Sohgo Security Services Co., Ltd. (2331) AI Stock Analysis

• Market Cap: ¥538.69B
• Dividend Yield: 2.2%
• Average Volume (3M): 783.35K
• Price to Earnings (P/E): 17.5
• Beta (1Y): 0.44
• Revenue Growth: 7.73%
• EPS Growth: 30.92%
• Country: JP
• Employees: 64,982
• Sector: Industrials
• Sector Strength: 72
• Industry: Security & Protection Services
• EPS (TTM): 16.83
• Shares Outstanding: 510,200,200
• 10 Day Avg. Volume: 728,830
• 30 Day Avg. Volume: 783,346
• PEG Ratio: 4.36
• Price to Book (P/B): 1.62
• Price to Sales (P/S): 0.99
• P/FCF Ratio: 18.13
• 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: N/A
• Price Target Upside: N/A
• Rating Consensus: Hold
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 76 Outperform
• Price Target: ¥1,375.00 ▲(12.06% Upside)

Sohgo Security Services Co., Ltd. achieves a solid overall stock score driven primarily by its strong financial performance and positive technical indicators. The company's stable financial foundation and efficient cash flow management provide a robust base for future growth. Technical analysis supports a bullish outlook with the stock trading above key moving averages. Valuation metrics are balanced, offering a reasonable P/E ratio and a decent dividend yield.

Positive Factors

Revenue Growth

Consistent revenue growth indicates a robust market position and demand for services, supporting long-term business expansion and stability.

Cash Generation

Strong cash generation enhances financial flexibility, enabling strategic investments and debt servicing, crucial for sustainable growth.

Balance Sheet Health

A strong balance sheet with low leverage reduces financial risk, providing stability and resilience against economic fluctuations.

Negative Factors

Margin Pressure

Relatively low margins may limit profitability and competitive edge, potentially impacting long-term financial performance.

Industry Competition

High competition in the security industry could pressure pricing and margins, challenging the company’s ability to maintain market share.

Dependence on Core Services

Heavy reliance on core services may limit diversification and adaptability to market changes, affecting long-term growth potential.

Sohgo Security Services Co., Ltd. Business Overview & Revenue Model

Company Description

Sohgo Security Services Co.,Ltd. engages in the security, integrated management, and disaster prevention businesses in Japan and internationally. The company offers home security systems and services, such as housework contracting and safety confirmation services for senior citizens; stalker countermeasures for women; and long-term care services. It also provides various systems for corporate customers, including online security systems, electronic security systems, condominium complex security systems, and automated management system for ATMs, as well as security systems for supporting schedule management at unmanned stores and other buildings; and damage insurance policies. In addition, the company offers stationed security services, total security and robot systems, transportation security systems, cash management solutions for stores, and total ATM management systems; and general property management and fire protection, building management, and call center services, as well as automated external defibrillator, a device that administrates an electric shock. Further, it provides other products and services for corporate customers, such as guest reception terminals, risk management tools, and security camera systems, as well as information security, specialty security, confidential document collection and recycling, test administration support, telegram, career training, BCP solution, and acquisition support services. The company was incorporated in 1965 and is headquartered in Tokyo, Japan.

How the Company Makes Money

Sohgo Security Services generates revenue primarily through its core offerings of manned security services, which include on-site security personnel for businesses and events. Additionally, the company earns income from the installation and maintenance of electronic security systems, such as surveillance cameras and alarm systems. Another key revenue stream is derived from security consulting services, where they provide expertise in risk assessment and security planning. The company also benefits from long-term contracts with clients in various sectors, ensuring a stable income flow. Significant partnerships with technology providers enhance their service offerings and contribute to operational efficiency, further bolstering their financial performance.

Sohgo Security Services Co., Ltd. Financial Statement Overview

Summary

Sohgo Security Services Co., Ltd. shows strong financial health with consistent revenue growth and stable profitability margins. The balance sheet is solid with low leverage, but the cash flow statement indicates potential liquidity challenges due to declining free cash flow.

