Tesec Corporation (6337) AI Stock Analysis

• Market Cap: ¥16.12B
• Dividend Yield: 3.47%
• Average Volume (3M): 16.82K
• Price to Earnings (P/E): 53.4
• Beta (1Y): 1.20
• Revenue Growth: -14.79%
• EPS Growth: -41.15%
• Country: JP
• Employees: 212
• Sector: Technology
• Sector Strength: 88
• Industry: Semiconductors
• EPS (TTM): 36.92
• Shares Outstanding: 5,578,695
• 10 Day Avg. Volume: 12,600
• 30 Day Avg. Volume: 16,820
• PEG Ratio: -0.27
• Price to Book (P/B): 0.58
• Price to Sales (P/S): 1.39
• P/FCF Ratio: 4.77
• 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: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 70 Outperform
• Price Target: ¥3,021.00 ▲(47.37% Upside)

The score is driven primarily by a very strong balance sheet and supportive cash flow, which help offset cyclical risk. Technicals are bullish but appear overextended, and the high P/E valuation is a meaningful headwind.

Positive Factors

Very low leverage / strong balance sheet

Exceptionally low leverage provides durable financial flexibility through semiconductor capex cycles. With equity substantial relative to assets and minimal debt, the company can fund R&D, service the installed base, and preserve operations without forced external financing during downturns.

Strong cash generation in latest year

Operating cash flow materially exceeded reported earnings and free cash flow roughly matched net income in the latest year, supporting sustainable investment in product development and aftermarket service. Solid cash generation underpins dividends, capex and balance-sheet resilience.

After-sales recurring revenue from installed base

A capital-equipment business with recurring maintenance, parts and service revenues creates a durable annuity stream tied to installed systems. This after-sales income smooths volatility from new orders, supports customer lock-in, and enhances long-term margin visibility.

Negative Factors

Cyclicality tied to semiconductor capex

Revenue and profitability are highly dependent on semiconductor capital expenditure cycles. Historical swings—including past losses—mean multi-quarter downturns can materially depress orders, underutilize capacity, and delay revenue recognition, increasing earnings volatility.

Recent sharp margin compression

Margins declined steeply from prior cycle highs, indicating weaker pricing, lower volumes, or cost deleverage. Sustained margin pressure reduces reinvestment capacity and returns on equity, making profitability and cash conversion more sensitive to demand swings over the medium term.

Inconsistent cash flow conversion across years

While cash flow was strong in the latest year, conversion has been uneven historically with negative OCF/FCF in some years. That variability—likely from working-capital and investment swings—complicates long-term planning and can strain liquidity during prolonged revenue downturns.

Tesec Corporation Business Overview & Revenue Model

Company Description

TESEC Corporation designs, develops, manufactures, and sells semiconductor test equipment in Japan and internationally. It offers various test systems, including discrete device test systems, thermal resistance testers, inductive load testers, dynamic test systems, and IPD/IPM test systems. The company provides various handlers comprising micro electro mechanical systems, film frame test, gravity, and TAB handlers, as well as die sorters. In addition, it offers after-sales services, such as tester calibration, overhaul, and training services, as well as spare parts, warranty, maintenance, and resale services. The company was formerly known as TES Corporation and changed its name to TESEC Corporation in 1980. TESEC Corporation was incorporated in 1969 and is headquartered in Tokyo, Japan.

How the Company Makes Money

Tesec Corporation generates revenue through the sale of its testing equipment and related services to semiconductor manufacturers. The company's key revenue streams include product sales of testers and handlers, as well as after-sales services such as maintenance and support. Tesec may also engage in partnerships with semiconductor companies to provide customized testing solutions, which can contribute to its earnings. The demand for semiconductor testing equipment is driven by the growth of the semiconductor industry, technological advancements, and the need for higher performance and reliability in electronic devices.

Tesec Corporation Financial Statement Overview

Summary

Strong financial foundation with very low leverage (balance sheet strength) and generally solid cash generation, but profitability and revenue cooled sharply in FY2025 with notable margin compression, highlighting cyclical earnings volatility.

Income Statement

Profitability remains positive in the latest year, but fundamentals have clearly cooled versus the prior two years. Revenue fell about 8% in FY2025 and margins compressed sharply (net margin ~7% vs ~18% in FY2024 and ~26% in FY2023), pointing to weaker pricing/volume and/or cost deleverage. Longer term, the company has demonstrated it can be highly profitable in stronger cycles (FY2022–FY2024), but results show meaningful cyclicality with losses in FY2020–FY2021.

Balance Sheet

The balance sheet is a major strength: leverage is very low (debt-to-equity ~0.03 in FY2025, and effectively zero in several prior years), providing flexibility through semiconductor downcycles. Equity is substantial and stable relative to assets, and returns on equity are still positive in FY2025 (~3%), though down materially from FY2022–FY2024 levels—highlighting that earnings volatility, not financial leverage, is the key risk.

Cash Flow

Cash generation is solid overall and improved meaningfully in FY2025, with operating cash flow well above reported earnings (operating cash flow to net income ~2.1x) and free cash flow roughly matching earnings (free cash flow to net income ~1.0x). That said, cash flow conversion has been inconsistent across years (including negative operating and free cash flow in FY2022 and a notably weaker conversion year in FY2024), indicating working-capital and/or investment swings that can amplify cyclicality.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	5.67B	5.89B	8.62B	8.74B	7.51B	3.45B
Gross Profit	2.17B	2.23B	3.83B	4.09B	3.35B	842.00M
EBITDA	691.00M	787.00M	1.80B	2.20B	1.80B	-208.00M
Net Income	359.00M	427.00M	1.51B	2.25B	1.72B	-290.00M
Balance Sheet
Total Assets	15.23B	15.47B	16.16B	14.34B	12.89B	10.34B
Cash, Cash Equivalents and Short-Term Investments	4.28B	4.55B	4.69B	3.86B	2.61B	3.25B
Total Debt	312.00M	363.00M	0.00	0.00	0.00	0.00
Total Liabilities	1.44B	1.31B	1.68B	1.43B	1.59B	828.00M
Stockholders Equity	13.79B	14.16B	14.48B	12.91B	11.30B	9.51B
Cash Flow
Free Cash Flow	0.00	1.71B	576.00M	1.30B	-152.00M	506.00M
Operating Cash Flow	0.00	1.77B	871.00M	1.45B	-117.00M	542.00M
Investing Cash Flow	0.00	-900.00M	149.00M	-117.00M	-825.00M	30.00M
Financing Cash Flow	0.00	-495.00M	-691.00M	-676.00M	-58.00M	-112.00M

Tesec Corporation Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 2050.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:6337, the sentiment is Positive. The current price of 2050 is below the 20-day moving average (MA) of 2357.35, below the 50-day MA of 2159.24, and above the 200-day MA of 1850.56, indicating a bullish trend. The MACD of 178.86 indicates Negative momentum. The RSI at 90.41 is Negative, neither overbought nor oversold. The STOCH value of 91.23 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:6337.

Tesec Corporation Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
6627	74 Outperform	¥67.32B	21.65	―	1.85%	3.60%	-17.45%
6855	74 Outperform	¥60.60B	15.91	―	1.72%	36.31%	101.77%
6337	70 Outperform	¥16.12B	53.42	―	3.47%	-14.79%	-41.15%
6871	70 Outperform	¥342.62B	34.00	―	1.02%	29.60%	24.39%
6338	66 Neutral	¥8.08B	13.80	―	3.26%	-54.42%	-69.81%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
6707	55 Neutral	¥146.38B	127.51	―	―	-51.82%	-96.08%