Equity Analyst, LightStream Research

Shifara Samsudeen, FCMA, CGMA

Equity Analyst

Long-Short Analysis on Japan, Asia and the World

LightStream Research

LightStream conducts quantitatively rigorous and data-driven analysis with a focus on Japan and Asia.

We consistently cover the Tech, Consumer and Industrial sectors, and provide ECM and Events coverage more broadly.

We supplement traditional qualitative insights from company relationships with a robust quantitative foundation that examines as much historical data as is available.
We further refine the accuracy of our insights and calls through the use of alternative data to flesh out current trends, and through a valuation framework that emphasises non-superficial peer group selection and a proper attempt to understand the metrics and changes that have driven security valuations in the past.

Equity Bottom-Up

<ul>
<li>
<a href="https://www.smartkarma.com/entities/money-forward-inc" target="_blank" data-smartkarma-citation="entities:25919:1" rel="noopener">Money Forward (3994 JP)</a><a href="https://www.smartkarma.com/entities/moneta-money-bank-as-91531fc9-8a67-43d7-8182-cf45abd5ebca" target="_blank" data-smartkarma-citation="entities:28372:1" rel="noopener"></a> MF’s recent earnings was no surprise to us as we continued to highlight that the company’s business model is far inferior to its counterpart freee. </li>
<li>The last 2-3 quarterly results have made that discrepancy clear and MF’s non-BO SaaS businesses are only dead weight and have helped conceal weaknesses of its business model.</li>
<li>MF’s share price is down 19.3% YTD and think the market has finally come to terms that MF is losing ground whereas freee has managed to turn around its profitability.</li>
</ul>



Money Forward (3994 JP) MF’s recent earnings was no surprise to us as we continued to highlight that the company’s business model is far inferior to its counterpart freee. 
The last 2-3 quarterly results have made that discrepancy clear and MF’s non-BO SaaS businesses are only dead weight and have helped conceal weaknesses of its business model.
MF’s share price is down 19.3% YTD and think the market has finally come to terms that MF is losing ground whereas freee has managed to turn around its profitability.


Money Forward: Business Model Begins to Breakdown

Japan Specialist

Mark Chadwick

<ul>
<li>Q1 revenue and EBITDA missed expectations, with slowing growth in key business segment and corporate customer adds.</li>
<li>Macroeconomic risks, including US tariffs, may be weighing on business confidence and new customer acquisition.</li>
<li>Valuation now looks attractive, trading at a steep discount to global peers despite similar fundamentals.</li>
</ul>


Q1 revenue and EBITDA missed expectations, with slowing growth in key business segment and corporate customer adds.
Macroeconomic risks, including US tariffs, may be weighing on business confidence and new customer acquisition.
Valuation now looks attractive, trading at a steep discount to global peers despite similar fundamentals.


Money Forward (3994) | SaaS Is Slowing, But So Is the Price

<ul>
<li>Money Forward, Japan’s leading SaaS provider, reported strong results for its fiscal year ending November 2024: Sales +33% YoY to ¥40.4 billion</li>
<li>FY11/25 EBITDA guidance of ¥3.5 billion significantly lags consensus expectations of ¥6 billion. </li>
<li>The disappointing EBITDA guidance may trigger further selling, but there is no material change to the company’s long-term fundamentals. Time to be bullish</li>
</ul>


Money Forward, Japan’s leading SaaS provider, reported strong results for its fiscal year ending November 2024: Sales +33% YoY to ¥40.4 billion
FY11/25 EBITDA guidance of ¥3.5 billion significantly lags consensus expectations of ¥6 billion. 
The disappointing EBITDA guidance may trigger further selling, but there is no material change to the company’s long-term fundamentals. Time to be bullish


Money Forward (3994) | SaaS Growth Engine Shows Resilience

<ul>
<li>In Q3, Money Forward demonstrated continued strong performance, with consolidated net sales posting 31% growth year-on-year to ¥9.81 billion</li>
<li>EBITDA for the cumulative nine months stands at ¥1.48 billion, comfortably within the company’s full year guidance range of ¥1-3 billion.</li>
<li>We now see a very modest 2% upside to our target price of ¥6,440, based on an 8x forward revenue multiple. </li>
</ul>


In Q3, Money Forward demonstrated continued strong performance, with consolidated net sales posting 31% growth year-on-year to ¥9.81 billion
EBITDA for the cumulative nine months stands at ¥1.48 billion, comfortably within the company’s full year guidance range of ¥1-3 billion.
We now see a very modest 2% upside to our target price of ¥6,440, based on an 8x forward revenue multiple. 


