Nippon Information Development Co., Ltd. (2349) AI Stock Analysis

Nippon Information Development Co., Ltd.

(TSE/TYO:2349)

Select Model

Rating:73Outperform

Price Target:JPY 2,843.00▲(14.45% Upside)

Action:upgraded

Date:08/17/26

Nippon Information Development scores 73, reflecting a financially stable IT services company with a debt-free balance sheet, consistent revenue growth, and excellent cash conversion — all key strengths. The attractive P/E of 11.1x suggests the stock is reasonably valued given its earnings profile. Technical indicators confirm a mild uptrend, though momentum is approaching overbought territory. The primary risks are gradual operating margin compression despite top-line growth and a conservative capital deployment strategy that may limit shareholder returns. The very low beta provides defensive characteristics but also limits upside in bullish markets. Overall, this is a solid, low-risk holding with moderate growth prospects.

Positive Factors

Exceptionally conservative balance sheetNegligible debt reduces interest burden and refinancing risk, while rising equity strengthens financial resilience. This provides flexibility to maintain operations, invest in growth, or withstand industry weakness without relying heavily on external funding.

Negative Factors

Margin compression since 2023Falling operating margins suggest that recent revenue growth is producing less incremental profit than at the prior peak. If this persists, weaker operating leverage could constrain earnings growth and reduce the company’s ability to absorb cost inflation.

Nippon Information Development Co., Ltd. (2349) vs. iShares MSCI Japan ETF (EWJ)

Market Cap: JPY 27.14B
Dividend Yield: 1.17%
Average Volume (3M): 2,741
Price to Earnings (P/E): 10.8
Beta (1Y): 0.16
Revenue Growth: 5.65%
EPS Growth: 7.73%
Country: Japan
Employees: 1,683
Sector: Technology
Sector Strength: 61
Industry: Information Technology Services

Nippon Information Development Co., Ltd. Business Overview & Revenue Model

Company Description

Nippon Information Development Co., Ltd. is a global technology company, active in Japan and abroad, specializing in embedded and control systems, as well as financial and general business solutions. The company develops mobile applications for Andro...

How the Company Makes Money

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Nippon Information Development Co., Ltd. Financial Statement Overview

Summary

Strong revenue growth (~49% over five years) and a fortress balance sheet with zero debt earn high marks. The balance sheet score of 88 is a standout, reflecting exceptional financial stability with equity comprising ~79% of total assets. Cash flow quality is excellent with near-perfect free cash flow conversion. However, the gradual compression of EBIT/EBITDA margins from FY2023 highs (~15.6%) to projected ~12.8% in FY2026 is a notable concern, and ROE in the 9-12% range is only adequate for an asset-light IT services firm. The blended financial score reflects the strong balance sheet and cash generation offset by margin pressure.

Income Statement

72Positive

Balance Sheet

88Very Positive

Cash Flow

75Positive

Financial statement breakdown
Breakdown	TTM	Mar 2026	Mar 2025	Mar 2024	Mar 2023	Mar 2022
Income Statement
Total Revenue	26.81B	26.43B	24.97B	22.57B	20.45B	18.25B
Gross Profit	6.43B	6.30B	5.68B	5.27B	4.81B	4.38B
EBITDA	3.60B	3.53B	3.24B	2.96B	2.67B	2.34B
Net Income	2.52B	2.50B	2.37B	2.11B	2.21B	1.63B
Balance Sheet
Total Assets	31.23B	30.72B	28.56B	26.62B	24.31B	22.27B
Cash, Cash Equivalents and Short-Term Investments	18.76B	18.12B	16.20B	14.19B	13.05B	11.85B
Total Debt	360.00M	0	10.13M	17.02M	23.28M	16.82M
Total Liabilities	6.73B	6.45B	7.03B	6.91B	6.40B	6.17B
Stockholders Equity	24.50B	24.28B	21.53B	19.71B	17.91B	16.10B
Cash Flow
Free Cash Flow	0	2.33B	2.57B	1.83B	2.06B	1.62B
Operating Cash Flow	0	2.51B	2.77B	1.85B	2.09B	1.65B
Investing Cash Flow	0	-376.46M	-506.84M	-121.89M	-1.21B	-318.93M
Financing Cash Flow	0	-308.66M	-302.26M	-582.60M	-267.83M	-617.69M

Nippon Information Development Co., Ltd. Technical Analysis

Technical Analysis SentimentPositive

Last Price2484.00

Price Trends

50DMA2486.18Negative

100DMA2462.29Positive

200DMA2417.58Positive

Market Momentum

MACD1.73Negative

RSI51.38Neutral

STOCH46.80Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:2349, the sentiment is Positive. The current price of 2484.00 is above the 20-day moving average (MA) of 2469.75, below the 50-day MA of 2486.18, and above the 200-day MA of 2417.58, indicating a neutral trend. The MACD of 1.73 indicates Negative momentum. The RSI at 51.38 is Neutral, neither overbought nor oversold. The STOCH value of 46.80 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:2349.

Nippon Information Development Co., Ltd. Peers Comparison

Overall Rating

UnderperformOutperform

Sector (61)

Financial Indicators

JP:2349 against its peers
Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
JP:3916	86Outperform	JPY 32.56B	14.90	―	3.54%	5.74%	-3.58%
JP:4396	81Outperform	JPY 31.32B	16.64	―	2.12%	15.42%	27.83%
JP:4072	81Outperform	JPY 35.53B	11.20	―	3.04%	11.79%	55.44%
JP:2349	73Outperform	JPY 27.59B	10.79	―	1.17%	5.65%	7.73%
JP:3393	71Outperform	JPY 31.07B	12.12	―	5.04%	7.10%	31.29%
Sector *	61Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
JP:4813	46Neutral	JPY 14.42B	-10.79	―	―	24.78%	83.28%

* Technology Sector Average

Performance Comparison

JP:2349 and its peers over the selected period
Ticker	Company Name	Price	Change	% Change
JP:2349	Nippon Information Development Co., Ltd.	2484.00	230.24	10.22%
JP:3393	Startia Holdings,Inc.	3135.00	520.62	19.91%
JP:3916	Digital Information Technologies Corp.	1059.00	-135.68	-11.36%
JP:4072	Densan System Holdings Co. Ltd.	3290.00	-167.86	-4.85%
JP:4396	System Support, Inc.	1507.00	24.62	1.66%
JP:4813	Access Co., Ltd.	365.00	-178.00	-32.78%

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 17, 2026

Nippon Information Development Co., Ltd. AI Stock Analysis