Quest Co., Ltd. (2332) AI Stock Analysis

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Quest Co., Ltd.

(TSE/TYO:2332)

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Rating:65Neutral

Price Target:JPY 1,805.00▲(12.46% Upside)

Action:downgraded

Date:08/27/26

The company's fortress-like balance sheet is the primary strength, providing significant stability. This is partially offset by bearish technical signals, with the stock trading below key moving averages and showing weak momentum. The attractive valuation, characterized by a low P/E ratio and high dividend yield, adds a layer of support. The main risk lies in the recent erosion of profit margins and declining cash flows, which warrant monitoring.

Positive Factors

Sustained revenue growthStrong multi-year revenue expansion indicates continued demand for the company’s systems integration and IT support services. Maintaining double-digit growth improves operating scale, broadens the earnings base, and supports reinvestment in client delivery capabilities over the next several quarters.

Negative Factors

Margin compressionFalling gross and net margins indicate that recent revenue growth is not being retained proportionally as profit. If the trend persists, higher costs or pricing pressure could limit earnings expansion, reduce operating flexibility, and weaken the benefit of continued top-line growth.

Quest Co., Ltd. (2332) vs. iShares MSCI Japan ETF (EWJ)

Market Cap: JPY 8.59B
Dividend Yield: 3.46%
Average Volume (3M): 11.31K
Price to Earnings (P/E): 11.0
Beta (1Y): 0.73
Revenue Growth: 15.24%
EPS Growth: 7.17%
Country: Japan
Employees: 1,092
Sector: Technology
Sector Strength: 61
Industry: Information Technology Services

Quest Co., Ltd. Business Overview & Revenue Model

Company Description

Quest Co., Ltd., based in Tokyo, Japan, delivers a comprehensive array of information technology services and solutions within the Japanese market. Their offerings encompass the full scope of system development and ongoing maintenance, alongside the...

How the Company Makes Money

Quest Co., Ltd. primarily generates revenue by delivering IT services to corporate clients, including (1) systems integration projects (fees for designing, building, and deploying business/IT systems), and (2) ongoing IT support/operations services (...

Quest Co., Ltd. Financial Statement Overview

Summary

The balance sheet is excellent with negligible debt and steady equity growth, providing a strong foundation. However, income statement and cash flow scores are moderate due to margin contraction and declining cash generation. The overall financial health is solid, weighted towards the strong balance sheet.

Income Statement

65Positive

Balance Sheet

88Very Positive

Cash Flow

62Positive

Financial statement breakdown
Breakdown	TTM	Mar 2026	Mar 2025	Mar 2024	Mar 2023	Mar 2022
Income Statement
Total Revenue	18.14B	17.81B	14.94B	14.22B	14.20B	11.81B
Gross Profit	3.08B	3.02B	2.75B	2.62B	2.58B	2.04B
EBITDA	1.29B	1.30B	1.22B	1.17B	1.15B	979.48M
Net Income	788.80M	800.74M	767.59M	696.18M	690.29M	690.41M
Balance Sheet
Total Assets	10.11B	10.36B	10.22B	9.46B	9.04B	7.94B
Cash, Cash Equivalents and Short-Term Investments	2.75B	3.06B	3.53B	3.20B	2.66B	2.17B
Total Debt	246.00M	9.92M	11.68M	15.04M	3.80M	7.43M
Total Liabilities	2.79B	2.90B	2.97B	2.67B	2.78B	2.28B
Stockholders Equity	7.31B	7.46B	7.25B	6.79B	6.27B	5.67B
Cash Flow
Free Cash Flow	0	446.11M	588.54M	500.71M	648.07M	450.55M
Operating Cash Flow	0	510.29M	590.98M	709.34M	659.93M	458.29M
Investing Cash Flow	0	-68.13M	91.31M	-2.15M	-150.81M	-1.14B
Financing Cash Flow	0	-915.93M	-265.58M	-251.96M	-326.42M	-210.62M

Quest Co., Ltd. Technical Analysis

Technical Analysis SentimentNegative

Last Price1605.00

Price Trends

50DMA1724.14Negative

100DMA1719.34Negative

200DMA1719.41Negative

Market Momentum

MACD-30.22Positive

RSI46.02Neutral

STOCH46.93Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:2332, the sentiment is Negative. The current price of 1605.00 is below the 20-day moving average (MA) of 1726.35, below the 50-day MA of 1724.14, and below the 200-day MA of 1719.41, indicating a bearish trend. The MACD of -30.22 indicates Positive momentum. The RSI at 46.02 is Neutral, neither overbought nor oversold. The STOCH value of 46.93 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:2332.

Quest Co., Ltd. Peers Comparison

Overall Rating

UnderperformOutperform

Sector (61)

Financial Indicators

JP:2332 against its peers
Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
JP:4752	83Outperform	JPY 7.13B	8.52	―	4.09%	7.77%	5.97%
JP:4442	81Outperform	JPY 9.53B	20.85	―	0.91%	9.86%	-35.09%
JP:3676	70Outperform	JPY 22.71B	19.34	―	2.48%	1.78%	30.06%
JP:2332	65Neutral	JPY 8.56B	11.01	―	3.46%	15.24%	7.17%
Sector *	61Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
JP:3657	46Neutral	JPY 11.92B	-4.51	―	4.73%	-10.31%	-194.96%
JP:5255	40Underperform	JPY 4.01B	-29.54	―	―	-1.67%	98.41%

* Technology Sector Average

Performance Comparison

JP:2332 and its peers over the selected period
Ticker	Company Name	Price	Change	% Change
JP:2332	Quest Co., Ltd.	1605.00	36.11	2.30%
JP:3657	Pole To Win Holdings.Inc.	339.00	26.58	8.51%
JP:3676	DIGITAL HEARTS HOLDINGS Co., Ltd.	1051.00	99.11	10.41%
JP:4442	VALTES HOLDINGS CO. LTD.	431.00	-18.04	-4.02%
JP:4752	Showa System Engineering Corporation	1590.00	-1.63	-0.10%
JP:5255	Monstarlab Holdings Inc.	62.00	-109.00	-63.74%

Quest Co., Ltd. Corporate Events

Quest Co. Maintains Earnings Outlook as Q1 Margins Tighten but Sales Rise

Aug 13, 2026

Quest Co., Ltd. reported consolidated net sales of ¥4.71 billion for the quarter ended June 30, 2026, up 7.5% year on year, while operating profit edged down 3.4% to ¥212 million and profit attributable to owners fell 7.4% to ¥141 million, resulting...

Glossary

BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.

Date of analysis: Aug 27, 2026

Quest Co., Ltd. AI Stock Analysis