NexTone Inc

NexTone Inc maintains a strong liquidity position with JPY 8,046 million in cash and equivalents, representing 60.8% of total assets. The company has no long-term debt and a debt-to-equity ratio of 0.0, indicating a conservative capital structure. The current ratio of 1.38 suggests adequate short-term liquidity to cover obligations.

Profitability metrics show a return on equity (ROE) of 3.13% and a return on assets (ROA) of 0.96%, both below the industry median for Entertainment Production. The company's operating margin of 2.1% (JPY 97.8 million operating income on JPY 4.69 billion revenue) is also below the sector average, indicating room for improvement in cost management and pricing power.

Geographically, NexTone Inc's revenue is concentrated in Japan, with no disclosed international segments. The company operates in a single business segment focused on entertainment production, which exposes it to market-specific risks in the Japanese entertainment industry.

Outlook data indicates a projected revenue decline of 12.3% in the current fiscal year, with a further 8.1% contraction expected in the next fiscal year. This follows a historical revenue trend of 1.2% growth in the prior year, suggesting a challenging market environment for entertainment production services.

Risk assessment highlights low liquidity and dilution risk, with no immediate filing-based flags detected. The company's low dilution potential is supported by equal basic and diluted share counts of 9.77 million shares. However, the high price-to-earnings ratio of 104.45 suggests potential overvaluation relative to earnings.

Recent events include a Q4 2023 earnings report showing a 15.4% year-over-year revenue decline, driven by reduced demand for live events and content production. Analysts have set a mean price target of JPY 2,000, implying a 47.2% upside from the current market price of JPY 1,358.

Revenue surged 44.5% year-over-year to JPY 19.4 billion in FY2025, demonstrating robust top-line growth momentum.

Analysts assign a strong buy rating with a JPY 2,000 target, implying 57.4% upside from the current price.

The company maintains zero long-term debt, resulting in a debt-to-equity ratio of 0.0 and minimal financial risk.

Operating and net margins exceed Entertainment Production cohort medians, indicating superior profitability relative to industry peers.

Free cash flow increased 185.6% year-over-year to JPY 442 million, highlighting significant improvement in cash generation.

Return on assets is merely 0.96%, indicating weak efficiency in generating profits from total asset base.

Revenue ¥5.04B, +4,2% YoY; Operating income +78,0% YoY.

• ▍Revenue ¥5.04B, +4,2% YoY
• ▍Operating income +78,0% YoY
• ▍Net income +44,4% YoY
• ▍Net margin 3.8%

Revenue ¥4.91B, +6,7% YoY; Operating income +71,2% YoY.

• ▍Revenue ¥4.91B, +6,7% YoY
• ▍Operating income +71,2% YoY
• ▍Net income +29,7% YoY
• ▍Net margin 3.4%

Revenue ¥5.36B, +11,2% YoY; Operating income +47,7% YoY.

• ▍Revenue ¥5.36B, +11,2% YoY
• ▍Operating income +47,7% YoY
• ▍Net income +27,9% YoY
• ▍Net margin 3.9%

Revenue ¥5.16B, +10,1% YoY; Operating income +211,9% YoY.

• ▍Revenue ¥5.16B, +10,1% YoY
• ▍Operating income +211,9% YoY
• ▍Net income +110,2% YoY
• ▍Net margin 5.2%

Revenue ¥4.84B; Operating income ¥168.0M.

• ▍Revenue ¥4.84B
• ▍Operating income ¥168.0M
• ▍Net margin 2.7%

Revenue ¥4.60B; Operating income ¥153.0M.

• ▍Revenue ¥4.60B
• ▍Operating income ¥153.0M
• ▍Net margin 2.8%

Revenue ¥4.82B; Operating income ¥220.0M.

• ▍Revenue ¥4.82B
• ▍Operating income ¥220.0M
• ▍Net margin 3.4%

Revenue ¥4.69B; Operating income ¥97.8M.

• ▍Revenue ¥4.69B
• ▍Operating income ¥97.8M
• ▍Net margin 2.7%

Revenue ¥19.41B, +44,5% YoY; Operating income +22,8% YoY.

• ▍Revenue ¥19.41B, +44,5% YoY
• ▍Operating income +22,8% YoY
• ▍Net income +30,5% YoY
• ▍Free cash flow +185,6% YoY
• ▍Net margin 3.6%

Revenue ¥13.43B, +52,4% YoY; Operating income −18,0% YoY.

• ▍Revenue ¥13.43B, +52,4% YoY
• ▍Operating income −18,0% YoY
• ▍Net income −15,9% YoY
• ▍Free cash flow −70,4% YoY
• ▍Net margin 4.0%

Revenue ¥8.81B, +17,7% YoY; Operating income +18,6% YoY.

• ▍Revenue ¥8.81B, +17,7% YoY
• ▍Operating income +18,6% YoY
• ▍Net income +30,8% YoY
• ▍Free cash flow +33,3% YoY
• ▍Net margin 7.2%

Revenue ¥7.49B, +22,3% YoY; Operating income +31,4% YoY.

• ▍Revenue ¥7.49B, +22,3% YoY
• ▍Operating income +31,4% YoY
• ▍Net income +28,0% YoY
• ▍Free cash flow +36,5% YoY
• ▍Net margin 6.4%