bBreak Systems Co. Ltd. (3986) AI Stock Analysis

• Market Cap: ¥2.36B
• Dividend Yield: 1.38%
• Average Volume (3M): 2.03K
• Price to Earnings (P/E): 26.0
• Beta (1Y): 0.44
• Revenue Growth: -0.32%
• EPS Growth: -15.27%
• Country: JP
• Employees: 148
• Sector: Technology
• Sector Strength: 88
• Industry: Software - Application
• EPS (TTM): 7.45
• Shares Outstanding: 4,610,880
• 10 Day Avg. Volume: 2,860
• 30 Day Avg. Volume: 2,033
• PEG Ratio: -0.71
• Price to Book (P/B): 1.24
• Price to Sales (P/S): 1.54
• P/FCF Ratio: 18.47
• 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: 65 Neutral
• Price Target: ¥543.00 ▼(-60.39% Downside)
• Action: Reiterated Date: 02/14/26
• Date: Action: Reiterated 02/14/26

The score is driven primarily by solid financial resilience (notably zero debt) but tempered by a clear recent deterioration in revenue growth, profitability, and cash flow. Technically the stock is trending above major moving averages, though momentum looks stretched (high RSI). Valuation is moderate with a modest dividend yield, offering limited support given the recent fundamental slowdown.

Positive Factors

Balance Sheet Strength

A debt-free balance sheet significantly reduces financial risk, providing resilience in economic downturns and flexibility for future investments.

Equity Growth

Steady equity growth and positive returns on equity indicate strong shareholder value creation and efficient capital management over the long term.

Cash Conversion

Strong cash conversion reflects efficient operations and the ability to generate cash, supporting reinvestment and shareholder returns.

Negative Factors

Revenue Decline

A decline in revenue indicates potential challenges in market demand or competitive pressures, impacting long-term growth prospects.

Margin Compression

Margin compression suggests increased cost pressures or reduced pricing power, which could affect profitability and competitive positioning.

Volatile Cash Flow

Volatility in cash flow can indicate operational inefficiencies or timing issues, potentially impacting liquidity and financial planning.

bBreak Systems Co. Ltd. Business Overview & Revenue Model

Company Description

bBreak Systems Company, Limited builds and integrates business system solutions. It offers MA-EYES, an accounting management system that allows users to understand profits and losses in real time; GLOBAL EYES, an overseas offices management system, which allows the users to use the local language and to create the accounting data in the local currency; and J-Fusion that provides tools for developing systems, as well as information regarding programming practices, project specifications, and data modeling. The company was founded in 2002 and is headquartered in Tokyo, Japan.

How the Company Makes Money

bBreak Systems Co. Ltd. generates revenue primarily through the sale and licensing of its ERP software solutions. The company offers customized software packages tailored to the specific needs of different industries, which clients purchase or license for use within their organizations. Additionally, bBreak Systems Co. Ltd. earns income from providing professional services such as consulting, system integration, and ongoing technical support to ensure the effective deployment and utilization of its software solutions. The company may also engage in strategic partnerships with other technology providers to expand its market reach and enhance its product offerings, contributing to its overall revenue.

bBreak Systems Co. Ltd. Financial Statement Overview

Summary

Strong financial safety from a debt-free balance sheet and steadily growing equity, but recent fundamentals weakened: revenue declined in 2025, margins compressed sharply, and operating cash flow softened versus prior years.

Income Statement

Profitability is solid for an application software company, with gross margin staying steady around the mid‑40% range and net margin generally high-single to ~10% over time. However, growth has cooled materially: revenue declined in 2025 (annual) after being roughly flat in 2024, and operating and net margins compressed sharply in 2025 versus the prior two years, pointing to weaker operating leverage or higher cost pressure.

Balance Sheet

The balance sheet is very conservative with zero debt across the period, which materially lowers financial risk and supports resilience through softer demand cycles. Equity has steadily grown over time, and returns on equity have been consistently positive, though they moderated in 2025 alongside the earnings decline (still positive but less efficient than prior years).

Cash Flow

Cash generation is positive, with free cash flow consistently positive and often matching net income (strong cash conversion in several years). That said, operating cash flow is volatile and weakened notably in 2025, and cash flow relative to reported earnings appears less supportive in the most recent year compared with 2024, suggesting working-capital or timing headwinds.

Breakdown	Jun 2024	Jun 2023	Jun 2022	Jun 2021	Jun 2020
Income Statement
Total Revenue	1.38B	1.39B	1.38B	1.26B	1.17B
Gross Profit	643.69M	659.89M	636.88M	587.90M	533.46M
EBITDA	121.82M	192.83M	176.41M	154.91M	122.51M
Net Income	91.84M	136.45M	136.17M	116.75M	91.50M
Balance Sheet
Total Assets	2.29B	2.23B	2.02B	1.88B	1.72B
Cash, Cash Equivalents and Short-Term Investments	2.00B	1.92B	1.73B	1.66B	1.48B
Total Debt	0.00	0.00	0.00	0.00	0.00
Total Liabilities	577.81M	582.74M	495.98M	448.96M	385.77M
Stockholders Equity	1.71B	1.65B	1.53B	1.43B	1.33B
Cash Flow
Free Cash Flow	114.88M	176.75M	159.96M	194.97M	112.77M
Operating Cash Flow	114.88M	239.85M	159.96M	194.97M	112.77M
Investing Cash Flow	-1.49B	-38.93M	-41.51M	-1.00K	-5.00K
Financing Cash Flow	-22.78M	-18.22M	-42.20M	-18.48M	-18.53M

bBreak Systems Co. Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 1371.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:3986, the sentiment is Positive. The current price of 1371 is above the 20-day moving average (MA) of 478.60, above the 50-day MA of 463.82, and above the 200-day MA of 470.86, indicating a bullish trend. The MACD of 13.04 indicates Negative momentum. The RSI at 68.54 is Neutral, neither overbought nor oversold. The STOCH value of 45.18 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:3986.

bBreak Systems Co. Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
4060	74 Outperform	¥6.87B	25.18	―	0.57%	21.03%	32.29%
5256	69 Neutral	¥2.92B	16.36	―	―	13.48%	61.77%
4397	68 Neutral	¥7.04B	17.46	―	―	11.32%	―
5033	66 Neutral	¥4.93B	13.38	―	―	7.60%	19.13%
3986	65 Neutral	¥2.36B	26.00	―	1.38%	-0.32%	-15.27%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
3976	54 Neutral	¥2.40B	-11.69	―	―	-14.55%	-8.13%