SK-Electronics Co., Ltd. (6677) AI Stock Analysis

• Market Cap: ¥37.86B
• Dividend Yield: 4.25%
• Average Volume (3M): 99.45K
• Price to Earnings (P/E): 13.7
• Beta (1Y): 0.90
• Revenue Growth: 13.45%
• EPS Growth: 19.19%
• Country: JP
• Employees: 387
• Sector: Technology
• Sector Strength: 88
• Industry: Hardware, Equipment & Parts
• EPS (TTM): 102.51
• Shares Outstanding: 11,368,400
• 10 Day Avg. Volume: 73,710
• 30 Day Avg. Volume: 99,450
• PEG Ratio: 0.57
• Price to Book (P/B): 0.86
• Price to Sales (P/S): 1.02
• P/FCF Ratio: 151.88
• 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): 313
• Revenue Forecast (FY): ¥31.36B

• Rating: 78 Outperform
• Price Target: ¥4,115.00 ▲(30.02% Upside)
• Action: Reiterated Date: 01/14/26
• Date: Action: Reiterated 01/14/26

The score is driven primarily by strong financial stability (zero debt and solid profitability) and supportive valuation (reasonable P/E with a strong dividend yield). Technicals also contribute positively as the stock trades above major moving averages with constructive momentum, while the key offset is weak and volatile free cash flow conversion.

Positive Factors

Debt-free balance sheet

Having total debt reported at zero provides durable financial flexibility: it lowers default and refinancing risk, enables funding of capex, dividends or bolt-on M&A from internal resources, and shields the company from rising rates over the next several quarters.

Improving operating cash flow

Consistent and improving operating cash flow strengthens earnings quality and working capital management. Sustained OCF around current levels supports ongoing operations, reinvestment, and shareholder returns even if free cash flow remains volatile, improving financial resilience.

Revenue recovery with solid margins

Revenue growth resuming alongside mid‑teens operating margins signals a durable turnaround from prior losses and structural improvement in the business model. Sustained profitable revenue expansion supports capacity utilization and long‑term cash generation potential.

Negative Factors

Weak free cash flow conversion

Very low free cash flow conversion limits the company's ability to sustainably fund dividends, buybacks, or large reinvestments without relying on working capital swings. This structural cash conversion gap is a key constraint on durable shareholder return capacity.

Margin compression vs prior peaks

A persistent step‑down from prior peak margins suggests either rising cost pressure or competitive pricing that could be structural. Lower margins reduce earnings sensitivity to revenue growth and constrain the company's ability to improve returns without structural cost or mix improvements.

Moderate return on equity

ROE near 8% indicates only moderate efficiency in converting equity into profits. Over a multi‑quarter horizon this limits the compounding of shareholder value absent either higher margins, faster revenue growth, or capital allocation changes to boost capital efficiency.

SK-Electronics Co., Ltd. Business Overview & Revenue Model

Company Description

SK-Electronics CO.,LTD. manufactures and sells large-format photomasks in Japan and internationally. The company offers photomasks for use in display panels, including liquid crystal displays, plasma display panel, OLEDs, and TSPs; and other electronic devices, such as semiconductor packages, light guides, micro electro mechanical systems, and other components and tools for equipment inspections. It also provides radio frequency identification products; and healthcare/medical devices, including electrical stimulators, carbonhand for self support, and stethoscopes and percussion hammers. The company was incorporated in 2001 and is headquartered in Kyoto, Japan.

How the Company Makes Money

SK-Electronics generates revenue primarily through the sale of its electronic components and systems to various industries, including consumer electronics, automotive, and industrial sectors. Key revenue streams include direct sales to OEMs (Original Equipment Manufacturers), contracts for custom electronic solutions, and long-term supply agreements with major corporations. The company also benefits from partnerships with technology firms and research institutions, allowing it to stay at the forefront of innovation and expand its product offerings. Additionally, SK-Electronics engages in R&D to develop next-generation technologies, which not only enhances its product portfolio but also opens up new markets, further contributing to its earnings.

SK-Electronics Co., Ltd. Financial Statement Overview

Summary

Strong balance sheet with zero debt and growing equity supports low financial risk and flexibility. Profitability is solid with revenue back to growth, but margins are below 2022–2023 levels. Cash generation is the main weak spot due to volatile and currently low free cash flow relative to earnings.

