Updating Estimates, MF, Rakus, freee

Research evidence excerpt

Updating Estimates, MF, Rakus, freee

Japan | SaaS EquityJuneResearch17, 2026

KEY STOCKS FEATURED INCLUDE:Updating Estimates, MF, Rakus, freee

We have updated our estimates for freee, Money Forward, and Rakus. While TICKER RATING PRICE TARGET

there are no rating changes, we have raised Rakus’s PT to ¥900. The latest 4478 JP BUY ¥2,800

earnings from all three companies—as well as the broader Japan cloud 3994 JP HOLD ¥4,000

SaaS sector—showed steady fundamentals, highlighting a gap between AI- 3923 JP HOLD ¥900

related negative sentiment and actual earnings performance.

Sector Valuation — We are updating our earnings estimates for all three cloud SaaS stocks. KEY CHANGES INCLUDE:

Based on recent results, we see no evidence of a slowdown in fundamentals due to AI-related

TICKER RATING PRICE TARGET

risks. All three companies have scope for internal margin improvement as they increasingly

adopt AI internally. We reiterate that the Japan cloud SaaS sector shows a valuation gap, with 3923 JP HOLD ¥900 (¥830)

multiples being rerated downward despite continued fundamental growth.

AI implementation speeding up: All three companies highlighted progress in AI adoption,

suggesting scope for further internal efficiency gains. Money Forward may incur one-off costs

related to the recent data breach, but is moving toward profitability, potentially from next FY.

freee is already profitable, while Rakus is expecting to achieve a “Rule of 50” again from next FY.

Rakus (3923 JP, Hold, PT ¥900 from ¥830): We are raising our PT to ¥900 ( was ¥830), which

equates to a P/E of 12.4x and EV/Sales of 4.6x based on this FY earnings and EPS. Note that

there is extraordinary profit of ¥16.7bn in the company guidance, providing an uplift to EPS this

FY.