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Soliton Systems KK (3040) AI Stock Analysis

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JP:3040

Soliton Systems KK

(TSE/TYO:3040)

Select Model
Rating:90Outperform
Price Target:JPY 3,370.00â–²(20.01% Upside)
Action:reiterated
Date:10/24/26

JP:3040 achieves a top-tier score primarily driven by a pristine, debt-free balance sheet and outstanding free cash flow generation. The stock's robust fundamental profile is further reinforced by strong technical upward momentum across all moving averages and a highly reasonable valuation.

Positive Factors
Very low leverageExtremely low leverage reduces financial risk and preserves flexibility for investment, dividends, or acquisitions. The declining debt-to-equity ratio, alongside a rising equity base, supports balance-sheet resilience through changing operating conditions over the next several quarters.
Negative Factors
Uneven revenue trajectoryThe recent pattern of two years of revenue contraction followed by a moderate rebound shows that demand growth has not been consistently sustained. This uneven top-line trajectory can limit operating leverage and makes future earnings expansion more dependent on margin performance.

Soliton Systems KK (3040) vs. iShares MSCI Japan ETF (EWJ)

-25%0%25%50%75%100%125%JP:3040+63.26%EWJ+18.01%Dec '25Jan '26Feb '26Mar '26Apr '26May '26Jun '26Jul '26Aug '26Sep '26Oct '26Nov '26
Market Cap
JPY 54.45B
Dividend Yield
2.07%
Average Volume (3M)
274.43K
Price to Earnings (P/E)
16.4
Beta (1Y)
1.02
Revenue Growth
12.25%
EPS Growth
84.46%
Country
Japan
Employees
655
Sector
Technology
Sector Strength
61
Industry
Software - Infrastructure

Soliton Systems KK Business Overview & Revenue Model

Company Description

Operating both within Japan and on an international scale, Soliton Systems K.K. is a technology firm specializing in IT security, remote live broadcasting, and embedded system solutions. Its comprehensive portfolio of cybersecurity offerings includes...

Soliton Systems KK Financial Statement Overview

Summary

Exceptional financial health featuring a fortress balance sheet with negligible debt, strong free cash flow generation, and expanding profit margins alongside recovering top-line growth.

Income Statement

88Very Positive

Balance Sheet

96Very Positive

Cash Flow

90Very Positive
Financial statement breakdown
BreakdownTTMDec 2025Dec 2024Dec 2023Dec 2022Dec 2021
Income Statement
Total Revenue21.07B19.76B18.61B19.06B19.76B17.39B
Gross Profit10.39B9.24B8.29B8.56B7.63B7.82B
EBITDA4.47B3.26B2.52B3.12B2.77B2.98B
Net Income3.17B2.30B1.72B1.94B1.59B1.87B
Balance Sheet
Total Assets26.91B26.23B23.29B22.63B19.26B17.32B
Cash, Cash Equivalents and Short-Term Investments18.14B16.86B14.69B13.39B10.20B8.45B
Total Debt80.00M97.00M191.00M133.00M157.00M157.00M
Total Liabilities12.71B12.97B11.00B11.49B9.65B8.84B
Stockholders Equity14.19B13.25B12.27B11.12B9.60B8.46B
Cash Flow
Free Cash Flow03.43B1.84B3.55B2.20B2.03B
Operating Cash Flow03.60B2.04B3.64B2.30B2.11B
Investing Cash Flow0-10.17B-237.00M-57.00M-309.00M-495.00M
Financing Cash Flow0-1.27B-507.00M-397.00M-252.00M-481.00M

Soliton Systems KK Technical Analysis

Technical Analysis SentimentPositive
Last Price2808.00

Price Trends

50DMA2731.62Positive
100DMA2387.60Positive
200DMA2144.62Positive

Market Momentum

MACD80.80Positive
RSI42.38Neutral
STOCH4.79Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:3040, the sentiment is Positive. The current price of 2808.00 is below the 20-day moving average (MA) of 3165.90, above the 50-day MA of 2731.62, and above the 200-day MA of 2144.62, indicating a neutral trend. The MACD of 80.80 indicates Positive momentum. The RSI at 42.38 is Neutral, neither overbought nor oversold. The STOCH value of 4.79 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:3040.

Soliton Systems KK Peers Comparison

Overall Rating

UnderperformOutperform
Sector (61)

Financial Indicators

JP:3040 against its peers
NameOverall RatingMarket CapP/E RatioROEDividend YieldRevenue GrowthEPS Growth
JP:3040JP:304090OutperformJPY 54.45B16.4523.79%2.07%12.25%84.46%
JP:4493JP:449387OutperformJPY 29.20B28.77―0.18%22.65%74.18%
JP:4417JP:441781OutperformJPY 129.67B58.50―0.51%25.18%85.59%
JP:3694JP:369478OutperformJPY 25.35B22.21――21.05%-2.47%
JP:4475JP:447578OutperformJPY 67.94B34.92―0.60%19.17%46.29%
Sector *61Neutral$37.18B12.37-10.20%1.83%8.50%-7.62%
JP:147AJP:147A57NeutralJPY 41.60B60.09――45.62%48.60%

* Technology Sector Average

Performance Comparison

0%50%100%JP:3040JP:147AJP:3694JP:4417JP:4475JP:4493Dec '25Jan '26Feb '26Mar '26Apr '26May '26Jun '26Jul '26Aug '26Sep '26Oct '26Nov '26
JP:3040 and its peers over the selected period
Show on chartTickerCompany NamePriceChange% Change
JP:3040Soliton Systems KK2808.001205.5675.23%
JP:147ASORACOM,INC.903.0035.004.03%
JP:3694OPTiM Corp.453.00-70.00-13.38%
JP:4417Global Security Experts Inc.8470.005012.49144.97%
JP:4475HENNGE K.K.1846.00451.8232.41%
JP:4493Cyber Security Cloud, Inc.2728.00863.1646.29%

Soliton Systems KK Corporate Events

Soliton Systems Hikes 2026 Earnings and Dividend Forecast on Strong Security Demand

Aug 12, 2026

Soliton Systems has raised its full-year 2026 earnings forecast, projecting record net sales and profits as robust demand from local governments and schools for its authentication and zero-trust security solutions lifts revenue above earlier guidance...

Soliton Systems Boosts Earnings, Raises Dividend and Full-Year Forecast

Aug 12, 2026

Soliton Systems K.K. reported strong growth for the six months ended June 30, 2026, with net sales rising 15.1% year-on-year to ¥10,022 million and profit attributable to owners of parent surging 150.8% to ¥1,447 million. Operating profit m...

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: Oct 24, 2026