Strong Balance Sheet And Low LeverageSystem D's materially reduced debt-to-equity and solid equity ratio provide durable financial flexibility. Low leverage supports capital allocation for R&D, acquisitions or dividends, reduces refinancing risk, and helps the company absorb downturns without stressing operations or liquidity.

Consistently High Gross MarginsA ~43% gross margin indicates sustained pricing power or efficient cost structure in application software. High gross margins create structural room to fund SG&A and R&D while preserving operating profit, underpinning long-term competitiveness and investment capacity.

Efficient Cash ConversionNear-1 FCF-to-net-income and generally robust operating cash flow show strong earnings quality and cash conversion. This supports durable internal funding for capex, product development and shareholder returns without persistent reliance on external financing.

Bears Say

Volatile Free Cash FlowSignificant swings in free cash flow create planning uncertainty for investment and payout policy. Even with good cash conversion on average, volatility can constrain long-term capital allocation, force precautionary liquidity buffers, and raise execution risk for growth initiatives.

Declining Net Profit MarginA falling net margin over recent years signals pressure below the operating line or rising non-operating costs. Persistent margin erosion undermines return on sales and limits reinvestment or distributions, reducing resilience to slower revenue growth or competitive stress.

Recent Revenue Weakness NotedSustained or recent declines in revenue constrain scale economics and make it harder to expand operating profit even with strong margins. Structural revenue weakness raises questions about market penetration, product relevance, or competitive displacement over the medium term.

3804 FAQ

What was System D Inc.’s price range in the past 12 months?

System D Inc. lowest stock price was ¥1410.00 and its highest was ¥2503.00 in the past 12 months.

What is System D Inc.’s market cap?

System D Inc.’s market cap is ¥10.31B.

When is System D Inc.’s upcoming earnings report date?

System D Inc.’s upcoming earnings report date is Mar 16, 2026 which is in 26 days.

How were System D Inc.’s earnings last quarter?

System D Inc. released its earnings results on Dec 15, 2025. The company reported ¥21.54 earnings per share for the quarter, beating the consensus estimate of N/A by ¥21.54.

Is System D Inc. overvalued?

According to Wall Street analysts System D Inc.’s price is currently Overvalued. Get more investment ideas with TipRanks Premium

Does System D Inc. pay dividends?

System D Inc. pays a Annually dividend of ¥28 which represents an annual dividend yield of 1.51%. See more information on System D Inc. dividends here

What is System D Inc.’s EPS estimate?

System D Inc.’s EPS estimate for its next earnings report is not yet available.

How many shares outstanding does System D Inc. have?

System D Inc. has 6,498,000 shares outstanding.

What happened to System D Inc.’s price movement after its last earnings report?

System D Inc. reported an EPS of ¥21.54 in its last earnings report, beating expectations of N/A. Following the earnings report the stock price went up 0.885%.

Which hedge fund is a major shareholder of System D Inc.?

Currently, no hedge funds are holding shares in JP:3804

What is the TipRanks Smart Score and how is it calculated?

Smart Score combines eight research factors - such as analyst recommendations, hedge fund trends, and technical indicators - to measure a stock’s outlook. These signals are unified into a single score that reflects bullish or bearish momentum. See detailed methodology

Company Description

System D Inc.

System D Inc. (3804) is a technology company specializing in innovative software solutions and digital services. Focused on the telecommunications and information technology sectors, the company develops a range of products that enhance network efficiency and optimize data management. Its core offerings include cloud-based platforms, cybersecurity solutions, and enterprise resource planning (ERP) systems designed to meet the needs of various industries, from small businesses to large corporations.