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

• Market Cap: ¥26.50B
• Dividend Yield: 2.12%
• Average Volume (3M): 34.78K
• Price to Earnings (P/E): 19.7
• Beta (1Y): 0.82
• Revenue Growth: 20.63%
• EPS Growth: 21.52%
• Country: JP
• Employees: 347
• Sector: Technology
• Sector Strength: 83
• Industry: Software - Infrastructure
• EPS (TTM): 82.71
• Shares Outstanding: 5,120,000
• 10 Day Avg. Volume: 46,090
• 30 Day Avg. Volume: 34,780
• PEG Ratio: 4.55
• Price to Book (P/B): 2.60
• 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: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0

• Rating: 71 Outperform
• Price Target: ¥6,144.00 ▲(18.61%Upside)

The company's strong financial performance, characterized by robust revenue growth and profitability, is the primary driver of its stock score. Although technical indicators suggest bullish momentum, the overbought condition warrants caution. The valuation is reasonable, supported by a decent dividend yield, yet cash flow issues slightly dampen the otherwise positive outlook.

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

Company Description

Systems Engineering Consultants Co., Ltd. (3741) is a Japanese company specializing in providing comprehensive engineering consulting services. The company operates primarily in the information technology and telecommunications sectors, offering an array of services including software development, systems integration, and IT infrastructure management. Its core products and services are tailored to enhance operational efficiency and technological advancement for various industries.

How the Company Makes Money

Systems Engineering Consultants Co., Ltd. generates revenue through a combination of service-based and project-based engagements. The company earns income by delivering specialized engineering consulting services, software development projects, and systems integration solutions to its clients. Revenue streams include fees for consulting services, software licensing, maintenance contracts, and custom IT solutions development. The company may also engage in strategic partnerships and collaborations with technology providers to enhance its service offerings, contributing to its overall revenue generation.

Systems Engineering Consultants Co., Ltd. Financial Statement Overview

Summary

Systems Engineering Consultants Co., Ltd. demonstrates a strong financial position with remarkable growth in revenue and profitability, supported by a robust balance sheet. The company's low leverage and solid equity position reflect sound financial management. However, inconsistencies in cash flow generation highlight the need for improved cash flow consistency.

Income Statement

The income statement of Systems Engineering Consultants Co., Ltd. shows strong revenue growth with a revenue growth rate of 11.86% in the latest TTM period. The gross profit margin is robust at 30.12%, and the net profit margin is impressive at 13.16%. The company also demonstrates good operational efficiency with an EBIT margin of 17.39% and an EBITDA margin of 18.02%. Overall, the financial health is excellent with consistent growth in revenue and profitability.

Balance Sheet

The balance sheet is strong with a low debt-to-equity ratio of 0.01, indicating low financial leverage. The return on equity (ROE) stands at 14.11%, showcasing effective use of equity to generate profits. The equity ratio is high at 85.05%, reflecting financial stability and a solid capital structure. These metrics highlight the company's prudent financial management and low risk.

Cash Flow

The cash flow metrics present a mixed picture. While the free cash flow to net income ratio indicates a positive conversion of earnings to cash, the operating cash flow to net income ratio cannot be assessed for the TTM due to missing data. The historical trend shows some fluctuations in free cash flow growth, but the overall cash flow management remains adequate.

Breakdown
TTM	Mar 2024	Mar 2023	Mar 2022	Mar 2021	Mar 2020
Income Statement		Total Revenue
9.55B	8.53B	7.49B	6.56B	6.53B	6.34B
	Gross Profit
2.88B	2.55B	2.24B	1.97B	1.85B	1.78B
	EBIT
1.66B	1.47B	1.22B	1.06B	1.01B	930.59M
	EBITDA
1.72B	1.58B	1.32B	1.14B	1.08B	1.03B
	Net Income Common Stockholders
1.26B	1.11B	878.83M	780.30M	727.68M	687.86M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
2.97B	2.97B	3.08B	3.23B	2.85B	3.37B
	Total Assets
10.11B	10.11B	9.19B	8.43B	7.94B	7.51B
	Total Debt
36.00M	36.00M	36.00M	36.00M	36.00M	36.00M
	Net Debt
-2.93B	-2.93B	-3.04B	-3.20B	-2.82B	-3.33B
	Total Liabilities
1.71B	1.71B	1.58B	1.33B	1.36B	1.26B
	Stockholders Equity
8.40B	8.40B	7.60B	7.09B	6.58B	6.25B
Cash Flow		Free Cash Flow
0.00	345.47M	431.18M	629.42M	-76.76M	824.06M
	Operating Cash Flow
0.00	384.07M	526.79M	642.95M	-52.13M	843.13M
	Investing Cash Flow
0.00	-139.18M	-303.57M	28.72M	-40.65M	73.13M
	Financing Cash Flow
0.00	-352.99M	-381.51M	-290.70M	-423.19M	-244.95M

Systems Engineering Consultants Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 5180.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• 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 Positive. The current price of 5180 is above the 20-day moving average (MA) of 4957.50, above the 50-day MA of 4593.93, and above the 200-day MA of 4402.51, indicating a bullish trend. The MACD of 210.59 indicates Negative momentum. The RSI at 60.43 is Neutral, neither overbought nor oversold. The STOCH value of 64.41 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive 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
4493	78 Outperform	¥18.60B	33.89		0.17%	24.15%	-7.80%
3992	76 Outperform	¥21.81B	25.96		1.67%	3.71%	-14.56%
4847	75 Outperform	¥28.65B	20.13		3.67%	7.50%	0.64%
3741	71 Outperform	¥26.50B	19.65		2.12%	20.63%	21.52%
3850	65 Neutral	¥18.82B	55.35		0.90%	32.25%	87.20%
Sector *	62 Neutral	$11.80B	10.37	-7.29%	2.91%	7.39%	-7.96%

Systems Engineering Consultants Co., Ltd. Corporate Events

Systems Engineering Consultants Announces Board Changes

Systems Engineering Consultants Co., Ltd. announced changes in its board of directors, effective after the upcoming General Meeting of Shareholders on June 26, 2025. The company plans to appoint Kunihiro Nishimura as an Outside Director, while Tsutomu Sakaida and Ryoko Ueoka are candidates for positions as Outside Directors and Audit and Supervisory Committee Members. These changes are part of the company’s strategy to strengthen its governance and align with Tokyo Stock Exchange requirements for independent officers.

Systems Engineering Consultants Exceeds Forecasts and Increases Dividends

Systems Engineering Consultants Co., Ltd. announced that its actual financial results for the fiscal year ended March 2025 exceeded its forecasts due to strong performance in government, medical, and defense sectors. The company also declared a higher dividend payout, including a commemorative dividend, reflecting its 20th anniversary as a public company and its commitment to shareholder returns.

Systems Engineering Consultants Co., Ltd. Reports Strong Financial Growth for FY 2025

Systems Engineering Consultants Co., Ltd. reported a significant increase in its non-consolidated financial results for the fiscal year ending March 31, 2025, with net sales rising by 20.6% and operating profit by 22.2% compared to the previous year. The company also announced an increase in dividends, reflecting its strong financial performance and commitment to shareholder returns, while maintaining a stable financial position with a high equity-to-asset ratio.