Breaking Down JustSystems Corporation Financial Health: Key Insights for Investors

Curious whether JustSystems Corporation (4686.T) is a buy, hold or simply a standout case study in corporate solidity? This deep dive peels back the numbers: six‑month net sales rose 17.5% to ¥25,951 million, trailing‑twelve‑months revenue reached ¥48,407 million (up 15.01%), and fiscal 2025 net sales were ¥44,551 million-while quarterly revenue hit ¥13,090 million for the period ending September 30, 2025; profitability is robust with a TTM net profit margin of 27.67%, operating margin at 33.84% and ROE of 13.18%, cash and equivalents stand at ¥95,526 million and a net cash position of ¥111,050 million supports a debt‑free balance sheet and an equity ratio of 87.36%; valuation metrics show a market cap of ¥322.40 billion (P/E 23.44, P/S 6.78, P/B 2.92) and EV/EBITDA of 9.47, while risks include an accrual ratio of 0.31 and an effective tax rate of 32.29%-read on to unpack what these exact figures mean for investors, valuation, liquidity and growth potential.

JustSystems Corporation (4686.T) - Revenue Analysis

• Net sales for the six months ending September 30, 2025: ¥25,951 million (YoY +17.5%).
• Quarterly revenue for period ending September 30, 2025: ¥13,090 million (QoQ/quarter-over-year growth +16.4%).
• Fiscal year net sales (FY ending March 31, 2025): ¥44,551 million (YoY +8.7%).
• Trailing twelve months (TTM) revenue as of September 2025: ¥48,407 million (TTM growth +15.01%).
• Revenue per employee: ~¥162.99 million.
• Market capitalization (as of December 12, 2025): ¥322.40 billion; Price-to-Sales (P/S) ratio: 6.78.

• Interpretation pointers for investors:
  • Consistent double-digit growth in recent periods (six-month and TTM) indicates strong revenue momentum versus the single-digit FY growth for FY2025.
  • High revenue per employee (~¥163M) suggests operational efficiency and scalable revenue generation.
  • P/S of 6.78 implies market premium pricing relative to sales-assess profitability margins and growth sustainability to justify valuation.
• For broader corporate context and historical background, see: JustSystems Corporation: History, Ownership, Mission, How It Works & Makes Money

JustSystems Corporation (4686.T) Profitability Metrics

Recent results for the six months ending September 30, 2025 show meaningful improvement across core profitability measures for JustSystems Corporation (4686.T).

• Gross profit: ¥20,880 million (up from ¥17,403 million year-over-year)
• Operating profit: ¥12,049 million (up 22.9% YoY)
• Profit attributable to owners of the parent: ¥8,291 million (up 25.4% YoY)

Key takeaways for investors include the combination of elevated margins and double‑digit growth in operating profit and net income, suggesting both revenue quality and cost control are contributing to earnings expansion. For broader investor context and shareholder activity, see: Exploring JustSystems Corporation Investor Profile: Who's Buying and Why?

JustSystems Corporation (4686.T) - Debt vs. Equity Structure

• Debt-to-equity ratio: 0 (debt-free balance sheet).
• Equity ratio (trailing twelve months): 87.36% - indicates high financial stability and low reliance on external financing.
• Equity-to-asset ratio: 85.0% (net assets/total assets basis).

• Asset growth: Total assets increased by ¥11,373 million year-over-year (from ¥121,040m to ¥132,413m), supporting expansion or retained earnings accumulation.
• Net worth scale: Net assets of ¥112,545 million provide a substantial equity cushion relative to liabilities (virtually none).
• Market vs. book: Market cap of ¥322.40 billion and P/B of 2.92 imply investors value the company at nearly three times book value - reflecting expectations for earnings, profitability, or intangible asset strength.
• Enterprise value context: EV of ¥217.14 billion factors out the cash/debt position (debt-free), offering an alternative view of valuation relative to operating performance.

JustSystems Corporation (4686.T) Liquidity and Solvency

• Current ratio: 6.13 - indicates ample ability to meet short-term liabilities with current assets.
• Quick ratio: 5.81 - shows near-immediate liquidity excluding inventories, signaling minimal short-term liquidity risk.
• Cash and cash equivalents (as of 30 Jun 2025): ¥95,526 million - a substantial liquid reserve.
• Net cash position: ¥111,050 million - company holds more cash than interest-bearing debt, providing a buffer versus financial stress.
• Operating cash flow (TTM): ¥16.81 billion - ongoing operations generate healthy cash inflows.
• Free cash flow (TTM): ¥16.77 billion - strong ability to fund capital expenditures, dividends, buybacks or debt reduction from operations.

