THK Co (6481) AI Stock Analysis

• Market Cap: ¥551.93B
• Dividend Yield: 6.16%
• Average Volume (3M): 771.40K
• Price to Earnings (P/E): 84.2
• Beta (1Y): 0.93
• Revenue Growth: 1.98%
• EPS Growth: -48.28%
• Country: JP
• Employees: 13,268
• Sector: Industrials
• Sector Strength: 72
• Industry: Industrial - Machinery
• EPS (TTM): 13.66
• Shares Outstanding: 119,099,800
• 10 Day Avg. Volume: 838,710
• 30 Day Avg. Volume: 771,403
• PEG Ratio: -1.00
• Price to Book (P/B): 1.18
• Price to Sales (P/S): 1.28
• P/FCF Ratio: -391.91
• 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 Neutral
• Price Target: ¥5,270.00 ▲(29.90% Upside)

THK Co's stock score is driven by strong technical indicators and stable financial health, despite a high P/E ratio suggesting overvaluation. The robust dividend yield adds appeal, but declining profitability margins and return on equity pose challenges.

Positive Factors

Strong cash generation

A 142.3% TTM free cash flow expansion and healthy operating-CFO-to-net-income ratios indicate durable cash generation. Persistent FCF strength enhances the company's ability to fund R&D, capex, dividends and absorb demand swings without heavy external financing, supporting long-term flexibility and investment capacity.

Manageable leverage / solid balance sheet

A debt-to-equity ratio around 0.39 and a strong equity ratio reflect a conservative capital structure. Manageable leverage reduces refinancing risk, preserves borrowing capacity for strategic investments or cyclical downturns, and supports sustained operations and supplier/customer confidence over time.

Durable, design-in business model

THK's core linear-motion products are engineered into customers' machinery across automation, semiconductors, machine tools and robotics. 'Designed-in' status creates recurring aftermarket and replacement demand and high switching costs, producing a sticky revenue base and structural customer relationships that persist through cycles.

Negative Factors

Margin compression / weak returns

A decline in net margin from 5.2% to 1.8% (and falling ROE) signals deteriorating profitability. Sustained margin pressure erodes internally generated capital for reinvestment, suggests pricing or cost-headwind issues, and weakens return profiles that are critical to funding growth and rewarding shareholders long term.

Low revenue growth

Revenue growth of ~1.9% TTM is modest for a technology-linked industrial supplier. Limited top-line expansion constrains operating leverage and the ability to scale R&D or product investments, making it harder to offset margin pressure and to capitalize on structural demand in automation and semiconductors.

Dependence on capex cycles

THK's revenue correlates with customers' capital spending in cyclical sectors. This structural dependence creates revenue volatility tied to macro capex cycles, complicates capacity planning and margin stability, and can prolong recovery periods when end-market investment slows, limiting predictability of earnings.

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 linear motion products, which are essential in various industrial applications. The company's revenue model is built on direct sales to manufacturers and businesses in need of precision motion solutions. Key revenue streams include the sale of linear guides, ball screws, and actuators, which are often sold as standard or customized solutions to meet specific client needs. Additionally, THK engages in providing maintenance and technical support services for its products, contributing to recurring revenue. The company has established significant partnerships with major industrial players, enhancing its market presence and driving sales through collaborations in product development and distribution.

THK Co Financial Statement Overview

Summary

THK Co demonstrates stable financial health with a strong cash flow position and manageable leverage. However, declining profitability margins and return on equity indicate potential challenges in maintaining growth and operational efficiency.

Income Statement

THK Co's income statement shows moderate performance with a slight revenue growth in TTM (Trailing-Twelve-Months) at 1.9%. The gross profit margin is stable at around 23%, but the net profit margin has decreased to 1.8% from 5.2% in 2023, indicating pressure on profitability. EBIT and EBITDA margins are relatively stable, but lower than historical highs, suggesting operational challenges.

Balance Sheet

The balance sheet reflects a stable financial position with a debt-to-equity ratio of 0.39 in TTM, indicating manageable leverage. Return on equity has declined to 1.9% from 5.1% in 2023, showing reduced profitability. The equity ratio remains strong, suggesting a solid capital structure.

