Ricksoft Co., Ltd. (4429) AI Stock Analysis

• Market Cap: ¥4.51B
• Dividend Yield: N/A
• Average Volume (3M): 8.17K
• Price to Earnings (P/E): 13.7
• Beta (1Y): 0.35
• Revenue Growth: N/A
• EPS Growth: N/A
• Country: JP
• Employees: 123
• Sector: Technology
• Sector Strength: 88
• Industry: Software - Application
• EPS (TTM): 22.69
• Shares Outstanding: 4,550,300
• 10 Day Avg. Volume: 12,590
• 30 Day Avg. Volume: 8,166
• PEG Ratio: 0.33
• Price to Book (P/B): 1.27
• Price to Sales (P/S): 0.43
• P/FCF Ratio: 12.92
• 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: 73 Outperform
• Price Target: ¥1,165.00 ▲(26.63% Upside)

The score is driven primarily by the company’s low-risk, debt-free balance sheet, offset by notable profitability/margin compression and uneven cash flow history. Technically, the stock shows strong momentum above major moving averages, while valuation appears reasonable based on its P/E.

Positive Factors

Balance Sheet Strength

A debt-free balance sheet with rising equity provides durable financial flexibility: it supports investment in products and services, cushions the business through cyclical downturns, and enables opportunistic M&A or partnership moves without levering the company.

Sustained Revenue Growth

Long-term top-line expansion and a recent re-acceleration signal persistent demand for the company’s implementation, integration, and add-on services around enterprise collaboration platforms, supporting a structurally growing services pipeline and repeatable revenue streams.

Improving Free Cash Flow

A large rebound in free cash flow and a healthy FCF-to-net-income ratio indicate improved cash conversion, which sustainably supports reinvestment in product development, working capital needs, and strategic initiatives without relying on external financing.

Negative Factors

Gross Margin Erosion

A multi-year decline in gross margin signals structural pressure on pricing power or rising delivery costs. Persistently lower gross margins reduce operating leverage, constrain profitability scalability, and limit the firm’s ability to fund investment from core operations over time.

Compressed Operating Profitability

Material fall in EBIT margins versus historical peaks weakens internal cash generation and resilience. Lower operating profitability reduces capacity to absorb cost shocks, invest in growth initiatives, or sustain long-term competitive differentiation in a services market.

Volatile Cash Generation

Significant year-to-year swings in cash flow undermine predictability for capital allocation and strategic planning. This volatility increases reliance on the balance sheet in weak years, complicates sustained investment in services and products, and raises execution risk over the medium term.

Ricksoft Co., Ltd. Business Overview & Revenue Model

Company Description

Ricksoft Co., Ltd. engages in the provision of system integration, cloud, and software development services in Japan. The company's system integration services include system design, construction, customization, migration, etc.; and operation support, tool training, etc. It also develops project management tool comprising WBS Gantt-Chart for Jira; usability enhancement tool, such as Excel-Like Issue Editor for Jira; digital transformation support tool for Alfresco connector series; and other self-developing and software tools. In addition, the company engages in the sale of licenses; and provision of full managed cloud service for enterprises. Ricksoft Co., Ltd. was incorporated in 2005 and is headquartered in Tokyo, Japan.

How the Company Makes Money

Ricksoft Co., Ltd. Financial Statement Overview

Summary

Strong balance sheet (zero debt, rising equity) supports financial flexibility, but profitability has weakened materially (lower gross and operating margins vs prior years) and cash flow has been positive yet volatile despite a 2025 rebound.

Income Statement

Revenue has grown strongly over the long term (rising from 2020 to 2025 annual), with a clear re-acceleration in 2025 (annual revenue growth 2.86% vs ~0.33% in 2024). However, profitability has compressed materially: gross margin has trended down (about 38% in 2020 to ~26% in 2025), and operating profitability is well below prior peaks (EBIT margin ~5% in 2025 vs ~10–14% earlier years). Net margin is also lower (~3.9% in 2025 vs ~7–10% historically), indicating weaker earnings quality versus the company’s earlier run-rate.

Balance Sheet

The balance sheet is a key strength: the company reports zero debt across the period, resulting in very low financial risk and high flexibility. Equity has steadily increased over time, supporting growth. Returns on equity remain positive and healthy (about 11.7% in 2025), though down from the much stronger levels seen earlier (roughly ~17–23% range in 2021–2023), suggesting reduced efficiency/profitability rather than balance sheet stress.

Cash Flow

Cash generation is positive, with operating cash flow and free cash flow both improving in 2025 versus 2024 (free cash flow rebounded from ~71M to ~298M). Free cash flow is reasonably supported by earnings (free cash flow to net income ~0.79 in 2025). The main concern is volatility: 2023 was exceptionally strong, followed by a sharp drop in 2024, and while 2025 improved, cash conversion of sales remains modest based on the provided operating cash flow coverage ratios.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	9.87B	9.04B	7.49B	5.62B	4.31B	4.43B
Gross Profit	2.38B	2.37B	2.24B	1.86B	1.53B	1.56B
EBITDA	438.99M	505.29M	375.80M	586.40M	480.19M	616.21M
Net Income	314.14M	355.52M	269.02M	423.88M	326.93M	445.74M
Balance Sheet
Total Assets	7.37B	6.68B	5.97B	4.57B	2.93B	3.17B
Cash, Cash Equivalents and Short-Term Investments	3.14B	3.30B	3.16B	3.07B	2.09B	1.94B
Total Debt	0.00	0.00	0.00	0.00	0.00	0.00
Total Liabilities	4.28B	3.65B	3.20B	2.10B	677.04M	1.27B
Stockholders Equity	3.09B	3.03B	2.77B	2.47B	2.26B	1.90B
Cash Flow
Free Cash Flow	0.00	297.77M	70.57M	952.53M	100.52M	468.93M
Operating Cash Flow	0.00	377.30M	100.27M	977.86M	161.14M	477.76M
Investing Cash Flow	0.00	-140.07M	-36.51M	-27.39M	-46.79M	-8.36M
Financing Cash Flow	0.00	-91.30M	7.41M	18.10M	22.74M	18.65M

Ricksoft Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
5596	76 Outperform	¥5.65B	14.48	―	0.95%	0.86%	2.72%
5257	75 Outperform	¥3.67B	12.89	―	―	8.61%	-9.25%
4429	73 Outperform	¥4.51B	13.68	―	―	―	―
4075	67 Neutral	¥4.77B	28.30	―	―	28.63%	551.37%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
4447	61 Neutral	¥3.19B	35.33	―	4.17%	-15.23%	-65.39%
4069	53 Neutral	¥4.96B	40.46	―	―	24.09%	141.68%