THK Co (6481) AI Stock Analysis

• Market Cap: $466.79B
• Dividend Yield: 6.01%
• Average Volume (3M): 771.40K
• Price to Earnings (P/E): 70.0
• Beta (1Y): 0.98
• 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: 0.95
• Enterprise Value/Revenue: 1.24
• Enterprise Value/Gross Profit: 5.44
• Enterprise Value/Ebitda: 10.56
• 1Y Price Target: $2,800.62
• Price Target Upside: -33.10% Downside
• Rating Consensus: Moderate Sell
• Number of Analyst Covering: 1
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 70 Neutral
• Price Target: ¥4,627.00 ▲(10.54% 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

Cash Flow Generation

Strong free cash flow growth indicates robust cash generation, providing THK Co with the flexibility to invest in growth opportunities and manage debt effectively.

Stable Financial Health

A stable financial position with manageable leverage supports THK Co's ability to withstand economic fluctuations and invest in strategic initiatives.

Market Position

As a key player in the global automation and manufacturing landscape, THK Co's strong market position enhances its competitive advantage and potential for sustained growth.

Negative Factors

Declining Profitability

Declining return on equity indicates reduced profitability, which may challenge THK Co's ability to generate returns for shareholders and sustain growth.

Profit Margin Pressure

Decreasing net profit margins suggest operational challenges, potentially impacting THK Co's ability to maintain profitability and invest in future growth.

Earnings Growth Concerns

Negative EPS growth reflects challenges in earnings expansion, which could hinder THK Co's capacity to increase shareholder value and fund strategic initiatives.

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 a stable financial foundation with strengths in cost management and a solid capital structure. However, challenges in revenue growth and cash flow efficiency highlight areas for strategic focus. Enhancing profitability and cash generation will be crucial for sustaining long-term growth and shareholder value.

Income Statement

THK Co's income statement shows mixed performance. The TTM data indicates a decline in revenue growth rate, suggesting challenges in maintaining sales momentum. However, the company maintains a stable gross profit margin around 23%, indicating efficient cost management. The net profit margin has decreased slightly in the TTM period, reflecting pressure on profitability. EBIT and EBITDA margins have shown some resilience, but the overall trend suggests a need for strategic improvements to boost revenue and profitability.

Balance Sheet

THK Co's balance sheet reflects a stable financial position with a manageable debt-to-equity ratio around 0.34 in the TTM period, indicating prudent leverage management. The equity ratio remains healthy, suggesting a strong capital structure. However, the return on equity has decreased over time, pointing to potential inefficiencies in generating returns from equity investments. Overall, the balance sheet is solid, but there is room for enhancing shareholder returns.

Cash Flow

The cash flow statement reveals significant volatility in free cash flow, with a notable improvement in the TTM period. However, the operating cash flow to net income ratio is relatively low, indicating challenges in converting earnings into cash. The free cash flow to net income ratio is also low, suggesting limited cash generation relative to profits. While there are positive signs of cash flow recovery, consistency and efficiency in cash generation remain areas for improvement.

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: 4186.00
• 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 4186 is above the 20-day moving average (MA) of 4011.45, above the 50-day MA of 4124.94, and above the 200-day MA of 3866.29, indicating a bullish trend. The MACD of 40.43 indicates Negative momentum. The RSI at 58.54 is Neutral, neither overbought nor oversold. The STOCH value of 76.22 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
6406	70 Outperform	¥431.72B	30.66	―	3.00%	0.32%	-15.41%
6481	70 Neutral	$466.79B	70.03	1.88%	6.01%	1.98%	-48.28%
6268	65 Neutral	$451.94B	28.30	5.25%	2.00%	-2.23%	130.96%
6324	64 Neutral	$267.61B	56.89	5.62%	0.51%	6.22%	―
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
5631	59 Neutral	€724.49B	38.70	11.66%	0.92%	10.11%	41.98%
6302	59 Neutral	¥527.25B	155.64	0.59%	2.86%	-2.67%	-85.21%

THK Co Corporate Events

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.

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.