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Stock Analysis & ValuationWith us Corporation (9696.T)

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¥3,225.00
Sector Valuation Confidence Level
Low
Valuation methodValue, ¥Upside, %
Artificial intelligence (AI)2648.06-18
Intrinsic value (DCF)1821.00-44
Graham-Dodd Methodn/a
Graham Formula644.89-80

Strategic Investment Analysis

Company Overview

With us Corporation (9696.T) is a leading education service provider in Japan, specializing in comprehensive academic support for students and professionals. Founded in 1976 and headquartered in Osaka, the company operates cram schools for high school students, offering subject learning, entrance exam guidance, and ability development through its proprietary Plus Cycle Learning Method. Beyond traditional tutoring, With us Corporation provides high school/career support, Japanese language education, e-learning services for corporations, and specialized courses for working adults, including qualification and language training. The company also delivers ICT solutions, educational content production, and healthcare-related services, positioning itself as a diversified player in Japan's education sector. With a market capitalization of approximately ¥23.5 billion, With us Corporation serves a broad demographic, from elementary students to corporate clients, leveraging both offline and digital platforms to enhance learning outcomes in Japan's competitive education market.

Investment Summary

With us Corporation presents a mixed investment profile. On the positive side, the company operates in Japan's stable education sector, which benefits from consistent demand for exam preparation and lifelong learning services. Its diversified offerings, including corporate e-learning and language services, provide revenue streams beyond traditional cram schools. Financially, the company maintains a solid cash position (¥8.1 billion) with modest debt (¥1.02 billion), and it pays a dividend (¥60 per share). However, challenges include a low beta (-0.094), suggesting limited correlation with market movements, and relatively thin net margins (4.4% on ¥20.7 billion revenue). The capital-intensive nature of education services is reflected in significant capex (-¥363 million). Investors should weigh Japan's demographic headwinds (declining student populations) against the company's expansion into corporate training and digital education solutions.

Competitive Analysis

With us Corporation competes in Japan's fragmented education services market by combining traditional cram school operations with modern digital learning solutions. Its competitive advantage stems from: 1) Vertical integration, offering services from elementary tutoring to corporate training; 2) Proprietary Plus Cycle Learning Method, which differentiates its pedagogy; and 3) Hybrid delivery (physical schools + online platforms). However, it faces intense competition from larger players like Benesse and Recruit Holdings, which have greater scale in corporate training, and from agile online-first competitors. The company's niche in regional markets (Osaka headquarters) provides local brand strength but may limit national reach compared to Tokyo-centric rivals. Its foray into ICT solutions and healthcare education shows diversification efforts, though these segments remain small. Financial metrics suggest moderate efficiency (4.4% net margin), with room to improve scalability in digital offerings. The competitive landscape requires continued investment in technology to match larger rivals' R&D budgets while maintaining the personalized service of its cram schools.

Major Competitors

  • Benesse Holdings, Inc. (9783.T): Benesse is a market leader in Japan's education services with strong brands like Shinkenzemi correspondence courses. It outperforms With us in scale (¥400B+ revenue) and diversified global operations, including preschools and nursing care. However, Benesse's recent profitability struggles and overreliance on traditional mail-order education make it slower to adapt to digital trends compared to With us's hybrid model.
  • Recruit Holdings Co., Ltd. (6098.T): Recruit dominates corporate training and HR services through subsidiaries like Staffic and Indeed. Its technological edge and global footprint (¥3T+ market cap) far surpass With us's capabilities in e-learning for enterprises. However, Recruit lacks depth in K-12 education, where With us maintains stronger localized expertise and cram school networks.
  • Waseda Academy Co., Ltd. (4718.T): A direct competitor in cram school services, Waseda Academy focuses exclusively on K-12 exam preparation with stronger brand recognition in Tokyo. It lacks With us's diversification into corporate training but benefits from higher-margin premium services. Both companies face similar demographic challenges but Waseda's single-segment approach makes it more vulnerable to market shifts.
  • Fronteo, Inc. (2158.T): This edtech firm competes in corporate e-learning and AI-driven education solutions. While smaller than With us (¥12B market cap), Fronteo's technological agility in adaptive learning platforms poses a long-term threat to With us's digital ambitions. However, Fronteo lacks physical school networks and has inconsistent profitability.
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