SAKURA KCS Corporation (4761) AI Stock Analysis

• Market Cap: ¥13.73B
• Dividend Yield: 2.98%
• Average Volume (3M): 7.30K
• Price to Earnings (P/E): 14.1
• Beta (1Y): 0.65
• Revenue Growth: 5.14%
• EPS Growth: 16.05%
• Country: JP
• Employees: 1,045
• Sector: Technology
• Sector Strength: 88
• Industry: Information Technology Services
• EPS (TTM): 17.98
• Shares Outstanding: 11,200,000
• 10 Day Avg. Volume: 7,490
• 30 Day Avg. Volume: 7,296
• PEG Ratio: 0.41
• Price to Book (P/B): 0.65
• Price to Sales (P/S): 0.58
• P/FCF Ratio: -31.25
• 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: 60 Neutral
• Price Target: ¥1,435.00 ▲(8.47% Upside)

The overall stock score reflects strong financial stability and reasonable valuation, but is significantly impacted by bearish technical indicators and concerns over declining revenue and negative free cash flow. The lack of earnings call data and corporate events further limits the assessment.

Positive Factors

Low leverage and strong equity base

Very low leverage and a high equity ratio provide durable financial flexibility, reducing refinancing risk and enabling capital allocation to R&D, client projects, or acquisitions. Improved ROE indicates gradually better capital efficiency, supporting long-term stability and resilience.

Stable and improving margins

Consistent gross margin and rising net margin point to sustained pricing power or cost control in core software and services. Margin durability helps absorb revenue volatility, funds reinvestment in product development, and supports gradual profit growth even with modest top-line trends.

Recurring revenue from support and digital demand

A revenue mix tilted to software licenses, maintenance and integration services creates predictable, recurring cash inflows. Combined with structural demand for digital transformation in healthcare and finance, this supports long-term client retention and a steadier revenue base versus one‑time project models.

Negative Factors

Declining revenue trend

A year-over-year revenue decline signals challenges in winning new business or retaining customers, which can erode operating leverage and limit the ability to scale. Sustained top-line weakness would constrain reinvestment in products and sales, slowing structural growth prospects over months.

Negative free cash flow and weak cash conversion

Negative FCF and a low OCF-to-net-income ratio indicate difficulty converting accounting profits into cash, reducing internal funding for capex, R&D, or dividends. This persistent cash conversion gap can force external financing or cutbacks, undermining long-term strategic investments.

Limited investor communication and disclosure

Absence of earnings calls and notable corporate events limits visibility into strategy, guidance and management accountability. Over time, weaker disclosure can impede stakeholder confidence, slow investor engagement, and make it harder to assess execution on structural initiatives and long-term plans.

SAKURA KCS Corporation Business Overview & Revenue Model

Company Description

SAKURA KCS Corporation (4761) is a Japan-based company that specializes in providing IT solutions and services, primarily focusing on the development and implementation of software and systems for various industries. The company operates in sectors such as healthcare, finance, and enterprise management, offering core products that include electronic medical record systems, financial transaction processing systems, and business process management solutions.

How the Company Makes Money

SAKURA KCS Corporation generates revenue through multiple streams, primarily by selling software licenses and providing customized system integration services. The company also earns income from maintenance and support services for its software products, ensuring continued client engagement and satisfaction. Additionally, SAKURA KCS may benefit from strategic partnerships with other technology firms, allowing them to enhance their product offerings and reach new markets. The recurring revenue from support contracts and the growing demand for digital transformation solutions in various sectors further contribute to the company's financial performance.

SAKURA KCS Corporation Financial Statement Overview

Summary

SAKURA KCS Corporation shows strong profitability and financial stability with improving margins and low leverage. However, declining revenue and negative free cash flow are significant concerns that could impact future growth and operational efficiency.

Income Statement

SAKURA KCS Corporation exhibits a stable gross profit margin of approximately 27.7% for 2025, with a slight increase from the previous year. Net profit margin improved to 5.1% in 2025 from 3.9% in 2024, indicating enhanced profitability. However, revenue growth has been negative, reflecting a decline of 1.0% from 2024 to 2025, which raises concerns about top-line growth.

Balance Sheet

The company maintains a strong balance sheet with a low debt-to-equity ratio of approximately 0.05, highlighting financial stability. The equity ratio stands at 77.7%, indicating a high degree of financial independence. Return on equity improved to 5.8% in 2025, showcasing effective use of equity to generate profits.

Cash Flow

Operating cash flow has significantly declined in 2025 compared to 2024, affecting free cash flow, which turned negative. The free cash flow to net income ratio is negative, indicating potential issues in converting income to cash. Despite this, the operating cash flow to net income ratio is 0.31, suggesting some ability to generate cash from operations.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	22.81B	22.54B	22.77B	23.59B	24.79B	24.66B
Gross Profit	6.39B	6.25B	5.72B	5.30B	5.04B	4.86B
EBITDA	2.34B	2.29B	1.92B	1.90B	1.73B	1.85B
Net Income	1.21B	1.15B	895.00M	748.00M	602.00M	736.00M
Balance Sheet
Total Assets	24.34B	25.56B	24.24B	22.81B	22.29B	22.82B
Cash, Cash Equivalents and Short-Term Investments	6.80B	5.92B	10.35B	8.43B	7.40B	8.72B
Total Debt	831.00M	923.00M	532.00M	660.00M	874.00M	1.36B
Total Liabilities	4.48B	5.69B	5.06B	4.98B	4.95B	6.01B
Stockholders Equity	19.86B	19.87B	19.18B	17.83B	17.34B	16.81B
Cash Flow
Free Cash Flow	0.00	-415.00M	2.42B	1.53B	-694.00M	369.00M
Operating Cash Flow	0.00	359.00M	2.97B	1.74B	-187.00M	725.00M
Investing Cash Flow	0.00	-6.42B	-527.00M	-201.00M	-561.00M	245.00M
Financing Cash Flow	0.00	-590.00M	-523.00M	-518.00M	-569.00M	-563.00M

SAKURA KCS Corporation Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 1323.00
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:4761, the sentiment is Negative. The current price of 1323 is above the 20-day moving average (MA) of 1302.85, above the 50-day MA of 1270.70, and above the 200-day MA of 1316.05, indicating a bearish trend. The MACD of -13.95 indicates Positive momentum. The RSI at 32.56 is Neutral, neither overbought nor oversold. The STOCH value of 13.89 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:4761.

SAKURA KCS Corporation Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
2354	82 Outperform	¥14.31B	11.41	―	2.66%	―	―
3924	79 Outperform	¥17.50B	15.93	―	3.98%	-5.92%	3.16%
2335	71 Outperform	¥15.81B	11.27	―	3.60%	2.46%	-5.85%
3683	68 Neutral	¥14.67B	11.61	―	1.19%	13.46%	91.02%
3968	66 Neutral	¥16.74B	19.50	―	1.72%	26.24%	29.73%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
4761	60 Neutral	¥13.73B	14.14	―	2.98%	5.14%	16.05%