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LEIFRAS Co., Ltd. Sponsored ADR
(NASDAQ:LFS)
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Rating:73Outperform
Price Target:
$2.50
▲(16.28% Upside)
Action:Upgraded
Date:10/08/26
The score is driven primarily by strong financial momentum (accelerating revenue growth, improving profitability, and a de-risking balance sheet) and supportive technicals with an established uptrend. The earnings call reinforces the outlook via maintained guidance and record first-half results, while valuation is only moderate and risks include thin net margins, cash flow variability, seasonality, and competitive pressure.
Positive Factors
Accelerating growth and profitability
Strong revenue acceleration alongside higher gross margins indicates improving scale and operating performance. Although profitability is not yet broad-based, sustained top-line growth and better gross economics can strengthen earnings capacity and support continued investment over the next several quarters.
Negative Factors
Thin operating and net margins
Low margins leave limited room for execution errors, cost inflation, or weaker demand to be absorbed before earnings are affected. Increased governance and corporate spending may be strategically necessary, but they can restrain near-term profit conversion as the business expands.
Read all positive and negative factors
Positive Factors
Negative Factors
Accelerating growth and profitability
Strong revenue acceleration alongside higher gross margins indicates improving scale and operating performance. Although profitability is not yet broad-based, sustained top-line growth and better gross economics can strengthen earnings capacity and support continued investment over the next several quarters.
Read all positive factors
LEIFRAS Co., Ltd. Sponsored ADR (LFS) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$57.81M
Dividend YieldN/A
Average Volume (3M)165.92K
Price to Earnings (P/E)19.7
Beta (1Y)-0.60
Revenue Growth13.83%
EPS Growth7.79%
CountryUS
Employees1,055
SectorGeneral
Sector StrengthN/A
IndustryEntertainment
Share Statistics
EPS (TTM)17.74
Shares Outstanding26,160,620
10 Day Avg. Volume390,084
30 Day Avg. Volume165,923
Financial Highlights & Ratios
PEG Ratio1.20
Price to Book (P/B)5.97
Price to Sales (P/S)0.90
P/FCF Ratio24.71
Enterprise Value/Market Cap1.00
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit0.02
Enterprise Value/Ebitda0.07
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
LEIFRAS Co., Ltd. Sponsored ADR Business Overview & Revenue Model
Company Description
LEIFRAS Co., Ltd. is a Japanese enterprise that strategically integrates sports-focused business with social impact initiatives. The company manages sports academies for children and organizes a variety of athletic events. Beyond these commercial ...
LEIFRAS Co., Ltd. Sponsored ADR Earnings Call Summary
Earnings Call Date:Oct 08, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Dec 17, 2026
Earnings Call Sentiment Positive
The call was broadly positive: first-half revenue, profitability, both segment results, school club contracts, geographic coverage and liquidity all improved, and full-year guidance was maintained. The main challenges were the 0.9% decline in Sports School membership, seasonal concentration of profit in the second half, acquisition-related costs, lower operating cash flow, increased competition in tenders and a still-slow start to some school club reform opportunities.Positive Updates
First-Half Revenue and Profit Reached Record Highs
First-half FY2026 net revenue increased 8.9% year-over-year to USD 36.8 million, gross profit increased 22.6% to USD 10.9 million, income from operations increased 35.9% to USD 0.6 million, and net income increased 43.5% to USD 0.5 million. Net revenue, gross profit, income from operations, operating margin, adjusted income from operations and net income all reached record highs for the first half of the fiscal year in the period shown since FY2025.
Negative Updates
Sports School Membership Declined
Sports School membership stood at 68,873, down 0.9% year-over-year. Management attributed the decline to more graduating members, a strategic shift in the timing of new member acquisition to strengthen service quality, changes in the timing of new class openings and customer acquisition, and the termination of a franchise agreement.
Read all updates
Q2-2026 Updates
Positive
Negative
First-Half Revenue and Profit Reached Record Highs
First-half FY2026 net revenue increased 8.9% year-over-year to USD 36.8 million, gross profit increased 22.6% to USD 10.9 million, income from operations increased 35.9% to USD 0.6 million, and net income increased 43.5% to USD 0.5 million. Net revenue, gross profit, income from operations, operating margin, adjusted income from operations and net income all reached record highs for the first half of the fiscal year in the period shown since FY2025.
