THK Co (6481) AI Stock Analysis

• Market Cap: ¥494.06B
• Dividend Yield: 6.24%
• Average Volume (3M): 680.27K
• Price to Earnings (P/E): 56.0
• Beta (1Y): 1.00
• Revenue Growth: 2.63%
• EPS Growth: -34.53%
• Country: JP
• Employees: 13,268
• Sector: Industrials
• Sector Strength: 94
• Industry: Industrial - Machinery
• EPS (TTM): 2.75
• Shares Outstanding: 129,856,900
• 10 Day Avg. Volume: 558,240
• 30 Day Avg. Volume: 680,266
• PEG Ratio: -3.28
• Price to Book (P/B): 1.40
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 72.26K
• 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: ¥4,150.01
• Price Target Upside: 2.95% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 2

• Rating: 68 Neutral
• Price Target: ¥4,283.00 ▲(6.25%Upside)

THK Co's overall stock score is mainly driven by a stable financial foundation and strong technical indicators. The company's solid balance sheet and positive market momentum are significant strengths. However, high valuation ratios and declining profitability margins are notable risks that need addressing for improved long-term investor confidence.

THK Co Business Overview & Revenue Model

Company Description

THK Co., Ltd. manufactures and supplies machine components in Japan, the Americas, Europe, China, and internationally. The company provides linear motion (LM) guides, ball screws, ball splines, LM guide actuators, cross roller rings and tables, electric actuators and linear motor actuators, cam followers, roller followers, linear bushes, slide packs, slide rails, cross roller guides, linear ball slides, LM and flat rollers, spline nuts, LM strokes, screw nuts, change nuts, precision linear packs, link balls, rod ends, spherical plain bearings, lubrication accessories, and seismic isolation products. Its products are used in various applications, including machine tools, general industrial machinery, precision instruments, semiconductor and LCD manufacturing equipment, industrial robots, electronic devices, and transport systems, as well as in construction, aerospace, medical and assistive, and other manufacturing industries. The company was incorporated in 1946 and is headquartered in Tokyo, Japan.

How the Company Makes Money

THK Co. generates revenue primarily through the sale of its high-precision mechanical components, such as linear motion guides and ball screws, to a diverse range of industries including industrial machinery, automotive, electronics, and robotics. The company's key revenue streams include direct sales to manufacturers and distributors, as well as through strategic partnerships with other companies that integrate THK's components into their systems. Additionally, THK may engage in service agreements and maintenance contracts that provide recurring revenue. The company benefits from a strong global distribution network, allowing it to cater to customers worldwide, and it continuously invests in research and development to innovate and expand its product offerings, further driving sales and revenue growth.

THK Co Financial Statement Overview

Summary

THK Co demonstrates a stable financial foundation with strong equity and manageable debt levels. However, challenges such as declining profitability margins and inconsistent revenue growth require attention for sustainable long-term success. The company could benefit from strategic initiatives to enhance operational efficiency and cash flow generation.

Income Statement

THK Co's income statement shows stable revenue figures with minor fluctuations over the years. The gross profit margin for TTM is 23.3%, indicating a healthy profit generation from revenues. However, a declining trend in the net profit margin from 5.93% in 2024 to 2.49% in TTM suggests rising costs or declining efficiency. Revenue growth has been inconsistent, with a notable decrease in 2023 following a peak in 2022, which raises concerns about sustained growth momentum. EBIT and EBITDA margins have also experienced a decline, which could impact future profitability.

Balance Sheet

THK Co maintains a strong balance sheet with a debt-to-equity ratio of 0.34, indicating a conservative use of leverage. The equity ratio stands at 62.5%, showcasing a solid capital structure with a significant portion of assets funded by equity. However, the return on equity has decreased from 2.72% in 2024 to 2.74% in TTM, reflecting reduced efficiency in generating profits from shareholders' equity. Overall, the company displays financial stability but should focus on enhancing profitability.

Cash Flow

The cash flow statement reveals a mixed picture. Operating cash flow is positive and supports business operations, but the free cash flow has been volatile, recently turning positive in TTM after a negative figure in 2024. The free cash flow to net income ratio is low, reflecting tight liquidity. The company should focus on improving cash generation to support future investments and reduce reliance on external financing.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	352.76B	351.94B	393.69B	318.19B	219.00B
Gross Profit	81.78B	81.63B	105.29B	79.75B	46.43B
EBITDA	41.27B	47.82B	67.98B	48.13B	9.16B
Net Income	10.44B	18.40B	21.20B	23.01B	-11.86B
Balance Sheet
Total Assets	567.42B	556.35B	560.30B	516.09B	460.17B
Cash, Cash Equivalents and Short-Term Investments	140.29B	156.49B	165.34B	151.43B	158.85B
Total Debt	96.51B	121.61B	120.88B	101.76B	102.57B
Total Liabilities	177.62B	193.45B	223.02B	201.80B	185.03B
Stockholders Equity	383.64B	357.26B	331.89B	304.56B	266.49B
Cash Flow
Free Cash Flow	-1.15B	12.29B	8.15B	-3.60B	7.39B
Operating Cash Flow	28.41B	39.33B	37.56B	15.64B	25.40B
Investing Cash Flow	-34.22B	-27.09B	-30.08B	-19.13B	-18.41B
Financing Cash Flow	-22.65B	-24.27B	-3.65B	-12.72B	3.98B

THK Co Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 4031.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:6481, the sentiment is Positive. The current price of 4031 is above the 20-day moving average (MA) of 3864.62, above the 50-day MA of 3801.89, and above the 200-day MA of 3391.09, indicating a bullish trend. The MACD of 39.89 indicates Negative momentum. The RSI at 69.05 is Neutral, neither overbought nor oversold. The STOCH value of 79.11 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:6481.

THK Co Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
6481	68 Neutral	¥494.06B	56.05	2.48%	6.24%	2.63%	-34.53%
Sector *	67 Neutral	€8.36B	21.11	6.46%	2.82%	1.86%	-38.90%
HSYDF	―	$2.04B	78.28	4.32%	1.08%	―	―
J9R	―	€3.76B	33.87	9.67%	0.90%	―	―
NCTKF	―	$2.27B	26.89	4.03%	4.81%	―	―
SOHVF	―	$2.75B	988.54	0.06%	1.65%	―	―
6406	73 Outperform	¥452.90B	32.08		2.77%	5.17%	-18.61%

THK Co Corporate Events

THK Co. Revises Dividend Projection to Enhance Shareholder Returns

THK Co., Ltd. has revised its dividend projection for the year ending December 31, 2025, to ¥246.00 per share, split evenly between interim and year-end dividends. This decision aligns with their management policy aimed at achieving an ROE of over 10% and reflects their commitment to improving capital efficiency and returning profits to shareholders.

THK Co., Ltd. Reports First Quarter 2025 Financial Results and Updates Dividend Projection

THK Co., Ltd. reported a slight decrease in revenue for the first quarter of 2025, with significant declines in operating income and profits compared to the previous year. The company’s financial position showed a reduction in total assets and equity, and it announced a revised dividend projection for the year.