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Encourage Technologies Co., Ltd.
(3682)
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Rating:70Outperform
Price Target:
¥682.00
▼(-1.16% Downside)
Action:Reiterated
Date:05/15/26
The score is primarily supported by strong financial quality (debt-free balance sheet, steady growth, and solid profitability) and a supportive dividend yield. It is held back by clear near-term technical weakness (below major moving averages with negative MACD) and some uncertainty from historically volatile cash flows.
Positive Factors
Debt-free balance sheet
A debt-free balance sheet with rising equity materially reduces financial risk and preserves strategic optionality. Over the next 2–6 months this underpins stable dividend capacity, funds internal investment or M&A without refinancing, and cushions the business against cyclical IT spending shocks.
Negative Factors
Margin compression
A meaningful decline from earlier margin peaks suggests structural mix shifts, pricing pressure, or rising operating costs. Persisting margin compression could limit free cash flow expansion and the ability to re-invest or raise dividends, reducing long-term profitability upside.
Read all positive and negative factors
Positive Factors
Negative Factors
Debt-free balance sheet
A debt-free balance sheet with rising equity materially reduces financial risk and preserves strategic optionality. Over the next 2–6 months this underpins stable dividend capacity, funds internal investment or M&A without refinancing, and cushions the business against cyclical IT spending shocks.
Read all positive factors
Encourage Technologies Co., Ltd. (3682) vs. iShares MSCI Japan ETF (EWJ)
Market Cap
¥3.98B
Dividend Yield4.35%
Average Volume (3M)5.93K
Price to Earnings (P/E)18.7
Beta (1Y)0.28
Revenue Growth3.32%
EPS Growth-3.40%
CountryJP
Employees124
SectorTechnology
Sector Strength88
IndustryInformation Technology Services
Share Statistics
EPS (TTM)33.21
Shares Outstanding6,924,200
10 Day Avg. Volume7,980
30 Day Avg. Volume5,930
Financial Highlights & Ratios
PEG Ratio-6.24
Price to Book (P/B)1.27
Price to Sales (P/S)1.76
P/FCF Ratio6.21
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
EPS Forecast (FY)N/A
Revenue Forecast (FY)N/A
Encourage Technologies Co., Ltd. Business Overview & Revenue Model
Company Description
Encourage Technologies Co., Ltd. is a Japan-based firm specializing in the development, maintenance, and sale of computer system software products. The company provides a comprehensive suite of solutions, notably its "ESS SmartIT Operation" lineup...
How the Company Makes Money
Encourage Technologies primarily makes money by selling its software products and providing related services to enterprise customers. Key revenue streams generally include (1) software license sales (or equivalent rights-to-use fees, depending on ...
Encourage Technologies Co., Ltd. Financial Statement Overview
Summary
Income Statement
78
Positive
Balance Sheet
90
Very Positive
Cash Flow
70
Positive
| Breakdown | TTM | Mar 2026 | Mar 2025 | Mar 2024 | Mar 2023 | Mar 2022 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 2.35B | 2.58B | 2.50B | 2.50B | 2.12B | 2.07B |
| Gross Profit | 1.31B | 1.30B | 1.28B | 1.26B | 1.39B | 1.29B |
| EBITDA | 560.08M | 566.03M | 587.04M | 694.94M | 345.96M | 434.67M |
| Net Income | 221.15M | 212.81M | 220.24M | 218.86M | 174.76M | 248.59M |
Balance Sheet | ||||||
| Total Assets | 4.66B | 4.98B | 4.67B | 4.89B | 4.22B | 4.46B |
| Cash, Cash Equivalents and Short-Term Investments | 3.76B | 4.05B | 3.71B | 3.76B | 3.39B | 3.74B |
| Total Debt | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Total Liabilities | 1.32B | 1.41B | 1.16B | 1.47B | 878.21M | 1.16B |
| Stockholders Equity | 3.34B | 3.57B | 3.51B | 3.43B | 3.34B | 3.29B |
Cash Flow | ||||||
| Free Cash Flow | 0.00 | 730.17M | 312.97M | 503.05M | -216.51M | 567.06M |
| Operating Cash Flow | 0.00 | 751.75M | 345.94M | 862.64M | 3.88M | 741.15M |
| Investing Cash Flow | 0.00 | -937.57M | -261.88M | -364.19M | -226.66M | -164.49M |
| Financing Cash Flow | 0.00 | -167.87M | -134.29M | -134.29M | -120.86M | -120.86M |
Encourage Technologies Co., Ltd. Technical Analysis
Positive
690.00
Price Trends
594.42
Positive
618.94
Negative
629.11
Negative
Market Momentum
1.37
Positive
54.58
Neutral
66.68
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:3682, the sentiment is Positive. The current price of 690 is above the 20-day moving average (MA) of 607.90, above the 50-day MA of 594.42, and above the 200-day MA of 629.11, indicating a neutral trend. The MACD of 1.37 indicates Positive momentum. The RSI at 54.58 is Neutral, neither overbought nor oversold. The STOCH value of 66.68 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:3682.
Encourage Technologies Co., Ltd. Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
70 Outperform | ¥3.98B | 18.72 | ― | 2.99% | 3.32% | -3.40% | |
70 Outperform | ¥5.00B | 10.28 | ― | 2.99% | 24.04% | -0.32% | |
65 Neutral | ¥4.25B | 10.24 | ― | 1.20% | 9.28% | -12.50% | |
62 Neutral | ¥4.66B | 17.21 | ― | ― | 16.25% | -2.05% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% | |
60 Neutral | ¥5.29B | 47.99 | ― | 1.61% | 3.07% | -54.25% | |
52 Neutral | ¥4.29B | 24.44 | ― | 0.94% | -3.16% | ― |
* Technology Sector Average
JP:3682
Encourage Technologies Co., Ltd.
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3.90%
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Encourage Technologies Co., Ltd. Corporate Events
Encourage Technologies Posts Modest Revenue Growth, Maintains Strong Equity Base
May 13, 2026
Encourage Technologies Co., Ltd. reported net sales of ¥2,584 million for the fiscal year ended March 2026, a 3.3% increase from the prior year, with operating profit edging up 1.7% to ¥303 million and ordinary profit rising 4.1% to ...
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.