Income Statement

Sohgo Security Services Co., Ltd. demonstrates solid revenue growth with a 2.2% increase in TTM, supported by consistent gross and net profit margins. The EBIT and EBITDA margins are stable, indicating efficient operational management. However, the slight decline in gross profit margin over the years suggests potential cost pressures.

Balance Sheet

The company maintains a strong balance sheet with a low debt-to-equity ratio of 0.16, indicating prudent financial leverage. The return on equity is healthy at 8.01%, reflecting effective use of shareholder funds. The equity ratio is robust, showcasing financial stability and a solid asset base.

Cash Flow

Cash flow analysis reveals challenges with a significant decline in free cash flow growth at -45.96% TTM. The operating cash flow to net income ratio is moderate, suggesting adequate cash generation relative to earnings. However, the decline in free cash flow signals potential liquidity concerns.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	579.94B	551.88B	521.40B	492.23B	489.09B	469.92B
Gross Profit	137.35B	127.76B	125.71B	121.23B	125.58B	117.11B
EBITDA	75.42B	68.71B	59.94B	61.62B	67.19B	59.45B
Net Income	31.62B	27.11B	27.33B	23.95B	28.96B	25.01B
Balance Sheet
Total Assets	580.77B	572.40B	567.56B	516.65B	488.28B	481.46B
Cash, Cash Equivalents and Short-Term Investments	151.27B	150.68B	151.23B	143.65B	148.50B	144.25B
Total Debt	13.48B	59.91B	50.58B	53.83B	54.26B	69.98B
Total Liabilities	192.54B	196.40B	180.98B	172.76B	160.77B	177.04B
Stockholders Equity	348.82B	338.43B	352.93B	305.07B	290.71B	268.49B
Cash Flow
Free Cash Flow	30.08B	30.28B	40.57B	14.41B	26.93B	42.08B
Operating Cash Flow	46.97B	45.13B	56.06B	31.68B	42.74B	55.52B
Investing Cash Flow	-22.52B	-15.55B	-16.91B	-24.82B	-14.09B	-38.45B
Financing Cash Flow	-20.75B	-36.31B	-21.50B	-19.38B	-18.18B	-12.71B

Sohgo Security Services Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 1227.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:2331, the sentiment is Positive. The current price of 1227 is above the 20-day moving average (MA) of 1209.20, above the 50-day MA of 1138.28, and above the 200-day MA of 1087.91, indicating a bullish trend. The MACD of 22.94 indicates Positive momentum. The RSI at 62.24 is Neutral, neither overbought nor oversold. The STOCH value of 53.14 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:2331.

Sohgo Security Services Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
9740	80 Outperform	¥37.57B	11.99	―	1.95%	9.05%	14.38%
9686	77 Outperform	¥16.55B	7.74	―	3.30%	34.15%	324.87%
2331	76 Outperform	¥538.69B	17.49	―	2.20%	7.73%	30.92%
9735	73 Outperform	$2.41T	21.05	8.35%	1.81%	5.39%	4.89%
7058	72 Outperform	¥4.32B	19.81	―	3.12%	6.87%	-1.10%
4754	67 Neutral	¥7.43B	7.66	―	2.39%	3.00%	-13.97%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%

Sohgo Security Services Co., Ltd. Corporate Events

ALSOK Revises Financial Forecasts and Increases Dividends

ALSOK CO., LTD. announced an upward revision of its annual financial results forecasts for the fiscal year ending March 31, 2026, driven by strong performance in security and facility management services. The company also increased its interim and year-end dividend forecasts, reflecting improved financial results and a commitment to shareholder returns.

ALSOK Reports Strong Q2 Financial Performance and Upward Forecast Revisions

ALSOK CO., LTD. reported a significant increase in its financial performance for the second quarter ended September 30, 2025, with net sales rising by 10.7% and profit attributable to owners of parent increasing by 48.3% compared to the previous year. The company also announced upward revisions to its annual financial results forecasts and dividend payments, reflecting a positive outlook for the fiscal year ending March 31, 2026, which could enhance its market positioning and stakeholder confidence.