Renesas Electronics Corporation (JP:6723)
:6723
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Renesas Electronics
(6723)
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Rating:67Neutral
Price Target:
¥4,182.00
▲(49.62% Upside)
Action:Reiterated
Date:05/15/26
The score is primarily driven by mixed fundamentals: strong cash flow and a solid balance sheet are tempered by a recent swing to losses. Technicals are a clear positive with strong trend and momentum. Valuation is reasonable on P/E but supported by a low dividend yield. The latest earnings call adds moderate support via a Q1 beat and Q2 revenue growth outlook, but guidance for margin compression and ongoing supply/cost headwinds limits upside.
Positive Factors
Cash generation
Consistently strong operating cash flow (~¥425B TTM) and robust free cash flow (~¥340B) provide durable internal funding for R&D, capacity spending and working capital. This cash buffer supports multi‑year programs, cushions cyclicality, and reduces reliance on external financing.
Negative Factors
Earnings volatility
A swing from multi-year profitability to a TTM net loss, and a larger loss in 2025, signals weakened earnings quality and greater volatility. Persistent earnings weakness would impair returns, constrain reinvestment cadence and complicate long‑term planning for multi‑year automotive programs.
Read all positive and negative factors
Positive Factors
Negative Factors
Cash generation
Consistently strong operating cash flow (~¥425B TTM) and robust free cash flow (~¥340B) provide durable internal funding for R&D, capacity spending and working capital. This cash buffer supports multi‑year programs, cushions cyclicality, and reduces reliance on external financing.
Read all positive factors
Renesas Electronics (6723) vs. iShares MSCI Japan ETF (EWJ)
Market Cap
¥6.22T
Dividend Yield1.31%
Average Volume (3M)11.54M
Price to Earnings (P/E)14.3
Beta (1Y)1.43
Revenue Growth6.68%
EPS Growth-106.55%
CountryJP
Employees21,204
SectorTechnology
Sector Strength88
IndustrySemiconductors
Share Statistics
EPS (TTM)-6.29
Shares Outstanding1,870,614,900
10 Day Avg. Volume12,754,450
30 Day Avg. Volume11,541,726
Financial Highlights & Ratios
PEG Ratio0.61
Price to Book (P/B)1.58
Price to Sales (P/S)2.93
P/FCF Ratio11.11
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
¥3,716.67Price Target Upside32.98% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering9
EPS Forecast (FY)199.77
Revenue Forecast (FY)¥1.53T
Renesas Electronics Business Overview & Revenue Model
Company Description
Renesas Electronics Corporation researches, develops, designs, manufactures, sells, and services semiconductors in Japan, China, North America, Europe, rest of Asia, and internationally. The company operates through Automotive Business and Industr...
How the Company Makes Money
Renesas primarily makes money by selling semiconductor products (and related embedded solutions) to equipment manufacturers and system suppliers, with revenue recognized from shipments of chips and, in some cases, associated software/solutions tha...
Renesas Electronics Earnings Call Summary
Earnings Call Date:Apr 24, 2026
(Q1-2026)
| % Change Since: |
Next Earnings Date:Jul 23, 2026
Earnings Call Sentiment Neutral
The call presents a mix of strong demand and execution positives (Q1 beat vs guidance, rising utilization, product ramps such as R‑Car Gen4, AI/data center demand, and a significant CapEx plan) tempered by meaningful near‑term constraints and margin pressure (supply disruptions from Taiwan earthquake, tester/wafer bottlenecks, Q2 gross and operating margin declines driven by FX, mix and higher manufacturing and labor costs). Management is constructive on demand and is investing to expand capacity, but several near‑term operational and cost headwinds balance the upbeat demand outlook.Positive Updates
Q1 Revenue and Profit Beat vs Forecast
Pro forma Q1 revenue (excluding divested timing business) ~JPY 369.1–372.3 billion, above company guidance by ~1.4%; gross margin ~59.1–59.2%, above forecast by ~1.1 percentage points; operating profit ~JPY 123.7–125.4 billion, ~2.5% above forecast; EBITDA JPY 146.2 billion; net profit JPY 102.9 billion.
Negative Updates
Supply Constraints from Taiwan Earthquake & Other Bottlenecks
Supply/demand mismatch due to major earthquake in Taiwan and subsequent disruptions; wafer and tester shortages identified as rate‑limiting factors, constraining ability to convert strong demand into shipments in Q1 and limiting intended channel inventory builds.
