Union Tool Co. (JP:6278)
:6278
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Union Tool Co.
(6278)
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Rating:80Outperform
Price Target:
¥25,714.00
▲(184.76% Upside)
Action:Reiterated
Date:05/15/26
The score is driven primarily by strong financial quality (high margins and a debt-free balance sheet) and supportive technical momentum (price above major moving averages with positive MACD). Offsetting factors are weaker recent cash conversion (free cash flow near breakeven) and a less attractive valuation (P/E ~25 with a low dividend yield).
Positive Factors
High Profitability / Margins
Consistently strong gross and EBIT margins indicate structural pricing power, efficient production and product mix that support durable operating cash generation and reinvestment capacity across cycles. High margins help sustain R&D and quality investments that reinforce competitive position.
Negative Factors
Weak Free Cash Flow / Cash Conversion
A collapse in FCF despite reported earnings signals working-capital strain or heavy reinvestment, reducing cash available for dividends, buybacks or opportunistic M&A. Persistent weak conversion would constrain shareholder return and make capital allocation more difficult.
Read all positive and negative factors
Positive Factors
Negative Factors
High Profitability / Margins
Consistently strong gross and EBIT margins indicate structural pricing power, efficient production and product mix that support durable operating cash generation and reinvestment capacity across cycles. High margins help sustain R&D and quality investments that reinforce competitive position.
Read all positive factors
Union Tool Co. (6278) vs. iShares MSCI Japan ETF (EWJ)
Market Cap
¥364.86B
Dividend Yield1.17%
Average Volume (3M)193.44K
Price to Earnings (P/E)19.7
Beta (1Y)1.35
Revenue Growth29.22%
EPS Growth29.50%
CountryJP
Employees1,454
SectorIndustrials
Sector Strength72
IndustryManufacturing - Tools & Accessories
Share Statistics
EPS (TTM)324.86
Shares Outstanding19,780,000
10 Day Avg. Volume167,400
30 Day Avg. Volume193,436
Financial Highlights & Ratios
PEG Ratio1.54
Price to Book (P/B)1.84
Price to Sales (P/S)3.67
P/FCF Ratio1.94K
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
EPS Forecast (FY)476.65
Revenue Forecast (FY)¥48.00B
Union Tool Co. Business Overview & Revenue Model
Company Description
Union Tool Co. produces and sells cutting tools, linear motion products, and metal machining equipment in Japan and internationally. It offers printed circuit board (PCB) drills/routers; PCB tools-related equipment, such as MDP drill pointers, rin...
How the Company Makes Money
Union Tool Co. generates revenue through the production and sale of precision cutting tools and machinery, with its primary income stemming from carbide end mills, drills, and PCB-related products. The company serves business-to-business customers...
Union Tool Co. Financial Statement Overview
Summary
Income Statement
86
Very Positive
Balance Sheet
95
Very Positive
Cash Flow
62
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 35.06B | 40.16B | 32.61B | 25.34B | 29.09B | 28.17B |
| Gross Profit | 14.43B | 16.04B | 13.10B | 8.94B | 11.52B | 10.55B |
| EBITDA | 10.92B | 11.98B | 9.73B | 6.44B | 8.78B | 8.07B |
| Net Income | 5.61B | 6.11B | 5.28B | 3.08B | 5.00B | 3.80B |
Balance Sheet | ||||||
| Total Assets | 80.98B | 88.20B | 78.86B | 70.61B | 69.14B | 64.53B |
| Cash, Cash Equivalents and Short-Term Investments | 18.50B | 18.11B | 18.13B | 20.07B | 20.97B | 17.58B |
| Total Debt | 435.00M | 0.00 | 427.00M | 186.00M | 890.00M | 313.00M |
| Total Liabilities | 6.87B | 8.20B | 5.72B | 3.32B | 5.51B | 5.47B |
| Stockholders Equity | 74.11B | 80.00B | 73.14B | 67.28B | 63.63B | 59.06B |
Cash Flow | ||||||
| Free Cash Flow | 0.00 | 76.00M | 3.18B | 228.00M | 4.18B | 3.21B |
| Operating Cash Flow | 0.00 | 7.51B | 7.28B | 4.69B | 6.71B | 5.83B |
| Investing Cash Flow | 0.00 | -6.80B | -7.27B | -5.01B | -1.96B | -3.16B |
| Financing Cash Flow | 0.00 | -2.26B | -1.68B | -1.61B | -1.55B | -1.44B |
Union Tool Co. Technical Analysis
Positive
9030.00
Price Trends
16244.60
Positive
13739.77
Positive
10742.49
Positive
Market Momentum
1175.51
Negative
64.52
Neutral
52.81
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:6278, the sentiment is Positive. The current price of 9030 is below the 20-day moving average (MA) of 18089.00, below the 50-day MA of 16244.60, and below the 200-day MA of 10742.49, indicating a bullish trend. The MACD of 1175.51 indicates Negative momentum. The RSI at 64.52 is Neutral, neither overbought nor oversold. The STOCH value of 52.81 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:6278.
