Makita Corporation (6586) AI Stock Analysis

• Market Cap: ¥1.42T
• Dividend Yield: 2.18%
• Average Volume (3M): 640.20K
• Price to Earnings (P/E): 16.7
• Beta (1Y): 1.11
• Revenue Growth: -1.72%
• EPS Growth: 31.58%
• Country: JP
• Employees: 17,641
• Sector: Industrials
• Sector Strength: 72
• Industry: Manufacturing - Tools & Accessories
• EPS (TTM): 70.77
• Shares Outstanding: 280,017,550
• 10 Day Avg. Volume: 753,990
• 30 Day Avg. Volume: 640,196
• PEG Ratio: 0.20
• Price to Book (P/B): 1.43
• Price to Sales (P/S): 1.76
• P/FCF Ratio: 11.80
• 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: ¥6,100.00
• Price Target Upside: 16.50% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 2
• EPS Forecast (FY): 285.38
• Revenue Forecast (FY): ¥764.70B

• Rating: 77 Outperform
• Price Target: ¥6,869.00 ▲(31.19% Upside)
• Action: Reiterated Date: 01/31/26
• Date: Action: Reiterated 01/31/26

The score is driven primarily by strong financial performance, especially the conservative balance sheet and improved profitability. Technicals are constructive with price above major moving averages, but momentum looks stretched with RSI near 70. Valuation is reasonable (mid-teens P/E) with a moderate dividend yield, providing some support but not a major catalyst.

Positive Factors

Conservative balance sheet

Makita's extremely conservative balance sheet (very low leverage and ~¥1.01T equity) provides durable financial flexibility. Low debt reduces interest burden, supports capital allocation (capex/dividends/M&A) and increases resilience through construction and cyclical downturns.

Improved profitability and margins

Sustained margin recovery versus prior troughs shows pricing power and effective cost control. Higher structural profitability enhances cash generation, funds reinvestment in battery platforms and product R&D, and creates a more durable earnings base independent of cyclical revenue swings.

Strong cash generation

Solid operating cash flow and high FCF conversion (~81% of net income) indicate earnings quality and funding capacity. Reliable FCF supports steady capex for new cordless/OPE platforms, recurring battery/accessory investment, and shareholder returns without relying on external financing.

Negative Factors

Stagnant revenue growth

Revenue growth is modest and essentially flat, limiting the benefits of operating leverage. Long-term value creation will depend on new product cycles, market share gains, or expansion into adjacencies; absent stronger top-line momentum, profit gains may be harder to sustain.

Cooling and volatile cash conversion

Although absolute cash generation is strong, TTM free cash flow declined and cash conversion has cooled with past negative OCF/FCF episodes. This volatility reduces predictability for capex, R&D, and shareholder returns, raising execution risk in weaker demand environments.

Rising absolute debt level

Total debt increased materially versus FY2025 levels, even though leverage remains low. If revenue stagnation or margin pressures persist, higher absolute debt raises interest and refinancing exposure and could constrain financial flexibility for strategic investments or shareholder distributions.

Makita Corporation Business Overview & Revenue Model

Company Description

Makita Corporation engages in the manufacture and sale of electric power tools, pneumatic tools, and gardening and household equipment in Japan, Europe, North America, rest of Asia, Central and South America, Oceania, and the Middle East and Africa. The company offers cordless, drilling/fastening, impact drilling/demolition, grinding/sanding, sawing, planning/routering, pneumatic, outdoor power, and dust extraction/other equipment, as well as accessories; and cutting equipment for new materials, masonry, and metals. It provides its products under the Makita brand. The company was formerly known as Makita Electric Works, Ltd. and changed its name to Makita Corporation in April 1991. Makita Corporation was founded in 1915 and is headquartered in Anjo, Japan.

