Global Security Experts Inc. (4417) AI Stock Analysis

• Market Cap: ¥39.10B
• Dividend Yield: 0.9%
• Average Volume (3M): 57.54K
• Price to Earnings (P/E): 31.1
• Beta (1Y): 1.05
• Revenue Growth: 25.06%
• EPS Growth: 37.24%
• Country: JP
• Employees: 154
• Sector: Technology
• Sector Strength: 88
• Industry: Software - Infrastructure
• EPS (TTM): 27.56
• Shares Outstanding: 15,309,600
• 10 Day Avg. Volume: 82,230
• 30 Day Avg. Volume: 57,536
• PEG Ratio: 1.30
• Price to Book (P/B): 12.03
• Price to Sales (P/S): 4.21
• P/FCF Ratio: 50.07
• 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): 99.9
• Revenue Forecast (FY): ¥11.50B

• Rating: 65 Neutral
• Price Target: ¥2,637.00 ▼(-17.59% Downside)
• Action: Reiterated Date: 02/26/26
• Date: Action: Reiterated 02/26/26

The score is anchored by strong financial performance (robust growth, profitability, and cash generation), but is meaningfully reduced by weak technical trends (below major moving averages with negative momentum). Valuation is neither cheap nor extreme, offering only modest support via the dividend yield.

Positive Factors

Revenue Growth & Profitability

Sustained 25.7% revenue growth alongside an 18.3% EBIT margin and 11.5% net margin shows the business expands sales while preserving profitability. This supports reinvestment in R&D and service capacity, funds scaling of recurring offerings, and underpins margin durability across business cycles.

Cash Generation Efficiency

An OCF-to-net income ratio ~1.0 and FCF-to-net-income 0.73 indicate high quality earnings and reliable cash conversion. Durable cash generation enables consistent contract delivery, capex for product development, and debt servicing without heavy reliance on external financing, supporting long-term financial flexibility.

Diversified Recurring Revenue Model

A mix of consulting, proprietary software sales, recurring maintenance contracts, training and technology partnerships creates diversified, recurring streams. This structure increases customer stickiness, cross-sell opportunities and predictable cashflows, aligning with structural demand for integrated, long-term security solutions.

Negative Factors

Limited Equity Cushion

An equity ratio of 37.8% implies a smaller equity buffer relative to total assets, reducing shock absorption capacity. Over months, this heightens vulnerability to unexpected contract cancellations or asset write-downs and could pressure credit metrics or force more costly financing to shore up resilience.

Moderate Leverage

Debt-to-equity of 0.63 denotes moderate leverage that brings fixed interest and principal obligations. While manageable today, this leverage can constrain strategic choices—M&A, higher R&D or hiring—if cash generation falters, and reduces flexibility to invest opportunistically without raising new capital.

FCF Growth Lags Revenue

Free cash flow growth of only 4.1% despite ~25% revenue expansion suggests growth is working-capital or capex intensive and not fully translating to cash. Persistent divergence could force reliance on external funding for growth or debt paydown, limiting financial optionality and increasing execution risk.

Global Security Experts Inc. Business Overview & Revenue Model

Company Description

Global Security Experts Inc. operates as a cybersecurity education company in Japan. It offers security consulting and vulnerability diagnosis, as well as other security solutions. The company was incorporated in 1984 and is headquartered in Tokyo, Japan.

How the Company Makes Money

Global Security Experts Inc. generates revenue through a multi-faceted business model that includes consulting fees for risk assessments, sales of proprietary security software, and contracts for ongoing security services such as monitoring and response. Key revenue streams include project-based engagements for security system installations and upgrades, recurring maintenance contracts, and training services for client personnel. Significant partnerships with technology providers enhance the company's offerings and enable it to deliver integrated security solutions, further contributing to its earnings through bundled service packages and joint marketing initiatives.

Global Security Experts Inc. Financial Statement Overview

Summary

Strong fundamentals supported by 25.7% revenue growth, solid profitability (11.5% net margin; 18.3% EBIT margin), and healthy cash conversion (operating cash flow to net income of 1.01). Balance sheet leverage is moderate (debt-to-equity 0.63) with strong ROE (32.8%), though the equity ratio (37.8%) leaves some room to strengthen resilience.

Income Statement

Global Security Experts Inc. has demonstrated strong revenue growth with a 25.7% increase from 2024 to 2025. The gross profit margin stands at 34.8%, indicating efficient cost management. The net profit margin of 11.5% and EBIT margin of 18.3% reflect solid profitability. The company has shown consistent growth in both revenue and net income over the past years, highlighting a robust upward trajectory.

Balance Sheet

The company maintains a healthy balance sheet with a debt-to-equity ratio of 0.63, indicating moderate leverage. The return on equity (ROE) is 32.8%, showcasing effective use of equity to generate profits. The equity ratio of 37.8% suggests a stable financial structure, though there is room for improvement in equity proportion relative to total assets.

Cash Flow

The free cash flow growth rate is 4.1%, reflecting positive cash generation. The operating cash flow to net income ratio of 1.01 indicates strong cash conversion efficiency. The free cash flow to net income ratio of 0.73 suggests a solid ability to generate cash relative to net income, supporting continued investment and debt servicing.

Breakdown	TTM	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	9.23B	8.80B	7.00B	5.56B	4.39B	2.95B
Gross Profit	3.23B	3.07B	2.28B	1.78B	1.36B	911.73M
EBITDA	1.70B	1.63B	1.17B	795.65M	471.50M	293.70M
Net Income	1.05B	1.01B	783.43M	488.12M	261.10M	167.66M
Balance Sheet
Total Assets	8.28B	8.14B	6.54B	4.12B	3.48B	2.38B
Cash, Cash Equivalents and Short-Term Investments	1.47B	1.39B	1.23B	1.08B	1.15B	652.32M
Total Debt	1.67B	1.93B	1.75B	221.64M	278.79M	173.84M
Total Liabilities	4.85B	5.06B	4.10B	2.40B	1.92B	1.44B
Stockholders Equity	3.43B	3.08B	2.43B	1.72B	1.57B	942.20M
Cash Flow
Free Cash Flow	0.00	739.50M	710.64M	550.79M	314.63M	734.11M
Operating Cash Flow	0.00	1.02B	713.55M	594.95M	328.22M	767.00M
Investing Cash Flow	0.00	-411.37M	-2.01B	-212.16M	-294.65M	-240.40M
Financing Cash Flow	0.00	-457.42M	1.45B	-456.00M	460.63M	-91.24M

Global Security Experts Inc. Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 3200.00
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:4417, the sentiment is Negative. The current price of 3200 is above the 20-day moving average (MA) of 2739.80, above the 50-day MA of 3041.40, and below the 200-day MA of 3218.58, indicating a bearish trend. The MACD of -146.72 indicates Positive momentum. The RSI at 44.83 is Neutral, neither overbought nor oversold. The STOCH value of 56.37 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:4417.

Global Security Experts Inc. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
4494	75 Outperform	¥3.41B	9.16	―	―	1.62%	9.93%
3040	73 Outperform	¥35.54B	16.09	19.71%	3.09%	3.44%	79.35%
4475	68 Neutral	¥32.40B	24.33	―	0.39%	30.59%	65.14%
4493	67 Neutral	¥16.26B	20.22	―	0.17%	31.39%	13.12%
4417	65 Neutral	¥39.10B	31.12	―	0.90%	25.06%	37.24%
3042	62 Neutral	¥2.45B	32.27	―	0.58%	25.37%	―
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%