System Support, Inc. (4396) AI Stock Analysis

• Market Cap: ¥30.10B
• Dividend Yield: 1.69%
• Average Volume (3M): 57.95K
• Price to Earnings (P/E): 20.5
• Beta (1Y): 0.81
• Revenue Growth: 22.28%
• EPS Growth: 19.69%
• Country: JP
• Employees: 1,484
• Sector: Technology
• Sector Strength: 86
• Industry: Information Technology Services
• EPS (TTM): 18.71
• Shares Outstanding: 10,400,000
• 10 Day Avg. Volume: 51,780
• 30 Day Avg. Volume: 57,946
• PEG Ratio: N/A
• Price to Book (P/B): 0.00
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 0.00
• 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: ¥2,949.00
• Price Target Upside: 1.51% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 0

• Rating: 76 Outperform
• Price Target: ¥2,949.00 ▲(1.51% Upside)

System Support, Inc. receives a strong overall score driven by robust financial performance and positive technical indicators. The company's solid revenue and profit growth, efficient cash flow management, and stable balance sheet contribute significantly to the score. The stock's positive price trend further supports its attractiveness. Valuation metrics indicate the stock is fairly valued, with a reasonable P/E ratio and modest dividend yield.

System Support, Inc. Business Overview & Revenue Model

Company Description

System Support, Inc. (4396) is a technology services company specializing in providing comprehensive IT support solutions to businesses across various sectors, including healthcare, finance, and education. The company offers a range of core services, including managed IT services, cloud computing solutions, cybersecurity consulting, and technical support. With a focus on enhancing operational efficiency and ensuring data security, System Support, Inc. aims to empower organizations to leverage technology effectively.

How the Company Makes Money

System Support, Inc. generates revenue primarily through a subscription-based model for its managed IT services, which includes ongoing support and maintenance for client systems. Additionally, the company earns income from project-based contracts for cloud implementation and cybersecurity assessments. Key revenue streams also include software licensing for proprietary tools and solutions developed in-house. Strategic partnerships with leading technology providers enable System Support, Inc. to offer bundled services, enhancing its market presence and revenue potential. Furthermore, the company benefits from long-term client relationships that foster repeat business and referrals, contributing significantly to its overall earnings.

System Support, Inc. Financial Statement Overview

Summary

System Support, Inc. demonstrates strong financial health with robust growth in revenues and profitability, supported by a stable balance sheet and efficient cash flow management. The financial metrics indicate sustained growth and operational efficiency. However, liability management requires careful attention to ensure long-term stability.

Income Statement

System Support, Inc. showcases strong revenue growth with a 14.37% increase from the previous year. The gross profit margin and net profit margin are healthy at 27.64% and 5.56% respectively, indicating profitability and efficiency in cost management. The EBIT margin of 7.58% and EBITDA margin of 9.10% suggest robust operational performance. There is a consistent upward trend in revenue and profit margins over the years, highlighting a strong competitive position in the market.

Balance Sheet

The company maintains a solid balance sheet with a debt-to-equity ratio of 0.21, reflecting conservative leverage. The return on equity (ROE) stands at 24.21%, demonstrating efficient use of shareholder funds. An equity ratio of 50.91% indicates a stable financial structure. The growing stockholders' equity and asset base over the years underscore financial stability, although the increasing liabilities warrant monitoring.

Cash Flow

Cash flow analysis reveals a strong free cash flow growth rate of 46.53% from the previous year, indicating excellent cash generation capabilities. The operating cash flow to net income ratio of 1.20 and a free cash flow to net income ratio of 1.08 reflect effective cash conversion. Increasing free cash flow and operational efficiency enhance the company's ability to reinvest and fund future growth.

Breakdown	Jun 2024	Jun 2023	Jun 2022	Jun 2021	Jun 2020
Income Statement
Total Revenue	22.03B	19.27B	16.20B	14.43B	13.38B
Gross Profit	6.09B	5.23B	4.34B	3.74B	3.39B
EBITDA	2.01B	1.66B	1.38B	1.12B	847.85M
Net Income	1.22B	1.01B	785.69M	674.50M	450.10M
Balance Sheet
Total Assets	9.93B	8.87B	7.82B	6.66B	5.95B
Cash, Cash Equivalents and Short-Term Investments	4.25B	3.57B	3.25B	2.70B	2.39B
Total Debt	1.06B	1.21B	1.21B	1.00B	1.08B
Total Liabilities	4.87B	4.75B	4.39B	3.67B	3.54B
Stockholders Equity	5.06B	4.12B	3.42B	2.99B	2.41B
Cash Flow
Free Cash Flow	1.32B	901.40M	913.58M	488.16M	893.95M
Operating Cash Flow	1.47B	1.07B	1.01B	709.23M	1.06B
Investing Cash Flow	-419.54M	-324.49M	-274.70M	-276.55M	-308.43M
Financing Cash Flow	-513.24M	-462.04M	-240.62M	-165.71M	-316.10M

System Support, Inc. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 2905.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:4396, the sentiment is Positive. The current price of 2905 is above the 20-day moving average (MA) of 2817.50, above the 50-day MA of 2669.92, and above the 200-day MA of 2153.01, indicating a bullish trend. The MACD of 65.61 indicates Negative momentum. The RSI at 62.49 is Neutral, neither overbought nor oversold. The STOCH value of 86.08 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:4396.

System Support, Inc. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
2359	78 Outperform	¥28.00B	12.35		2.74%	1.65%	-2.94%
2349	77 Outperform	¥26.11B	11.00		1.20%	9.56%	7.39%
4396	76 Outperform	¥30.10B	20.50		1.69%	22.28%	19.69%
3393	75 Outperform	¥26.41B	13.53		4.28%	13.54%	15.43%
3655	73 Outperform	¥28.98B	26.56		0.62%	11.47%	17.94%
3788	73 Outperform	¥26.31B	34.51		1.62%	5.38%	-8.86%
Sector *	61 Neutral	$36.05B	6.66	-10.61%	1.86%	8.68%	-8.81%

System Support, Inc. Corporate Events

System Support Holdings Inc. Completes Acquisition of Echo System Co., Ltd.

System Support Holdings Inc. has completed the acquisition of Echo System Co., Ltd., a company specializing in contracted software development and sales of packaged software and applications. This acquisition is expected to have a minimal immediate impact on the company’s financial results for the current fiscal year, but it is anticipated to enhance the corporate value and contribute positively to the group’s consolidated results in the medium to long term.

System Support Holdings Inc. Acquires Echo System Co., Ltd. to Expand Cloud Integration Business

System Support Holdings Inc. announced its decision to acquire Echo System Co., Ltd., a systems integrator with a strong presence in western Japan. This acquisition aligns with System Support’s Medium-Term Management Plan to expand its cloud integration business and enhance its service offerings by leveraging Echo System’s technical expertise and customer base.