I'LL (TSE:3854) Stock Price Disconnect Deepens As Margins Improve

Investors treated I'LL like a problem stock over the past quarter, with the share price sliding about 11% in three months, yet the latest quarter reads more like a quiet upgrade to the investment case than a letdown. Basic earnings per share for Q4 were ¥49.75 on revenue of ¥5,345.59m, resulting in a trailing 12‑month profit at a 20% net margin. The key point is the gap between a stock priced for doubt and a business still generating solid earnings, which leads to a very different conversation once you dig into the details.

Is I'LL trading at a genuine discount, or does it only appear cheap on the surface because of those high non cash earnings and mixed dividend history? [Compare the current share price to the platform's full valuation breakdown on the valuation analysis for I'LL

Q4 2026 Earnings Summary

• Revenue (Q4 2026 vs. Q4 2025): ¥5,345.59m vs. ¥5,195.67m (up about 2.9%)
• Net Income (Q4 2026 vs. Q4 2025): ¥1,243.82m vs. ¥1,131.57m (up about 9.9%)
• Basic EPS (Q4 2026 vs. Q4 2025): ¥49.75 vs. ¥45.36 (up about 9.7%)
• Net Margin, Trailing 12 Months (Q4 2026 vs. prior year): 20.0% vs. 18.1% (margin widened by about 1.9 percentage points)

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I'LL earnings, where the bullish story still fits

For anyone leaning positive on I'LL as a steady digital enabler, the quarter broadly lines up with that view. Revenue moved from ¥5,195.67m to ¥5,345.59m and net income from ¥1,131.57m to ¥1,243.82m, so the engine is still producing more output. A trailing net margin of 20.0%, compared with 18.1% a year earlier, points to firmer profitability. That combination of higher sales and fatter margins supports the idea of a service focused IT group quietly improving its economics.

Bearish worries about I'LL only partly reflected

On the cautious side, recent share performance sends a different message. The stock fell about 11% over 90 days even as earnings and margin moved higher, which suggests lingering doubts about durability or growth quality. Concerns around project lumpiness or competition therefore cannot be dismissed. At the same time, the latest quarter does not show obvious deterioration in revenue, profit, or margin, so any bear case today rests more on perception and positioning than on clear cracks in the reported numbers.

Compare how I'LL's improving 20.0% net margin lines up against a share price that moved to ¥2,090 after the Q4 release. See the consensus price target analysis for I'LL to check whether analysts think this earnings trend justifies a different path for the stock.

Take Control Of Your Next Move

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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