System Integrator Corp. (3826) AI Stock Analysis

• Market Cap: ¥5.57B
• Dividend Yield: 2.28%
• Average Volume (3M): 27.30K
• Price to Earnings (P/E): 7.3
• Beta (1Y): 0.63
• 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: ¥557.00 ▲(24.89% Upside)

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

Very conservative balance sheet (no debt)

Zero reported debt and a growing equity base provide durable financial flexibility. This reduces insolvency risk, supports investment or dividend capacity during downturns, and gives management optionality to pursue strategic initiatives without refinancing pressure.

Proven historical cash-generation ability

Prior multi-year operating and free cash flow strength demonstrates the business can convert revenue into cash, enabling reinvestment, dividends, or reserves. That track record indicates underlying business economics can support sustainable cash generation when execution is stable.

Stable revenue with healthy gross margins

Modest, consistent revenue growth combined with mid-30s gross margins indicates durable core profitability. Solid gross margins provide a structural buffer to absorb SG&A or R&D investment without immediately eroding operating profits.

Negative Factors

Sharp 2025 cash-flow reversal

A large, persistent cash outflow in 2025 undermines liquidity and raises questions about working-capital management or one-off cash items. This materially weakens the company's ability to self-fund growth or dividends absent corrective actions or improved cash conversion.

Earnings volatility and recent profit step-down

Meaningful swings in net income reduce forecastability and increase execution risk for planning capex, dividends, or hiring. Persistent volatility can raise capital costs and make long-term strategic commitments harder to justify for management and investors.

Operational sensitivity due to zero leverage

A zero-debt policy limits financial engineering to boost returns, so performance depends heavily on margin and revenue execution. That structural reliance magnifies the impact of operational missteps and makes sustained shareholder return growth contingent on flawless operating delivery.

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	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
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
3826	70 Outperform	¥5.57B	7.35	―	2.28%	―	―
3965	69 Neutral	¥4.58B	11.36	―	2.20%	18.47%	155.94%
3917	66 Neutral	¥4.89B	7.62	―	―	7.40%	―
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
3936	48 Neutral	¥5.16B	63.32	―	―	33.73%	―
3967	44 Neutral	¥3.98B	-4.79	―	―	15.39%	-562.65%