Secom Co (9735) AI Stock Analysis

• Market Cap: ¥2.34T
• Dividend Yield: 1.77%
• Average Volume (3M): 1.02M
• Price to Earnings (P/E): 20.3
• Beta (1Y): 0.47
• Revenue Growth: 3.91%
• EPS Growth: 7.86%
• Country: JP
• Employees: 64,744
• Sector: Industrials
• Sector Strength: 92
• Industry: Security & Protection Services
• EPS (TTM): 69.05
• Shares Outstanding: 466,599,800
• 10 Day Avg. Volume: 1,147,390
• 30 Day Avg. Volume: 1,023,096
• PEG Ratio: -1.60
• Price to Book (P/B): 1.87
• 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: ¥6,200.20
• Price Target Upside: 17.25% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 1

• Rating: 74 Outperform
• Price Target: ¥6,035.00 ▲(14.13%Upside)

Secom Co's overall stock score of 74 reflects its strong financial performance and solid technical indicators. The company's financial stability, highlighted by consistent revenue growth and robust cash flow management, is a key strength. While the valuation is fair with a moderately high P/E ratio, the dividend yield offers a stable return. The absence of earnings call data and notable corporate events did not impact the score calculation.

Secom Co Business Overview & Revenue Model

Company Description

Secom Co., Ltd. is a leading Japanese security services company, renowned for pioneering the concept of electronic security services in Japan. Established in 1962, Secom operates across various sectors including security services, medical services, insurance services, geographic information services, information and communication related services, real estate development, and other services. The company's core products and services include security systems for homes and businesses, medical and health care services, fire protection services, and disaster prevention solutions.

How the Company Makes Money

Secom Co., Ltd. generates revenue primarily through its comprehensive range of security services. The company's primary revenue stream is its security services division, which includes electronic security systems for homes and businesses, surveillance, and on-site security personnel services. Additionally, Secom earns income from its medical services, providing home medical and nursing care. The insurance services offered by Secom, such as fire insurance and personal accident insurance, also contribute to its revenue. Geographic information services, involving mapping and location-based services, as well as information and communication related services, provide additional streams of income. Real estate development and management, along with other diversified business activities, further bolster Secom's earnings.

Secom Co Financial Statement Overview

Summary

Secom Co exhibits strong financial health, particularly in profitability and balance sheet stability. The income statement is robust with strong profitability metrics. The balance sheet is solid with low debt and high equity ratio, enhancing financial stability. However, the recent lack of free cash flow generation represents a potential risk area, despite the company's historical resilience in managing cash effectively.

Income Statement

Secom Co's income statement shows strong profitability with a consistent Gross Profit Margin around 29.6% for TTM and 30.9% for the previous annual period. The Net Profit Margin is stable at approximately 8.9% for TTM. Revenue growth is moderate, with a TTM revenue increase of about 2.5% compared to the previous year. Strong EBIT and EBITDA margins further emphasize operational efficiency and profitability.

Balance Sheet

The company maintains a robust balance sheet with a low Debt-to-Equity ratio of 0.058 and a strong Equity Ratio of 58.6% for TTM. Return on Equity (ROE) is healthy at around 8.5% for TTM, indicating efficient use of equity capital. The high level of cash and short-term investments further enhances financial stability.

Cash Flow

Cash flow analysis reflects challenges in generating free cash flow in the TTM period, with both Operating Cash Flow and Free Cash Flow being notably low or zero. Historically, the company has demonstrated strong Free Cash Flow, which provides some assurance of cash flow management capabilities.

Breakdown
TTM	Mar 2024	Mar 2023	Mar 2022	Mar 2021	Mar 2020
Income Statement		Total Revenue
1.18T	1.15T	1.10T	1.05T	1.04T	1.06T
	Gross Profit
350.91B	357.28B	342.46B	337.67B	330.57B	337.52B
	EBIT
137.27B	140.66B	136.70B	143.50B	136.93B	142.86B
	EBITDA
227.81B	236.61B	223.18B	220.31B	201.68B	213.78B
	Net Income Common Stockholders
105.05B	101.95B	96.08B	94.27B	74.68B	89.08B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
397.19B	599.15B	684.18B	685.86B	659.72B	587.55B
	Total Assets
2.10T	2.08T	1.99T	1.91T	1.86T	1.82T
	Total Debt
70.98B	68.96B	64.28B	67.63B	66.17B	70.66B
	Net Debt
-297.33B	-510.53B	-593.57B	-591.21B	-571.96B	-484.44B
	Total Liabilities
699.69B	690.09B	673.02B	651.72B	634.36B	642.63B
	Stockholders Equity
1.23T	1.22T	1.16T	1.12T	1.08T	1.04T
Cash Flow		Free Cash Flow
0.00	71.34B	85.09B	101.24B	123.82B	105.77B
	Operating Cash Flow
0.00	165.76B	146.43B	164.91B	181.93B	175.56B
	Investing Cash Flow
0.00	-162.27B	-70.45B	-55.35B	-48.54B	-60.78B
	Financing Cash Flow
0.00	-95.49B	-77.84B	-87.39B	-49.31B	-48.21B

Secom Co Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 5288.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:9735, the sentiment is Neutral. The current price of 5288 is below the 20-day moving average (MA) of 5331.15, above the 50-day MA of 5247.57, and above the 200-day MA of 5212.24, indicating a neutral trend. The MACD of 5.11 indicates Positive momentum. The RSI at 47.36 is Neutral, neither overbought nor oversold. The STOCH value of 12.09 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for JP:9735.