How the Company Makes Money

Makita Corporation generates revenue primarily through the sale of its power tools and outdoor equipment. The company has a diversified revenue model that includes direct sales to retailers, distributors, and end-users, as well as international sales through its extensive global network. Key revenue streams include sales of cordless tools, electric tools, and outdoor power equipment. Additionally, Makita benefits from a strong brand reputation and customer loyalty, which contribute to repeat purchases. The company also engages in partnerships with various retailers and distributors to expand its market reach. Factors such as the growing demand for power tools in construction and renovation projects, as well as increasing interest in DIY home improvement, positively influence its earnings.

Makita Corporation Financial Statement Overview

Summary

Strong overall fundamentals led by a very conservative balance sheet (very low leverage) and a clear profitability/margin recovery (TTM operating margin ~14.1%, net margin ~10.0%). Offsets are modest top-line growth (~1.6% FY2025) and softer/declining recent cash flow momentum (TTM FCF down ~7.2% with mixed cash conversion).

Income Statement

Makita’s profitability profile has strengthened materially versus FY2023–FY2024: TTM (Trailing-Twelve-Months) gross margin is ~36.6% and net margin is ~10.0%, both well above the prior-cycle lows (FY2023 net margin ~1.5%). Earnings power looks solid with TTM operating margin ~14.1% and healthy EBITDA margin ~18.1%. The main offset is growth: revenue is essentially flat in the latest annual period (FY2025 revenue growth ~1.6%), suggesting the improved profit picture is being driven more by margin recovery than top-line momentum.

Balance Sheet

The balance sheet is a clear strength: leverage is very low with TTM debt-to-equity ~0.03 and substantial equity (~¥1.01T) supporting a large asset base (~¥1.19T). Returns on equity are respectable at ~7.9% in TTM (and ~8.6% in FY2025), reflecting good profitability without reliance on debt. A watch item is the increase in total debt versus FY2025 (TTM total debt ~¥34.9B vs ~¥10.2B), though leverage remains conservative overall.

Cash Flow

Cash generation is positive and supportive in TTM (operating cash flow ~¥94.5B; free cash flow ~¥76.0B), and free cash flow is a solid ~81% of net income, indicating decent earnings quality. However, cash conversion has cooled versus FY2024–FY2025: cash flow relative to profits is lower in TTM (operating cash flow is ~0.67x net income), and free cash flow growth is negative in TTM (about -7.2%). The historical track record also shows volatility (notably negative operating/free cash flow in FY2022), which keeps the score below the balance sheet and income statement.

Breakdown	TTM	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	753.35B	753.13B	741.39B	764.70B	739.26B	608.33B
Gross Profit	275.45B	271.43B	223.94B	188.75B	228.32B	203.05B
EBITDA	130.78B	136.79B	95.09B	54.13B	112.73B	104.95B
Net Income	75.01B	79.34B	43.69B	11.71B	64.77B	62.02B
Balance Sheet
Total Assets	1.19T	1.11T	1.06T	1.10T	1.01T	812.88B
Cash, Cash Equivalents and Short-Term Investments	285.11B	253.28B	196.65B	162.72B	71.06B	148.64B
Total Debt	19.13B	30.10B	40.32B	203.62B	96.46B	16.45B
Total Liabilities	181.42B	174.03B	180.60B	323.65B	254.97B	149.55B
Stockholders Equity	1.01T	926.00B	868.16B	769.25B	746.34B	657.86B
Cash Flow
Free Cash Flow	76.05B	112.28B	219.24B	5.34B	-163.60B	14.68B
Operating Cash Flow	94.46B	129.87B	237.09B	44.43B	-103.66B	64.54B
Investing Cash Flow	-22.30B	-37.87B	-25.62B	-37.68B	-27.89B	-42.91B
Financing Cash Flow	-64.03B	-33.55B	-191.28B	80.97B	52.63B	-23.04B

Makita Corporation Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 5236.00
• 50DMA: Negative
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:6586, the sentiment is Negative. The current price of 5236 is below the 20-day moving average (MA) of 5663.95, below the 50-day MA of 5489.36, and above the 200-day MA of 4883.93, indicating a neutral trend. The MACD of -87.26 indicates Positive momentum. The RSI at 37.76 is Neutral, neither overbought nor oversold. The STOCH value of 21.27 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:6586.

