IPS, Inc. (4390) AI Stock Analysis

• Market Cap: ¥39.97B
• Dividend Yield: 1.28%
• Average Volume (3M): 140.12K
• Price to Earnings (P/E): 12.4
• Beta (1Y): 1.07
• Revenue Growth: -7.46%
• EPS Growth: 11.57%
• Country: JP
• Employees: 557
• Sector: Communication Services
• Sector Strength: 97
• Industry: Telecommunications Services
• EPS (TTM): 73.63
• Shares Outstanding: 13,063,200
• 10 Day Avg. Volume: 110,180
• 30 Day Avg. Volume: 140,120
• PEG Ratio: -0.87
• Price to Book (P/B): 1.78
• Price to Sales (P/S): 1.81
• P/FCF Ratio: -50.06
• 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: 80 Outperform
• Price Target: ¥4,198.00 ▲(38.55% Upside)

IPS, Inc. receives a strong overall score due to robust financial performance and positive technical analysis. The company's revenue growth and stable balance sheet are significant strengths, while the technical indicators suggest strong market momentum. Valuation is reasonable, though profitability and cash flow management need attention.

Positive Factors

Revenue Growth

The significant revenue growth over five years highlights IPS's expanding market presence and successful product adoption, supporting long-term business sustainability.

Gross Profit Margin

Improving gross profit margins indicate effective cost management and pricing power, which can enhance profitability and competitive positioning over time.

Equity Position

A strong equity position provides financial stability and flexibility, enabling IPS to invest in growth opportunities and weather economic fluctuations.

Negative Factors

Net Profit Margin Pressure

Declining net profit margins suggest challenges in maintaining profitability despite revenue growth, which could impact future earnings and investment capacity.

Rising Debt Levels

Increasing debt levels can strain financial resources and limit strategic flexibility, potentially affecting long-term financial health if not controlled.

Cash Flow Volatility

Volatile cash flow, particularly negative Free Cash Flow, can hinder the company's ability to fund operations and growth initiatives, impacting long-term viability.

IPS, Inc. Business Overview & Revenue Model

Company Description

IPS, Inc. provides IT and telecommunications services in Japan and the Philippines. The company provides internet connection services; data center services; domestic telecommunications services comprising toll free services, service for MVNO businesses, trunk, and value-added services; network services for local and overseas telecom companies; and international telecommunication lines. It also offers CloudSigma, a cloud computing service; and AmeyoJ, a contact center management software, as well as business process outsourcing services. In addition, the company operates clinics that offer medical services, including laser-eye surgery, aesthetic dermatology, cosmetic dentistry, and cataract surgery; and an online pharmacy. IPS, Inc. was incorporated in 1991 and is based in Tokyo, Japan.

How the Company Makes Money

IPS, Inc. generates revenue through multiple streams, primarily by offering consultancy and engineering services for large-scale industrial projects. The company charges fees for project management and engineering services based on the project scope and duration. Additionally, IPS earns money through the sale of proprietary software and automation tools that improve operational efficiencies for clients. Significant partnerships with industry leaders enhance IPS's service offerings, allowing the company to tap into new markets and expand its customer base. Furthermore, recurring revenue from maintenance contracts and support services provides a stable income stream, contributing to the company's overall profitability.

IPS, Inc. Financial Statement Overview

Summary

IPS, Inc. shows strong revenue growth and a stable balance sheet. The income statement highlights significant revenue increase, but profitability margins face pressure. The balance sheet reflects a healthy equity position with increasing leverage that needs careful monitoring. Cash flow volatility, particularly in Free Cash Flow, indicates a need for improved cash management.

Income Statement

IPS, Inc. has demonstrated strong growth in revenue, with a notable increase from ¥6.5 billion in 2020 to ¥15.3 billion in 2025. The Gross Profit Margin consistently improved, reaching 54.23% in 2025, indicating efficient cost management. However, the Net Profit Margin decreased from 20.60% in 2024 to 16.67% in 2025, reflecting some pressure on profitability despite revenue growth. Overall, the company shows robust growth with room for improving net profitability.

