Quest Co., Ltd. (2332) AI Stock Analysis

• Market Cap: ¥7.28B
• Dividend Yield: 3.5%
• Average Volume (3M): 4.80K
• Price to Earnings (P/E): 9.8
• Beta (1Y): 0.57
• Revenue Growth: 5.00%
• EPS Growth: 10.16%
• Country: JP
• Employees: 966
• Sector: Technology
• Sector Strength: 87
• Industry: Information Technology Services
• EPS (TTM): 39.83
• Shares Outstanding: 5,487,768
• 10 Day Avg. Volume: 6,200
• 30 Day Avg. Volume: 4,796
• PEG Ratio: -1.75
• Price to Book (P/B): 0.99
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 47.10
• 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: N/A
• Number of Analyst Covering: 0

• Rating: 76 Outperform
• Price Target: ¥1,583.00 ▲(12.91%Upside)

Quest Co., Ltd. benefits from strong financial performance and attractive valuation, making it a promising investment. However, technical indicators suggest the stock may be overbought, tempering enthusiasm for immediate entry.

Quest Co., Ltd. Business Overview & Revenue Model

Company Description

Quest Co., Ltd. (2332) is a Japanese company operating within the information technology sector. It specializes in providing system development, IT consulting, and outsourcing services. The company primarily engages in offering integrated solutions that encompass software development, system operation, and maintenance services to a wide range of industries, including finance, manufacturing, and public sectors.

How the Company Makes Money

Quest Co., Ltd. generates revenue through various streams, primarily from its system development and IT consulting services. The company earns money by designing and implementing custom software solutions tailored to meet the specific needs of its clients. Additionally, it offers IT consulting services to help organizations optimize their IT infrastructure and business processes. Another significant revenue stream comes from its outsourcing services, where Quest Co., Ltd. manages IT operations and support services on behalf of its clients. The company's ability to maintain long-term contracts and partnerships with key clients in different industries, along with its reputation for delivering reliable and high-quality services, significantly contributes to its earnings.

Quest Co., Ltd. Financial Statement Overview

Summary

Quest Co., Ltd. presents a strong financial profile with consistent revenue growth, solid profitability margins, and an exceptionally strong balance sheet characterized by zero debt and a high equity ratio. While cash flow metrics are stable, further improvement in cash flow generation and efficiency could enhance financial resilience.

Income Statement

Quest Co., Ltd. demonstrates robust income statement metrics. The company has achieved consistent revenue growth, with a TTM revenue increase of approximately 3% over the previous year. Strong profitability is evidenced by a solid gross profit margin of 18.05% and a net profit margin of 4.68% for the TTM. EBIT and EBITDA margins remain stable at 6.73% and 7.72%, respectively, indicating efficient cost management. However, there is room for improvement in further enhancing margins to industry-leading levels.

Balance Sheet

The balance sheet of Quest Co., Ltd. reflects financial strength and stability. The Debt-to-Equity ratio is zero, indicating no reliance on debt financing. The company maintains a high Equity Ratio of 74.82%, showcasing a strong equity base relative to total assets. Return on Equity is healthy at 9.84% for the TTM, reflecting effective use of equity capital. Overall, the balance sheet is robust, with minimal liabilities and strong equity, indicating low financial risk.

Cash Flow

Quest Co., Ltd. exhibits stable cash flow metrics. The Operating Cash Flow to Net Income ratio is 0.21 for the TTM, suggesting moderate conversion of income into cash flow. The Free Cash Flow to Net Income ratio is 0.21, reflecting decent cash generation from operations. However, the Free Cash Flow Growth Rate has fluctuated, with a noticeable decline in the TTM compared to the previous year. Enhancing cash flow efficiency could further strengthen financial flexibility.

Breakdown	TTM	Mar 2024	Mar 2023	Mar 2022	Mar 2021	Mar 2020
Income Statement
Total Revenue	14.64B	14.22B	14.20B	11.81B	11.18B	10.31B
Gross Profit	2.64B	2.62B	2.58B	2.04B	1.93B	1.64B
EBITDA	1.13B	1.23B	1.21B	1.02B	902.17M	762.25M
Net Income	684.83M	696.18M	690.29M	690.41M	636.23M	342.39M
Balance Sheet
Total Assets	9.30B	9.46B	9.04B	8.26B	7.23B	6.41B
Cash, Cash Equivalents and Short-Term Investments	2.79B	3.00B	2.66B	2.48B	2.85B	2.69B
Total Debt	0.00	15.04M	3.80M	113.10M	10.91M	14.25M
Total Liabilities	2.34B	2.67B	2.78B	2.53B	2.04B	1.88B
Stockholders Equity	6.96B	6.79B	6.27B	5.64B	5.20B	4.53B
Cash Flow
Free Cash Flow	145.76M	494.97M	645.16M	449.45M	645.84M	610.39M
Operating Cash Flow	145.76M	709.34M	659.93M	458.29M	653.11M	634.84M
Investing Cash Flow	4.96M	-2.15M	-150.81M	-1.14B	-108.15M	-22.09M
Financing Cash Flow	-131.19M	-251.96M	-326.42M	-210.62M	-184.47M	-173.64M

Quest Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 1402.00
• 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:2332, the sentiment is Neutral. The current price of 1402 is below the 20-day moving average (MA) of 1426.80, above the 50-day MA of 1376.40, and above the 200-day MA of 1289.82, indicating a neutral trend. The MACD of 18.51 indicates Positive momentum. The RSI at 45.18 is Neutral, neither overbought nor oversold. The STOCH value of 37.02 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for JP:2332.

Quest Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
3847	79 Outperform	¥7.07B	10.80		2.80%	3.93%	12.87%
2332	76 Outperform	¥7.28B	9.79		3.50%	5.00%	10.16%
3799	73 Outperform	¥7.47B	7.29		3.44%	3.61%	-14.09%
3940	72 Outperform	¥6.12B	14.47		2.48%	11.17%	2.06%
2488	69 Neutral	¥7.52B	13.57		4.30%	13.09%	61.54%
Sector *	69 Neutral	¥228.59B	14.33	7.64%	2.71%	9.13%	8.49%
1447	49 Neutral	¥6.08B	183.41		―	-1.42%	-172.22%

Quest Co., Ltd. Corporate Events

Quest Co., Ltd. Announces Increased Dividend Payout

Quest Co., Ltd. announced an increase in its dividend payout, raising it by 4 yen per share from the previous forecast to 58 yen per share, reflecting its strong financial performance and commitment to shareholder returns. This decision underscores Quest’s strategy to maintain stable shareholder returns while strengthening its earnings base and adapting to the evolving business environment.

Quest Co., Ltd. Completes Acquisition of Sept Inc.

Quest Co., Ltd. has completed the acquisition of Sept Inc., making it a wholly owned subsidiary. This strategic move, effective April 15, 2025, involves changes in Sept Inc.’s leadership and positions Quest Co., Ltd. to consolidate Sept Inc.’s operations into its financial results from the first quarter of the fiscal year ending March 31, 2026.