Makita Corporation Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
6586	77 Outperform	¥1.42T	16.74	―	2.18%	-1.72%	31.58%
6278	76 Outperform	¥256.03B	24.11	―	1.17%	29.51%	48.81%
5851	72 Outperform	¥78.39B	7.91	6.66%	3.36%	3.80%	-15.46%
6136	72 Outperform	¥235.48B	13.29	7.86%	2.55%	0.57%	4.54%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
6474	62 Neutral	¥111.43B	17.03	2.64%	2.30%	-4.11%	46.76%
6141	57 Neutral	¥355.05B	15.50	11.46%	3.77%	-9.34%	164.21%

Makita Corporation Corporate Events

Makita Begins Execution of Multi-Billion-Yen Share Buyback Program

Makita Corporation has disclosed the initial status of its new share buyback program, repurchasing 174,300 common shares for a total of 931,168,500 yen on January 30, 2026. The move is part of a broader board-approved authorization allowing buybacks of up to 10 million shares, or 3.78% of issued shares excluding treasury stock, for a maximum of 40 billion yen through May 31, 2026.

The early execution of the repurchase plan signals Makita’s active use of capital to enhance shareholder returns and potentially support its share price in the market. While the shares bought back so far represent only a small fraction of the total authorization, the scale and duration of the program underscore management’s commitment to capital efficiency and may be closely watched by investors assessing the company’s financial strategy.

The most recent analyst rating on (JP:6586) stock is a Buy with a Yen6100.00 price target. To see the full list of analyst forecasts on Makita Corporation stock, see the JP:6586 Stock Forecast page.

Makita Lifts Full-Year Earnings Forecast on Resilient Sales and Weaker Yen

Makita Corporation has raised its consolidated earnings forecast for the fiscal year ending March 31, 2026, citing resilient sales and more favorable foreign exchange assumptions despite a challenging demand environment. The company now expects revenue of ¥760 billion and operating profit of ¥100 billion, both higher than its October 2025 projections and modestly above the prior year’s revenue, supported by sales promotion efforts and a weaker yen against the U.S. dollar, euro and renminbi, which is boosting reported revenue and profit for shareholders.

The most recent analyst rating on (JP:6586) stock is a Buy with a Yen5786.00 price target. To see the full list of analyst forecasts on Makita Corporation stock, see the JP:6586 Stock Forecast page.

Makita Approves Up to ¥40 Billion Share Buyback to Boost Shareholder Returns

Makita Corporation’s board of directors has approved a share buyback program authorizing the repurchase of up to 10 million common shares, representing about 3.78% of its outstanding stock, for a total expenditure of up to 40 billion yen between January 30 and May 31, 2026. The move, framed as part of Makita’s basic profit distribution policy, is intended to flexibly return profits to shareholders and may support earnings per share and capital efficiency, signaling management’s confidence in the company’s valuation and financial position.

The most recent analyst rating on (JP:6586) stock is a Buy with a Yen5786.00 price target. To see the full list of analyst forecasts on Makita Corporation stock, see the JP:6586 Stock Forecast page.

Makita Lifts Operating Profit on Modest Sales Growth, Keeps Dividend Outlook Steady

Makita Corporation reported consolidated results for the nine months ended December 31, 2025, showing modest revenue growth to ¥568.6 billion, up 3.3% year-on-year, while operating profit surged 76.6% to ¥76.2 billion as profitability recovered. Profit attributable to owners of the parent rose 7.2% to ¥57.6 billion despite higher comprehensive income in the prior year, and the company’s balance sheet remained strong with total assets of ¥1.19 trillion and an equity ratio above 80%, underscoring a conservative financial position; the dividend forecast for the fiscal year ending March 31, 2026 remains unchanged so far, signaling management’s confidence in stable shareholder returns amid improved earnings efficiency.

The most recent analyst rating on (JP:6586) stock is a Buy with a Yen5786.00 price target. To see the full list of analyst forecasts on Makita Corporation stock, see the JP:6586 Stock Forecast page.