Cash Flow

Cash flow analysis reveals strong free cash flow growth of 142.3% in TTM, indicating improved cash generation. The operating cash flow to net income ratio is healthy at 0.40, and the free cash flow to net income ratio is 0.41, reflecting efficient cash conversion despite past volatility.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	355.86B	352.76B	351.94B	393.69B	318.19B	219.00B
Gross Profit	81.30B	81.78B	81.63B	105.29B	79.75B	46.43B
EBITDA	41.91B	41.27B	44.85B	56.33B	48.70B	9.16B
Net Income	6.50B	10.44B	18.40B	21.20B	23.01B	-9.99B
Balance Sheet
Total Assets	525.09B	567.42B	556.35B	560.30B	516.09B	460.17B
Cash, Cash Equivalents and Short-Term Investments	107.66B	140.29B	156.49B	163.84B	151.43B	158.85B
Total Debt	122.99B	96.51B	118.53B	120.88B	112.32B	113.39B
Total Liabilities	204.53B	177.62B	193.45B	223.02B	201.80B	185.03B
Stockholders Equity	316.59B	383.64B	357.26B	331.89B	304.56B	266.49B
Cash Flow
Free Cash Flow	15.12B	-1.15B	12.29B	8.15B	-3.60B	7.39B
Operating Cash Flow	36.74B	28.41B	39.33B	37.56B	15.64B	25.40B
Investing Cash Flow	-22.72B	-34.22B	-27.09B	-30.08B	-19.13B	-18.41B
Financing Cash Flow	-45.76B	-22.65B	-24.27B	-3.65B	-12.72B	3.98B

THK Co Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 4057.00
• 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:6481, the sentiment is Positive. The current price of 4057 is below the 20-day moving average (MA) of 4349.10, below the 50-day MA of 4132.34, and above the 200-day MA of 3886.96, indicating a bullish trend. The MACD of 176.01 indicates Negative momentum. The RSI at 80.97 is Negative, neither overbought nor oversold. The STOCH value of 88.93 is Negative, 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
6406	70 Outperform	¥429.97B	28.55	―	3.00%	0.32%	-15.41%
6481	70 Neutral	¥551.93B	84.23	1.88%	6.16%	1.98%	-48.28%
6268	65 Neutral	¥521.47B	32.93	5.25%	2.13%	-2.23%	130.96%
6324	64 Neutral	¥332.11B	71.21	5.62%	0.56%	6.22%	―
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
5631	59 Neutral	¥661.92B	29.46	11.66%	1.03%	10.11%	41.98%
6302	59 Neutral	¥648.41B	181.68	0.59%	2.95%	-2.67%	-85.21%

THK Co Corporate Events

THK Finalizes Sale of Automotive Subsidiaries, Corrects Currency in Disclosure

THK has corrected currency unit notations in a recent English disclosure related to the transfer of shares in several consolidated automotive subsidiaries and the assignment of associated receivables, clarifying that financial data for its Czech unit is in thousands of Czech koruna and for its Michigan unit in thousands of U.S. dollars rather than euros. At the same time, the company confirmed its board has approved the sale of all shares in TRA Holdings and its key THK RHYTHM automotive subsidiaries, along with related loans, to a special purpose company backed by funds serviced by Advantage Partners, a move aligned with THK’s strategy to boost ROE above 10% by tightening control of shareholders’ equity and completing the selection and concentration of its automotive and transportation business portfolio.

The most recent analyst rating on (JP:6481) stock is a Hold with a Yen5044.00 price target. To see the full list of analyst forecasts on THK Co stock, see the JP:6481 Stock Forecast page.

THK to Divest Automotive Subsidiaries to Boost Capital Efficiency and ROE

THK has decided to transfer all shares in several automotive-focused consolidated subsidiaries—including TRA Holdings and multiple THK RHYTHM entities in North America, Europe, and Asia—as well as all related loans receivable to a special purpose company backed by funds serviced by Advantage Partners. The move, approved by the board on February 2, 2026, is positioned as the culmination of THK’s selection-and-concentration strategy in its automotive & transportation business, reflecting a detailed review of cost of capital and return on invested capital and aimed at improving ROE and tightening control over shareholders’ equity, with significant implications for the company’s portfolio mix and future capital efficiency.

The most recent analyst rating on (JP:6481) stock is a Hold with a Yen5044.00 price target. To see the full list of analyst forecasts on THK Co stock, see the JP:6481 Stock Forecast page.

THK Co. Revises 2025 Financial Forecasts Amid Weaker Orders

THK Co., Ltd. has revised its financial forecasts for the year ending December 31, 2025, due to weaker-than-expected orders in the industrial machinery business across Japan and Europe. The company anticipates lower consolidated revenue and profit margins, impacted by U.S. tariffs and structural reforms. However, non-consolidated ordinary and net income are expected to exceed initial forecasts due to increased dividend income from subsidiaries.

The most recent analyst rating on (JP:6481) stock is a Hold with a Yen4704.00 price target. To see the full list of analyst forecasts on THK Co stock, see the JP:6481 Stock Forecast page.

THK Co. Reports Mixed Financial Results Amid Revenue Growth

THK Co., Ltd. reported a slight increase in revenue for the nine months ending September 30, 2025, but experienced significant declines in operating income and profit compared to the previous year. The company’s financial position showed a decrease in total assets and equity, and it adjusted its profit forecasts for the year. Despite these challenges, THK maintained its dividend policy, projecting a total dividend of 246 yen per share for the year, reflecting its commitment to shareholders.

The most recent analyst rating on (JP:6481) stock is a Hold with a Yen4704.00 price target. To see the full list of analyst forecasts on THK Co stock, see the JP:6481 Stock Forecast page.