Softcreate Holdings Corp. (3371) AI Stock Analysis

• Market Cap: ¥52.60B
• Dividend Yield: 2.82%
• Average Volume (3M): 23.00K
• Price to Earnings (P/E): 12.7
• Beta (1Y): 0.59
• Revenue Growth: 10.46%
• EPS Growth: 8.98%
• Country: JP
• Employees: 963
• Sector: Technology
• Sector Strength: 88
• Industry: Information Technology Services
• EPS (TTM): 42.36
• Shares Outstanding: 27,550,278
• 10 Day Avg. Volume: 31,410
• 30 Day Avg. Volume: 23,000
• PEG Ratio: 1.50
• Price to Book (P/B): 2.30
• Price to Sales (P/S): 1.59
• P/FCF Ratio: 10.09
• 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
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 82 Outperform
• Price Target: ¥2,531.00 ▲(18.22% Upside)
• Action: Reiterated Date: 12/30/25
• Date: Action: Reiterated 12/30/25

The score is driven primarily by strong financial quality (consistent growth, solid profitability, and virtually no leverage). Technicals are supportive but somewhat stretched near-term, and valuation looks reasonable with a mid-teens P/E and a ~2.7% dividend yield.

Positive Factors

Multi-year revenue growth

Consistent multi-year revenue expansion from ¥23.8B to ¥31.0B indicates sustained client demand and service adoption. This durable top-line growth supports scale economics, recurring project pipelines and reinvestment capacity, reducing execution risk over the next several quarters.

Conservative balance sheet

Effectively zero debt materially lowers financial risk and preserves flexibility. With growing equity and negligible leverage, the company can fund growth, weather cyclical dips, pursue M&A or maintain dividends without straining liquidity over a multi-month horizon.

Strong margins and returns

Healthy operating (~18.6%) and net (~11.5%) margins reflect durable pricing power and operational efficiency in IT services. Robust margin profile underpins strong free cash flow generation and mid-to-high teen ROE, supporting shareholder returns and internal investment capacity.

Negative Factors

Choppy operating cash flow

Volatile operating cash flow and inconsistent cash conversion reduce predictability of internally generated funds. Even with FCF roughly equal to net income in 2025, OCF swings can constrain capital allocation, dividend stability and the ability to absorb shocks over 2–6 months.

Margin erosion risk

Recent easing in gross and operating margins signals rising cost pressures or pricing stress. If this trend persists, it can compress profitability and returns, limiting reinvestment and reducing the cushion against demand slowdowns in the medium term.

Service-heavy business exposure

Concentration in systems-integration and IT services exposes the firm to competitive bidding, wage inflation and project timing risk. The labor-intensive model and customer project concentration can cap margin upside and make revenue sensitive to corporate IT spend cycles over coming months.

Softcreate Holdings Corp. Business Overview & Revenue Model

Company Description

Softcreate Holdings Corp. (3371) is a Japan-based company primarily engaged in the provision of information technology (IT) services. The company operates through several business segments, including IT Infrastructure, Solution, and Other. Softcreate Holdings offers a range of products and services, such as IT infrastructure management, cloud solutions, cybersecurity services, and IT consulting. Its clientele spans various industries, providing tailored solutions to meet the diverse technological needs of businesses.

How the Company Makes Money

Softcreate Holdings Corp. generates revenue through its multiple business segments, with IT Infrastructure being a significant contributor. The company earns income by providing IT infrastructure management services, which include system integration, managed services, and maintenance. Additionally, it offers cloud-based solutions that enable businesses to transition to scalable and flexible IT environments, thus driving subscription-based revenue. The cybersecurity services offered by Softcreate Holdings provide another revenue stream, as companies increasingly prioritize protecting their digital assets. Moreover, the company's IT consulting services cater to businesses seeking expert guidance on technology strategy and implementation, further adding to its earnings. Strategic partnerships with major technology vendors enhance its service offerings and expand its market reach, contributing to its overall revenue growth.

Softcreate Holdings Corp. Financial Statement Overview

Summary

Strong fundamentals supported by steady multi-year revenue growth, healthy operating and net margins, and an exceptionally conservative balance sheet with effectively no debt. Key watch-outs are slightly softer margins versus the prior year and choppy operating cash flow/cash conversion.

Income Statement

Revenue shows a solid multi-year upward trend (¥23.8B in 2020 to ¥31.0B in 2025), with growth re-accelerating most recently. Profitability is strong for the sector, with consistently healthy operating and net margins (2025 net margin ~11.5% and operating margin ~18.6%). A mild watch-out is that gross and operating margins have eased slightly versus the prior year, suggesting some incremental cost pressure even as earnings continue to grow.

Balance Sheet

The balance sheet is very conservatively positioned with effectively no debt (2024–2025 debt at zero; only de minimis debt in earlier years), which materially lowers financial risk. Equity has grown meaningfully over time alongside rising assets, supporting balance-sheet flexibility. Returns on equity are consistently strong (mid-to-high teens), though a slight dip in 2025 versus 2024 indicates returns are stable but not accelerating.

