JIG-SAW INC. (3914) AI Stock Analysis

• Market Cap: ¥15.39B
• Dividend Yield: N/A
• Average Volume (3M): 19.04K
• Price to Earnings (P/E): 42.4
• Beta (1Y): 1.06
• Revenue Growth: 3.17%
• EPS Growth: -16.66%
• Country: JP
• Employees: 178
• Sector: Technology
• Sector Strength: 88
• Industry: Software - Infrastructure
• EPS (TTM): 17.89
• Shares Outstanding: 6,751,000
• 10 Day Avg. Volume: 16,900
• 30 Day Avg. Volume: 19,040
• PEG Ratio: -3.54
• Price to Book (P/B): 5.26
• Price to Sales (P/S): 4.89
• P/FCF Ratio: 71.30
• 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: 57 Neutral
• Price Target: ¥2,740.00 ▲(1.86% Upside)
• Action: Reiterated Date: 02/04/26
• Date: Action: Reiterated 02/04/26

The score is primarily supported by solid underlying profitability and a still-manageable balance sheet, but is held back by worsening cash conversion and margin/return compression. Technical indicators also point to a weak downtrend, and the high P/E without dividend support further weighs on the overall score.

Positive Factors

High gross and EBITDA margins

Sustained high gross and healthy EBITDA margins are a durable strength for a software-infrastructure business. They indicate strong pricing power and scalable product economics, supporting persistent operating cash generation, reinvestment capacity, and resilience against cyclical revenue swings.

Positive free cash flow

Positive operating and free cash flow provide long-term optionality: funding for R&D, product development, and debt servicing without external financing. Even with weaker conversion trends, consistent FCF preserves strategic flexibility and reduces reliance on capital markets for near-term investments.

Manageable leverage and rising equity base

A still-modest debt-to-equity ratio and a growing equity base support financial flexibility. Manageable leverage lowers insolvency risk and gives management room to pursue M&A or capital spending, while an improving equity position strengthens the balance sheet against shocks.

Negative Factors

Worsening cash conversion

Declining cash-to-profit conversion is a persistent structural weakness: earnings are translating less efficiently into cash. Over months this erodes liquidity cushions, constrains internal funding for growth or capex, and raises the risk that reported profits overstate underlying cash generation.

Margin and return compression

A multi-year decline in net margins and return on equity signals structural pressure on profitability—whether from competition, pricing, or rising costs. Persistently lower margins reduce retained earnings, limit reinvestment, and weaken long-term return potential for shareholders.

Decelerating revenue growth and rising leverage

Slowing top-line growth alongside increasing leverage is a concerning structural trend: it reduces the company's ability to deleverage organically and may pressure margins. If growth remains subdued, higher debt levels magnify financial risk and constrain strategic initiatives over the medium term.

JIG-SAW INC. Business Overview & Revenue Model

Company Description

JIG-SAW INC. provides IoT based auto sensing and auto control services in Japan. It offers IoT big data control services; secure data and bidirectional control services in mobile edge computing; direct control of cells and living organisms through software; and automation, decentralization, and sharing services for various industries based on optimal control and operation technology for business systems. The company also engages in the research and development of automated driving software, next-generation real-time operating systems, next-generation modules, etc. In addition, it offers end-to-end automatic data control services, which include big data, cloud, servers, networking, apps, platforms, security software, IoT devices, communication modules, devices, equipment, cells, living organisms, etc. The company was founded in 2001 and is headquartered in Tokyo, Japan.

How the Company Makes Money

JIG-SAW INC. generates revenue through multiple streams, primarily from software sales, subscription services, and consulting fees. The company's core revenue sources include licensing its proprietary analytics software to enterprises, which provides recurring subscription income. Additionally, JIG-SAW INC. offers customized data analytics services, charging clients for bespoke solutions tailored to their specific needs. Strategic partnerships with industry leaders in sectors like healthcare and finance also contribute to revenue, as they enable JIG-SAW INC. to expand its market reach and enhance product offerings. Furthermore, the company may benefit from government contracts and grants aimed at advancing technology solutions in public sector projects.