Read all positive updates
Company Guidance
The full year consolidated outlook for FY 2026 remains unchanged: net revenue of USD 82.9 million to USD 95.7 million, representing growth of 10.8% to 27.9% compared with FY 2025; income from operations of $4.5 million to $5.4 million, representing growth of 13.2% to 33.9%; and an expected operating margin of 5.5% to 5.6%. The company expects Sports School membership to recover in the third and fourth quarters through new initiatives, will continue to pursue both membership growth and higher revenue per member, and will continue to execute its second half initiatives and work toward achieving its full year targets, given that the majority of its profit is generated in the second half. This outlook assumes that no business acquisitions, restructuring transactions or legal settlements are entered into.LEIFRAS Co., Ltd. Sponsored ADR Financial Statement Overview
Summary
Income Statement
78
Positive
Balance Sheet
74
Positive
Cash Flow
69
Positive
| Breakdown | TTM | Mar 2026 | Dec 2024 | Dec 2023 | Dec 2022 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 12.24B | 12.20B | 10.33B | 9.30B | 7.69B |
| Gross Profit | 3.76B | 3.61B | 2.95B | 2.34B | 1.96B |
| EBITDA | 799.58M | 783.94M | 676.49M | 516.40M | 358.70M |
| Net Income | 463.99M | 456.17M | 418.63M | 245.34M | 178.03M |
Balance Sheet | |||||
| Total Assets | 4.88B | 4.64B | 4.50B | 4.38B | 3.52B |
| Cash, Cash Equivalents and Short-Term Investments | 2.56B | 2.51B | 2.54B | 2.73B | 2.08B |
| Total Debt | 1.14B | 1.05B | 1.73B | 1.87B | 1.80B |
| Total Liabilities | 2.98B | 2.81B | 3.45B | 3.76B | 3.10B |
| Stockholders Equity | 1.90B | 1.83B | 1.04B | 622.23M | 420.28M |
Cash Flow | |||||
| Free Cash Flow | 421.95M | 442.89M | 172.98M | 673.16M | 377.55M |
| Operating Cash Flow | 429.14M | 487.21M | 207.11M | 677.94M | 401.50M |
| Investing Cash Flow | -225.03M | -55.66M | -51.39M | -4.78M | 66.04M |
| Financing Cash Flow | -176.43M | -454.66M | -346.45M | -20.98M | 404.37M |
LEIFRAS Co., Ltd. Sponsored ADR Technical Analysis
Negative
2.15
Price Trends
2.24
Negative
2.26
Negative
2.36
Negative
Market Momentum
0.01
Negative
50.84
Neutral
62.02
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For LFS, the sentiment is Negative. The current price of 2.15 is below the 20-day moving average (MA) of 2.17, below the 50-day MA of 2.24, and below the 200-day MA of 2.36, indicating a neutral trend. The MACD of 0.01 indicates Negative momentum. The RSI at 50.84 is Neutral, neither overbought nor oversold. The STOCH value of 62.02 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for LFS.
LEIFRAS Co., Ltd. Sponsored ADR Peers Comparison
UnderperformOutperform
Sector (55)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
73 Outperform | $57.81M | 19.72 | 26.49% | ― | 13.83% | 7.79% | |
71 Outperform | $34.23M | 0.74 | 32.87% | 11.35% | -5.26% | -3.04% | |
63 Neutral | $36.76M | -2.09 | -39.66% | ― | 80.33% | 31.05% | |
55 Neutral | $6.65B | 3.83 | -15.92% | 6.20% | 10.91% | 7.18% | |
46 Neutral | $28.62M | -0.63 | -14.33% | 134.23% | 106.42% | 56.99% | |
45 Neutral | $34.29M | -3.95 | -120.18% | ― | ― | ― |
* General Sector Average
LFS
LEIFRAS Co., Ltd. Sponsored ADR
2.21
-1.48
-40.11%
STG
Sunlands Online Education Group
2.68
-4.66
-63.49%
YQ
17 Education & Technology Group
3.39
-1.60
-32.06%
GNS
Genius Group Limited
0.15
-0.71
-82.67%
RYET
Ruanyun Edai Technology Incorporation
0.92
-0.51
-35.73%
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.