TOWA Hi SYSTEM Co., Ltd. (4172) AI Stock Analysis

TOWA Hi SYSTEM Co., Ltd.

(TSE/TYO:4172)

Select Model

Rating:82Outperform

Price Target:JPY 2,587.00▲(23.13% Upside)

Action:reiterated

Date:08/06/26

The company exhibits strong financial health, with high profitability, a debt-free balance sheet, and solid cash flows. Valuation is attractive with a low P/E and high dividend yield. Technicals show short-term upward momentum but face resistance from longer-term moving averages. Overall, the stock presents a favorable risk-reward profile.

Positive Factors

Zero-debt balance sheetA zero-debt capital structure provides durable financial flexibility: it lowers bankruptcy risk, preserves borrowing capacity for strategic investments or M&A, and supports consistent dividend policy. This conservative position sustains resilience through industry cycles and funds opportunistic growth without leverage-driven strain.

Negative Factors

Uneven revenue trajectoryTop-line volatility undercuts predictability of earnings and makes margin gains more fragile if demand weakens. Reliance on episodic revenue recovery raises execution risk for sustaining profitability improvements and complicates long-range planning, capital allocation, and confidence in steady organic growth.

TOWA Hi SYSTEM Co., Ltd. (4172) vs. iShares MSCI Japan ETF (EWJ)

Market Cap: JPY 4.68B
Dividend Yield: 4.47%
Average Volume (3M): 1,316
Price to Earnings (P/E): 9.0
Beta (1Y): 0.43
Revenue Growth: 12.40%
EPS Growth: 26.63%
Country: Japan
Employees: 117
Sector: Healthcare
Sector Strength: 51
Industry: Medical - Care Facilities

TOWA Hi SYSTEM Co., Ltd. Business Overview & Revenue Model

Company Description

Hi-CRATES CO.,LTD. specializes in the creation, sale, and maintenance of comprehensive electronic medical record systems tailored for dental practices. Beyond its core EMR offerings, the company also develops and supports applications for iPads and w...

How the Company Makes Money

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TOWA Hi SYSTEM Co., Ltd. Financial Statement Overview

Summary

Strong profitability with 5.4% revenue growth, high margins (gross 77%, EBIT 27%, net 18.6%), zero debt balance sheet, and robust cash flow generation. Recent recovery from a temporary dip demonstrates resilience.

Income Statement

85Very Positive

Balance Sheet

95Very Positive

Cash Flow

80Positive

Financial statement breakdown
Breakdown	TTM	Sep 2025	Sep 2024	Sep 2023	Sep 2022	Sep 2021
Income Statement
Total Revenue	2.57B	2.41B	2.11B	2.04B	2.22B	2.37B
Gross Profit	2.00B	1.85B	1.60B	1.46B	1.63B	1.78B
EBITDA	740.88M	739.43M	500.83M	299.00M	526.99M	575.02M
Net Income	521.35M	448.09M	401.81M	258.51M	316.27M	375.57M
Balance Sheet
Total Assets	5.11B	4.73B	4.38B	4.07B	4.05B	4.02B
Cash, Cash Equivalents and Short-Term Investments	1.68B	2.10B	1.61B	1.60B	1.80B	2.16B
Total Debt	0	0	0	0	0	0
Total Liabilities	704.97M	531.10M	447.10M	333.70M	455.95M	521.73M
Stockholders Equity	4.40B	4.20B	3.93B	3.73B	3.59B	3.50B
Cash Flow
Free Cash Flow	420.19M	420.19M	490.61M	-115.80M	243.93M	122.69M
Operating Cash Flow	461.22M	461.22M	504.44M	61.07M	342.68M	248.00M
Investing Cash Flow	-735.24M	-735.24M	186.01M	-360.86M	-481.22M	-574.52M
Financing Cash Flow	-227.34M	-227.34M	-178.24M	-95.88M	-222.74M	444.72M

TOWA Hi SYSTEM Co., Ltd. Technical Analysis

Technical Analysis SentimentNegative

Last Price2101.00

Price Trends

50DMA2240.83Negative

100DMA2190.84Negative

200DMA2237.07Negative

Market Momentum

MACD-30.78Positive

RSI32.07Neutral

STOCH11.59Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:4172, the sentiment is Negative. The current price of 2101.00 is below the 20-day moving average (MA) of 2202.00, below the 50-day MA of 2240.83, and below the 200-day MA of 2237.07, indicating a bearish trend. The MACD of -30.78 indicates Positive momentum. The RSI at 32.07 is Neutral, neither overbought nor oversold. The STOCH value of 11.59 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:4172.

TOWA Hi SYSTEM Co., Ltd. Peers Comparison

Overall Rating

UnderperformOutperform

Sector (51)

Financial Indicators

JP:4172 against its peers
Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
JP:4172	82Outperform	JPY 4.78B	8.98	―	4.47%	12.40%	26.63%
JP:9220	73Outperform	JPY 3.19B	7.00	―	3.39%	5.48%	13.46%
JP:2425	56Neutral	JPY 2.50B	29.54	―	3.35%	-5.72%	-73.78%
JP:2373	52Neutral	JPY 5.26B	17.98	―	4.45%	4.76%	-52.55%
Sector *	51Neutral	$7.86B	-0.30	-43.30%	2.27%	22.53%	-2.21%
JP:7061	46Neutral	JPY 3.90B	11.55	―	5.54%	14.91%	-39.00%

* Healthcare Sector Average

Performance Comparison

JP:4172 and its peers over the selected period
Ticker	Company Name	Price	Change	% Change
JP:4172	TOWA Hi SYSTEM Co., Ltd.	2101.00	-201.78	-8.76%
JP:2373	Care Twentyone Corporation	382.00	-60.66	-13.70%
JP:2425	Care Service Co., Ltd.	657.00	-121.64	-15.62%
JP:7061	Japan Hospice Holdings Inc.	451.00	-872.95	-65.94%
JP:9220	FB CARE SERVICE CO.,LTD.	1270.00	82.69	6.96%

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

TOWA Hi SYSTEM Co., Ltd. AI Stock Analysis