Datasection, Inc. (3905) AI Stock Analysis

• Market Cap: ¥52.86B
• Dividend Yield: N/A
• Average Volume (3M): 2.67M
• Price to Earnings (P/E): ―
• Beta (1Y): 1.53
• Revenue Growth: 32.00%
• EPS Growth: 55.21%
• Country: JP
• Employees: 210
• Sector: Technology
• Sector Strength: 84
• Industry: Software - Application
• EPS (TTM): -14.32
• Shares Outstanding: 20,793,750
• 10 Day Avg. Volume: 7,692,290
• 30 Day Avg. Volume: 2,665,820
• PEG Ratio: <0.01
• Price to Book (P/B): 1.53
• Price to Sales (P/S): 0.00
• P/FCF Ratio: -12.95
• 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: 58 Neutral
• Price Target: ¥2,412.00 ▼(-5.11%Downside)

The overall stock score of 58 reflects a company with strong technical momentum but significant challenges in financial performance and valuation. While the stock exhibits bullish technical indicators, its financial performance and negative P/E ratio highlight the need for operational improvements and profitability before it becomes an attractive investment.

Datasection, Inc. Business Overview & Revenue Model

Company Description

Datasection, Inc. (3905) is a technology company specializing in the development and provision of artificial intelligence and data analysis solutions. The company focuses on sectors such as digital marketing, consumer insights, and smart city applications, offering advanced products and services that leverage big data and machine learning technologies to deliver actionable insights and innovative solutions for businesses and municipalities.

How the Company Makes Money

Datasection, Inc. generates revenue through the sale of its AI-driven data analysis products and services. The company offers tailored solutions to its clients, which include businesses seeking to enhance their digital marketing strategies and municipalities looking to implement smart city technologies. Revenue streams are primarily derived from subscription fees for its software platforms, consulting services, and custom data analytics projects. Additionally, partnerships with technology firms and government entities contribute to its earnings by expanding its market reach and integrating its solutions into broader initiatives.

Datasection, Inc. Financial Statement Overview

Summary

Datasection, Inc. exhibits strong revenue growth but struggles with profitability and cash flow generation. The company maintains a relatively strong cash position, providing some financial stability; however, it must address operational inefficiencies and reduce its reliance on debt to improve financial health.

Income Statement

Datasection, Inc. has shown a steady revenue growth from 2020 to 2025, with a significant increase from 2024 to 2025. However, the company is currently facing profitability challenges as evidenced by its negative EBIT and net income margins in recent years. The gross profit margin has remained relatively stable, indicating the company is maintaining its cost of goods sold effectively. Despite the growth in revenue, the company needs to improve its operational efficiency to return to profitability.

Balance Sheet

The company's balance sheet shows a moderate debt-to-equity ratio, which suggests a balanced capital structure. However, the equity ratio has been declining, indicating an increasing reliance on debt to finance assets. The company has maintained a strong cash position relative to its liabilities, which provides some financial stability. Improving stockholders' equity and reducing total liabilities will be crucial for long-term financial health.

Cash Flow

The cash flow statement highlights challenges in generating positive free cash flow, with negative values in recent years. The operating cash flow to net income ratio indicates cash flow issues, exacerbated by significant capital expenditures. Despite these challenges, the company has seen periods of positive operating cash flow, suggesting potential for cash generation if operational inefficiencies are addressed.

Breakdown
TTM	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement		Total Revenue
2.74B	2.94B	2.23B	1.92B	1.69B	1.39B
	Gross Profit
1.03B	1.16B	701.28M	785.61M	684.75M	537.87M
	EBIT
-314.31M	-496.00M	-216.10M	-55.50M	77.31M	18.05M
	EBITDA
-431.09M	-315.25M	-873.90M	770.76M	322.44M	240.38M
	Net Income Common Stockholders
-812.66M	-654.99M	-1.26B	-530.29M	2.44M	-41.77M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
544.00M	526.04M	1.69B	2.01B	1.95B	1.92B
	Total Assets
4.38B	4.59B	3.79B	4.39B	4.40B	4.27B
	Total Debt
1.18B	1.37B	843.53M	1.16B	960.68M	709.88M
	Net Debt
633.00M	844.08M	-1.49B	-844.07M	-988.69M	-1.21B
	Total Liabilities
1.82B	2.19B	1.80B	1.88B	1.58B	1.40B
	Stockholders Equity
2.54B	2.38B	1.95B	2.48B	2.80B	2.83B
Cash Flow		Free Cash Flow
0.00	-177.43M	-360.75M	-294.40M	-76.90M	-4.12M
	Operating Cash Flow
0.00	-83.41M	333.60M	2.42M	113.09M	169.73M
	Investing Cash Flow
0.00	-1.19B	-569.26M	-255.77M	-304.07M	-508.84M
	Financing Cash Flow
0.00	163.55M	382.96M	242.02M	28.31M	232.93M

Datasection, Inc. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 2542.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:3905, the sentiment is Positive. The current price of 2542 is above the 20-day moving average (MA) of 1248.90, above the 50-day MA of 1010.98, and above the 200-day MA of 990.76, indicating a bullish trend. The MACD of 365.66 indicates Negative momentum. The RSI at 79.63 is Negative, neither overbought nor oversold. The STOCH value of 89.32 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:3905.

Datasection, Inc. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
3856	79 Outperform	¥11.28B	8.29		1.68%	-54.06%	-72.85%
4299	79 Outperform	¥13.77B	10.62		3.88%	2.13%	7.67%
3937	71 Outperform	¥12.14B	13.93		4.04%	6.70%	59.07%
3800	68 Neutral	¥13.69B	20.19		3.67%	-2.98%	-31.07%
Sector *	62 Neutral	$11.93B	10.60	-7.51%	3.00%	7.40%	-8.09%
3905	58 Neutral	¥52.86B	―		―	32.00%	55.21%
3823	49 Neutral	¥13.21B	―		―	45.82%	-6.97%