Secom Co Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
9686	75 Outperform	¥13.91B	19.66		3.03%	11.76%	9.97%
9735	74 Outperform	¥2.34T	20.28	8.55%	1.77%	3.91%	7.86%
6744	74 Outperform	¥230.36B	20.34		1.99%	12.84%	54.25%
7058	72 Outperform	¥3.43B	13.11		3.74%	13.49%	17.08%
9740	69 Neutral	¥34.51B	10.65		2.54%	5.01%	-39.78%
2331	66 Neutral	¥511.18B	18.11		2.57%	5.85%	3.31%
Sector *	66 Neutral	$4.50B	12.28	5.32%	248.52%	4.13%	-12.36%

Secom Co Corporate Events

SECOM Co., Ltd. Evaluates Further Reduction of Investment Units

SECOM Co., Ltd. has announced its approach and policy regarding the reduction of investment units to increase stock market participation and enhance stock liquidity. The company, having already implemented a 2 for 1 stock split in October 2024, will continue to evaluate further investment unit reductions by considering various factors such as share price, stock liquidity, shareholder composition, and market demands.

The most recent analyst rating on (JP:9735) stock is a Hold with a Yen11000.00 price target. To see the full list of analyst forecasts on Secom Co stock, see the JP:9735 Stock Forecast page.

SECOM Announces Share Repurchase Plan

SECOM CO., LTD. announced the repurchase of 1,687,400 of its own shares for a total price of JPY 9,027,126,700, as part of a resolution by its Board of Directors. This move, conducted through market purchases on the Tokyo Stock Exchange, is part of a larger plan to repurchase up to 18,000,000 shares, potentially impacting the company’s stock value and shareholder equity.

The most recent analyst rating on (JP:9735) stock is a Hold with a Yen11000.00 price target. To see the full list of analyst forecasts on Secom Co stock, see the JP:9735 Stock Forecast page.

SECOM Board Opposes Shareholder Proposal on Management Amendments

SECOM Co., Ltd.’s Board of Directors has decided to oppose a shareholder proposal from LONGCHAMP SICAV to amend the Articles of Incorporation to include management actions conscious of cost of capital and stock price. The Board believes that SECOM’s existing strategies, including the SECOM Group Road Map 2027, already address these concerns and that such provisions should remain flexible to adapt to changing market conditions. The company aims to enhance corporate value and shareholder returns through strategic initiatives and financial measures.

The most recent analyst rating on (JP:9735) stock is a Hold with a Yen11000.00 price target. To see the full list of analyst forecasts on Secom Co stock, see the JP:9735 Stock Forecast page.

Secom Co. Receives Shareholder Proposal for Enhanced Capital Management

Secom Co., Ltd. has received a shareholder proposal from LONGCHAMP SICAV, represented by Dalton Investments, for amendments to its Articles of Incorporation to implement management practices conscious of cost of capital and stock price. The proposal aims to ensure Secom’s alignment with the Tokyo Stock Exchange’s request for transparency and efficiency in capital management, urging the company to disclose specific financial metrics and improve its capital allocation strategies to meet its medium- to long-term goals.

The most recent analyst rating on (JP:9735) stock is a Hold with a Yen11000.00 price target. To see the full list of analyst forecasts on Secom Co stock, see the JP:9735 Stock Forecast page.

SECOM Co., Ltd. Announces Share Repurchase Plan to Boost Shareholder Value

SECOM Co., Ltd. announced a decision to repurchase up to 18 million of its own shares, representing 4.33% of total issued shares, with a maximum repurchase price of JPY 60 billion. This move aims to enhance shareholder returns and improve capital efficiency, reflecting the company’s commitment to sustainable growth and strategic capital management.

Secom Co., Ltd. Announces New Executive Structure

Secom Co., Ltd. has announced its new director candidates and executive structure following a recent Board of Directors meeting. The appointments, including Yasuyuki Yoshida as President and Representative Director, will be finalized at the upcoming Ordinary General Meeting of Shareholders on June 26, 2025. This restructuring is expected to influence the company’s strategic direction and reinforce its leadership in the security services industry.

SECOM Co., Ltd. Reports Modest Financial Growth and Announces Stock Split

SECOM Co., Ltd. reported its consolidated financial results for the fiscal year ended March 31, 2025, showing a modest increase in net sales and profits compared to the previous year. The company’s financial position remains strong with an increase in total assets and net assets, and it has announced a stock split and adjusted its dividend payouts accordingly. The forecast for the next fiscal year indicates continued growth in net sales and operating profit, although ordinary profit and profit attributable to owners of the parent are expected to decline slightly.