| Valuation method | Value, ¥ | Upside, % |
|---|---|---|
| Artificial intelligence (AI) | 2518.05 | 3 |
| Intrinsic value (DCF) | 7863.14 | 223 |
| Graham-Dodd Method | 931.18 | -62 |
| Graham Formula | 2750.14 | 13 |
F&M Co., Ltd. (4771.T) is a Japan-based company specializing in management support and accounting services for small and medium-sized businesses (SMBs) and individual entrepreneurs. Headquartered in Osaka, the company operates through four key segments: Accounting Service Business, Consulting Business, Business Solution Business, and Real Estate Leasing Business. F&M provides a comprehensive suite of services, including financial analysis, risk management, human resource development, subsidy application support, and ISO/P mark certification acquisition. Additionally, the company runs a computer classroom for seniors, showcasing its diversified service offerings. Formerly known as The Flower Co., F&M rebranded in 1993 and has since established itself as a trusted partner for SMBs in Japan. With a market capitalization of approximately ¥37.1 billion, F&M plays a critical role in Japan's industrials sector, particularly in specialty business services, by helping businesses optimize operations and financial performance.
F&M Co., Ltd. presents a stable investment opportunity with a beta of 0.658, indicating lower volatility compared to the broader market. The company reported solid financials for FY 2024, with revenue of ¥14.9 billion and net income of ¥1.6 billion, translating to a diluted EPS of ¥110.28. Notably, F&M maintains a strong balance sheet with zero debt and ¥5.2 billion in cash and equivalents, providing financial flexibility. The company also pays a dividend of ¥40 per share, appealing to income-focused investors. However, its niche focus on Japanese SMBs may limit growth potential compared to global competitors. Investors should weigh its steady cash flow generation against the challenges of a mature domestic market.
F&M Co., Ltd. differentiates itself through a diversified service portfolio tailored to Japanese SMBs, combining accounting, consulting, and business solutions under one roof. Its competitive advantage lies in its deep understanding of local regulatory and business environments, enabling customized support for clients. The company’s real estate leasing segment adds an additional revenue stream, reducing reliance on pure service-based income. However, F&M faces competition from larger global consulting firms and domestic players offering similar services. Its lack of international presence may hinder growth compared to multinational competitors. The company’s zero-debt position and strong cash reserves provide stability but may also indicate conservative growth strategies. F&M’s ability to integrate technology into its service offerings, such as its senior computer classroom initiative, demonstrates innovation, though it remains to be seen if such ventures will significantly drive future growth.