Ridge-i Inc. (5572) AI Stock Analysis

• Market Cap: ¥11.02B
• Dividend Yield: N/A
• Average Volume (3M): 263.61K
• Price to Earnings (P/E): 78.3
• Beta (1Y): 1.12
• Revenue Growth: 141.92%
• EPS Growth: 12.72%
• Country: JP
• Employees: 29
• Sector: Technology
• Sector Strength: 88
• Industry: Software - Application
• EPS (TTM): 1.79
• Shares Outstanding: 3,909,880
• 10 Day Avg. Volume: 501,670
• 30 Day Avg. Volume: 263,610
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• 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: 68 Neutral
• Price Target: ―

Ridge-i Inc. showcases strong financial performance with significant revenue growth and a robust balance sheet, suggesting a solid foundation for future expansion. However, technical indicators show mixed signals with potential overbought conditions, and the high P/E ratio indicates a premium valuation that could limit upside potential. The absence of dividend yield may also deter certain investors. Overall, the stock is positioned for growth, but investors should be cautious of current valuation and market momentum.

Ridge-i Inc. Business Overview & Revenue Model

Company Description

Ridge-i Inc. engages in the consulting and development of artificial intelligence (AI)/deep learning technologies. It offers problem solving consulting services; new business creation services; sells licensed AI products; environmental and social infrastructure monitoring platforms; and AI analysis solutions using satellite data. The company's products are used in manufacturing industry, space/satellite, infrastructure plants, environmental monitoring, security/crime prevention, distribution/logistics, architecture, media, and event venues and store applications. Ridge-i Inc. was incorporated in 2016 and is based in Tokyo, Japan.

How the Company Makes Money

Ridge-i Inc. generates revenue through the development and deployment of AI solutions and services. The company earns money by offering AI consulting services, where it advises businesses on integrating AI technologies into their operations. Additionally, Ridge-i develops custom AI software and applications tailored to the specific needs of its clients, which is a significant revenue stream. The company also offers subscription-based cloud services, allowing clients to access and utilize its AI tools and platforms. Partnerships with other technology firms and collaborations on large-scale AI projects contribute to its earnings, enhancing its market reach and capabilities.

Ridge-i Inc. Financial Statement Overview

Summary

Ridge-i Inc. exhibits strong financial health with marked improvements in revenue growth, profitability, and cash flow generation. The company maintains a solid balance sheet with minimal debt, providing ample room for strategic investments. While the return on equity is slightly below expectations, the overall financial trajectory is positive, positioning the company well for future growth and resilience in the competitive software application industry.

Income Statement

Ridge-i Inc. has demonstrated impressive revenue growth with a 35.6% increase from 2023 to 2024, indicating strong business expansion. The gross profit margin for 2024 is robust at 68.6%, highlighting effective cost management. The net profit margin has improved significantly to 11.4% from 5.6% in the previous year, showcasing enhanced profitability. Both EBIT and EBITDA margins have strengthened, reflecting efficient operational performance.

Balance Sheet

The company's balance sheet is solid with a high equity ratio of 90.6%, indicating financial stability and low reliance on debt. The return on equity is at 5.7% for 2024, slightly below industry benchmarks. The negative debt-to-equity ratio due to significant cash reserves and minimal debt suggests strong liquidity, though it might reflect under-leveraging, which could limit growth potential.

Cash Flow

Ridge-i Inc. has turned around its cash flow situation, with a positive free cash flow of 342.6 million yen, up from a negative position in 2023. The operating cash flow to net income ratio of 2.9 indicates efficient cash generation relative to earnings. The free cash flow growth rate is remarkable, further strengthening the company’s financial flexibility and potential for reinvestment.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	1.07B	790.38M	968.52M	419.44M
Gross Profit	735.61M	515.65M	612.58M	191.49M
EBITDA	171.49M	83.97M	88.45M	-123.40M
Net Income	121.70M	44.56M	150.06M	-148.76M
Balance Sheet
Total Assets	2.36B	2.06B	1.56B	1.39B
Cash, Cash Equivalents and Short-Term Investments	1.37B	1.72B	1.38B	1.21B
Total Debt	0.00	0.00	0.00	2.84M
Total Liabilities	222.89M	73.18M	147.63M	128.91M
Stockholders Equity	2.14B	1.99B	1.41B	1.26B
Cash Flow
Free Cash Flow	342.58M	-184.98M	173.61M	-81.42M
Operating Cash Flow	348.62M	-145.76M	178.19M	-76.46M
Investing Cash Flow	-723.02M	-38.26M	-4.58M	-4.96M
Financing Cash Flow	24.42M	521.65M	-2.84M	777.16M

Ridge-i Inc. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 2819.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:5572, the sentiment is Positive. The current price of 2819 is below the 20-day moving average (MA) of 2954.45, above the 50-day MA of 2724.40, and above the 200-day MA of 2662.59, indicating a neutral trend. The MACD of 22.03 indicates Positive momentum. The RSI at 48.11 is Neutral, neither overbought nor oversold. The STOCH value of 16.49 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:5572.

Ridge-i Inc. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
3920	79 Outperform	5.56B	13.75	12.63%	1.00%	7.38%	515.19%
3996	77 Outperform	4.62B	22.43	14.26%	―	-1.23%	2.92%
3923	76 Outperform	487.44B	51.06	36.42%	0.17%	25.22%	70.77%
5572	68 Neutral	¥11.02B	78.27		―	141.92%	12.72%
3697	66 Neutral	355.38B	43.18	15.06%	―	18.03%	46.07%
3994	56 Neutral	338.65B	-56.31	-16.91%	―	20.96%	-6.20%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%