Union Tool Co. Peers Comparison
UnderperformOutperform
Sector (63)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
81 Outperform | ¥281.73B | 8.85 | ― | 2.33% | 20.23% | 56.48% | |
80 Outperform | ¥364.86B | 19.71 | ― | 1.17% | 29.22% | 29.50% | |
76 Outperform | ¥21.99B | 14.08 | ― | 3.31% | 0.67% | 14.92% | |
74 Outperform | ¥314.37B | 11.92 | 7.86% | 2.55% | 5.68% | 41.20% | |
63 Neutral | $10.79B | 15.43 | 7.44% | 2.01% | 2.89% | -14.66% | |
62 Neutral | ¥139.14B | 26.06 | 2.64% | 2.30% | 0.90% | 15.74% | |
49 Neutral | ¥13.96B | 8.91 | ― | 6.98% | -6.57% | -4872.75% |
* Industrials Sector Average
JP:6278
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Union Tool Co. Corporate Events
Union Tool Confirms Full Take-Up of Third-Party Allotment to Fund Capacity Expansion
May 15, 2026
Union Tool has confirmed that the underwriter will subscribe in full to a third-party allotment of 270,000 treasury shares, priced at ¥15,645.80 per share, raising approximately ¥4.22 billion, with payment due on May 20, 2026. Following ...
Union Tool Lifts 2026 Earnings Outlook on AI-Driven Demand and Capacity Expansion
May 13, 2026
Union Tool has sharply raised its consolidated forecasts for the first half and full year ending December 31, 2026, projecting double-digit percentage increases in net sales and profits versus its February guidance and the prior year. The company ...
Union Tool Delivers Sharp Profit Surge on Strong First-Quarter Sales
May 13, 2026
Union Tool Co. reported strong consolidated results for the first quarter of fiscal 2026, with net sales climbing 42.6% year on year to ¥12.55 billion and operating profit surging 60.4% to ¥3.54 billion. Ordinary profit rose 82.0% to ...
Union Tool Sets Share Offer Pricing to Fund Major Plant Expansion and R&D
Apr 14, 2026
Union Tool Co. has set the disposal and selling prices for a large-scale disposal of treasury stock and secondary offering, pricing the public offering and over-allotment at ¥16,349 per share after a 7% discount to the market reference price....
Union Tool to Sell Treasury Shares to Fund Major Expansion of PCB Drill Capacity
Apr 6, 2026
Union Tool has approved the disposal of 1.8 million shares of treasury stock via a public offering and a secondary offering of up to 270,000 shares through over-allotment by the underwriter. Pricing will be set in mid-April based on market demand,...
Union Tool Weighs Cutting Investment Unit to Boost Share Liquidity
Mar 18, 2026
Union Tool Co. has outlined its stance on reducing the minimum investment unit for its shares, viewing a lower unit size as a way to invigorate the stock market. The company believes such a move could improve liquidity and make its stock more acce...
Union Tool Lifts Year-End Dividend, Adds Commemorative Payout for 65th Anniversary
Feb 24, 2026
Union Tool Co. has proposed a year-end dividend of 70 yen per share for the fiscal year ended December 31, 2025, up from 60 yen a year earlier, bringing the total annual dividend to 130 yen versus 105 yen previously. The plan, to be voted on at th...
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.