NOVA SYSTEM CO.,LTD. (5257) AI Stock Analysis

• Market Cap: ¥4.20B
• Dividend Yield: N/A
• Average Volume (3M): 2.21K
• Price to Earnings (P/E): 11.7
• Beta (1Y): 0.73
• Revenue Growth: 15.53%
• EPS Growth: 2.74%
• Country: JP
• Employees: 470
• Sector: Technology
• Sector Strength: 86
• Industry: Software - Application
• EPS (TTM): 52.18
• Shares Outstanding: 1,402,500
• 10 Day Avg. Volume: 1,740
• 30 Day Avg. Volume: 2,213
• PEG Ratio: -1.28
• Price to Book (P/B): 1.81
• 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: ¥3,128.00
• Price Target Upside: 4.48% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 0

• Rating: 75 Outperform
• Price Target: ¥3,128.00 ▲(4.48%Upside)

The overall stock score of 75 reflects strong financial performance driven by significant revenue growth and improved cash flow, alongside reasonable valuation metrics. Technical indicators suggest moderate resistance, which tempers the otherwise positive outlook.

NOVA SYSTEM CO.,LTD. Business Overview & Revenue Model

Company Description

NOVA SYSTEM CO.,LTD. (5257) is a technology company that specializes in providing advanced IT solutions and services. The company operates primarily in the software development sector, focusing on creating innovative software products and offering IT consulting services to a diverse range of industries. Its core offerings include custom software development, system integration, and IT infrastructure management.

How the Company Makes Money

NOVA SYSTEM CO.,LTD. generates revenue through multiple streams primarily centered around its software development and IT services. The company makes money by designing custom software solutions tailored to the specific needs of its clients, which often involves long-term contracts and ongoing support services. Additionally, NOVA SYSTEM CO.,LTD. earns from system integration projects where it helps businesses implement and integrate new technologies into their existing infrastructure. IT consulting services also contribute significantly to the company's earnings, providing strategic advice and technical support. The company may also engage in partnerships with other technology firms to expand its service offerings and access new markets, thus enhancing its revenue potential.

NOVA SYSTEM CO.,LTD. Financial Statement Overview

Summary

NOVA SYSTEM CO., LTD. exhibits strong financial health with significant revenue growth, improved profitability, and a solid balance sheet. The company maintains low leverage and high equity, and its cash flow situation has improved significantly, positioning it well for future growth and operational stability.

Income Statement

NOVA SYSTEM CO., LTD. demonstrates strong revenue growth with a 19.14% increase from 2023 to 2024. The gross profit margin is stable at 22.05% for 2024, indicating efficient cost management. Net profit margin improved to 6.10%, reflecting growing profitability. Both EBIT and EBITDA margins are solid at 8.17% and 9.15% respectively, indicating strong operational performance.

Balance Sheet

The company's balance sheet shows a robust equity base with a debt-to-equity ratio of 0.28, reflecting low leverage. With an equity ratio of 59.86%, the company maintains significant financial stability. Return on equity improved to 17.64%, showcasing efficient use of equity to generate profits. Overall, the balance sheet is strong with a focus on equity financing.

Cash Flow

Free cash flow improved significantly from a deficit in 2023 to a positive 236 million yen in 2024, reflecting effective cash management. Operating cash flow to net income ratio is 0.64, indicating good cash conversion from profits. The free cash flow to net income ratio is 0.60, showcasing efficient cash generation relative to profits. Overall, cash flow stability has improved markedly.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	6.46B	5.42B	4.63B	4.17B	4.08B
Gross Profit	1.42B	1.33B	1.03B	759.21M	854.79M
EBITDA	606.70M	550.57M	370.10M	145.30M	249.14M
Net Income	394.68M	342.24M	212.56M	72.21M	137.56M
Balance Sheet
Total Assets	3.73B	3.38B	2.79B	2.58B	2.77B
Cash, Cash Equivalents and Short-Term Investments	758.98M	898.69M	633.55M	937.23M	988.95M
Total Debt	628.00M	894.07M	902.65M	930.47M	1.39B
Total Liabilities	1.50B	1.59B	1.62B	1.63B	1.98B
Stockholders Equity	2.23B	1.80B	1.16B	944.96M	787.70M
Cash Flow
Free Cash Flow	234.73M	-66.20M	-310.49M	156.90M	72.30M
Operating Cash Flow	253.24M	145.01M	80.14M	174.69M	126.61M
Investing Cash Flow	158.88M	-223.71M	-299.11M	161.36M	88.74M
Financing Cash Flow	-265.84M	308.13M	-27.82M	-455.80M	-9.21M

NOVA SYSTEM CO.,LTD. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 2994.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:5257, the sentiment is Positive. The current price of 2994 is above the 20-day moving average (MA) of 2939.20, above the 50-day MA of 2835.70, and above the 200-day MA of 2656.98, indicating a bullish trend. The MACD of 41.90 indicates Negative momentum. The RSI at 58.83 is Neutral, neither overbought nor oversold. The STOCH value of 64.08 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:5257.

NOVA SYSTEM CO.,LTD. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
5257	75 Outperform	¥4.20B	11.71		―	15.53%	2.74%
5596	69 Neutral	¥4.11B	12.21		―	―	―
4167	67 Neutral	¥3.68B	27.98		―	10.24%	280.31%
Sector *	63 Neutral	$34.55B	5.25	-11.40%	1.91%	5.47%	-20.39%
4069	62 Neutral	¥4.80B	181.48		―	-6.27%	-109.58%
2345	40 Underperform	¥3.65B	―		―	―	―