PA Co., Ltd. (4766) AI Stock Analysis

• Market Cap: ¥2.94B
• Dividend Yield: 3.32%
• Average Volume (3M): 117.75K
• Price to Earnings (P/E): 42.6
• Beta (1Y): 0.25
• Revenue Growth: 5.45%
• EPS Growth: 38.61%
• Country: JP
• Employees: 153
• Sector: Industrials
• Sector Strength: 94
• Industry: Staffing & Employment Services
• EPS (TTM): 0.23
• Shares Outstanding: 11,229,800
• 10 Day Avg. Volume: 134,660
• 30 Day Avg. Volume: 117,746
• PEG Ratio: 0.29
• Price to Book (P/B): 5.90
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 0.00
• 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

• Rating: 72 Outperform
• Price Target: ¥314.00 ▲(15.02%Upside)

The stock's strong technical performance and improving financial health are the primary drivers of its score. However, a high P/E ratio indicates potential overvaluation risks. Continued financial discipline is necessary given its debt levels and cash flow volatility.

PA Co., Ltd. Business Overview & Revenue Model

Company Description

PA Co., Ltd. (4766) is a Japanese company primarily engaged in the provision of comprehensive IT solutions and services. The company operates in sectors including system integration, cloud services, and IT infrastructure management. PA Co.'s core services involve developing customized software solutions, offering IT consulting, and providing maintenance and support services to a diverse client base spanning various industries.

How the Company Makes Money

PA Co., Ltd. generates revenue through a multi-faceted business model that includes system development contracts, IT consulting fees, and subscription-based cloud service offerings. Its key revenue streams involve long-term contracts with businesses for custom software development projects, where PA Co. designs and implements tailored IT solutions to meet specific client needs. Additionally, the company earns from providing ongoing support and maintenance services, ensuring the smooth operation of client IT systems. PA Co. also capitalizes on the growing demand for cloud services by offering scalable and secure cloud solutions on a subscription basis, thus ensuring a steady flow of recurring revenue. Strategic partnerships with technology providers enhance PA Co.'s service offerings and expand its market reach, contributing significantly to its earnings.

PA Co., Ltd. Financial Statement Overview

Summary

PA Co., Ltd. is on a positive trajectory with improving revenue, profitability, and cash flow generation. The company has managed to reduce its debt levels and enhance its equity position, but a substantial debt load and fluctuating cash flows necessitate continued financial discipline.

Income Statement

PA Co., Ltd. demonstrated strong revenue growth with a consistent increase in total revenue over the years, reaching 1,877 million in 2024 from 1,586 million in 2021. The company recovered well from previous losses, achieving a positive net income in recent years. Gross profit margin remained healthy, and both EBIT and EBITDA margins showed improvement, reflecting operational efficiency gains. However, the net profit margin is still modest, indicating room for further profitability improvement.

Balance Sheet

The company's balance sheet is stable with a reasonable debt-to-equity ratio. The equity ratio improved over time, suggesting a stronger capital structure. Return on equity has shown a positive trend, indicating efficient use of equity in generating profits. However, the total debt remains significant, which could pose risks if not managed carefully.

Cash Flow

PA Co., Ltd. exhibited a significant turnaround in operating cash flow, transitioning from negative to positive values, indicating improved cash generation from core operations. The free cash flow growth is positive, which supports future investment and debt servicing. However, the fluctuations in cash flow components suggest some volatility, which should be monitored.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
1.88B	1.79B	1.67B	1.58B	1.60B
	Gross Profit
772.42M	783.88M	744.24M	684.72M	637.85M
	EBIT
67.16M	59.59M	41.46M	-60.36M	-205.06M
	EBITDA
94.68M	87.78M	107.36M	-208.07M	-16.89M
	Net Income Common Stockholders
73.42M	44.96M	49.24M	-280.54M	-103.76M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
824.30M	878.86M	822.28M	853.15M	1.01B
	Total Assets
1.34B	1.36B	1.33B	1.40B	1.73B
	Total Debt
595.48M	650.49M	705.50M	755.00M	800.00M
	Net Debt
-228.82M	-228.37M	-116.78M	-98.16M	-214.22M
	Total Liabilities
871.69M	957.67M	978.71M	1.05B	1.10B
	Stockholders Equity
465.00M	395.37M	350.53M	351.20M	630.75M
Cash Flow		Free Cash Flow
11.12M	105.01M	11.60M	-120.78M	-249.96M
	Operating Cash Flow
21.83M	111.27M	58.30M	-92.68M	-71.13M
	Investing Cash Flow
-19.87M	-1.41M	-40.07M	225.08M	-12.40M
	Financing Cash Flow
-55.44M	-55.01M	-49.50M	-45.07M	184.88M

PA Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 273.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:4766, the sentiment is Positive. The current price of 273 is above the 20-day moving average (MA) of 264.50, above the 50-day MA of 252.78, and above the 200-day MA of 270.86, indicating a bullish trend. The MACD of 5.64 indicates Negative momentum. The RSI at 57.87 is Neutral, neither overbought nor oversold. The STOCH value of 34.67 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:4766.

PA Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
6538	76 Outperform	¥3.69B	17.17		2.82%	13.99%	―
4766	72 Outperform	¥2.94B	42.57		3.32%	5.45%	38.61%
7361	71 Outperform	¥3.78B	9.41		2.27%	16.31%	0.09%
6563	67 Neutral	¥3.65B	40.28		―	26.41%	8.91%
6198	66 Neutral	¥2.69B	23.04		1.98%	-4.08%	-41.24%
Sector *	66 Neutral	$4.48B	12.24	5.32%	248.54%	4.09%	-12.10%
7043	60 Neutral	¥1.96B	―		0.90%	4.29%	-2895.03%