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Softfront Holdings (JP:2321)
:2321
Japanese Market

Softfront Holdings (2321) AI Stock Analysis

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JP

Softfront Holdings

(2321)

Rating:47Neutral
Price Target:
Softfront Holdings exhibits challenges with profitability and cash flow, overshadowing its revenue growth and stable balance sheet. The technical analysis suggests bearish momentum, and the valuation metrics are unattractive due to negative earnings. Improved operational efficiency and cost management are crucial for future performance.

Softfront Holdings (2321) vs. iShares MSCI Japan ETF (EWJ)

Softfront Holdings Business Overview & Revenue Model

Company DescriptionSoftfront Holdings (2321) is a technology company primarily engaged in the development and provision of communication software solutions. The company specializes in software products related to internet protocol (IP) communication systems, serving a variety of sectors including telecommunications, enterprise communication, and consumer applications. Softfront Holdings is recognized for its innovations in voice over IP (VoIP) technologies, which facilitate efficient and reliable communication services.
How the Company Makes MoneySoftfront Holdings generates revenue through the sale and licensing of its communication software solutions. Key revenue streams include the licensing of VoIP software and platforms to telecommunications companies and enterprises looking to integrate advanced communication solutions into their operations. The company also earns money from providing ongoing support and maintenance services for its software products. Significant partnerships with telecom operators and technology companies enhance its market reach and contribute to its earnings by enabling joint development and distribution of communication technologies.

Softfront Holdings Financial Statement Overview

Summary
Softfront Holdings shows revenue growth and a stable balance sheet, but faces significant profitability and cash flow challenges. Improving operational efficiencies and cost management are crucial to enhance financial stability and shareholder value.
Income Statement
45
Neutral
The income statement shows a mixed performance for Softfront Holdings. The gross profit margin remains positive, indicating some ability to cover costs of goods sold, but persistent negative net income and EBIT margins highlight ongoing challenges with profitability. Revenue has shown growth over the years, but negative EBIT and EBITDA margins in TTM signal operational inefficiencies. The company must address these cost concerns to improve its financial health.
Balance Sheet
60
Neutral
Softfront Holdings displays a relatively stable balance sheet with a low debt-to-equity ratio and positive equity ratio, indicating a cautious approach to leveraging. However, a decrease in stockholders' equity over recent periods suggests possible erosion of value. The company's ability to maintain cash reserves provides some buffer, but improving profitability is crucial for maintaining equity strength.
Cash Flow
40
Negative
The cash flow analysis reveals some concerns, with free cash flow fluctuating significantly and turning negative in some periods. The operating cash flow to net income ratio is unavailable in TTM, suggesting issues with cash generation relative to accounting profits. Despite previous periods showing some improvement, consistent positive cash flow generation is essential for future stability.
BreakdownTTMMar 2025Mar 2024Mar 2023Mar 2022Mar 2021
Income Statement
Total Revenue849.71M823.60M889.51M763.83M377.80M310.10M
Gross Profit393.80M408.24M285.62M364.70M205.85M198.31M
EBITDA169.18M-27.01M-32.17M35.80M7.23M58.67M
Net Income-12.39M-81.17M-317.02M-59.41M-29.06M54.30M
Balance Sheet
Total Assets453.00M1.71B515.45M772.92M819.70M418.14M
Cash, Cash Equivalents and Short-Term Investments225.00M1.42B206.03M157.00M292.52M217.17M
Total Debt2.00M0.009.98M20.38M32.49M0.00
Total Liabilities272.00M417.83M343.75M277.50M264.11M212.96M
Stockholders Equity135.14M1.23B132.35M424.97M484.16M205.18M
Cash Flow
Free Cash Flow0.0060.68M33.37M-123.80M-44.30M2.54M
Operating Cash Flow0.0060.68M64.94M-44.86M9.16M47.24M
Investing Cash Flow0.00-14.41M-29.91M-78.46M39.82M-24.35M
Financing Cash Flow0.001.17B14.00M-12.19M26.36M12.60M

Softfront Holdings Technical Analysis

Technical Analysis Sentiment
Positive
Last Price116.00
Price Trends
50DMA
105.22
Positive
100DMA
108.88
Positive
200DMA
97.91
Positive
Market Momentum
MACD
4.09
Positive
RSI
52.92
Neutral
STOCH
15.47
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:2321, the sentiment is Positive. The current price of 116 is below the 20-day moving average (MA) of 116.15, above the 50-day MA of 105.22, and above the 200-day MA of 97.91, indicating a neutral trend. The MACD of 4.09 indicates Positive momentum. The RSI at 52.92 is Neutral, neither overbought nor oversold. The STOCH value of 15.47 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:2321.

Softfront Holdings Peers Comparison

Overall Rating
UnderperformOutperform
Sector (69)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
81
Outperform
¥16.69B24.11
2.59%11.22%3.81%
75
Outperform
¥53.87B17.0517.71%2.96%8.29%9.19%
73
Outperform
¥230.24B18.68
0.56%4.47%-1.74%
69
Neutral
¥228.59B14.337.64%2.71%9.13%8.49%
66
Neutral
¥163.91B54.50
0.10%43.92%302.88%
47
Neutral
¥6.03B
-3.01%95.93%
* Technology Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
JP:2321
Softfront Holdings
116.00
34.00
41.46%
JP:3778
SAKURA Internet Inc.
4,100.00
109.08
2.73%
JP:3963
Synchro Food Co., Ltd.
579.00
80.24
16.09%
JP:4686
Justsystems Corporation
3,590.00
566.92
18.75%
JP:3844
Comture
1,690.00
-88.07
-4.95%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: May 02, 2025