NS Solutions (2327) AI Stock Analysis

• Market Cap: ¥735.63B
• Dividend Yield: 1.76%
• Average Volume (3M): 337.20K
• Price to Earnings (P/E): 26.5
• Beta (1Y): 0.36
• Revenue Growth: 11.66%
• EPS Growth: -0.21%
• Country: JP
• Employees: 7,826
• Sector: Technology
• Sector Strength: 88
• Industry: Information Technology Services
• EPS (TTM): 49.80
• Shares Outstanding: 183,002,000
• 10 Day Avg. Volume: 306,130
• 30 Day Avg. Volume: 337,196
• PEG Ratio: 2.24
• Price to Book (P/B): 2.69
• Price to Sales (P/S): 2.07
• P/FCF Ratio: 20.82
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: ¥4,500.00
• Price Target Upside: 15.24% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 1
• EPS Forecast (FY): 162.35
• Revenue Forecast (FY): ¥382.42B

• Rating: 57 Neutral
• Price Target: ¥3,788.00 ▼(-3.00% Downside)
• Action: Downgraded Date: 02/01/26
• Date: Action: Downgraded 02/01/26

The score is held back primarily by the sharp deterioration in TTM cash generation (negative operating and free cash flow). Technicals also remain weak with the stock below major moving averages despite oversold momentum readings. Valuation is moderate-to-expensive (P/E ~26.9) with only modest support from a ~1.9% dividend yield.

Positive Factors

Steady Revenue Growth

Consistent multi-year revenue expansion indicates durable demand for NS Solutions' system-integration, infrastructure and consulting services across enterprise clients. A steady top-line trend supports predictable project pipelines and recurring outsourcing contracts, underpinning medium-term revenue visibility.

Conservative Balance Sheet

Very low leverage and a large equity base provide financial flexibility to absorb cyclical swings and fund strategic investments or acquisitions. A conservative balance sheet reduces refinancing risk and supports stable counterparty confidence for large enterprise contracts over the next several quarters.

Stable Profitability and Returns

Sustained margins and mid-single-digit ROE consistency reflect efficient delivery and pricing in IT services. Stable profitability supports reinvestment in capabilities and dividend distribution capacity, and signals the business model can convert revenue into recurring operating earnings over the medium term.

Negative Factors

Negative Operating & Free Cash Flow

A sudden TTM reversal to negative operating and free cash flow suggests working-capital strain or elevated investment spend that reduces self-funding. Persistent cash outflows would force reliance on external funding, constrain discretionary spending, and weaken the firm's ability to sustain dividends or buybacks over coming quarters.

Rising Total Debt

An uptick in absolute debt, even from low leverage, narrows the margin of safety if cash generation has weakened. Higher debt magnifies interest and refinancing exposure, limiting flexibility to invest or absorb further operational shocks while cash flows are under pressure in the near term.

Margins Not Expanding

Stagnant margins and a slight net-margin dip point to pricing, mix, or cost pressures that reduce earnings leverage from revenue growth. Without margin improvement, revenue gains will translate less into free cash flow and returns, limiting long-term profit expansion and capital return capacity.

NS Solutions Business Overview & Revenue Model

Company Description

NS Solutions Corporation provides information technology solutions in Japan and internationally. The company offers business and information system consultation services; and plans, designs, develops, implements, operates, and maintains information systems. It also develops, manufactures, and sells software and hardware; and provides outsourcing services using information technology. In addition, the company offers data center and cloud computing services; and ERP, management visualization, system integration and workflow, and production and sales management solutions, as well as IT infrastructure and global expansion support services. It serves manufacturing, retail, distribution, transportation, finance, and telecommunication sectors, as well as government. The company was formerly known as Nippon Steel Information and Communication Systems Inc. and changed its name to NS Solutions Corporation in 2001. NS Solutions Corporation was incorporated in 1980 and is headquartered in Tokyo, Japan. NS Solutions Corporation is a subsidiary of Nippon Steel & Sumitomo Metal Corporation.

How the Company Makes Money

NS Solutions generates revenue primarily through its IT service offerings, which include system integration projects, managed services, and software development. The company earns a significant portion of its income from long-term contracts with corporate clients, providing them with ongoing support and maintenance for their IT systems. Additionally, the company benefits from consulting services that help organizations optimize their IT strategies. Key revenue streams include project-based contracts, recurring subscription fees for managed services, and consulting fees. Partnerships with technology providers and software vendors also enhance its service capabilities, allowing NS Solutions to offer a broader range of integrated solutions, thereby driving additional revenue growth.

NS Solutions Financial Statement Overview

Summary

Income statement and balance sheet are solid (steady revenue growth, stable margins, low leverage), but the TTM swing to negative operating cash flow (-7.8B) and free cash flow (-12.3B) is a major near-term quality risk that materially drags the financial score.

Income Statement

TTM (Trailing-Twelve-Months) revenue rose to 373.4B with ~3.7% growth, extending a steady multi-year uptrend. Profitability is solid and fairly stable for an IT services business (TTM gross margin ~25.6%, EBIT margin ~10.9%, net margin ~7.4%), and net income increased versus the prior annual period. Offsetting this, margins are not expanding meaningfully and net margin in TTM is slightly below the most recent annual level, pointing to modest mix/price or cost pressure.

