GMO TECH, Inc. (6026) AI Stock Analysis

• Market Cap: ¥7.76B
• Dividend Yield: 4.2%
• Average Volume (3M): 8.97K
• Price to Earnings (P/E): 13.2
• Beta (1Y): 0.75
• Revenue Growth: -2.17%
• EPS Growth: 25.33%
• Country: JP
• Employees: 230
• Sector: Communication Services
• Sector Strength: 83
• Industry: Internet Content & Information
• EPS (TTM): 110.37
• Shares Outstanding: 1,100,620
• 10 Day Avg. Volume: 9,720
• 30 Day Avg. Volume: 8,970
• PEG Ratio: 0.77
• Price to Book (P/B): 10.33
• 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

GMO TECH, Inc. scores well in financial performance with strong revenue growth and profitability. However, bearish technical indicators and historical volatility in earnings and cash flows suggest caution. The stock is reasonably valued with a good dividend yield, making it attractive for income investors despite potential risks.

GMO TECH, Inc. Business Overview & Revenue Model

Company Description

GMO TECH, Inc. provides internet advertisement services in Japan and internationally. The company offers search engine optimization (SEO) services to optimize client's website; DeepCrawl, a technical SEO tool; job advertisement services; and internet advertisement services comprising listing, display, demand-side platform, and social media advertisement services, as well as map engine optimization consulting services. It also offers affiliate advertisement services, including GMO SmaAFFi, a service that assists advertisers and media owners to enhance their sales through affiliate marketing; GMO SmaAD, an ASP for pay-per-performance advertising services; and GMO SmaAD DSP, a pay-per-performance demand-side platform. The company was formerly known as GMO SEO Technology, Inc. and changed its name to GMO TECH, Inc. in December 2011. The company was incorporated in 2006 and is headquartered in Tokyo, Japan. GMO TECH, Inc. is a subsidiary of GMO Internet, Inc.

How the Company Makes Money

GMO TECH, Inc. generates revenue primarily through its internet advertising services. The company earns money by helping businesses enhance their online visibility and attract more customers through effective SEO strategies and digital marketing solutions. It also generates income from its media services by developing and managing content platforms that draw user traffic, which can be monetized through advertising. Partnerships with other digital platforms and advertising networks further contribute to its revenue streams, allowing GMO TECH to expand its reach and offer comprehensive marketing solutions to its clients.

GMO TECH, Inc. Financial Statement Overview

Summary

GMO TECH, Inc. demonstrates robust financial health with strong revenue growth, improved profitability margins, and a stable balance sheet. The income statement shows significant revenue and net profit margin improvement, while the balance sheet reflects prudent financial leverage. The cash flow statement indicates effective earnings conversion into cash, though historical volatility should be monitored.

Income Statement

GMO TECH, Inc. shows strong revenue growth with a rate of 9.78% from 2023 to 2024. The gross profit margin is healthy at 41.78%, and the net profit margin has improved significantly to 9.74% in 2024 from previous years. The EBIT and EBITDA margins indicate good operational efficiency. Overall, profitability metrics reflect a robust financial performance, although historical volatility in net income presents a cautionary note.

Balance Sheet

The company maintains a solid balance sheet with a low debt-to-equity ratio of 0.17, suggesting prudent financial leverage. The return on equity improved significantly to 54.78% in 2024, indicating effective use of shareholders' equity. The equity ratio of 44.11% reflects a balanced capital structure, although relatively low equity in earlier years could signify potential risk if liabilities increase.

Cash Flow

Operating cash flow has grown steadily, with a positive free cash flow reaching ¥402 million in 2024. With a free cash flow to net income ratio of 0.60, the company efficiently converts earnings into cash. However, cash flow volatility in previous years suggests the need for careful cash management as the company scales.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
6.87B	6.26B	5.46B	4.25B	2.70B
	Gross Profit
2.87B	2.46B	1.99B	1.40B	853.60M
	EBIT
899.00M	566.00M	226.00M	-258.00M	16.67M
	EBITDA
985.00M	582.00M	-141.00M	-204.99M	29.80M
	Net Income Common Stockholders
669.00M	405.00M	-295.00M	-288.00M	14.06M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
1.26B	1.28B	1.12B	590.00M	407.63M
	Total Assets
2.77B	2.76B	2.23B	1.72B	1.23B
	Total Debt
210.00M	280.00M	350.00M	210.00M	0.00
	Net Debt
-1.05B	-999.00M	-772.00M	-380.00M	-407.63M
	Total Liabilities
1.55B	1.95B	1.84B	1.24B	458.98M
	Stockholders Equity
1.22B	806.00M	393.00M	483.00M	771.79M
Cash Flow		Free Cash Flow
402.00M	223.00M	-162.00M	-221.00M	-113.01M
	Operating Cash Flow
402.00M	354.00M	-33.00M	62.00M	-11.54M
	Investing Cash Flow
-117.00M	-135.00M	-125.00M	-88.00M	-69.69M
	Financing Cash Flow
-318.00M	-60.00M	690.00M	209.00M	-72.10M

GMO TECH, Inc. Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 7310.00
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Positive
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:6026, the sentiment is Negative. The current price of 7310 is below the 20-day moving average (MA) of 9308.00, below the 50-day MA of 9108.40, and below the 200-day MA of 8153.99, indicating a bearish trend. The MACD of -302.65 indicates Positive momentum. The RSI at 27.37 is Positive, neither overbought nor oversold. The STOCH value of 2.72 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:6026.

GMO TECH, Inc. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
3989	79 Outperform	¥28.18B	17.57		1.33%	16.07%	13.19%
3696	68 Neutral	¥22.21B	37.53		3.11%	13.50%	-45.84%
3922	68 Neutral	¥31.64B	27.85		0.44%	17.06%	-3.98%
6026	66 Neutral	¥7.76B	13.16		4.20%	-2.17%	25.33%
6050	66 Neutral	¥23.42B	20.70		1.53%	-2.15%	-13.31%
Sector *	60 Neutral	$14.09B	6.89	-3.35%	3.69%	2.42%	-36.25%