The average target price of 4488.T is 3100 and suggests 6% downside potential. Usually, this means a SELL recommendation among investment firms, or a recommendation to decrease one's position in this instrument in the next 12 months. The most optimistic analyst has a target price of 3100.0. This is lower than the current market price, meaning that even the most optimistic analyst does not see upside potential. On the other hand, the most pessimistic analyst has a target price of 3100.0. This is equivalent to 6% downside potential in the worst case. 

AI inside Inc. provides OCR-services using artificial intelligence-technology in Japan. It offers DX suite, an AI OCR platform. The company was founded in 2015 and is based in Tokyo, japan.

Japan

AI inside Inc.

Technology

The company does not pay dividends at all, or it pays them sporadically. There have only been a few years with dividend payments in the past ten years. 

4488.T reported revenue of JPY 4 400mn in the last 12 months, up 2% from FY24. At the same time, the dynamics of cash flow, as measured by free cash flow (FCF), were drastically different. Market expects EPS to reach JPY 60.70 in FY25.

The stock's performance has been mixed in the past six months, with growth following a decline. There is no clear price trend compared to its global peers from the same sector and industry (as shown above). The stock has outperformed this peer group by 6ppts over past six months and grown 12ppts faster in the past month. This is largely true for peers from the same country and sector. With respect to the stock's valuation against its peers, its overall price performance is neutral.

The company has reported modest EBITDA margins compared to its global peers in recent years. EBITDA margin amounted to 4.8% in the last 12 months, a decline from 19.0% in FY24. 

Historically, 4488.T has reported very poor net margins compared to its global peers. Specifically, in the last 12 months, this metric equalled -11.3%, down from 3.7% in FY24. 

In the last 12 months, the return on capital employed (RoCE) declined to -10.2%, below the peers. The consensus estimate for FY25 for RoCE is 2.4%, again behind the peers. 

AI inside Inc. reported a return on equity (RoE) of -10.3% in the last 12 months, down from 3.2% in FY24. The market consensus projects an RoE of 1.2% in FY25, again behind its peers. 

Another important profitability metric, return on assets (RoA), amounted to -6.9% in the last 12 months, a decrease from 2.2% in FY24. The market analysts predict that RoA will be 0.8% in FY25, again weaker than its peers. 

The ratio of return on invested capital (RoIC) to the weighted average cost of capital (WACC) has been 0.1 in the past several years. This ratio implies a weak shareholder value creation. 

The institutional, legal, and compliance risks associated with the company's country are minimal. In combination with stringent business standards, shareholder rights are very highly protected.

4488.T has poor trading liquidity. It will take at least a day or two for the average private investor to sell a common position under normal market conditions. Liquidity is very unstable and remains favourable on the days with the lowest activity. The trading volume mostly stays the same even under highly turbulent market conditions. The stock has a very small market capitalisation, which usually makes its trading liquidity erratic and unpredictable. 

No other major risks have been identified.

The risk of default is high. Among the negative credit factors, we point to weak positions in its industry, slow historical revenue growth, negligible return on capital, and poor working capital management. We note adequate interest coverage, solid cash flow generation, and an favourable capital structure, among the positive credit factors. 

In highly turbulent market conditions, 4488.T is exceptionally volatile. In other words, the stock will be among the worst-performers in times of extreme market volatility or shocking company news. Standalone, the worst-day losses (less than 1% of the time) will likely be critical. 

In normal market circumstances, 4488.T is exceptionally volatile. Put differently, without outstanding market volatility or shocking company news, the stock's price will change quite unpredictably. The stock's losses on its worst days (less than 1-5% of the time) will range from critical to immense. 

Considering past and projected metrics, the stock is distinctly 'expensive' compared to its peers. In particular, the stock is overpriced on P/E, of fair value on EV/EBITDA, overvalued on P/FCF. 

AI inside Inc.

¥ 3450

2

AI inside Inc.

¥ 3450

2

Risk factor

Profitability factor

Risk / Profitability

Risk factor

Profitability factor

¥ 3450

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