THK Co Ltd (JP:6481)
:6481
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THK Co
(6481)
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Rating:55Neutral
Price Target:
¥5,617.00
▲(38.45% Upside)
Action:ReiteratedDate:02/18/26
The score is held back primarily by weakened financial performance, driven by the steep revenue drop and large net loss in 2025. Supporting the rating are improving cash generation (solid positive free cash flow) and constructive technical momentum (price above key moving averages with positive MACD). Valuation is a secondary drag due to the very high P/E, partially offset by the strong dividend yield.
Positive Factors
Strong cash generation
THK’s turn to solid positive free cash flow (~23.9B) and stronger operating cash flow provides durable liquidity and internal funding capacity. Over 2–6 months this supports working-capital needs, maintenance capex, dividend support and resilience through cyclical end-market swings without immediate reliance on external financing.
Negative Factors
Sharp revenue decline and net loss
A 32.4% revenue drop and swing to a large net loss show pronounced exposure to industrial capex weakness. This magnitude of demand shock creates persistent uncertainty about recovery timing and increases the risk that fixed costs, customer mix shifts, or structural demand changes will depress earnings for multiple quarters.
Read all positive and negative factors
Positive Factors
Negative Factors
Strong cash generation
THK’s turn to solid positive free cash flow (~23.9B) and stronger operating cash flow provides durable liquidity and internal funding capacity. Over 2–6 months this supports working-capital needs, maintenance capex, dividend support and resilience through cyclical end-market swings without immediate reliance on external financing.
Read all positive factors
THK Co (6481) vs. iShares MSCI Japan ETF (EWJ)
Market Cap
¥514.96B
Dividend Yield6.16%
Average Volume (3M)771.40K
Price to Earnings (P/E)―
Beta (1Y)0.92
Revenue Growth1.98%
EPS Growth-48.28%
CountryJP
Employees13,268
SectorIndustrials
Sector Strength72
IndustryIndustrial - Machinery
Share Statistics
EPS (TTM)-665.04
Shares Outstanding119,099,800
10 Day Avg. Volume838,710
30 Day Avg. Volume771,403
Financial Highlights & Ratios
PEG Ratio<0.01
Price to Book (P/B)1.73
Price to Sales (P/S)1.88
P/FCF Ratio18.98
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
EPS Forecast (FY)211.82
Revenue Forecast (FY)¥287.21B
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, el...
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 m...
THK Co Earnings Call Summary
Earnings Call Date:Aug 07, 2024
(Q2-2024)
| % Change Since: |
Next Earnings Date:May 07, 2026
Earnings Call Sentiment Neutral
The earnings call presents a mixed outlook for THK. While there are notable achievements in areas like the Automotive and Transportation business's profitability and promising growth in the Industrial Machinery sector, as well as sustainability initiatives, the significant declines in sales revenue and operating income, combined with challenges in multiple regions, highlight the company's ongoing struggles.Positive Updates
Automotive and Transportation Business Profitability
The Automotive and Transportation business posted an increase in operating income due to efforts aimed at improving profitability, with positive contributions including a volume effect of JPY 0.2 billion, a variable cost ratio effect of JPY 1.2 billion, and an FX impact of JPY 0.5 billion.
Negative Updates
Decline in Consolidated Sales Revenue
Consolidated sales revenue declined 3.1% year-on-year to JPY 179.8 billion.
Read all updates
Q2-2024 Updates
Positive
Negative
Automotive and Transportation Business Profitability
The Automotive and Transportation business posted an increase in operating income due to efforts aimed at improving profitability, with positive contributions including a volume effect of JPY 0.2 billion, a variable cost ratio effect of JPY 1.2 billion, and an FX impact of JPY 0.5 billion.
