FFRI Security, Inc. (3692) AI Stock Analysis

• Market Cap: ¥89.58B
• Dividend Yield: 0.14%
• Average Volume (3M): 975.63K
• Price to Earnings (P/E): 98.5
• Beta (1Y): 1.40
• Revenue Growth: 50.53%
• EPS Growth: 227.57%
• Country: JP
• Employees: 199
• Sector: Technology
• Sector Strength: 88
• Industry: Software - Application
• EPS (TTM): 31.03
• Shares Outstanding: 8,190,000
• 10 Day Avg. Volume: 1,531,580
• 30 Day Avg. Volume: 975,626
• PEG Ratio: 0.67
• Price to Book (P/B): 9.76
• Price to Sales (P/S): 8.95
• P/FCF Ratio: 44.03
• 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: 76 Outperform
• Price Target: ―

FFRI Security, Inc. demonstrates strong financial stability with a robust balance sheet and consistent revenue growth, supporting a high overall score. Technical analysis indicates that while there is some short-term downtrend, the stock maintains a positive long-term outlook. However, its high P/E ratio suggests overvaluation, which could restrict further price appreciation and tempers the overall score.

Positive Factors

Revenue Growth

Consistent revenue growth indicates strong market demand for FFRI Security's products, enhancing its competitive position and supporting long-term business expansion.

Balance Sheet Strength

A strong balance sheet with low leverage and high liquidity provides financial stability, allowing FFRI Security to invest in growth opportunities and weather economic downturns.

Profitability

High profitability margins reflect effective cost management and strong pricing power, enabling sustainable earnings and reinvestment into R&D for future growth.

Negative Factors

Cash Flow Concerns

Lack of operating cash flow raises concerns about cash generation efficiency, potentially impacting the company's ability to fund operations and growth initiatives without external financing.

Operational Efficiency

A decline in EBIT margin suggests challenges in operational efficiency, which could pressure future profitability if not addressed through cost control or revenue enhancement strategies.

Cash Conversion

Zero free cash flow indicates potential issues in converting revenue into cash, which may affect the company's ability to invest in growth or return capital to shareholders.

FFRI Security, Inc. Business Overview & Revenue Model

Company Description

FFRI Security, Inc. (3692) is a Japanese company specializing in cybersecurity solutions. The company primarily focuses on providing advanced security technologies and services that protect against cyber threats and malware. FFRI Security is known for its research and development in the field of information security, offering products such as endpoint security solutions, vulnerability assessment tools, and threat intelligence services to a wide range of clients across various industries.

How the Company Makes Money

FFRI Security, Inc. generates revenue through the sale of its cybersecurity products and services. The company's key revenue streams include licensing fees for its software solutions, subscription fees for ongoing security services, and consulting fees for specialized security assessments and threat analysis. Additionally, FFRI Security may engage in partnerships with other technology firms to enhance its offerings and reach a broader client base, further boosting its revenue. The company's focus on cutting-edge research and development allows it to maintain a competitive edge and attract clients looking for innovative security solutions.

FFRI Security, Inc. Financial Statement Overview

Summary

FFRI Security, Inc. exhibits strong financial health with consistent revenue growth, robust profitability, and a stable balance sheet characterized by high equity and low debt. While the income statement and balance sheet suggest a solid position, the cash flow statement highlights potential concerns in operational cash generation. Overall, the company is well-positioned financially with minor areas to monitor in cash flow management.

Income Statement

FFRI Security, Inc. demonstrates strong income statement performance with sustained revenue growth, achieving a TTM revenue of ¥2,628.2M, up from ¥2,446.9M in the prior year. The gross profit margin is robust at 62.5%, indicating effective cost management. Net profit margin stands at an impressive 16.4%, reflecting strong profitability. However, a slight decline in EBIT margin from 20.3% to 17.7% suggests some operational efficiency challenges.

Balance Sheet

The balance sheet of FFRI Security, Inc. is exceptionally strong, with a high equity ratio of 61.5%, indicating financial stability and low leverage. The company has minimal debt, resulting in a negligible debt-to-equity ratio, which minimizes financial risk. High levels of cash and short-term investments further bolster the company's liquidity position.

Cash Flow

The cash flow statement presents a mixed picture. While free cash flow growth is not available due to zero reported figures in the TTM period, the company shows robust free cash flow in prior periods. However, the zero operating cash flow in the TTM period raises concerns about cash generation from operations. Historical free cash flow to net income ratios indicate efficient cash conversion.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	3.41B	3.04B	2.45B	1.95B	1.78B	1.62B
Gross Profit	2.35B	2.03B	1.54B	1.17B	1.23B	1.33B
EBITDA	1.15B	925.15M	538.00M	257.32M	209.29M	387.27M
Net Income	891.09M	687.02M	432.17M	187.28M	120.98M	249.24M
Balance Sheet
Total Assets	5.04B	4.31B	3.38B	2.63B	2.45B	2.66B
Cash, Cash Equivalents and Short-Term Investments	3.47B	2.16B	2.08B	1.76B	1.64B	2.09B
Total Debt	9.99M	10.33M	0.00	0.00	0.00	0.00
Total Liabilities	2.16B	1.52B	1.20B	878.49M	730.52M	814.32M
Stockholders Equity	2.87B	2.79B	2.18B	1.75B	1.72B	1.84B
Cash Flow
Free Cash Flow	0.00	618.01M	370.42M	276.17M	-48.47M	75.00M
Operating Cash Flow	0.00	641.50M	390.63M	302.31M	-16.31M	120.16M
Investing Cash Flow	0.00	-477.61M	-20.72M	-26.10M	-157.98M	-42.82M
Financing Cash Flow	0.00	-79.64M	-50.09M	-161.52M	-275.08M	0.00

FFRI Security, Inc. Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 8260.00
• 50DMA: Negative
• 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:3692, the sentiment is Negative. The current price of 8260 is below the 20-day moving average (MA) of 9344.50, below the 50-day MA of 9553.20, and above the 200-day MA of 5954.94, indicating a neutral trend. The MACD of -444.66 indicates Positive momentum. The RSI at 40.87 is Neutral, neither overbought nor oversold. The STOCH value of 47.68 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:3692.

FFRI Security, Inc. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
4333	80 Outperform	¥21.31B	15.54	―	4.00%	0.50%	17.15%
3692	76 Outperform	¥89.58B	98.45	―	0.14%	50.53%	227.57%
4323	72 Outperform	¥52.85B	20.35	―	1.64%	13.48%	35.63%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
4259	61 Neutral	¥60.35B	―	―	―	8.98%	-581.59%
4382	43 Neutral	¥14.72B	-101.66	―	―	17.83%	87.36%