Mitsubishi Electric (6503) AI Stock Analysis

• Market Cap: ¥12.59T
• Dividend Yield: 1.19%
• Average Volume (3M): 4.92M
• Price to Earnings (P/E): 33.0
• Beta (1Y): 1.48
• Revenue Growth: 4.62%
• EPS Growth: 40.65%
• Country: JP
• Employees: 149,914
• Sector: Industrials
• Sector Strength: 72
• Industry: Electrical Equipment & Parts
• EPS (TTM): 53.11
• Shares Outstanding: 2,113,201,700
• 10 Day Avg. Volume: 6,056,250
• 30 Day Avg. Volume: 4,920,096
• PEG Ratio: 1.19
• Price to Book (P/B): 1.43
• Price to Sales (P/S): 1.03
• P/FCF Ratio: 21.62
• 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: ¥5,677.97
• Price Target Upside: -3.27% Downside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 11
• EPS Forecast (FY): 174.97
• Revenue Forecast (FY): ¥5.75T

• Rating: 71 Outperform
• Price Target: ¥6,537.00 ▲(11.36% Upside)
• Action: Reiterated Date: 02/05/26
• Date: Action: Reiterated 02/05/26

The score is driven primarily by solid financial strength (notably low leverage and improving profitability) and strong technical momentum. Offsetting factors are inconsistent/declining free cash flow trends and a relatively high P/E with a low dividend yield, which makes the stock less compelling on valuation.

Positive Factors

Conservative balance sheet

Very low leverage and rising equity provide durable financial flexibility to fund capex, R&D, or bid on large, long-cycle infrastructure projects without relying on external financing. Improving ROE signals better capital efficiency, supporting sustainable returns over multiple cycles.

Accelerating revenue and margins

Sustained revenue acceleration with improving gross and operating margins indicates operational leverage and better mix or pricing power. This trend supports reinvestment in products and services and strengthens medium-term earnings capacity if execution and market demand persist.

Diversified, recurring revenue base

Wide product mix across factory automation, infrastructure, building systems, HVAC, automotive and electronic devices plus recurring service contracts and long-term supply deals smooth revenue volatility. Structural demand for automation and infrastructure underpins steady mid-term revenue visibility.

Negative Factors

Volatile free cash flow

Inconsistent FCF generation undermines the durability of internally funded investments, dividends, or buybacks. Volatility in cash conversion and occasional negative years make capital allocation and funding of long-cycle projects less predictable, raising execution risk over multiple quarters.

Modest net margins

Mid-single-digit net margins leave limited buffer against cost inflation, pricing pressure, or project overruns. Limited margin headroom reduces resilience in downturns and constrains the ability to rapidly expand investments or absorb input-cost shocks while maintaining profitability.

Exposure to cyclical & external risks

Large dependence on capital spending cycles, infrastructure budgets and automotive production creates structural revenue sensitivity to macro and policy shifts. Supply-chain and input-cost volatility can lengthen project cycles and compress margins, reducing predictability across 2-6 months.

Mitsubishi Electric Business Overview & Revenue Model

Company Description

Mitsubishi Electric Corporation develops, manufactures, distributes, and sells electrical and electronic equipment worldwide. The company offers turbine generators, hydraulic turbine generators, nuclear power plant and power electronics equipment, motors, transformers, circuit breakers, gas insulated switchgears, switch controls, surveillance-system control and security systems, transmission and distribution ICT systems, large display devices, locomotive and rolling stock electrical equipment, wireless and wired communications systems, network camera systems, elevators, escalators, building security and management systems, and others. It also provides programmable logic controllers, inverters, servomotors, human-machine interfaces, hoists, magnetic switches, circuit breakers, time and power meters, uninterruptible power supply, industrial fans, computerized numerical controllers, electrical-discharge and laser processing machines, industrial robots, clutches, automotive electrical equipment, electric powertrain systems, car electronics and mechatronics, car multimedia, and others. In addition, the company offers satellite communications and radar equipment, satellites, antennas, missile and fire control systems, broadcasting and information systems equipment, network security systems, and systems integration products; and power modules, high-frequency devices, optical and LCD devices, and others. Further, it provides air conditioners, chillers, showcases, compressors, refrigeration units, air-to-water heat pump boilers, ventilators, hot water supply systems, IH cooking heaters, LED bulbs, indoor lighting, LCD televisions, refrigerators, electric fans, dehumidifiers, air purifiers, vacuum cleaners, jar rice cookers, microwave ovens, and others. Additionally, the company offers procurement, logistics, real estate, advertising, finance, and other services. Mitsubishi Electric Corporation was incorporated in 1921 and is headquartered in Tokyo, Japan.

