Japan Business Systems, Inc. (5036) AI Stock Analysis

• Market Cap: ¥66.52B
• Dividend Yield: 2.74%
• Average Volume (3M): 154.23K
• Price to Earnings (P/E): 13.3
• Beta (1Y): 0.60
• Revenue Growth: 22.09%
• EPS Growth: 143.20%
• Country: JP
• Employees: 2,700
• Sector: Technology
• Sector Strength: 88
• Industry: Software - Infrastructure
• EPS (TTM): 19.75
• Shares Outstanding: 48,366,400
• 10 Day Avg. Volume: 133,480
• 30 Day Avg. Volume: 154,230
• PEG Ratio: -0.59
• Price to Book (P/B): 2.16
• Price to Sales (P/S): 0.35
• P/FCF Ratio: -6.25
• 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: ¥1,590.00
• Price Target Upside: 8.98% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 1

• Rating: 68 Neutral
• Price Target: ¥1,590.00 ▲(8.98% Upside)

Japan Business Systems, Inc. has a solid financial foundation with strong revenue growth and improving margins, but it faces challenges with profitability and cash flow management. The technical analysis indicates weak momentum, which could impact short-term performance. However, the stock's reasonable valuation and attractive dividend yield provide a positive offset, making it a moderately appealing investment.

Japan Business Systems, Inc. Business Overview & Revenue Model

Company Description

Japan Business Systems, Inc. provides cloud integration and related services. The company operates through three segments: Cloud Integration Business, Cloud Service Business, and License & Products Business. It develops, implements, establishes, and monitors cloud migration plans; implements Microsoft Cloud services; and offers maintenance, operation, and support services to enhance cloud utilization, focusing on Microsoft Cloud. The company also engages in cloud solutions, licenses, and the resale of related equipment; and provides equipment for on-premise infrastructure and private cloud services. Japan Business Systems, Inc. was incorporated in 1990 and is headquartered in Tokyo, Japan.

How the Company Makes Money

Japan Business Systems, Inc. generates revenue primarily through its diverse IT service offerings, including system integration projects, cloud service subscriptions, and ongoing IT infrastructure management contracts. Key revenue streams include fees from project-based work, recurring revenues from managed services, and licensing fees from proprietary software solutions. Additionally, the company has established strategic partnerships with major technology providers, which enable it to enhance its service offerings and expand its market reach, contributing significantly to its overall earnings.

Japan Business Systems, Inc. Financial Statement Overview

Summary

Japan Business Systems, Inc. shows strong revenue growth and improving gross margins, indicating solid operational performance. However, profitability metrics such as net profit margin and ROE suggest room for improvement. The balance sheet shows increased leverage, and negative free cash flow highlights the need for better cash management strategies.

Income Statement

Japan Business Systems, Inc. has shown consistent revenue growth with a 26.6% increase from 2022 to 2023 and a further 24.9% increase from 2023 to 2024 (TTM). The gross profit margin improved to 10.7% in 2024 (TTM) from 9.9% in 2023. EBIT margin for 2024 (TTM) is stable at 3.7%, showing slight improvement over previous years. However, net profit margin is relatively low at 1.5% in 2024 (TTM), indicating room for profitability improvement.

Balance Sheet

The company's debt-to-equity ratio increased to 0.70 in 2024 (TTM) from 0.57 in 2023, reflecting higher leverage. The equity ratio stands at 38.4%, suggesting a stable equity position. ROE has decreased to 9.2% in 2024 (TTM) from 15.1% in 2023, indicating reduced efficiency in generating profits from equity. Overall, the balance sheet shows stability but with increased debt levels.

Cash Flow

Free cash flow has been negative, showing a concerning trend with no improvement in 2024 (TTM). The operating cash flow to net income ratio is unavailable due to zero cash flow, indicating potential cash management issues. The company needs to improve its cash flow generation to support operations and growth.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	166.82B	140.86B	112.80B	86.33B	74.95B	68.25B
Gross Profit	17.37B	14.57B	13.08B	10.88B	8.50B	8.48B
EBITDA	8.09B	3.98B	5.15B	4.68B	2.87B	1.93B
Net Income	4.98B	1.51B	3.35B	2.65B	1.56B	833.00M
Balance Sheet
Total Assets	83.70B	60.95B	49.61B	38.79B	29.49B	30.20B
Cash, Cash Equivalents and Short-Term Investments	4.54B	3.37B	5.34B	7.75B	4.01B	4.02B
Total Debt	20.89B	19.71B	12.91B	6.35B	5.71B	6.60B
Total Liabilities	58.30B	38.22B	27.39B	19.08B	16.15B	18.30B
Stockholders Equity	25.39B	22.73B	22.22B	19.71B	13.34B	11.90B
Cash Flow
Free Cash Flow	0.00	-7.85B	-4.73B	711.00M	945.00M	2.72B
Operating Cash Flow	0.00	-320.00M	-206.00M	3.47B	1.96B	3.22B
Investing Cash Flow	0.00	-7.66B	-7.04B	-3.97B	-894.00M	-480.00M
Financing Cash Flow	0.00	6.05B	4.99B	4.01B	-1.08B	-998.00M

Japan Business Systems, Inc. Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 1459.00
• 50DMA: Negative
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:5036, the sentiment is Negative. The current price of 1459 is below the 20-day moving average (MA) of 1496.68, below the 50-day MA of 1497.58, and above the 200-day MA of 1217.54, indicating a neutral trend. The MACD of -9.26 indicates Positive momentum. The RSI at 43.68 is Neutral, neither overbought nor oversold. The STOCH value of 44.93 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:5036.

Japan Business Systems, Inc. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
4431	80 Outperform	¥53.89B	32.74	―	0.54%	27.02%	21.10%
5036	68 Neutral	¥66.52B	13.35	―	2.74%	22.09%	143.20%
4475	66 Neutral	¥46.90B	39.88	―	0.29%	30.64%	33.06%
3854	63 Neutral	¥62.14B	17.56	―	2.02%	10.20%	22.51%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
4419	59 Neutral	¥61.97B	67.29	―	―	34.54%	398.15%