Kubota (6326) AI Stock Analysis

• Market Cap: $1.85T
• Dividend Yield: 2.79%
• Average Volume (3M): 4.63M
• Price to Earnings (P/E): 9.4
• Beta (1Y): 1.16
• Revenue Growth: -2.02%
• EPS Growth: -16.84%
• Country: JP
• Employees: 52,094
• Sector: Industrials
• Sector Strength: 90
• Industry: Agricultural - Machinery
• EPS (TTM): 35.97
• Shares Outstanding: 1,150,896,900
• 10 Day Avg. Volume: 5,808,010
• 30 Day Avg. Volume: 4,625,960
• PEG Ratio: -0.69
• Price to Book (P/B): 0.76
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 16.54
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $1,755.23
• Price Target Upside: 9.43% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 4

• Rating: 70 Outperform
• Price Target: ¥1,733.00 ▲(8.04%Upside)

Kubota's overall stock score is driven by strong financial performance and attractive valuation, despite technical indicators pointing to a bearish trend. The company's robust profit margins, effective equity utilization, and undervaluation compared to peers are key strengths. However, market momentum suggests caution due to the stock's current downtrend.

Positive Factors

Foreign Exchange Impact

Kubota's earnings and share price benefit significantly from a weaker yen, which could become an upside factor if the depreciation trend continues.

Management and Strategy

A major management reshuffle could lead to a meaningful announcement and potentially a major upgrade to the company's shareholder returns policy.

Retail Sales Recovery

Kubota expects retail sales volumes of compact construction machinery to recover slightly if interest rates continue to be lowered.

Negative Factors

Earnings Challenges

Earnings are unlikely to rise in the near term due to excess inventory in the North American compact construction machinery market.

Operating Profit Forecast

The initial guidance for the next fiscal year forecasts an 11% drop in operating profit, influenced by adverse foreign exchange effects.

Tariff Impact

Kubota only produces around 40% of agricultural machinery and 10% of construction machinery in the US, so it expects to be impacted if tariffs are raised.

Kubota Business Overview & Revenue Model

Company Description

Kubota Corporation manufactures and markets machinery and related solutions in the food, water, and environment markets in Japan, North America, Europe, Asia, and internationally. It operates in three segments: Farm & Industrial Machinery, Water & Environment, and Other. The Farm & Industrial Machinery segment offers tractors, power tillers, combine harvesters, rice transplanters, turf equipment, utility vehicles, other agricultural machinery, implements, attachments, post-harvest machinery, vegetable production equipment, and other agricultural equipment; cooperative drying, rice seedling, and gardening facilities; rice mill plants; scales, weighing and measuring control systems, and air purifiers; engines for farming, construction, industrial machinery, and generators; and mini excavators, wheel and skid steer loaders, compact track and, and other construction machinery related products. The Water & Environment segment provides ductile iron and plastic pipes, valves, and single stack drain fittings, as well as design and construction services; reformer and cracking tubes, hearth and steel mill rolls, TXAX friction materials, and spiral welded steel pipes; air-conditioning equipment; wastewater treatment equipment and plants, pumps and plants, membrane solutions, flue gas desulfurization apparatus, membrane methane fermentation plants, and bathtubs; and water purification, night-soil treatment, waste incinerating and melting, and waste shredding and sorting plants. The Other segment offers logistics; and roofing and siding materials. The company also engages in non-life insurance underwriting, finance leasing and factoring services, building maintenance, security guarding, transportation, storage, distribution, and cargo handling businesses; and export and import of repair parts related to farm equipment, engines, and construction machinery. It serves customers through a network of dealers. The company was founded in 1890 and is headquartered in Osaka, Japan.

How the Company Makes Money

Kubota makes money through the sale of its wide range of machinery and equipment primarily in the agricultural and construction sectors. Its main revenue streams include the sale of tractors, combine harvesters, and construction equipment like excavators and loaders. Additionally, the company generates income from the sale of engines and water technology-related products. Kubota also benefits from a global distribution network and various strategic partnerships that help expand its market reach and enhance its earnings potential. The company's focus on innovation and sustainability further contributes to its competitive edge and financial performance.

Kubota Financial Statement Overview

Summary

Kubota presents a financially stable entity with strong profitability and operational efficiency. The income statement shows healthy margins, though revenue growth has stagnated. The balance sheet displays a solid equity foundation despite increased leverage, which could introduce risk if debt levels continue to rise. Cash flow management has improved recently, but historical volatility suggests a need for caution. Overall, Kubota's financial health is sound but requires attention to revenue growth and leverage management.

Income Statement

Kubota has demonstrated a stable revenue trajectory with a slight dip in 2024. The Gross Profit Margin improved slightly to 30.77% in 2024, indicating better cost management. The Net Profit Margin also remained strong at 7.64%. However, revenue growth was stagnant due to the slight decrease from the previous year. The EBIT and EBITDA margins were healthy, at 10.97% and 14.45% respectively, showcasing operational efficiency. Overall, profitability and operational efficiency are strengths, but stagnant revenue growth is a concern.