Money Forward (3994) | Q3 Priced In; Look for Pull-Back

<ul>
<li>With results due October 15, we expect net sales growth of 29% YoY, bringing 9-month revenue on track to meet full-year guidance.</li>
<li>Money Forward’s businesses are Japan-centric, creating a steady revenue stream insulated from yen volatility and uncertain global macro conditions.</li>
<li>By targeting larger corporations, Money Forward aims to unlock substantial cross-selling potential, supporting long-term growth and market penetration.</li>
</ul>


With results due October 15, we expect net sales growth of 29% YoY, bringing 9-month revenue on track to meet full-year guidance.
Money Forward’s businesses are Japan-centric, creating a steady revenue stream insulated from yen volatility and uncertain global macro conditions.
By targeting larger corporations, Money Forward aims to unlock substantial cross-selling potential, supporting long-term growth and market penetration.


Money Forward (3994) | Q3 Results and Strategic Expansion Fueling Long-Term Upside

Japan

Money Forward, Inc. develops mobile application software. The Company produces automatic household account book softwares, household account book application softwares, and other products. Money Forward also provides personal financial management, cloud based accounting solutions, and other services.

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Money Forward (3994 JP)

Money Forward: Business Model Begins to Breakdown

Money Forward's recent earnings was no surprise to us and it highlights its inferior business model compared to freee, with non-BO SaaS businesses...

Shifara Samsudeen, FCMA, CGMA

Money Forward (3994) | SaaS Is Slowing, But So Is the Price

Q1 revenue and EBITDA missed expectations due to slowing growth in key segment and corporate customer adds. Despite this, valuation is attractive...

Mark Chadwick

Money Forward (3994) | SaaS Growth Engine Shows Resilience

Money Forward, Japan's top SaaS provider, posts strong sales growth but disappoints with lower EBITDA guidance for FY11/25, causing potential...

Mark Chadwick

Money Forward (3994) | Q3 Priced In; Look for Pull-Back

Money Forward's Q3 performance shows strong growth with net sales up 31% year-on-year, EBITDA at ¥1.48 billion, and a 2% upside to target price of...

Mark Chadwick

Money Forward (3994) | Q3 Results and Strategic Expansion Fueling Long-Term Upside

Upcoming Q3 Results: With results due October 15, we expect net sales growth of 29% YoY, bringing 9-month revenue on track to meet full-year guidance.

Mark Chadwick

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Money Forward: Business Model Begins to Breakdown

​Money Forward's recent earnings was no surprise to us and it highlights its inferior business model compared to freee, with non-BO SaaS businesses...

Shifara Samsudeen, FCMA, CGMA

Money Forward (3994) | SaaS Is Slowing, But So Is the Price

​Q1 revenue and EBITDA missed expectations due to slowing growth in key segment and corporate customer adds. Despite this, valuation is attractive...

Mark Chadwick

Money Forward (3994) | SaaS Growth Engine Shows Resilience

​Money Forward, Japan's top SaaS provider, posts strong sales growth but disappoints with lower EBITDA guidance for FY11/25, causing potential...

Mark Chadwick

Money Forward (3994) | Q3 Priced In; Look for Pull-Back

​Money Forward's Q3 performance shows strong growth with net sales up 31% year-on-year, EBITDA at ¥1.48 billion, and a 2% upside to target price of...

Mark Chadwick

Money Forward (3994) | Q3 Results and Strategic Expansion Fueling Long-Term Upside

Upcoming Q3 Results: With results due October 15, we expect net sales growth of 29% YoY, bringing 9-month revenue on track to meet full-year guidance.

Mark Chadwick

Money Forward's recent earnings was no surprise to us and it highlights its inferior business model compared to freee, with non-BO SaaS businesses...

Q1 revenue and EBITDA missed expectations due to slowing growth in key segment and corporate customer adds. Despite this, valuation is attractive...

Money Forward, Japan's top SaaS provider, posts strong sales growth but disappoints with lower EBITDA guidance for FY11/25, causing potential...

Money Forward's Q3 performance shows strong growth with net sales up 31% year-on-year, EBITDA at ¥1.48 billion, and a 2% upside to target price of...