System Integrator Corp. (3826) AI Stock Analysis

• Market Cap: ¥5.64B
• Dividend Yield: 2.28%
• Average Volume (3M): 27.30K
• Price to Earnings (P/E): 7.4
• Beta (1Y): 0.61
• Revenue Growth: N/A
• EPS Growth: N/A
• Country: JP
• Employees: 216
• Sector: Technology
• Sector Strength: 88
• Industry: Software - Application
• EPS (TTM): 12.34
• Shares Outstanding: 11,078,400
• 10 Day Avg. Volume: 38,630
• 30 Day Avg. Volume: 27,300
• PEG Ratio: -0.17
• Price to Book (P/B): 0.91
• Price to Sales (P/S): 0.78
• P/FCF Ratio: -8.41
• 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: 70 Outperform
• Price Target: ¥563.00 ▲(26.23% Upside)
• Action: N/A Date: 01/04/26
• Date: Action: N/A 01/04/26

The score is driven primarily by financial performance: a very conservative, zero-debt balance sheet is a major strength, but it is materially offset by the latest year’s negative operating/free cash flow and earnings volatility. Valuation is supportive with a low P/E and dividend yield, while technical signals are neutral-to-soft with negative MACD and price below key moving averages.

Positive Factors

Conservative balance sheet

A zero-debt balance sheet materially reduces solvency and refinancing risk and preserves strategic optionality. Over a 2–6 month horizon this conservatism supports resilience to demand shocks, funds discretionary investments without borrowing, and lowers downside risk to operations.

Stable gross margins

Consistent gross margins near 32–35% indicate durable pricing power and an advantageous service/product mix for a software integrator. Sustained margins provide a structural buffer to absorb SG&A variation and support medium-term profitability despite revenue swings.

Proven cash-generation history

A multi-year record of positive operating and free cash flow shows the business can convert earnings into cash, enabling reinvestment and shareholder returns. This suggests 2025 cash weakness may be episodic working-capital stress rather than permanent impairment.

Negative Factors

Sharp 2025 cash-flow reversal

A large negative operating and free cash flow outturn in 2025, despite positive net income, highlights earnings-quality and working-capital issues. Over the medium term this constrains capex, hiring and dividends unless management fixes cash conversion and liquidity dynamics.

Earnings volatility

Wide swings in net margin across recent years point to sensitivity to cost structure or one-off items and make forecasting and capital allocation difficult. Persistent margin volatility undermines confidence in sustainable profitability unless cost drivers are stabilized.

Limited return leverage

The absence of financial leverage reduces financial risk but also limits tools to amplify shareholder returns. Medium-term return improvement must come from organic execution and margin expansion, increasing pressure on operations to deliver consistent growth.

System Integrator Corp. Business Overview & Revenue Model

Company Description

System Integrator Corp. plans, develops, and sells packaging software and cloud services in Japan. It offers ERP, EC, omni channel, project management, database development and design support, application design, and e-learning tools. The company's products include AISIA, a design recognition solution; TOPSIC, an online and in real time cloud solution to evaluate a range of engineers' programming skills from beginner to advanced; SI Object Browser, a database development support tool; SI Object Browser ER, a data modeling tool; and SI Object Browser Designer, an AI design document preparation tool. Its products also comprise SI Object Browser PM, an integrated project management tool; SI Web Shopping, an EC site construction package software; and GRANDIT, a Web-based ERP. In addition, the company offers consulting services. System Integrator Corp. was founded in 1995 and is headquartered in Saitama, Japan.

How the Company Makes Money

System Integrator Corp. Financial Statement Overview

Summary

Strong balance sheet (no debt; solid equity base) supports resilience, but overall financial quality is held back by volatile profitability and a major 2025 cash-flow reversal (negative operating and free cash flow despite positive net income).

Income Statement

Revenue has been broadly stable with modest growth in the latest year (2025 annual revenue up ~2.8% after stronger growth in 2022 and a dip in 2023). Profitability is generally healthy for the sector, with solid gross margins (~32–35% in recent years) and net margins that have varied meaningfully (from ~6% in 2023 to ~20% in 2024 and ~12% in 2025). The main weakness is earnings volatility and a noticeable step-down in net income from 2024 to 2025, which suggests sensitivity to cost structure and/or non-operating items despite decent operating profitability.

Balance Sheet

The balance sheet is very conservative: total debt is reported at zero across all years, keeping financial risk low and flexibility high. Equity has grown over time (supporting a stronger capital base), and returns on equity have been solid overall, peaking in 2024 before normalizing in 2025. The key trade-off is that with no leverage, shareholder returns rely more heavily on operating execution; any profitability swings (as seen recently) flow directly through without the cushion of optimized capital structure.

Cash Flow

Cash generation has been inconsistent. After strong operating and free cash flow in 2021–2023 and positive cash flow in 2024, 2025 shows a sharp reversal with negative operating cash flow (-346M) and negative free cash flow (-443M). This divergence versus positive net income in 2025 raises questions around working capital timing and the sustainability/quality of earnings in the near term. The upside is that prior years demonstrate the business can generate meaningful cash, but the latest year’s cash outflow is a clear risk flag.

Breakdown	TTM	Feb 2025	Feb 2024	Feb 2023	Feb 2022	Feb 2021
Income Statement
Total Revenue	5.02B	4.77B	4.84B	4.49B	4.82B	4.26B
Gross Profit	1.64B	1.53B	1.63B	1.58B	1.68B	1.41B
EBITDA	506.21M	985.18M	516.00M	437.70M	790.40M	544.81M
Net Income	618.78M	583.41M	944.46M	280.10M	391.01M	293.06M
Balance Sheet
Total Assets	5.44B	4.98B	4.75B	3.78B	3.58B	3.50B
Cash, Cash Equivalents and Short-Term Investments	3.30B	2.97B	2.99B	1.96B	1.63B	1.47B
Total Debt	15.34M	0.00	0.00	0.00	0.00	0.00
Total Liabilities	1.41B	865.33M	1.09B	910.83M	866.10M	1.07B
Stockholders Equity	4.03B	4.11B	3.67B	2.87B	2.71B	2.43B
Cash Flow
Free Cash Flow	0.00	-442.63M	148.36M	540.94M	260.55M	366.05M
Operating Cash Flow	0.00	-346.11M	275.07M	625.57M	406.45M	683.56M
Investing Cash Flow	0.00	-69.81M	958.21M	-123.68M	-160.31M	-363.69M
Financing Cash Flow	0.00	-131.01M	-86.87M	-168.94M	-88.44M	-142.79M

System Integrator Corp. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
4491	82 Outperform	¥6.08B	13.76	―	1.87%	6.18%	29.79%
4333	81 Outperform	¥21.97B	16.24	―	3.86%	0.50%	17.15%
3771	77 Outperform	¥31.38B	12.82	―	2.93%	11.53%	23.23%
3826	70 Outperform	¥5.64B	7.44	―	2.28%	―	―
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
4829	50 Neutral	¥5.28B	158.97	―	2.78%	-4.90%	-85.89%
7527	47 Neutral	¥5.17B	-12.18	―	―	-40.57%	83.14%