Balance Sheet

The balance sheet is conservatively levered with low debt relative to equity (TTM debt-to-equity ~0.17) and a sizeable equity base (268.2B). Returns on equity are consistent around ~10% across periods, indicating stable profitability on shareholder capital. The main watch item is the increase in total debt versus the last annual report (45.5B TTM vs 29.2B annual), though leverage remains very manageable.

Cash Flow

Cash flow quality deteriorated sharply in TTM (Trailing-Twelve-Months): operating cash flow swung to -7.8B and free cash flow to -12.3B, a meaningful reversal from strong positive cash generation in recent annual periods (e.g., 37.2B operating cash flow and 33.7B free cash flow in FY2025). This suggests working-capital or timing-related pressure and/or higher investment spend; regardless of cause, negative cash generation is a near-term risk despite healthy reported earnings.

Breakdown	TTM	Mar 2026	Mar 2025	Mar 2024	Mar 2023	Mar 2021
Income Statement
Total Revenue	373.40B	338.30B	310.63B	291.69B	270.33B	251.99B
Gross Profit	95.47B	81.71B	71.60B	65.94B	60.32B	51.95B
EBITDA	53.73B	51.68B	47.68B	44.94B	41.90B	31.93B
Net Income	27.77B	27.05B	24.24B	22.00B	20.52B	16.98B
Balance Sheet
Total Assets	392.00B	421.30B	374.64B	319.91B	325.76B	272.22B
Cash, Cash Equivalents and Short-Term Investments	94.08B	192.93B	103.97B	101.32B	7.87B	6.25B
Total Debt	45.46B	29.22B	34.79B	25.03B	4.95B	2.26B
Total Liabilities	114.57B	151.49B	129.85B	112.11B	121.19B	86.09B
Stockholders Equity	268.21B	261.17B	236.83B	200.52B	197.83B	179.82B
Cash Flow
Free Cash Flow	-12.33B	33.69B	23.03B	21.63B	26.98B	13.90B
Operating Cash Flow	-7.80B	37.21B	26.15B	26.03B	32.31B	17.54B
Investing Cash Flow	-59.47B	70.25B	-8.57B	-5.63B	-8.54B	10.41B
Financing Cash Flow	-21.82B	-18.80B	-15.08B	-14.94B	-6.84B	-7.39B

NS Solutions Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 3905.00
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:2327, the sentiment is Neutral. The current price of 3905 is above the 20-day moving average (MA) of 3857.45, below the 50-day MA of 4217.72, and above the 200-day MA of 3880.12, indicating a neutral trend. The MACD of -100.50 indicates Negative momentum. The RSI at 53.11 is Neutral, neither overbought nor oversold. The STOCH value of 86.61 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for JP:2327.

NS Solutions Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
2317	76 Outperform	¥160.18B	14.15	―	2.30%	13.82%	37.07%
3626	70 Outperform	¥723.99B	13.78	―	1.39%	4.95%	9.54%
8056	67 Neutral	¥434.49B	14.62	―	2.17%	10.42%	28.75%
9682	66 Neutral	¥181.68B	15.39	18.89%	2.78%	11.90%	60.66%
4725	65 Neutral	¥32.65B	10.11	10.34%	4.82%	-3.03%	38.83%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
2327	57 Neutral	¥735.63B	26.49	10.07%	1.76%	11.66%	-0.21%

NS Solutions Corporate Events

NS Solutions Shifts Shareholder Perks to Digital Gifts to Bolster Long-Term Holding

NS Solutions Corporation will revamp its shareholder benefits program by replacing its traditional QUO card rewards with a digital gift format known as “Selectable Pay,” while keeping benefit values unchanged based on shareholding and holding period. The move, effective for shareholders on the register as of March 31, 2026, is intended to enhance the appeal of the company’s stock and promote longer-term shareholding, and also reflects a broader shift toward more convenient, digitally delivered shareholder incentives that can be used across a wide range of physical and online merchants.

The most recent analyst rating on (JP:2327) stock is a Hold with a Yen5025.00 price target. To see the full list of analyst forecasts on NS Solutions stock, see the JP:2327 Stock Forecast page.

NS Solutions Delivers Higher Revenue and Steady Profits, Affirms Full-Year Outlook and Dividend Plan

NS Solutions reported strong top-line growth for the nine months ended December 31, 2025, with revenue rising 14.6% year-on-year to ¥275.4 billion, while operating profit increased 4.7% to ¥31.0 billion and profit attributable to owners of the parent grew 3.5% to ¥21.1 billion. Despite a decline in total comprehensive income, the company’s financial position improved, with the equity ratio climbing to 68.4%, and it maintained a shareholder-friendly stance by confirming its full-year dividend forecast of ¥80 per share and reiterating its full-year outlook calling for double-digit revenue and profit growth, signaling continued confidence in its medium-term performance and stability for investors.

The most recent analyst rating on (JP:2327) stock is a Hold with a Yen5025.00 price target. To see the full list of analyst forecasts on NS Solutions stock, see the JP:2327 Stock Forecast page.