Lowering Estimates and Target Price for freee K.K.

Goldman Sachs maintains a Sell rating on freee K.K., lowering the target price to ¥2,000 as persistent costs for personnel and sales promotion delay the recoupment of upfront investments until FY6/28.

Key Takeaways

• 1.Lowered 12-month target price from ¥2,100 to ¥2,000 reflecting higher-than-expected costs for personnel and sales promotion.
• 2.Maintain Sell rating due to a stretched valuation (3-year forward P/E of 34X) compared to the sector average of 16X.
• 3.Full-scale recoupment of upfront investments is delayed, with the analyst suggesting it is unlikely until FY6/28.

Table of Contents

• Earnings estimates
• Corporate ARR
• FY6/27 earnings outlook
• AI disruption
• Investment Thesis, Price Target Risks and Methodology: freee K.K.
• Disclosure Appendix

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