How the Company Makes Money

Mitsubishi Electric generates revenue through a diversified model that includes the sale of its core products, systems integration services, and maintenance contracts. Key revenue streams include industrial automation solutions, which cater to manufacturers seeking to enhance productivity and efficiency, and building systems, which cover HVAC systems, elevators, and other infrastructure-related technologies. Additionally, the company earns revenue from its semiconductor and display systems divisions, which supply essential components for various electronic devices. Significant partnerships with other technology firms and collaborations in smart city initiatives also bolster revenue generation, while ongoing investments in R&D enable Mitsubishi Electric to innovate and maintain a competitive edge in the market.

Mitsubishi Electric Financial Statement Overview

Summary

Strong balance sheet with very low leverage (debt-to-equity ~0.09) and improving ROE (~9.3% TTM) supports resilience. Income statement trends are solid with accelerating revenue growth (~19% TTM) and improving margins, but net margin remains mid-single-digit (~6.6%). Cash flow is the main drag: free cash flow is positive (~¥317B) yet volatile and down vs the prior annual period (TTM FCF growth ~-8.4%), lowering confidence in consistency.

Income Statement

TTM (Trailing-Twelve-Months) results show solid profitability with improving margins versus prior years (gross margin ~33.6%, EBIT margin ~7.5%, net margin ~6.6%). Revenue growth is positive and appears to be accelerating (TTM growth ~19% vs ~5% in recent annual periods), supporting earnings momentum. The main weakness is that absolute net margin remains mid-single-digit, which leaves less cushion if costs rise or demand softens.

Balance Sheet

The balance sheet looks conservative: leverage is low with debt-to-equity around 0.09 in both TTM (Trailing-Twelve-Months) and the latest annual period, and equity has grown over time. Returns on equity are healthy and trending higher (about 9.3% TTM vs ~6.6% in 2023), indicating improving capital efficiency. A watch item is that returns are good but not exceptional for a high-quality industrial, so execution needs to remain strong to sustain the upward trend.

Cash Flow

Cash generation is positive in TTM (Trailing-Twelve-Months) with free cash flow of ~¥317B, and free cash flow covers a meaningful portion of net income (about 65%). However, free cash flow is down versus the prior annual period (TTM free cash flow growth ~-8.4%), and cash conversion is not consistently strong across the cycle (including a year with negative free cash flow in 2023). This volatility tempers confidence in near-term cash consistency despite the current positive level.

Breakdown	TTM	Mar 2026	Mar 2025	Mar 2024	Mar 2023	Mar 2022
Income Statement
Total Revenue	5.68T	5.52T	5.26T	5.00T	4.48T	4.19T
Gross Profit	1.85T	1.69T	1.55T	1.41T	1.26T	1.17T
EBITDA	631.91B	532.44B	450.87B	476.19B	458.86B	443.51B
Net Income	374.25B	324.08B	284.95B	213.91B	203.48B	193.13B
Balance Sheet
Total Assets	6.66T	6.38T	6.17T	5.58T	5.11T	4.80T
Cash, Cash Equivalents and Short-Term Investments	719.24B	757.33B	765.38B	645.87B	727.18B	767.41B
Total Debt	355.44B	462.29B	501.29B	505.05B	394.71B	434.71B
Total Liabilities	2.36T	2.30T	2.30T	2.22T	2.01T	1.93T
Stockholders Equity	4.16T	3.95T	3.74T	3.24T	2.98T	2.75T
Cash Flow
Free Cash Flow	316.80B	261.92B	239.72B	-8.85B	126.31B	353.76B
Operating Cash Flow	490.67B	455.90B	415.48B	166.71B	282.37B	542.12B
Investing Cash Flow	-196.46B	-206.16B	-105.47B	-150.38B	-117.56B	-176.26B
Financing Cash Flow	-331.58B	-250.92B	-228.76B	-117.72B	-238.63B	-157.64B

Mitsubishi Electric Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 5870.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:6503, the sentiment is Positive. The current price of 5870 is above the 20-day moving average (MA) of 5567.05, above the 50-day MA of 5107.90, and above the 200-day MA of 3981.76, indicating a bullish trend. The MACD of 233.03 indicates Negative momentum. The RSI at 68.85 is Neutral, neither overbought nor oversold. The STOCH value of 83.67 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:6503.

