Daiwa Computer Co., Ltd. (3816) AI Stock Analysis

• Market Cap: ¥4.31B
• Dividend Yield: 1.7%
• Average Volume (3M): 2.28K
• Price to Earnings (P/E): 44.9
• Beta (1Y): 0.36
• Revenue Growth: -0.23%
• EPS Growth: 23.25%
• Country: JP
• Employees: 187
• Sector: Technology
• Sector Strength: 88
• Industry: Software - Application
• EPS (TTM): 6.23
• Shares Outstanding: 3,949,762
• 10 Day Avg. Volume: 3,150
• 30 Day Avg. Volume: 2,283
• PEG Ratio: 0.48
• Price to Book (P/B): 0.82
• Price to Sales (P/S): 1.38
• P/FCF Ratio: 17.66
• 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
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 69 Neutral
• Price Target: ¥1,263.00 ▲(9.54% Upside)
• Action: Downgraded Date: 11/01/25
• Date: Action: Downgraded 11/01/25

The overall score of 69 for JP:3816 is driven primarily by strong financial performance (score: 73), underpinned by a robust balance sheet and stable profitability, despite minor revenue growth concerns. Valuation (score: 80) also supports the score with a reasonable P/E ratio and decent dividend yield. However, weaker technical indicators (score: 55) with bearish price trends temper the outlook. Financial health remains the most significant positive factor.

Positive Factors

Strong Profitability

Consistent profitability indicates effective cost management and operational efficiency, supporting long-term business sustainability.

Low Leverage

Low leverage enhances financial stability and flexibility, reducing risk and enabling strategic investments without excessive debt burden.

Free Cash Flow Generation

Strong free cash flow generation provides liquidity for reinvestment, debt reduction, and shareholder returns, supporting long-term growth.

Negative Factors

Decline in Revenue Growth

Volatile and declining revenue growth can hinder long-term expansion and market competitiveness, affecting future profitability.

Decreased Operating Cash Flow

Decreased operating cash flow may limit the company's ability to fund operations and investments, potentially affecting financial health.

Declining Return on Equity

A declining return on equity suggests challenges in generating profits from equity, potentially impacting investor confidence and capital efficiency.

Daiwa Computer Co., Ltd. Business Overview & Revenue Model

Company Description

Daiwa Computer Co., Ltd. (3816) is a Japanese technology firm specializing in the development and provision of software and IT solutions primarily for the financial services sector. The company focuses on offering advanced systems for asset management, trading, and risk management, catering to both institutional and retail clients. With a strong emphasis on innovation, Daiwa Computer integrates cutting-edge technologies such as AI and big data analytics into its product offerings, ensuring that clients can optimize their operations and enhance decision-making processes.

How the Company Makes Money

Daiwa Computer generates revenue through multiple streams, primarily from software sales, licensing fees, and maintenance services. The company sells proprietary software solutions designed for the financial industry, which includes trading platforms, risk management systems, and analytics tools. Additionally, Daiwa Computer offers consulting services to help clients implement and customize these solutions, further contributing to its income. Recurring revenue from ongoing maintenance and support contracts provides stability to its earnings. Significant partnerships with financial institutions and technology providers bolster its market presence and facilitate access to a broader client base, enhancing overall revenue potential.

Daiwa Computer Co., Ltd. Financial Statement Overview

Summary

Daiwa Computer Co., Ltd. exhibits solid financial health with a strong balance sheet (score: 85) due to minimal debt and high equity, moderate income statement performance (score: 65) with stable profitability but slight revenue decline, and reasonable cash flow (score: 70) with good profit-to-cash conversion but some efficiency gaps. The score reflects a balanced view of stability and minor growth concerns.

Income Statement

Daiwa Computer Co., Ltd. shows moderate profitability with a Gross Profit Margin of 32.8% and a Net Profit Margin of 13.0% in the latest annual report. EBIT and EBITDA Margins are solid at 17.8% and 18.9%, respectively, indicating decent operational efficiency. However, a slight revenue decline of 0.7% year-over-year raises concerns about growth trajectory, though historical data shows periods of positive growth. The score reflects a balance of stable profitability and minor growth challenges.

Balance Sheet

The company's balance sheet is strong, with an extremely low Debt-to-Equity Ratio of 0.008 in the latest annual report, indicating minimal leverage and financial stability. Stockholders' Equity stands at 5.36 billion, representing a significant portion of Total Assets (6.24 billion), with an Equity Ratio of approximately 86.0%. This reflects a robust capital structure with low risk of over-leverage, supporting a high score.

Cash Flow

Cash flow performance is reasonable, with Operating Cash Flow of 277 million and Free Cash Flow of 250 million in the latest annual report. The Free Cash Flow to Net Income Ratio of 0.90 suggests good conversion of profits to cash, though Operating Cash Flow to Net Income is lower at 0.56, indicating some gaps in cash generation efficiency. Historical Free Cash Flow growth shows volatility, which tempers the score despite solid current metrics.

Breakdown	Jul 2025	Jul 2024	Jul 2023	Jul 2022	Jul 2021
Income Statement
Total Revenue	3.20B	3.29B	3.01B	2.88B	2.61B
Gross Profit	1.05B	1.06B	960.96M	894.76M	899.68M
EBITDA	606.82M	604.89M	538.55M	504.39M	496.67M
Net Income	417.51M	342.18M	329.00M	339.56M	328.88M
Balance Sheet
Total Assets	6.24B	6.12B	5.76B	5.32B	5.15B
Cash, Cash Equivalents and Short-Term Investments	3.95B	3.88B	3.26B	3.18B	2.98B
Total Debt	44.12M	79.61M	85.50M	30.00M	30.00M
Total Liabilities	876.45M	1.02B	975.73M	916.13M	899.30M
Stockholders Equity	5.37B	5.10B	4.78B	4.41B	4.25B
Cash Flow
Free Cash Flow	250.61M	588.46M	318.21M	281.33M	380.87M
Operating Cash Flow	277.08M	593.37M	324.42M	283.60M	383.22M
Investing Cash Flow	-87.89M	79.12M	-130.91M	-20.12M	-14.45M
Financing Cash Flow	-109.68M	-76.09M	-121.62M	-93.70M	-64.91M

Daiwa Computer Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 1153.00
• 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:3816, the sentiment is Negative. The current price of 1153 is above the 20-day moving average (MA) of 1149.50, above the 50-day MA of 1136.50, and above the 200-day MA of 1148.71, indicating a bearish trend. The MACD of -1.50 indicates Positive momentum. The RSI at 47.17 is Neutral, neither overbought nor oversold. The STOCH value of 34.07 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:3816.

Daiwa Computer Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
4491	82 Outperform	¥5.83B	10.91	―	1.87%	6.18%	29.79%
5033	71 Outperform	¥4.79B	21.99	―	―	7.60%	19.13%
3816	69 Neutral	¥4.31B	44.94	7.21%	1.70%	-0.23%	23.25%
3826	64 Neutral	¥4.74B	9.17	―	2.28%	―	―
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
4019	60 Neutral	¥5.28B	34.59	―	0.49%	41.47%	104.50%
7527	47 Neutral	¥4.32B	-18.61	―	―	-40.57%	83.14%