Income Statement

Profitability is solid in the latest annual period (2025): gross margin ~23.7%, operating margin ~13.2%, and net margin ~9.4%, with revenue returning to growth (~3.8%) after a decline in 2024. However, margins and earnings are below the stronger 2022–2023 levels (when net margin was ~12–13%), pointing to some normalization/pressure versus peak performance. The multi-year trend is still positive overall given the clear turnaround from 2020 losses to consistent profitability since 2021.

Balance Sheet

The balance sheet is a major strength: total debt is reported at zero in 2025 (down from 0.8–4.45B previously), implying very low financial risk and strong flexibility. Equity has steadily grown (to ~34.6B), supporting a healthy capital base. Returns on equity are positive but moderate (~7.9% in 2025, below ~10–12% in 2022–2023), suggesting the company is conservatively financed but not generating peak-level returns on its equity base.

Cash Flow

Operating cash flow is consistently positive and improved in 2025 (~5.1B vs ~3.9B in 2024), which supports earnings quality. The weakness is free cash flow volatility: strong in 2022–2023, negative in 2021 and 2024, and only modestly positive in 2025 (~0.20B). In 2025, free cash flow is low relative to net income (free cash flow to net income ~3.8%), indicating that cash conversion remains the key watch item despite decent operating cash generation.

Breakdown	Sep 2025	Sep 2024	Sep 2023	Sep 2022	Sep 2021
Income Statement
Total Revenue	29.19B	25.73B	28.11B	24.88B	20.44B
Gross Profit	6.92B	5.94B	7.51B	6.36B	3.87B
EBITDA	7.16B	5.90B	8.09B	7.32B	4.46B
Net Income	2.73B	2.29B	3.38B	3.32B	1.07B
Balance Sheet
Total Assets	42.52B	39.67B	41.81B	39.45B	32.88B
Cash, Cash Equivalents and Short-Term Investments	9.68B	12.48B	15.28B	13.93B	8.84B
Total Debt	495.50M	800.00M	1.60B	2.40B	3.35B
Total Liabilities	7.93B	7.51B	10.19B	10.85B	8.51B
Stockholders Equity	34.59B	32.17B	31.62B	28.60B	24.38B
Cash Flow
Free Cash Flow	195.54M	-258.52M	2.83B	5.76B	-636.59M
Operating Cash Flow	5.13B	3.89B	5.34B	6.27B	3.66B
Investing Cash Flow	-6.14B	-4.15B	-2.51B	-529.68M	-4.30B
Financing Cash Flow	-1.97B	-2.51B	-1.49B	-1.28B	-1.22B

SK-Electronics Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 3165.00
• 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:6677, the sentiment is Positive. The current price of 3165 is below the 20-day moving average (MA) of 3444.25, below the 50-day MA of 3302.70, and above the 200-day MA of 2889.33, indicating a bullish trend. The MACD of 80.73 indicates Negative momentum. The RSI at 67.29 is Neutral, neither overbought nor oversold. The STOCH value of 90.95 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:6677.

SK-Electronics Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
6677	78 Outperform	¥37.86B	13.70	―	4.25%	13.45%	19.19%
6915	77 Outperform	¥31.14B	12.54	―	4.78%	-7.10%	6.38%
6958	76 Outperform	¥42.42B	19.97	―	3.75%	2.98%	-56.70%
6800	74 Outperform	¥77.62B	38.22	―	2.20%	4.75%	164.54%
6266	69 Neutral	¥37.52B	10.54	―	1.63%	12.91%	11.46%
6999	65 Neutral	¥67.52B	25.01	2.45%	2.19%	5.79%	193.94%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%

SK-Electronics Co., Ltd. Corporate Events

SK-Electronics Posts Steady Profit Growth and Maintains Robust Balance Sheet in Q1 FY2026

SK-Electronics reported solid first-quarter results for the fiscal year ending September 2026, with net sales rising 5.0% year on year to ¥7.39 billion and operating profit increasing 7.8% to ¥1.29 billion. Ordinary profit and profit attributable to owners of the parent both recorded modest growth of 1.3% and 0.5% respectively, while basic earnings per share edged up to ¥102.51.

The company’s financial position remains strong, with total assets expanding to ¥43.27 billion and net assets to ¥34.69 billion, resulting in a high capital adequacy ratio of 80.2%. Stable profitability combined with a robust balance sheet suggests SK-Electronics retains significant financial resilience, supporting its ability to invest, withstand industry cycles, and maintain shareholder value.

The most recent analyst rating on (JP:6677) stock is a Buy with a Yen3825.00 price target. To see the full list of analyst forecasts on SK-Electronics Co., Ltd. stock, see the JP:6677 Stock Forecast page.