SHIFT (3697) AI Stock Analysis

• Market Cap: ¥425.54B
• Dividend Yield: N/A
• Average Volume (3M): 3.43M
• Price to Earnings (P/E): 51.7
• Beta (1Y): 1.19
• Revenue Growth: 18.03%
• EPS Growth: 46.07%
• Country: JP
• Employees: 10,266
• Sector: Technology
• Sector Strength: 91
• Industry: Software - Application
• EPS (TTM): 6.80
• Shares Outstanding: 267,500,670
• 10 Day Avg. Volume: 5,094,210
• 30 Day Avg. Volume: 3,432,940
• PEG Ratio: 0.39
• Price to Book (P/B): 0.75
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 0.00
• 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: ¥1,900.34
• Price Target Upside: 17.78% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 1

• Rating: 58 Neutral
• Price Target: ¥1,626.00 ▲(0.77%Upside)

SHIFT, Inc.'s solid financial performance is a strong positive factor, but the bearish technical indicators and potentially high valuation weigh down the overall score. Monitoring debt levels and improving cash conversion efficiency are necessary to sustain financial health.

SHIFT Business Overview & Revenue Model

Company Description

SHIFT Inc. (Ticker: 3697) is a Japan-based company primarily engaged in the provision of software testing services. The company offers comprehensive testing solutions across various industries, including finance, retail, telecommunications, and manufacturing. SHIFT's core services encompass test planning, design, execution, and automation, with a focus on enhancing the quality and reliability of software applications for its clients. It leverages its expertise in quality assurance to support businesses in optimizing their software development processes and reducing time-to-market.

How the Company Makes Money

SHIFT Inc. generates revenue primarily through its software testing services offered to a broad range of industries. The company's revenue model is based on charging clients for the testing services it provides, which can include manual and automated testing, as well as consulting and quality assurance support. Key revenue streams include service fees for test planning, execution, and automation projects. Additionally, SHIFT may engage in long-term contracts with clients, which can provide steady income streams. Strategic partnerships with technology firms and expansion into new industries also contribute to its financial growth by broadening its client base and service offerings.

SHIFT Financial Statement Overview

Summary

SHIFT, Inc. demonstrates strong financial health with notable revenue growth, solid profitability margins, and a stable balance sheet. However, attention is required on rising debt levels and cash conversion efficiency.

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

SHIFT Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 1613.50
• 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:3697, the sentiment is Neutral. The current price of 1613.5 is below the 20-day moving average (MA) of 1659.22, below the 50-day MA of 1659.35, and above the 200-day MA of 1306.10, indicating a neutral trend. The MACD of -25.31 indicates Positive momentum. The RSI at 43.94 is Neutral, neither overbought nor oversold. The STOCH value of 46.39 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	¥252.81B	22.70		2.53%	6.45%	15.31%
4776	72 Outperform	¥177.55B	41.78		0.78%	16.68%	43.49%
Sector *	68 Neutral	¥232.03B	14.76	7.50%	2.61%	9.28%	6.75%
4443	66 Neutral	¥246.96B	585.64		―	29.19%	―
3697	58 Neutral	¥425.54B	51.70	23.55%	―	18.03%	46.07%
3994	55 Neutral	€286.13B	―	-18.26%	―	20.96%	-6.20%
4478	47 Neutral	¥233.04B	―		―	29.79%	77.13%

SHIFT Corporate Events

SHIFT Inc. Amends Acquisition Terms with Infratop Inc.

SHIFT Inc. has announced amendments to its acquisition agreement with Infratop Inc., focusing on the transfer of training and human dispatching businesses. The changes involve transferring these businesses to Roppongi Kanri No.10 Co., Ltd., a subsidiary of DMM.com LLC, instead of forming a new company. This adjustment excludes Infratop’s generative AI business from the acquisition and revises the acquisition price, impacting SHIFT’s strategic positioning in the industry.

The most recent analyst rating on (JP:3697) stock is a Hold with a Yen1500.00 price target. To see the full list of analyst forecasts on SHIFT stock, see the JP:3697 Stock Forecast page.

SHIFT Inc. Forms Strategic Alliance with MEDIA DO to Boost Global Content Distribution

SHIFT Inc. has announced a capital and business alliance with MEDIA DO Co., Ltd., acquiring 3.08% of its voting rights. This partnership aims to leverage SHIFT’s expertise in software services to support MEDIA DO’s digital distribution businesses and enhance the global distribution of Japanese content. The collaboration is expected to strengthen SHIFT’s position in the international market and expand its business channels, promoting digital transformation and increasing global awareness of Japanese-origin content.

The most recent analyst rating on (JP:3697) stock is a Buy with a Yen1500.00 price target. To see the full list of analyst forecasts on SHIFT stock, see the JP:3697 Stock Forecast page.

SHIFT Inc. Revises Financial Forecast Upwards Amid Strong Performance

SHIFT Inc. has revised its financial forecast for the fiscal year ending August 31, 2025, projecting an increase in operating and ordinary profit due to a record-high gross profit margin. Despite maintaining the forecast for profit attributable to owners of the parent, the company shows strong progress in net sales and profits, reflecting effective measures in improving engineer utilization and stabilizing the top line.

The most recent analyst rating on (JP:3697) stock is a Buy with a Yen1500.00 price target. To see the full list of analyst forecasts on SHIFT stock, see the JP:3697 Stock Forecast page.

SHIFT, Inc. Reports Strong Financial Growth and Strategic Moves in 2025

SHIFT, Inc. reported significant financial growth for the nine months ending May 31, 2025, with net sales increasing by 17.6% and operating profit surging by 68.7% compared to the previous year. The company also finalized accounting treatments related to a business combination and conducted a 15-for-1 stock split, indicating strategic moves to enhance its market position and shareholder value.

The most recent analyst rating on (JP:3697) stock is a Buy with a Yen1500.00 price target. To see the full list of analyst forecasts on SHIFT stock, see the JP:3697 Stock Forecast page.