Read all positive updates
Company Guidance
During the Q2 2024 earnings call, Takashi Teramachi, President and COO of THK, provided an overview of the company's financial performance for the first half of the fiscal year ending December 2024. Consolidated sales revenue declined by 3.1% year-on-year to JPY 179.8 billion, with operating income decreasing by 49% to JPY 8.3 billion. Despite these declines, both metrics exceeded initial targets due to a gradual demand recovery in the Industrial Machinery business and favorable foreign exchange effects. The Automotive and Transportation business saw an improvement in operating income, driven by profitability enhancement efforts, although it faced a JPY 0.8 billion increase in fixed costs and a JPY 0.6 billion decline from the absence of a previous onetime subsidy. Total assets increased by JPY 30.4 billion to JPY 586.7 billion. The company maintained its growth strategy pillars and outlined key initiatives, including a focus on raising ROE and ROIC, expanding the business domain, and reinforcing sustainability and ESG initiatives. THK plans to allocate capital for future growth investments, maintaining a dividend payout ratio of 30%, with potential share buybacks considered when capital is excess.THK Co Financial Statement Overview
Summary
Income Statement
38
Negative
Balance Sheet
57
Neutral
Cash Flow
64
Positive
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 240.44B | 352.76B | 351.94B | 393.69B | 318.19B |
| Gross Profit | 70.50B | 77.87B | 77.98B | 101.78B | 76.54B |
| EBITDA | 40.45B | 41.13B | 44.48B | 67.13B | 47.51B |
| Net Income | -69.89B | 10.44B | 18.40B | 21.20B | 23.01B |
Balance Sheet | |||||
| Total Assets | 472.99B | 567.42B | 556.35B | 560.30B | 516.09B |
| Cash, Cash Equivalents and Short-Term Investments | 110.01B | 138.29B | 156.49B | 163.84B | 151.43B |
| Total Debt | 123.20B | 105.58B | 118.53B | 131.07B | 112.32B |
| Total Liabilities | 207.24B | 177.62B | 193.45B | 223.02B | 201.79B |
| Stockholders Equity | 261.33B | 383.64B | 357.26B | 331.89B | 304.56B |
Cash Flow | |||||
| Free Cash Flow | 23.85B | -1.15B | 12.29B | 8.15B | -3.60B |
| Operating Cash Flow | 42.75B | 28.41B | 39.33B | 37.56B | 15.64B |
| Investing Cash Flow | -19.80B | -34.22B | -27.09B | -33.32B | -19.13B |
| Financing Cash Flow | -42.05B | -22.65B | -24.27B | -409.00M | -12.72B |
THK Co Technical Analysis
Neutral
4057.00
Price Trends
4816.60
Negative
4384.01
Positive
4151.08
Positive
Market Momentum
-42.96
Positive
38.09
Neutral
13.36
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:6481, the sentiment is Neutral. The current price of 4057 is below the 20-day moving average (MA) of 5069.40, below the 50-day MA of 4816.60, and below the 200-day MA of 4151.08, indicating a neutral trend. The MACD of -42.96 indicates Positive momentum. The RSI at 38.09 is Neutral, neither overbought nor oversold. The STOCH value of 13.36 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for JP:6481.
THK Co Peers Comparison
UnderperformOutperform
Sector (63)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
81 Outperform | ¥239.71B | 9.64 | 8.91% | 3.85% | 1.48% | 8.86% | |
75 Outperform | ¥277.44B | 14.76 | ― | 2.50% | 6.16% | 17.11% | |
73 Outperform | ¥261.07B | 14.24 | ― | 1.65% | 14.49% | -21.17% | |
71 Outperform | ¥475.50B | 26.32 | 5.25% | 2.13% | -2.23% | 130.96% | |
63 Neutral | $10.79B | 15.43 | 7.44% | 2.01% | 2.89% | -14.66% | |
58 Neutral | $368.21B | 197.68 | 5.94% | 0.56% | 6.22% | ― | |
55 Neutral | ¥514.96B | -6.48 | 1.88% | 6.16% | 1.98% | -48.28% |
* Industrials Sector Average
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THK Co Corporate Events
THK to Switch Long-Standing Auditor to KPMG AZSA for Fresh Global Perspective
Feb 19, 2026
THK Co., Ltd. has decided to replace its long-standing accounting auditor, Grant Thornton Taiyo LLC, with KPMG AZSA LLC, pending approval at its 56th general shareholders meeting scheduled for March 20, 2026. The change, following an engagement th...
THK Launches Special Career Support Program to Drive Organizational Renewal
Feb 12, 2026
THK has approved a Special Measures for the Next Career Support Program aimed at helping eligible employees pursue new opportunities outside the company while advancing its PMVV-based growth strategy. By promoting autonomous career development, ge...
THK Swings to Deep Loss as Automotive Business Exit Drives Gap With Forecasts
Feb 12, 2026
THK Co., Ltd. reported significant deviations between its earlier forecasts and actual results for the year ended December 31, 2025, largely due to the reclassification and liquidation of its automotive and transportation business. While revenue, ...
THK Swings to Net Loss on Business Reclassification but Signals 2026 Profit Rebound
Feb 12, 2026
THK Co., Ltd. reported 2025 revenue of ¥240.4 billion from continuing operations, up 7.9% year on year, but operating income fell 9.3% to ¥14.4 billion and profit before tax declined 11.9% to ¥15.7 billion. A reclassification of the...
THK Finalizes Sale of Automotive Subsidiaries, Corrects Currency in Disclosure
Feb 3, 2026
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 u...
THK to Divest Automotive Subsidiaries to Boost Capital Efficiency and ROE
Feb 2, 2026
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 spec...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.