Balance Sheet

IPS, Inc. has a solid equity position, with stockholders' equity growing from ¥3.9 billion in 2020 to ¥15.5 billion in 2025. The Debt-to-Equity Ratio is 0.65 as of 2025, indicating a balanced leverage profile. The Equity Ratio improved to 36.95% in 2025, suggesting a stable financial structure. However, the rising debt levels may pose a risk if not managed well, especially given the increase in Total Debt over the years.

Cash Flow

The Free Cash Flow has been volatile, turning negative in recent years, which is a concern despite positive Operating Cash Flow of ¥704 million in 2025. The company needs to stabilize its cash flow generation to support long-term investments and debt obligations. The Operating Cash Flow to Net Income Ratio improved, signaling better cash conversion, yet Free Cash Flow remains a challenge.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	15.03B	15.26B	14.12B	12.35B	10.73B	9.52B
Gross Profit	8.26B	8.28B	7.08B	5.83B	4.12B	3.66B
EBITDA	5.81B	5.44B	5.36B	3.76B	3.30B	2.50B
Net Income	2.54B	2.54B	2.83B	2.29B	1.89B	1.49B
Balance Sheet
Total Assets	41.42B	42.03B	33.53B	25.13B	18.42B	11.76B
Cash, Cash Equivalents and Short-Term Investments	3.81B	3.92B	4.23B	6.88B	5.78B	3.63B
Total Debt	10.41B	10.07B	10.10B	6.93B	3.05B	1.96B
Total Liabilities	21.24B	21.05B	18.35B	13.27B	9.29B	5.01B
Stockholders Equity	14.05B	15.53B	11.56B	9.62B	7.50B	5.52B
Cash Flow
Free Cash Flow	6.50M	-551.00M	-5.20B	-2.69B	1.05B	-176.74M
Operating Cash Flow	145.50M	704.00M	-574.00M	2.64B	3.58B	1.64B
Investing Cash Flow	-174.00M	-2.54B	-4.74B	-5.51B	-2.66B	-1.89B
Financing Cash Flow	61.50M	1.38B	2.31B	3.58B	1.07B	1.33B

IPS, Inc. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 3030.00
• 50DMA: Negative
• 100DMA: Negative
• 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:4390, the sentiment is Positive. The current price of 3030 is below the 20-day moving average (MA) of 3052.15, below the 50-day MA of 3146.18, and above the 200-day MA of 2705.92, indicating a neutral trend. The MACD of -35.32 indicates Negative momentum. The RSI at 46.65 is Neutral, neither overbought nor oversold. The STOCH value of 43.86 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:4390.

IPS, Inc. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
4390	80 Outperform	¥39.97B	12.42	―	1.28%	-7.46%	11.57%
3834	80 Outperform	¥19.74B	12.48	―	3.53%	5.03%	-9.55%
9424	74 Outperform	¥25.36B	24.11	―	―	30.15%	31.28%
3934	73 Outperform	¥11.05B	11.69	―	2.10%	13.64%	44.55%
3776	66 Neutral	¥11.43B	27.11	―	1.01%	17.19%	-43.91%
9450	64 Neutral	¥14.08B	10.72	―	4.02%	5.13%	-13.74%
Sector *	60 Neutral	$48.67B	4.58	-11.27%	4.14%	2.83%	-41.78%

IPS, Inc. Corporate Events

IPS to Book US$8.35 Million Dividend from Subsidiary as Non-Operating Income

IPS, Inc. announced that it will receive a dividend of US$8.35 million (approximately JPY 1,306 million) from its consolidated subsidiary ISMO Pte. Ltd., following a resolution dated December 29, 2025, with payment scheduled for January 5, 2026. The dividend will be recognized as non-operating income in IPS’s non-consolidated financial statements for the fiscal year ending March 31, 2026, but will have no impact on its consolidated financial results, signaling an internal capital flow that strengthens the parent’s standalone earnings without altering the group’s overall profit profile for stakeholders.

The most recent analyst rating on (JP:4390) stock is a Buy with a Yen4198.00 price target. To see the full list of analyst forecasts on IPS, Inc. stock, see the JP:4390 Stock Forecast page.