Cash Flow

Cash generation is generally solid: free cash flow is high and in 2025 is nearly equal to net income (free cash flow to net income ~0.97), indicating good earnings quality. However, operating cash flow has been choppy year-to-year (down in 2023, rebound in 2024, lower again in 2025), and cash conversion from operating profit is not consistently strong (2025 operating cash flow relative to operating profit is meaningfully lower than 2024).

Breakdown	TTM	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	31.74B	30.95B	27.91B	24.25B	21.23B	24.24B
Gross Profit	13.18B	12.86B	11.92B	10.32B	9.25B	7.79B
EBITDA	6.85B	6.74B	6.09B	5.08B	4.76B	4.01B
Net Income	3.54B	3.55B	3.26B	2.74B	2.36B	1.82B
Balance Sheet
Total Assets	34.67B	35.59B	31.30B	25.19B	22.79B	21.14B
Cash, Cash Equivalents and Short-Term Investments	15.22B	14.96B	13.51B	9.43B	9.32B	9.98B
Total Debt	1.86M	0.00	0.00	11.84M	48.91M	93.53M
Total Liabilities	9.79B	10.99B	9.65B	7.66B	7.60B	6.75B
Stockholders Equity	21.60B	21.38B	19.05B	15.33B	13.25B	12.73B
Cash Flow
Free Cash Flow	0.00	4.87B	6.44B	2.44B	3.78B	3.25B
Operating Cash Flow	0.00	5.00B	6.48B	2.57B	3.86B	3.30B
Investing Cash Flow	0.00	-1.98B	-1.39B	-1.33B	-1.70B	-406.19M
Financing Cash Flow	0.00	-1.56B	-1.02B	-1.13B	-2.53B	-407.67M

Softcreate Holdings Corp. Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 2141.00
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:3371, the sentiment is Negative. The current price of 2141 is above the 20-day moving average (MA) of 2005.25, above the 50-day MA of 2059.14, and below the 200-day MA of 2151.86, indicating a bearish trend. The MACD of -22.34 indicates Positive momentum. The RSI at 42.58 is Neutral, neither overbought nor oversold. The STOCH value of 52.50 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:3371.

Softcreate Holdings Corp. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
3371	82 Outperform	¥52.60B	12.74	―	2.82%	10.46%	8.98%
3393	74 Outperform	¥26.98B	11.13	―	4.36%	12.32%	10.42%
3844	73 Outperform	¥46.70B	18.47	17.50%	2.88%	5.62%	3.81%
4674	72 Outperform	¥57.64B	11.56	16.12%	2.91%	10.02%	16.48%
4725	65 Neutral	¥30.97B	10.75	10.34%	4.82%	-3.03%	38.83%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%

Softcreate Holdings Corp. Corporate Events

Softcreate to Make MGRe a Consolidated Subsidiary, Boosting E‑Commerce Marketing Capabilities

Softcreate Holdings will acquire 75% of the issued shares of MGRe, Inc., an application marketing platform provider, turning it into a consolidated subsidiary as it seeks to strengthen and expand its e‑commerce solutions business. By integrating MGRe’s mobile app marketing and customer data capabilities with its existing “ecbeing” platform, the group aims to broaden its service lineup, deepen omnichannel marketing support for retailers, and enhance overall profitability and business scale.

As part of the transaction, Softcreate will dispose of treasury shares via a third‑party allocation to MGRe executive Kentaro Tashiro and his asset management firm Orange Co., bringing them in as shareholders to better align management incentives. The move is positioned as a step to reinforce sales channels, support stable growth, and raise corporate value across the Softcreate group amid continued expansion and structural change in the e‑commerce market.

The most recent analyst rating on (JP:3371) stock is a Buy with a Yen2301.00 price target. To see the full list of analyst forecasts on Softcreate Holdings Corp. stock, see the JP:3371 Stock Forecast page.

Softcreate Holdings Delivers Double-Digit Profit Growth and Raises Annual Dividend Payout

Softcreate Holdings reported solid growth for the nine months ended December 31, 2025, with net sales rising 11.0% year on year to ¥25.15 billion and profit attributable to owners of parent up 14.9% to ¥2.93 billion, lifting basic earnings per share to ¥117.41. The company’s financial position also strengthened, as total assets increased to ¥38.48 billion and the equity ratio improved to 60.8%, while management maintained its full-year forecast for fiscal 2026, targeting 8.2% sales growth and a 6.5% rise in full-year profit along with a planned annual dividend increase to ¥62 per share, underscoring steady earnings momentum and continued shareholder returns.

The most recent analyst rating on (JP:3371) stock is a Buy with a Yen2612.00 price target. To see the full list of analyst forecasts on Softcreate Holdings Corp. stock, see the JP:3371 Stock Forecast page.