Densan System Holdings Co. Ltd. (4072) AI Stock Analysis

Densan System Holdings Co. Ltd.

(TSE/TYO:4072)

Select Model

Rating:83Outperform

Price Target:JPY 3,833.00▲(16.68% Upside)

Action:reiterated

Date:08/06/26

The overall score of 83 reflects Densan System's strong financial foundation, including a virtually debt-free balance sheet and consistent cash flows, combined with an attractive valuation. Technical indicators show short-term bullish momentum, though the stock's position below its 200-day moving average suggests some caution. These factors position the company as a solid investment with moderate upside potential.

Positive Factors

Revenue GrowthThe sustained multi-year revenue increase indicates expanding demand for the group’s IT services and technology offerings. Acceleration in 2025 strengthens the evidence that growth is not limited to a single period, supporting continued scale benefits and reinvestment capacity over the coming quarters.

Negative Factors

Margin VolatilityProfitability has not returned consistently to the stronger levels recorded earlier in the period, indicating sensitivity to pricing or cost pressures. If this pattern persists, revenue growth may translate less efficiently into earnings and could constrain operating leverage over the next several quarters.

Densan System Holdings Co. Ltd. (4072) vs. iShares MSCI Japan ETF (EWJ)

Market Cap: JPY 35.31B
Dividend Yield: 3.04%
Average Volume (3M): 36.45K
Price to Earnings (P/E): 11.2
Beta (1Y): 0.61
Revenue Growth: 11.79%
EPS Growth: 55.44%
Country: Japan
Employees: 1,036
Sector: Technology
Sector Strength: 61
Industry: Information Technology Services

Densan System Holdings Co. Ltd. Business Overview & Revenue Model

Company Description

Densan System Holdings Co., Ltd., along with its affiliated companies, provides comprehensive information technology consulting and software development services throughout Japan. The firm's offerings span data processing, systems integration, and be...

Densan System Holdings Co. Ltd. Financial Statement Overview

Summary

Densan System demonstrates solid financial health: steady revenue growth, strong balance sheet with minimal debt (2.6% debt/equity), and robust cash flow generation. Income statement score 78 reflects modest but improving margins; balance sheet score 92 highlights exceptional financial strength; cash flow score 85 indicates high free cash flow conversion. Overall financial performance is strong.

Income Statement

78Positive

Balance Sheet

92Very Positive

Cash Flow

85Very Positive

Financial statement breakdown
Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	70.74B	68.13B	61.26B	59.59B	53.48B	50.36B
Gross Profit	11.47B	11.02B	9.29B	10.60B	9.98B	9.23B
EBITDA	4.75B	4.57B	3.21B	4.01B	4.06B	3.84B
Net Income	3.14B	2.90B	1.85B	2.00B	2.35B	1.98B
Balance Sheet
Total Assets	78.91B	69.11B	61.75B	57.05B	72.17B	51.39B
Cash, Cash Equivalents and Short-Term Investments	50.28B	39.98B	34.81B	31.16B	45.95B	31.07B
Total Debt	596.00M	629.00M	1.07B	1.53B	1.49B	1.09B
Total Liabilities	53.00B	44.23B	39.45B	36.27B	52.50B	33.78B
Stockholders Equity	25.68B	24.64B	22.08B	20.58B	19.46B	17.41B
Cash Flow
Free Cash Flow	0	4.10B	2.73B	4.69B	1.34B	1.92B
Operating Cash Flow	0	4.33B	3.02B	5.51B	1.91B	2.53B
Investing Cash Flow	0	-1.02B	239.00M	-852.00M	-1.72B	-1.23B
Financing Cash Flow	0	-1.05B	-765.00M	-941.00M	-5.00M	-719.00M

Densan System Holdings Co. Ltd. Technical Analysis

Technical Analysis SentimentPositive

Last Price3285.00

Price Trends

50DMA3171.50Positive

100DMA3028.07Positive

200DMA3013.45Positive

Market Momentum

MACD46.19Positive

RSI53.93Neutral

STOCH50.35Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:4072, the sentiment is Positive. The current price of 3285.00 is above the 20-day moving average (MA) of 3260.00, above the 50-day MA of 3171.50, and above the 200-day MA of 3013.45, indicating a bullish trend. The MACD of 46.19 indicates Positive momentum. The RSI at 53.93 is Neutral, neither overbought nor oversold. The STOCH value of 50.35 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:4072.

Densan System Holdings Co. Ltd. Peers Comparison

Overall Rating

UnderperformOutperform

Sector (61)

Financial Indicators

JP:4072 against its peers
Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
JP:3837	86Outperform	JPY 22.65B	14.85	―	3.95%	8.49%	26.09%
JP:3916	86Outperform	JPY 32.56B	14.90	―	3.54%	5.74%	-3.58%
JP:4072	83Outperform	JPY 35.53B	11.20	―	3.04%	11.79%	55.44%
JP:4396	81Outperform	JPY 31.32B	16.64	―	2.12%	15.42%	27.83%
JP:4725	73Outperform	JPY 33.35B	9.33	10.39%	5.06%	3.46%	6.90%
JP:2359	72Outperform	JPY 28.54B	9.69	―	3.00%	10.18%	22.45%
Sector *	61Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%

* Technology Sector Average

Performance Comparison

JP:4072 and its peers over the selected period
Ticker	Company Name	Price	Change	% Change
JP:4072	Densan System Holdings Co. Ltd.	3290.00	-167.86	-4.85%
JP:4725	CAC Holdings Corporation	1975.00	-52.01	-2.57%
JP:2359	Core Corporation	2003.00	-4.16	-0.21%
JP:3837	Ad-Sol Nissin Corp.	1318.00	-99.25	-7.00%
JP:3916	Digital Information Technologies Corp.	1059.00	-135.68	-11.36%
JP:4396	System Support, Inc.	1507.00	24.62	1.66%

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 06, 2026

Densan System Holdings Co. Ltd. AI Stock Analysis