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DeNA (TSE:2432) Tests AI Animation Tools, Is The 6% Undervaluation Enough?

Simply Wall St · 2d ago

DeNA (TSE:2432) is back in focus after Utopai Studios revealed a collaboration that brings its PAI cinematic AI system into DeNA’s experimental animation workflows, testing AI-assisted visual development and production iteration.

Despite the AI collaboration grabbing headlines, DeNA’s recent 7 day share price return is down 4.92%, and the 90 day share price return is down 6.72%. However, total shareholder return over the past 3 years is 71.05% and 5 year total shareholder return is 34.49%, which suggests long term holders have still seen substantial value creation compared with the softer recent momentum.

Scan beyond DeNA and this single AI collaboration by reviewing a curated group of 10 AI small caps that are already leaning into similar production and automation trends.

DeNA’s shares have slipped despite the AI buzz, which puts you at a simple fork in the road: lean into today’s reset, or wait and risk missing what current valuation signals actually say next.

Most Popular Narrative: 6% Undervalued

DeNA’s most followed narrative pegs fair value at ¥2,650 per share, slightly above the last close of ¥2,491. This frames today’s AI news against a measured long term earnings and margin view.

Rapid global adoption and engagement with Pokemon Trading Card Game Pocket, launched in 150 countries with exceptional download and retention rates, positions DeNA to benefit from expanding mobile internet usage and the rising monetization of digital content, likely delivering sustained top-line growth and increased segment profits in gaming.

Read the complete narrative. Read the complete narrative.

Curious how a hit title, steady digital healthcare rollout, and a richer earnings multiple combine into that fair value gap? The key ingredients are already spelled out. The interesting part is how flat revenue assumptions still support a premium future P/E while buybacks quietly reduce the share count.

Result: Fair Value of ¥2,650 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

Still, the DeNA narrative hinges on a few pressure points, particularly its heavy reliance on Pokemon Trading Card Game Pocket and the ongoing revenue strain in Live Streaming.

Find out about the key risks to this DeNA narrative.

Another View: DeNA And The Earnings Multiple Gap

On simple earnings math, DeNA looks very different. The shares trade on a P/E of 5.6x, compared with 16.4x for the JP Entertainment industry and 23.6x for peers, while the fair ratio points to 9.4x. That gap suggests either a cushion or a value trap. Which side do you think it reflects?

To unpack what that spread could mean in practice, including how sensitive it is to future profit swings and sentiment shifts, see what the numbers say in our valuation breakdown: See what the numbers say about this price — find out in our valuation breakdown.

TSE:2432 P/E Ratio as at Sep 2026
TSE:2432 P/E Ratio as at Sep 2026

Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out DeNA for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover 16 high quality undervalued stocks. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity.

Next Steps

Mixed signals around DeNA can feel like a coin toss. Move quickly, review the data independently, and consider the 3 key rewards and 2 important warning signs.

Looking for more investment ideas beyond DeNA?

If DeNA’s setup has you thinking harder about your portfolio, use that impulse now and line up a few fresh candidates while the data is in front of you.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.