Balance Sheet

The Debt-to-Equity Ratio increased to 0.92, indicating a higher leverage but still within reasonable limits for the industry. The Return on Equity (ROE) was strong at 9.30%, reflecting effective use of equity to generate earnings. The Equity Ratio, at 41.15%, suggests a solid balance between debt and equity financing. The balance sheet reflects strength in equity but notes increased leverage, which could pose potential risks if not managed carefully.

Cash Flow

Kubota's free cash flow turned positive in 2024 to ¥68.09 billion, showing improvement in cash generation. The Operating Cash Flow to Net Income Ratio was robust at 1.22, indicating good cash conversion from earnings. The Free Cash Flow to Net Income Ratio improved significantly, indicating better cash management. However, prior periods showed volatility, suggesting potential risks in cash flow stability.

Breakdown
TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
2.95T	3.02T	3.02T	2.68T	2.20T	1.85T
	Gross Profit
908.08B	927.98B	876.47B	696.52B	631.81B	534.85B
	EBIT
284.07B	330.97B	328.83B	218.94B	246.21B	175.28B
	EBITDA
411.15B	462.40B	454.81B	322.40B	325.61B	254.91B
	Net Income Common Stockholders
198.86B	230.44B	238.46B	156.47B	174.76B	128.52B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
210.17B	295.13B	305.14B	297.31B	309.51B	272.89B
	Total Assets
5.77T	6.02T	5.36T	4.73T	3.77T	3.19T
	Total Debt
2.18T	2.28T	1.99T	1.61T	1.09T	874.44B
	Net Debt
1.97T	1.98T	1.77T	1.39T	835.87B	651.52B
	Total Liabilities
3.12T	3.28T	2.94T	2.65T	1.99T	1.62T
	Stockholders Equity
2.40T	2.48T	2.18T	1.88T	1.68T	1.48T
Cash Flow		Free Cash Flow
110.61B	68.09B	-189.75B	-177.33B	-33.21B	58.17B
	Operating Cash Flow
285.21B	282.08B	-17.27B	-7.68B	92.51B	142.92B
	Investing Cash Flow
-201.70B	-208.88B	-173.44B	-318.50B	-127.37B	-47.13B
	Financing Cash Flow
-133.33B	-26.28B	178.40B	282.56B	60.59B	-68.35B

Kubota Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 1604.00
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:6326, the sentiment is Negative. The current price of 1604 is below the 20-day moving average (MA) of 1618.23, below the 50-day MA of 1647.92, and below the 200-day MA of 1857.29, indicating a bearish trend. The MACD of -14.26 indicates Negative momentum. The RSI at 45.70 is Neutral, neither overbought nor oversold. The STOCH value of 48.54 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:6326.

Kubota Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
6326	70 Outperform	$1.85T	9.41	8.29%	2.79%	-2.02%	-16.84%
Sector *	66 Neutral	$4.50B	12.29	5.40%	248.66%	4.13%	-12.33%
HTCMF		$6.54B	12.28	9.99%	3.75%	―	―
TN0		€745.11M	14.75	4.46%	2.37%	―	―
6301	79 Outperform	¥4.13T	9.44		4.25%	5.97%	13.78%
6310	54 Neutral	¥32.83B	―		2.07%	1.56%	-720.36%
6432		¥217.21B	8.25		4.39%	―	―

Kubota Corporate Events

Kubota Reports No Share Repurchase in May 2025

Kubota Corporation announced that no shares were repurchased during the specified period of May 2025, despite a board resolution allowing for the repurchase of up to 16 million shares. This decision reflects the company’s current strategic focus and may influence its financial positioning and shareholder relations.

The most recent analyst rating on (JP:6326) stock is a Hold with a Yen2300.00 price target. To see the full list of analyst forecasts on Kubota stock, see the JP:6326 Stock Forecast page.

Kubota Announces No Share Repurchases in April 2025

Kubota Corporation announced that it did not repurchase any of its own shares during the specified period from April 23 to April 30, 2025, despite having a board resolution authorizing the repurchase of up to 16 million shares or ¥20 billion worth of shares by December 15, 2025. The lack of repurchase activity may impact the company’s stock market strategy and shareholder value, as share buybacks are often used to return value to shareholders and adjust capital structure.

Kubota Announces Strategic Share Repurchase Plan

Kubota Corporation has announced a share repurchase plan to enhance shareholder value by buying back up to 16 million common shares, representing 1.4% of its total shares, for a maximum of ¥20 billion. This strategic move, set to occur between April 23 and December 15, 2025, aims to increase the value per share and return profits to shareholders, potentially strengthening Kubota’s market position and investor appeal.