard issuances exceeding 5 million. The company aims for a double-digit CAGR in revenue and over 25% CAGR in core operating profit by FY 2027, driven by Marketplace enhancements and Fintech growth, including a 32% increase in credit balance. For FY 2026, Mercari forecasts revenue of JPY 200-210 billion and core operating profit of JPY 28-32 billion, with plans to capitalize on AI to enhance user experience and maintain robust growth across all segments.Mercari Financial Statement Overview
Summary
Income Statement
78
Positive
Balance Sheet
58
Neutral
Cash Flow
24
Negative
| Breakdown | TTM | Jun 2025 | Jun 2024 | Jun 2023 | Jun 2022 | Jun 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 206.61B | 192.63B | 187.41B | 172.06B | 147.05B | 106.11B |
| Gross Profit | 150.85B | 138.26B | 129.73B | 114.42B | 95.14B | 81.80B |
| EBITDA | 39.09B | 29.67B | 20.42B | 17.96B | -3.05B | 6.03B |
| Net Income | 29.50B | 26.11B | 13.46B | 13.07B | -7.57B | 5.72B |
Balance Sheet | ||||||
| Total Assets | 615.14B | 543.76B | 501.77B | 415.29B | 339.86B | 262.53B |
| Cash, Cash Equivalents and Short-Term Investments | 159.16B | 153.40B | 197.31B | 204.73B | 218.85B | 171.46B |
| Total Debt | 234.16B | 199.38B | 193.31B | 157.53B | 131.35B | 71.15B |
| Total Liabilities | 503.91B | 444.12B | 429.63B | 360.06B | 301.87B | 222.52B |
| Stockholders Equity | 110.89B | 99.27B | 71.84B | 54.67B | 37.68B | 39.63B |
Cash Flow | ||||||
| Free Cash Flow | -22.05B | -12.25B | -43.49B | -37.35B | -26.89B | 2.95B |
| Operating Cash Flow | -21.14B | -11.95B | -43.34B | -36.88B | -26.22B | 3.37B |
| Investing Cash Flow | -53.30B | -209.62M | -877.00M | -632.00M | -671.00M | 6.91B |
| Financing Cash Flow | 50.11B | 3.37M | 32.09B | 26.84B | 62.06B | 19.77B |
Mercari Technical Analysis
Neutral
9.47
Price Trends
10.79
Negative
9.83
Positive
8.95
Positive
Market Momentum
0.01
Positive
46.32
Neutral
25.97
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For MCARY, the sentiment is Neutral. The current price of 9.47 is below the 20-day moving average (MA) of 11.02, below the 50-day MA of 10.79, and above the 200-day MA of 8.95, indicating a neutral trend. The MACD of 0.01 indicates Positive momentum. The RSI at 46.32 is Neutral, neither overbought nor oversold. The STOCH value of 25.97 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for MCARY.
Mercari Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
69 Neutral | $5.01B | 28.32 | 25.85% | 3.10% | 13.37% | -19.37% | |
67 Neutral | $40.25B | 19.34 | 42.68% | 1.38% | 4.89% | 17.30% | |
64 Neutral | $3.68B | 22.69 | 29.34% | ― | 5.63% | 111.35% | |
63 Neutral | $9.79B | 57.58 | 55.17% | ― | 9.80% | -46.84% | |
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% | |
55 Neutral | $5.05B | 33.41 | -15.36% | ― | 1.98% | -20.98% | |
53 Neutral | $440.82M | -38.47 | -34.47% | ― | -4.90% | 50.77% |
* Consumer Cyclical Sector Average
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Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.