TRADE WORKS Co.,Ltd (3997) AI Stock Analysis

TRADE WORKS Co.,Ltd

(TSE/TYO:3997)

Select Model

Rating:49Neutral

Price Target:JPY 348.00▼(-8.42% Downside)

Action:reiterated

Date:10/27/26

The score is primarily held back by weak technicals (price below major moving averages and negative MACD) and an expensive valuation (P/E ~96 with a low dividend yield). Financial performance is improving—driven by multi-year revenue growth and better 2025 free cash flow—but earnings remain thin and historically volatile, and leverage has increased, tempering the overall outlook.

Positive Factors

Steady Revenue GrowthRevenue growth across multiple years indicates expanding business activity and provides a stronger base for future earnings recovery. The 2025 rebound after a nearly flat 2024 also suggests demand remained resilient, although continued execution will be needed to convert scale into durable profits.

Negative Factors

Thin and Volatile ProfitabilityThe return to profit is encouraging, but a net margin of about 1% leaves limited protection against operating setbacks and cost pressure. The prior losses and sharp margin decline from approximately 6–7% in 2021–2022 show that earnings power has not yet demonstrated durable stability.

TRADE WORKS Co.,Ltd (3997) vs. iShares MSCI Japan ETF (EWJ)

Market Cap: JPY 15.46B
Dividend Yield: 0.53%
Average Volume (3M): 236.80K
Price to Earnings (P/E): 103.8
Beta (1Y): 1.35
Revenue Growth: 19.65%
EPS Growth: ―
Country: Japan
Employees: 270
Sector: General
Sector Strength: 55
Industry: Information Technology Services

TRADE WORKS Co.,Ltd Business Overview & Revenue Model

Company Description

Established in 1999 and headquartered in Tokyo, Japan, TRADE WORKS Co., Ltd. delivers sophisticated software solutions tailored for the financial sector, specifically supporting the securities, forex (FX) margin trading, and commodity futures industr...

How the Company Makes Money

Detailed, source-verifiable information on TRADE WORKS Co.,Ltd (3997)’s revenue model, key revenue streams, and material partnerships is not available in the information provided here. null

TRADE WORKS Co.,Ltd Financial Statement Overview

Summary

Steady multi-year revenue growth and improved 2025 cash generation support the recovery, but profitability has been volatile (losses in 2023–2024, only a small profit in 2025 with ~1% net margin). Balance sheet risk has risen as leverage increased materially since 2022 (debt-to-equity ~0.61), making margin durability and sustained positive free cash flow key watch items.

Income Statement

58Neutral

Balance Sheet

55Neutral

Cash Flow

60Neutral

Financial statement breakdown
Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	5.63B	5.05B	4.59B	3.75B	3.27B	2.55B
Gross Profit	1.36B	1.18B	786.15M	753.00M	832.23M	699.74M
EBITDA	629.45M	376.08M	83.78M	83.43M	415.48M	374.67M
Net Income	143.74M	56.89M	-151.69M	-53.00M	200.30M	189.97M
Balance Sheet
Total Assets	4.03B	4.02B	2.91B	3.04B	2.18B	2.10B
Cash, Cash Equivalents and Short-Term Investments	941.59M	973.07M	804.14M	615.04M	688.29M	802.55M
Total Debt	495.02M	1.08B	848.15M	585.65M	9.69M	0
Total Liabilities	1.50B	2.14B	1.63B	1.66B	717.21M	392.78M
Stockholders Equity	2.52B	1.78B	1.28B	1.39B	1.46B	1.71B
Cash Flow
Free Cash Flow	0	278.13M	-12.87M	-217.00M	390.02M	24.21M
Operating Cash Flow	0	312.10M	278.45M	-207.00M	399.77M	53.23M
Investing Cash Flow	0	-845.98M	-397.30M	-404.75M	-252.60M	-78.58M
Financing Cash Flow	0	702.80M	307.94M	514.00M	-261.42M	-8.10M

TRADE WORKS Co.,Ltd Technical Analysis

Technical Analysis SentimentNegative

Last Price380.00

Price Trends

50DMA403.34Negative

100DMA383.65Negative

200DMA405.88Negative

Market Momentum

MACD-13.61Positive

RSI44.17Neutral

STOCH55.34Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:3997, the sentiment is Negative. The current price of 380.00 is below the 20-day moving average (MA) of 407.60, below the 50-day MA of 403.34, and below the 200-day MA of 405.88, indicating a bearish trend. The MACD of -13.61 indicates Positive momentum. The RSI at 44.17 is Neutral, neither overbought nor oversold. The STOCH value of 55.34 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:3997.

TRADE WORKS Co.,Ltd Peers Comparison

Overall Rating

UnderperformOutperform

Sector (55)

Financial Indicators

JP:3997 against its peers
Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
JP:4396	81Outperform	JPY 31.32B	16.64	―	2.12%	15.42%	27.83%
JP:3984	80Outperform	JPY 22.67B	13.74	―	1.70%	16.61%	15.32%
JP:2185	79Outperform	JPY 24.12B	8.36	―	2.99%	9.46%	34.80%
JP:3393	71Outperform	JPY 31.07B	12.12	―	5.04%	7.10%	31.29%
Sector *	55Neutral	$6.65B	3.83	-15.92%	6.20%	10.91%	7.18%
JP:3997	49Neutral	JPY 15.60B	103.82	―	0.53%	19.65%	―
JP:4813	48Neutral	JPY 14.42B	-10.79	―	―	24.78%	83.28%

* General Sector Average

Performance Comparison

JP:3997 and its peers over the selected period
Ticker	Company Name	Price	Change	% Change
JP:3997	TRADE WORKS Co.,Ltd	380.00	35.58	10.33%
JP:2185	CMC Corporation	1814.00	253.41	16.24%
JP:3393	Startia Holdings,Inc.	3135.00	520.62	19.91%
JP:3984	User Local, Inc.	1410.00	-524.58	-27.12%
JP:4396	System Support, Inc.	1507.00	24.62	1.66%
JP:4813	Access Co., Ltd.	365.00	-178.00	-32.78%

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.

Date of analysis: Oct 27, 2026

TRADE WORKS Co.,Ltd AI Stock Analysis