IPS Tightens Governance After IP Phone Number Misused in Caller ID Scam

IPS, Inc. disclosed that an IP phone number provided by its subsidiary IPS Pro, Inc. to a Hong Kong-based client was fraudulently used for caller ID spoofing in early 2025, making scam calls appear to originate from Japanese police stations and other authorities. After detecting the suspicious activity in March, IPS Pro swiftly reconfigured its systems to block fraudulent display of the affected number and terminated service to the client, while an internal review found no other transactions with similar risks. The company is using the incident to tighten regulatory compliance and governance, including disabling caller ID functions for non-IPSPRO numbers where appropriate, revising systems and overseas contract structures, strengthening training on telecom laws and industry guidelines, and overhauling its management structure by January 2026 with external telecom experts and director changes. Directors involved have voluntarily agreed to return part of their remuneration, and the company emphasized that the financial impact is limited and its domestic telecom earnings forecast remains unchanged, as it seeks to restore trust and reinforce its social responsibility as a telecommunications provider.

The most recent analyst rating on (JP:4390) stock is a Buy with a Yen4198.00 price target. To see the full list of analyst forecasts on IPS, Inc. stock, see the JP:4390 Stock Forecast page.

IPS, Inc. Addresses Misuse of Telephone Lines by Subsidiary

IPS, Inc. has confirmed a report regarding the misuse of telephone lines by its subsidiary, IPS PRO, Inc., which led to fraudulent activities involving the display of incorrect caller IDs. The company is taking steps to enhance subsidiary management and prevent future occurrences, while cooperating with ongoing investigations. Currently, no financial impact is anticipated, but updates will be provided if necessary.

The most recent analyst rating on (JP:4390) stock is a Buy with a Yen4198.00 price target. To see the full list of analyst forecasts on IPS, Inc. stock, see the JP:4390 Stock Forecast page.

IPS, Inc. Poised for Growth Amid New Telecommunications Legislation and Infrastructure Developments

IPS, Inc. sees significant opportunities following the enactment of the Konektadong Pinoy Act in the Philippines, which promotes competition in telecommunications by mandating open access to fiber optic networks. This law is expected to boost demand for IPS’s network construction services, enabling the company to expand its role and anticipate stable revenue streams. Additionally, the completion of the Candle Submarine Cable System is set to enhance IPS’s position in international telecommunications infrastructure, creating further investment opportunities and growth potential.

The most recent analyst rating on (JP:4390) stock is a Buy with a Yen3290.00 price target. To see the full list of analyst forecasts on IPS, Inc. stock, see the JP:4390 Stock Forecast page.

IPS, Inc. Reports Discrepancy in Q2 Earnings Forecast

IPS, Inc. announced a discrepancy between its forecasted and actual consolidated earnings for the second quarter of the fiscal year ending March 2026. Despite a shortfall in net sales due to lower revenue from network construction services, operating profit exceeded expectations due to strong performance in domestic telecommunications and foreign exchange gains. Consequently, ordinary and interim profits surpassed forecasts, and the company maintains its earnings forecast for the fiscal year.

The most recent analyst rating on (JP:4390) stock is a Buy with a Yen3290.00 price target. To see the full list of analyst forecasts on IPS, Inc. stock, see the JP:4390 Stock Forecast page.

IPS, Inc. Reports Financial Results for Six Months Ending September 2025

IPS, Inc. reported its consolidated financial results for the six months ending September 30, 2025, showing a slight increase in net sales by 1.4% to ¥7,854 million and a significant rise in profit attributable to owners of the parent by 67.2% to ¥1,607 million. Despite a decrease in comprehensive income, the company maintains a stable financial position with total assets of ¥42,042 million and an equity ratio of 35.0%. The forecast for the fiscal year ending March 31, 2026, anticipates continued growth in net sales and profits, with no revisions to previously announced earnings forecasts.

The most recent analyst rating on (JP:4390) stock is a Buy with a Yen3290.00 price target. To see the full list of analyst forecasts on IPS, Inc. stock, see the JP:4390 Stock Forecast page.