• Balance-sheet strength: High current and quick ratios reduce short-term default risk and provide flexibility for opportunistic capital allocation.
• Liquidity buffer: ¥95.5bn in cash and a net cash surplus of ¥111.05bn support weathering cyclical downturns or pursuing M&A without immediate financing needs.
• Cash generation: Operating and free cash flows near parity (¥16.81bn vs. ¥16.77bn) indicate low capex requirements and efficient conversion of revenue to free cash.
• Investor implication: The combination of strong liquidity, net cash, and robust free cash flow enhances capacity for shareholder returns or strategic investments.

JustSystems Corporation (4686.T) - Valuation Analysis

JustSystems Corporation (4686.T) exhibits valuation metrics consistent with a mature software company trading at a premium to sales and book value while showing moderate enterprise-based multiples.

• Trailing twelve months (TTM) price-to-earnings (P/E): 23.44
• Price-to-sales (P/S): 6.78
• Price-to-book (P/B): 2.92
• Enterprise value / EBITDA (EV/EBITDA): 9.47
• Enterprise value / Free cash flow (EV/FCF): 12.95
• Market capitalization (as of 2025-12-12): ¥322.40 billion

Key takeaways from these multiples:

• P/E 23.44 signals investors are paying for above-average earnings growth or stability relative to lower-P/E peers.
• P/S 6.78 implies a premium on revenue-typical for software firms with recurring revenue and high margins.
• P/B 2.92 reflects market confidence in intangible assets, brand, and intellectual property beyond net tangible assets.
• EV/EBITDA 9.47 indicates a reasonable enterprise-level valuation versus operating profitability, often used for cross-cap comparisons.
• EV/FCF 12.95 shows the market prices the company's free cash flow at a mid-range multiple-balance between growth and cash-generation risk.

For context on corporate strategy and how these valuation levels align with long-term direction, see Mission Statement, Vision, & Core Values (2026) of JustSystems Corporation.

JustSystems Corporation (4686.T) - Risk Factors

• Accrual risk: The accrual ratio for the year ending September 2025 was 0.31, indicating that reported statutory profit was not fully supported by free cash flow - a sign that earnings quality may be vulnerable to non-cash accounting items or timing differences in working capital.
• Profitability sensitivity: The trailing twelve months (TTM) return on assets (ROA) is 10.11%, a moderate level that implies only limited buffer if asset utilization weakens or margins compress.
• Market volatility: A beta of 0.88 suggests lower volatility relative to the broader market, which can reduce downside in turbulent markets but may also limit upside during strong rallies.
• Tax burden: The effective tax rate stands at 32.29%, which materially reduces net income and cash available to shareholders compared with peers in lower-tax jurisdictions.
• Valuation and momentum risk: Market capitalization rose 48.24% over the past year and the 52‑week price change is +52.08%, reflecting strong investor sentiment that could reverse if growth disappoints or macro conditions worsen.

• Operational risk: A gap between cash generation and reported profits can constrain reinvestment or dividend capacity if persistent.
• Market risk: Elevated share price momentum increases sensitivity to growth misses; reduced volatility (beta <1) may not protect against sector-specific shocks.
• Regulatory/tax risk: A 32.29% effective tax rate heightens exposure to any adverse changes in tax policy or profit shifting limitations.
• Reputational/competitive risk: Sustaining ROA near current levels requires continued product-market fit and cost discipline.

JustSystems Corporation (4686.T) - Growth Opportunities

• TTM revenue growth: 15.01% - sustained top-line momentum supports reinvestment and scale.
• Operating margin: 33.84% - healthy profitability that can fund R&D, sales expansion, or strategic acquisitions.
• Return on equity (ROE): 13.18% - demonstrates effective use of equity capital with room to improve through capital allocation and leverage optimization.
• Market capitalization change (1Y): +48.24% - strong market re-rating signals confidence from investors and potential access to capital at attractive valuations.
• 52-week price change: +52.08% - reflects positive investor sentiment and momentum investing interest.
• Beta: 0.88 - lower volatility than the market, making the stock potentially attractive to risk-averse investors seeking growth with relative stability.

• Investing operating cash flow into targeted geographic or vertical expansion to sustain or accelerate the 15.01% TTM revenue growth.
• Leveraging the 33.84% operating margin to increase R&D and product differentiation without diluting equity.
• Using improved market capitalization (+48.24% Y/Y) to pursue bolt-on acquisitions that enhance recurring revenue or technology stack.
• Marketing the stock's lower beta (0.88) and robust price performance (+52.08% 52-week) to attract long-only and risk-averse institutional investors.
• Optimizing capital structure and share repurchase or dividend policies to lift ROE above the current 13.18% level.