Systems Engineering Consultants Co., Ltd. (3741) AI Stock Analysis

• Market Cap: ¥23.54B
• Dividend Yield: 2.24%
• Average Volume (3M): 43.15K
• Price to Earnings (P/E): 18.0
• Beta (1Y): 0.73
• Revenue Growth: 17.22%
• EPS Growth: 10.53%
• Country: JP
• Employees: 347
• Sector: Technology
• Sector Strength: 87
• Industry: Software - Infrastructure
• EPS (TTM): 43.56
• Shares Outstanding: 5,120,000
• 10 Day Avg. Volume: 35,740
• 30 Day Avg. Volume: 43,153
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• 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: ¥5,165.00
• Price Target Upside: 13.64% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 1

• Rating: 67 Neutral
• Price Target: ¥5,165.00 ▲(13.64% Upside)

The overall stock score is primarily driven by strong financial performance, despite challenges in cash flow. Technical analysis indicates bearish momentum, which impacts the score negatively. Valuation is fair, providing some support to the score. The absence of earnings call data and corporate events means these factors do not influence the score.

Systems Engineering Consultants Co., Ltd. Business Overview & Revenue Model

Company Description

Systems Engineering Consultants Co., Ltd. (3741) is a Japanese company that operates in the information technology and engineering sectors. The company specializes in providing engineering and IT solutions, including software development, systems integration, and consulting services. It serves a diverse range of industries, including telecommunications, automotive, and manufacturing, by delivering innovative technology solutions and support.

How the Company Makes Money

Systems Engineering Consultants Co., Ltd. generates revenue through a variety of streams, primarily centered around its core offerings in software development, systems integration, and consulting services. The company earns income by developing custom software solutions tailored to the needs of its clients, which often involves long-term contracts and maintenance agreements. Systems integration projects also provide significant revenue, as the company assists businesses in implementing and optimizing complex IT systems. Additionally, the consultancy services offered by the company, which include strategic IT advice and project management, contribute to its earnings. Collaboration with various industries, including telecommunications and automotive, often involves partnerships or joint ventures that can enhance revenue through shared projects and innovation. Key factors contributing to the company's earnings include its expertise in cutting-edge technologies and its ability to adapt solutions to meet specific client needs.

Systems Engineering Consultants Co., Ltd. Financial Statement Overview

Summary

The company exhibits strong financial performance with robust revenue growth and profitability, minimal leverage, and healthy equity ratios. However, the cash flow situation poses challenges due to recent negative free cash flow, though historical resilience suggests potential recovery.

Income Statement

The company has demonstrated strong revenue growth with a 20.6% increase from the previous year, reflecting robust market demand and effective sales strategies. Gross profit margin and EBIT margin stand at 29.8% and 17.4% respectively, indicating efficient cost management and operational profitability. The net profit margin is also healthy at 13.1%, showing solid bottom-line performance. Overall, the income statement reflects a company with increasing revenue and profitability, positioning it well within the competitive software industry.

Balance Sheet

The balance sheet is strong with a low debt-to-equity ratio of 0.004, indicating minimal leverage and sound financial stability. The equity ratio of 79.2% suggests a high proportion of assets financed by equity, further strengthening the company's financial position. Return on equity is a solid 14.4%, showcasing effective utilization of shareholder funds. The company's high equity and low debt levels mitigate potential financial risks, providing a stable foundation for future growth.

Cash Flow

The cash flow statement shows a decline in operating cash flow, resulting in negative free cash flow in the most recent period. This is a concern as it suggests cash flow constraints despite the company's profitability. However, the free cash flow to net income ratio was positive in previous years, indicating potential for cash flow recovery. Overall, while the cash flow position requires improvement, historical performance suggests resilience.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	10.30B	10.30B	8.53B	7.49B	6.56B	6.53B
Gross Profit	3.07B	3.07B	2.55B	2.24B	1.97B	1.85B
EBITDA	1.87B	1.94B	1.58B	1.32B	1.14B	1.08B
Net Income	1.34B	1.34B	1.11B	878.83M	780.30M	727.68M
Balance Sheet
Total Assets	11.78B	11.78B	10.11B	9.19B	8.43B	7.94B
Cash, Cash Equivalents and Short-Term Investments	2.23B	2.23B	2.97B	3.08B	3.23B	2.85B
Total Debt	36.00M	36.00M	36.00M	36.00M	36.00M	36.00M
Total Liabilities	2.45B	2.45B	1.71B	1.58B	1.33B	1.36B
Stockholders Equity	9.33B	9.33B	8.40B	7.60B	7.09B	6.58B
Cash Flow
Free Cash Flow	0.00	-275.22M	345.47M	431.18M	629.42M	-76.76M
Operating Cash Flow	0.00	-250.49M	384.07M	526.79M	642.95M	-52.13M
Investing Cash Flow	0.00	-40.97M	-139.18M	-303.57M	28.72M	-40.65M
Financing Cash Flow	0.00	-445.43M	-352.99M	-381.51M	-290.70M	-423.19M

Systems Engineering Consultants Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 4545.00
• 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:3741, the sentiment is Negative. The current price of 4545 is below the 20-day moving average (MA) of 4774.50, below the 50-day MA of 4963.80, and below the 200-day MA of 4686.82, indicating a bearish trend. The MACD of -132.66 indicates Positive momentum. The RSI at 35.13 is Neutral, neither overbought nor oversold. The STOCH value of 20.38 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:3741.

Systems Engineering Consultants Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
3992	79 Outperform	¥21.17B	25.61		1.72%	2.06%	-16.53%
4493	78 Outperform	¥18.56B	34.10		0.17%	28.56%	-13.56%
3741	67 Neutral	¥23.54B	18.01		2.24%	17.22%	10.53%
4847	66 Neutral	¥28.00B	20.66		3.29%	7.42%	-4.90%
3850	65 Neutral	¥18.77B	32.36		0.91%	22.72%	71.04%
Sector *	61 Neutral	$35.45B	7.89	-10.11%	1.88%	8.47%	-9.45%

Systems Engineering Consultants Co., Ltd. Corporate Events

Systems Engineering Consultants Reports Q1 2025 Financial Results

Systems Engineering Consultants Co., Ltd. reported its non-consolidated financial results for the three months ended June 30, 2025, showing a 5.6% increase in net sales compared to the previous year. However, the company experienced declines in operating profit, ordinary profit, and net profit, with decreases of 18.6%, 15.5%, and 15.7% respectively. Despite these declines, the company maintains a strong equity-to-asset ratio of 84.4% and forecasts modest growth in net sales and profits for the fiscal year ending March 31, 2026. The company plans to maintain its dividend policy, with a slight increase in the forecasted year-end dividend.