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System Research Co., Ltd. (3771) AI Stock Analysis

JP:3771

System Research Co., Ltd.

(TSE/TYO:3771)

Select Model
Rating:88Outperform
Price Target:JPY 2,296.00â–²(24.11% Upside)
Action:reiterated
Date:08/17/26

The overall stock score of 88 is heavily driven by the company's pristine balance sheet, consistent double-digit revenue growth, and highly discounted valuation (12.5 P/E and a 3.6% dividend yield). Upward technical momentum further solidifies the bullish outlook, with the stock trading well above all major moving averages. Earnings call and corporate event components were excluded due to a lack of data, focusing the evaluation entirely on its excellent fundamental and technical merits.

Positive Factors
Consistent Revenue and Profit GrowthSustained revenue expansion alongside improving operating and net margins indicates durable customer demand and strengthening execution. The steady gross-margin profile also suggests the company can grow without materially sacrificing profitability.
Negative Factors
Weak and Volatile Cash ConversionCash conversion below operating profit suggests working-capital timing or collection pressures can separate accounting earnings from available cash. Recurring conversion weakness and prior free-cash-flow volatility may constrain funding predictability despite positive reported cash generation.

System Research Co., Ltd. (3771) vs. iShares MSCI Japan ETF (EWJ)

-20%-10%0%10%20%30%JP:3771-0.66%EWJ+17.00%Dec '25Jan '26Feb '26Mar '26Apr '26May '26Jun '26Jul '26Aug '26Sep '26Oct '26
Market Cap
JPY 31.20B
Dividend Yield
3.72%
Average Volume (3M)
79.42K
Price to Earnings (P/E)
12.5
Beta (1Y)
0.81
Revenue Growth
9.34%
EPS Growth
3.51%
Country
Japan
Employees
1,569
Sector
Technology
Sector Strength
61
Industry
Software - Application

System Research Co., Ltd. Business Overview & Revenue Model

Company Description

System Research Co.,Ltd. provides software development services in Japan. The company designs, develops, implements, operates, maintains, and improves corporate information systems for the car, logistics, distribution, communication and control, and...

How the Company Makes Money

null

System Research Co., Ltd. Financial Statement Overview

Summary

System Research Co. demonstrates an exceptionally strong financial profile. Top-line revenue and net profit margins have expanded consistently over the last five years. The company maintains a fortress balance sheet with aggressive debt paydown, resulting in a minimal 0.04x debt-to-equity ratio. While cash conversion has slightly softened, operating cash flows remain robust and adequately fund organic growth.

Income Statement

88Very Positive

Balance Sheet

92Very Positive

Cash Flow

82Very Positive
Financial statement breakdown
BreakdownTTMMar 2026Mar 2025Mar 2024Mar 2023Mar 2022
Income Statement
Total Revenue29.57B29.08B25.93B23.32B21.56B18.41B
Gross Profit6.85B6.76B6.03B5.36B4.82B4.12B
EBITDA3.70B3.74B3.20B2.88B2.66B2.20B
Net Income2.56B2.61B2.19B1.97B1.60B1.49B
Balance Sheet
Total Assets17.39B19.46B17.53B16.15B14.18B12.88B
Cash, Cash Equivalents and Short-Term Investments7.45B8.43B8.20B8.33B7.37B6.35B
Total Debt918.85M956.94M1.30B1.44B1.40B1.40B
Total Liabilities4.67B5.97B5.70B5.63B5.05B4.75B
Stockholders Equity12.69B13.46B11.81B10.51B9.12B8.12B
Cash Flow
Free Cash Flow01.68B971.47M1.59B1.59B1.28B
Operating Cash Flow02.50B2.06B2.46B1.80B1.29B
Investing Cash Flow0-942.32M-1.14B-926.71M-273.30M-254.65M
Financing Cash Flow0-1.33B-1.04B-546.50M-501.65M-526.75M

System Research Co., Ltd. Technical Analysis

Technical Analysis SentimentNegative
Last Price1850.00

Price Trends

50DMA1921.56Negative
100DMA1859.82Positive
200DMA1810.80Positive

Market Momentum

MACD3.90Positive
RSI42.37Neutral
STOCH17.29Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:3771, the sentiment is Negative. The current price of 1850.00 is below the 20-day moving average (MA) of 1932.65, below the 50-day MA of 1921.56, and above the 200-day MA of 1810.80, indicating a neutral trend. The MACD of 3.90 indicates Positive momentum. The RSI at 42.37 is Neutral, neither overbought nor oversold. The STOCH value of 17.29 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:3771.

System Research Co., Ltd. Peers Comparison

Overall Rating

UnderperformOutperform
Sector (61)

Financial Indicators

JP:3771 against its peers
NameOverall RatingMarket CapP/E RatioROEDividend YieldRevenue GrowthEPS Growth
JP:3771JP:377188OutperformJPY 31.45B12.46―3.72%9.34%3.51%
JP:9629JP:962983OutperformJPY 29.94B15.38―6.00%8.61%30.21%
JP:3826JP:382682OutperformJPY 5.26B11.55―2.73%13.99%-36.97%
JP:4323JP:432376OutperformJPY 43.23B17.86―2.81%9.28%-6.81%
Sector *61Neutral$37.18B12.37-10.20%1.83%8.50%-7.62%
JP:7527JP:752743NeutralJPY 4.87B148.39――-0.48%―

* Technology Sector Average

Performance Comparison

-20%0%20%JP:3771JP:3826JP:4323JP:7527JP:9629Dec '25Jan '26Feb '26Mar '26Apr '26May '26Jun '26Jul '26Aug '26Sep '26Oct '26
JP:3771 and its peers over the selected period
Show on chartTickerCompany NamePriceChange% Change
JP:3771System Research Co., Ltd.1881.00-48.04-2.49%
JP:3826System Integrator Corp.477.0024.855.50%
JP:4323Japan System Techniques Co., Ltd.1744.00-336.51-16.17%
JP:7527SystemSoft Corporation46.00-24.00-34.29%
JP:9629PCA Corporation1584.00-103.60-6.14%

System Research Co., Ltd. Corporate Events

System Research Completes Payment for Restricted Share Remuneration Disposal

Aug 7, 2026

System Research has completed payment procedures for the disposal of 25,250 treasury shares used as restricted share remuneration to its management team. The shares, priced at 1,836 yen each for a total of 46,359,000 yen, were allocated to six direct...

System Research Lifts Payout Target and Adopts Progressive Dividend Policy

Jul 28, 2026

System Research Co., Ltd. has revised its dividend policy to raise its target dividend payout ratio from 40% to 50%, underscoring a stronger commitment to shareholder returns while keeping an eye on capital efficiency and financial stability. As part...

System Research Balances Softer Q1 Profits With Higher Dividend and Confident Outlook

Jul 28, 2026

System Research reported consolidated net sales of ¥7.43 billion for the quarter ended June 30, 2026, up 7.0% year on year, but saw operating profit decline 10.1% to ¥540 million and profit attributable to owners of parent fall 11.6% to &#1...

System Research to Grant Restricted Treasury Shares to Directors and Executives

Jul 10, 2026

System Research Co., Ltd. has resolved to dispose of 25,250 treasury shares of common stock as restricted stock compensation for six directors and six executive officers. The shares, priced at 1,836 yen each for a total of 46,359,000 yen, are part of...

System Research Raises Year-End Dividend to 70 Yen per Share

May 27, 2026

System Research Co., Ltd. has resolved to distribute a year-end dividend of 70 yen per share for the fiscal year ended March 31, 2026, matching its latest forecast and up from 60 yen per share in the previous year. The dividend, totaling approximatel...

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