SHIFT (3697) AI Stock Analysis

• Market Cap: €454.55B
• Dividend Yield: N/A
• Average Volume (3M): 3.13M
• Price to Earnings (P/E): 68.0
• Beta (1Y): 1.14
• Revenue Growth: 20.02%
• EPS Growth: -5.47%
• Country: JP
• Employees: 10,266
• Sector: Technology
• Sector Strength: 86
• Industry: Software - Application
• EPS (TTM): 9.56
• Shares Outstanding: 267,500,670
• 10 Day Avg. Volume: 2,593,980
• 30 Day Avg. Volume: 3,125,886
• PEG Ratio: 0.22
• Price to Book (P/B): 1.21
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 3.92
• 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: €1,699.30
• Price Target Upside: -0.77% Downside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 2

• Rating: 74 Outperform
• Price Target: ¥1,980.00 ▲(15.62%Upside)

SHIFT, Inc. is financially robust with strong revenue and profit margins, complemented by bullish technical indicators. The high P/E ratio suggests a premium valuation which might deter conservative investors. Monitoring overbought indicators is recommended.

SHIFT Business Overview & Revenue Model

Company Description

SHIFT Inc. provides software quality assurance and testing solutions in Japan. The company offers CAT, a software test management tool. It also provides software consulting services. The company was incorporated in 2005 and is headquartered in Tokyo, Japan.

How the Company Makes Money

SHIFT, Inc. generates revenue primarily through its comprehensive suite of software testing services. The company earns money by providing testing solutions on a contractual basis, charging clients for the time and resources dedicated to ensuring the quality and functionality of their software products. Revenue streams include fees for individual testing projects, long-term service agreements, and subscription models for ongoing quality assurance support. The company may also engage in partnerships and collaborations with software development firms, enhancing its market presence and expanding its client base through strategic alliances.

SHIFT Financial Statement Overview

Summary

SHIFT, Inc. shows strong revenue growth and solid profitability margins. The company maintains a stable financial position with prudent balance sheet management, though monitoring debt levels and improving cash conversion efficiency are advisable.

Income Statement

SHIFT, Inc. demonstrated strong revenue growth over the years, with a notable increase from 2019 to 2024. The gross profit margin is healthy, and the net profit margin has been stable, reflecting efficient cost management. However, there was a slight decline in EBIT, which warrants monitoring.

Balance Sheet

The company maintains a strong equity position with an increasing equity ratio, indicating financial stability. A low debt-to-equity ratio suggests prudent leverage management. However, the increase in total debt over recent years should be observed closely to ensure it doesn't impact financial flexibility.

Cash Flow

SHIFT, Inc. has consistently generated positive operating cash flow, supporting its operations and growth initiatives. The free cash flow has shown growth, although the free cash flow to net income ratio suggests room for improvement in converting profits to cash.

Breakdown	TTM	Sep 2024	Sep 2023	Sep 2022	Sep 2021	Sep 2020
Income Statement
Total Revenue	115.73B	110.63B	88.03B	64.87B	46.00B	28.71B
Gross Profit	37.58B	35.36B	29.94B	21.10B	13.91B	8.95B
EBITDA	12.56B	11.98B	13.29B	8.93B	5.81B	3.14B
Net Income	6.60B	5.13B	6.25B	4.97B	2.82B	1.65B
Balance Sheet
Total Assets	66.21B	62.72B	49.53B	40.23B	34.27B	19.82B
Cash, Cash Equivalents and Short-Term Investments	24.40B	20.87B	17.59B	12.92B	14.25B	6.52B
Total Debt	12.83B	9.58B	4.90B	3.53B	4.22B	4.59B
Total Liabilities	30.61B	28.20B	19.96B	14.22B	11.59B	9.04B
Stockholders Equity	35.08B	34.04B	29.12B	25.65B	22.40B	10.51B
Cash Flow
Free Cash Flow	0.00	3.44B	8.99B	6.62B	4.32B	1.77B
Operating Cash Flow	0.00	9.09B	10.25B	7.39B	4.76B	2.25B
Investing Cash Flow	0.00	-9.95B	-3.80B	-5.61B	-5.43B	-5.93B
Financing Cash Flow	0.00	4.15B	-1.80B	-3.08B	8.29B	1.51B

SHIFT Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 1712.50
• 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:3697, the sentiment is Neutral. The current price of 1712.5 is below the 20-day moving average (MA) of 1748.05, above the 50-day MA of 1589.66, and above the 200-day MA of 1256.38, indicating a neutral trend. The MACD of 36.72 indicates Positive momentum. The RSI at 51.93 is Neutral, neither overbought nor oversold. The STOCH value of 38.73 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for JP:3697.

SHIFT Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
9759	80 Outperform	¥257.81B	23.15		2.45%	6.45%	15.31%
3697	74 Outperform	€454.55B	67.96	19.04%	―	20.02%	-5.47%
Sector *	56 Neutral	$3.18B	5.08	-5.68%	5.65%	8.05%	-41.83%
47D		€1.59B	―	-17.75%	―	―	―
4776	72 Outperform	¥170.90B	40.21		0.80%	16.68%	43.49%
4443	66 Neutral	¥262.39B	121.72		―	29.19%	―
4478	47 Neutral	¥215.25B	―		―	29.79%	77.13%

SHIFT Corporate Events

SHIFT Inc. Addresses Fraudulent Subsidy Applications at Subsidiary

SHIFT Inc. has uncovered fraudulent subsidy applications by its subsidiary, Infinic Inc., through an internal audit assisted by external experts. The director of Infinic has been dismissed, and the company is collaborating with local authorities to address the issue while implementing a compliance check system. The financial impact on SHIFT’s FY2025 statements is expected to be minimal.

SHIFT, Inc. Reports Strong Financial Growth for First Half of 2025

SHIFT, Inc. reported a significant increase in its consolidated financial results for the six months ending February 28, 2025, with net sales rising by 17.9% and operating profit surging by 72.1% compared to the previous year. The company’s strong performance reflects its strategic positioning in the software testing industry, with a notable impact on its profitability and market standing.

SHIFT Inc. Acquires Stake in Rise Consulting Group to Boost Market Position

SHIFT Inc. has announced the acquisition of a 33% stake in Rise Consulting Group, Inc., converting it into an equity-method affiliate, and has entered into a Business and Capital Alliance Agreement with Rise. This strategic move is expected to enhance SHIFT’s capabilities in upstream processes, expand its market reach, and increase its brand value in the consulting domain. The collaboration aims to broaden project opportunities, improve customer engagement, and support the company’s growth objectives.