JIG-SAW INC. Financial Statement Overview

Summary

Profitable with strong gross margins and still-manageable leverage, but recent trends are weaker: revenue growth has decelerated, net/EBITDA margins and ROE have compressed, leverage has risen versus prior years, and cash conversion deteriorated with a notable drop in free cash flow.

Income Statement

Revenue has grown consistently from 2020 to 2025, with strong growth in earlier years and a clear deceleration lately (2025 revenue growth at ~3.5% vs ~6–11% in 2022–2024). Profitability remains solid for software infrastructure, with gross margin holding around ~68–71% and EBITDA margin still near ~19% in 2025. The main weakness is declining earnings power: net margin fell to ~11.5% in 2025 from ~13.8–14.2% in 2023–2024, and EBIT/EBITDA margins have compressed versus prior years.

Balance Sheet

The balance sheet shows a meaningful equity base (equity rising over time) and moderate leverage overall, with debt-to-equity still low-to-reasonable at ~0.21 in 2025. However, leverage has increased sharply versus 2022–2023 (when debt-to-equity was near ~0.02–0.05), and returns have softened: return on equity declined to ~12.4% in 2025 from ~15–18% in 2022–2024. Strength is the still-manageable leverage level; risk is the direction of travel (more debt and lower returns).

Cash Flow

Cash generation is positive in recent years (2025 operating cash flow and free cash flow are both positive), but cash conversion has weakened. Free cash flow fell materially in 2025 versus 2024, and free cash flow covers only ~54% of net income in 2025 (down from ~66% in 2024 and ~98% in 2022–2023). A further concern is that operating cash flow relative to EBIT is low in 2025 (~0.34), suggesting earnings are not translating into cash as efficiently as before. Strength: still producing positive free cash flow; weakness: declining free cash flow and softer cash-to-profit quality.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	3.50B	3.63B	3.47B	3.24B	3.05B	2.69B
Gross Profit	2.45B	2.54B	2.44B	2.25B	2.08B	1.89B
EBITDA	614.99M	639.76M	708.82M	682.48M	645.53M	556.27M
Net Income	371.90M	418.23M	478.73M	459.63M	408.12M	336.33M
Balance Sheet
Total Assets	4.55B	5.29B	4.86B	3.49B	3.12B	2.64B
Cash, Cash Equivalents and Short-Term Investments	1.57B	2.38B	1.99B	1.48B	1.36B	1.13B
Total Debt	400.00M	700.01M	450.00M	45.00M	105.00M	165.00M
Total Liabilities	1.46B	1.92B	1.70B	902.85M	849.62M	673.03M
Stockholders Equity	3.09B	3.37B	3.15B	2.59B	2.27B	1.97B
Cash Flow
Free Cash Flow	0.00	248.60M	421.41M	511.32M	502.77M	344.13M
Operating Cash Flow	0.00	458.51M	618.82M	517.12M	506.91M	449.82M
Investing Cash Flow	0.00	-88.64M	-540.55M	-118.99M	3.71M	-134.66M
Financing Cash Flow	0.00	13.66M	410.21M	-259.94M	-246.11M	-65.25M

JIG-SAW INC. Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 2690.00
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:3914, the sentiment is Negative. The current price of 2690 is above the 20-day moving average (MA) of 2425.60, above the 50-day MA of 2594.08, and above the 200-day MA of 2672.68, indicating a bearish trend. The MACD of -67.84 indicates Negative momentum. The RSI at 38.87 is Neutral, neither overbought nor oversold. The STOCH value of 49.27 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:3914.

JIG-SAW INC. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
3915	68 Neutral	¥20.46B	9.96	―	―	17.93%	91.21%
4475	68 Neutral	¥31.27B	27.58	―	0.39%	30.59%	65.14%
4493	67 Neutral	¥17.40B	21.91	―	0.17%	31.39%	13.12%
3850	65 Neutral	¥14.44B	25.11	―	0.91%	15.28%	60.07%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
4434	61 Neutral	¥15.79B	8.71	―	―	―	―
3914	57 Neutral	¥15.39B	42.38	―	―	3.17%	-16.66%