Mitsubishi Electric Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
6674	73 Outperform	¥557.69B	16.36	8.89%	2.12%	3.05%	-16.11%
6506	72 Outperform	$1.44T	38.61	13.26%	1.49%	-2.18%	30.16%
5803	72 Outperform	¥7.38T	51.29	32.32%	0.91%	27.53%	137.34%
6503	71 Outperform	¥12.59T	33.01	10.23%	1.19%	4.62%	40.65%
6504	64 Neutral	¥1.99T	23.82	12.05%	1.50%	5.44%	-5.19%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
5801	61 Neutral	¥1.98T	37.68	10.06%	1.21%	10.52%	60.75%

Mitsubishi Electric Corporate Events

Mitsubishi Electric Reshapes HR Structure and Elevates Executives Ahead of April 2026

Mitsubishi Electric announced organizational and executive changes effective April 1, 2026, following a board decision in Tokyo. The Corporate Human Resources Group will be renamed the Corporate Human Resources & Culture Transformation Group, consolidating corporate culture reform initiatives with human resources strategy to strengthen execution from an employee-centric perspective.

The company also detailed a refreshed executive officer structure, including promotions of Kunihiko Kaga and Noriyuki Takazawa to Representative Executive Officer, Executive Vice President roles, while confirming continuity for key leaders like President & CEO Kei Uruma and several senior vice presidents. These changes signal a greater emphasis on technology strategy, digital innovation, human capital management, and governance alignment, which may sharpen Mitsubishi Electric’s operational efficiency and cultural transformation efforts across its global business areas.

The most recent analyst rating on (JP:6503) stock is a Buy with a Yen6800.00 price target. To see the full list of analyst forecasts on Mitsubishi Electric stock, see the JP:6503 Stock Forecast page.

Mitsubishi Electric Books ¥100 Billion Cost as Next-Stage Support Program Draws 4,700 Applicants

Mitsubishi Electric has reported the outcome of its “Next-Stage Support Program,” a voluntary separation initiative for contracted employees in Japan aged 53 and over, which was open from mid-December 2025 to early January 2026 and offers enhanced retirement settlements and re-employment support. The program, combined with similar streamlining measures at group companies to reshape organizational structures, has attracted around 4,700 applications group-wide, including 2,378 from Mitsubishi Electric alone, and is expected to generate a group-wide cost impact of about 100 billion yen in the fiscal year ending March 2026, prompting the company to revise its consolidated earnings forecast for the year in light of these restructuring expenses and the current business environment.

The most recent analyst rating on (JP:6503) stock is a Buy with a Yen5361.00 price target. To see the full list of analyst forecasts on Mitsubishi Electric stock, see the JP:6503 Stock Forecast page.

Mitsubishi Electric Lifts Full-Year Outlook on Record Q3 Revenue and Profit

Mitsubishi Electric reported record third-quarter fiscal 2026 revenue of ¥1,423.5 billion and record operating profit of ¥144.7 billion when excluding the impact of its Next-Stage Support Program, driven by strong sales in the Infrastructure segment, robust performance in Factory Automation Systems, a weaker yen, and ongoing pricing and profitability initiatives. For the full fiscal year ending March 31, 2026, the company raised its forecast to revenue of ¥5,760.0 billion and operating profit of ¥500.0 billion on the same basis, signaling improved earnings momentum as it pursues measures to bolster management resilience, enhance efficiency and profitability, and invest for future growth, which collectively strengthen its competitive position and outlook for stakeholders.

The most recent analyst rating on (JP:6503) stock is a Buy with a Yen5361.00 price target. To see the full list of analyst forecasts on Mitsubishi Electric stock, see the JP:6503 Stock Forecast page.

Mitsubishi Electric Finalizes Full Acquisition of OT Security Firm Nozomi Networks

Mitsubishi Electric has completed the full acquisition of U.S.-based Nozomi Networks Inc., a specialist in developing and selling operational technology (OT) security solutions, making the fast-growing cybersecurity firm a wholly owned subsidiary as of January 28, 2026. The deal strengthens Mitsubishi Electric’s position in industrial and infrastructure security by integrating Nozomi’s OT security capabilities and rapidly expanding revenue base into its broader portfolio, and the company indicated it will update investors if the transaction leads to changes in its consolidated performance outlook or triggers further disclosure obligations.

The most recent analyst rating on (JP:6503) stock is a Buy with a Yen5401.00 price target. To see the full list of analyst forecasts on Mitsubishi Electric stock, see the JP:6503 Stock Forecast page.