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Q1-2026 Updates
Positive
Negative
Q1 Revenue and Profit Beat vs Forecast
Pro forma Q1 revenue (excluding divested timing business) ~JPY 369.1–372.3 billion, above company guidance by ~1.4%; gross margin ~59.1–59.2%, above forecast by ~1.1 percentage points; operating profit ~JPY 123.7–125.4 billion, ~2.5% above forecast; EBITDA JPY 146.2 billion; net profit JPY 102.9 billion.
Read all positive updates
Company Guidance
Renesas guided Q2 revenue at a JPY 388.0 billion midpoint with gross margin 57.0% and operating margin 29.0% (FX assumptions JPY156/USD, JPY180/EUR); on a pro‑forma basis management expects Q‑on‑Q revenue +5.1% (+5.0% ex‑FX) but a gross‑margin decline of ~2.1 percentage points and an operating‑margin decline of ~4.5 percentage points. For context Q1 non‑GAAP results were revenue JPY372.3B (pro‑forma JPY369.1B), gross margin 59.2% (pro‑forma 59.1%), operating profit JPY125.4B (pro‑forma JPY123.7B), operating margin 33.7% (pro‑forma 33.5%), EBITDA JPY146.2B and net profit JPY102.9B (Q1 FX: JPY156/USD, JPY183/EUR). Operational guidance: front‑end wafer‑input utilization ~55% in Q1 (up ~6 points QoQ) and expected flat‑to‑slight increase in Q2; in‑house DOI target 150 days; channel inventory to be further built (WOI for automotive/IIoT expected to fall). CapEx decision = JPY94.0B (≈80% for capacity ≈JPY77B; ~50% to Kofu, >20% Naka, ~15% Saijo), with Kofu production targeted FY2028. Management flagged ~2 percentage‑point net OpEx headwind in Q2 (OpEx run‑rate ≈JPY100B+), manufacturing‑cost and FX pressure as drivers, and noted supply bottlenecks (testers/wafers) that could limit or, if resolved, add upside.Renesas Electronics Financial Statement Overview
Summary
Income Statement
52
Neutral
Balance Sheet
63
Positive
Cash Flow
71
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 1.39T | 1.32T | 1.35T | 1.47T | 1.50T | 993.91B |
| Gross Profit | 721.40B | 636.22B | 752.40B | 834.63B | 859.63B | 544.34B |
| EBITDA | 439.92B | 404.42B | 340.96B | 459.96B | 516.82B | 307.18B |
| Net Income | -9.62B | -51.76B | 219.08B | 337.09B | 256.63B | 119.54B |
Balance Sheet | ||||||
| Total Assets | 4.23T | 4.18T | 4.49T | 3.17T | 2.81T | 2.43T |
| Cash, Cash Equivalents and Short-Term Investments | 267.63B | 295.90B | 229.25B | 434.68B | 336.07B | 221.92B |
| Total Debt | 1.18T | 1.21T | 1.42T | 667.66B | 770.01B | 831.32B |
| Total Liabilities | 1.68T | 1.73T | 1.95T | 1.16T | 1.28T | 1.27T |
| Stockholders Equity | 2.54T | 2.44T | 2.54T | 2.00T | 1.53T | 1.15T |
Cash Flow | ||||||
| Free Cash Flow | 339.62B | 347.87B | 195.59B | 402.98B | 407.24B | 261.76B |
| Operating Cash Flow | 424.90B | 437.02B | 325.48B | 491.20B | 473.38B | 298.70B |
| Investing Cash Flow | -123.60B | -124.69B | -1.28T | -267.49B | -97.52B | -663.13B |
| Financing Cash Flow | -247.15B | -253.84B | 692.35B | -175.82B | -288.82B | 349.60B |
Renesas Electronics Technical Analysis
Positive
2795.00
Price Trends
2847.76
Positive
2696.10
Positive
2261.32
Positive
Market Momentum
248.13
Positive
63.29
Neutral
26.75
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:6723, the sentiment is Positive. The current price of 2795 is below the 20-day moving average (MA) of 3400.63, below the 50-day MA of 2847.76, and above the 200-day MA of 2261.32, indicating a bullish trend. The MACD of 248.13 indicates Positive momentum. The RSI at 63.29 is Neutral, neither overbought nor oversold. The STOCH value of 26.75 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:6723.
Renesas Electronics Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
78 Outperform | ¥179.24B | 13.16 | 1.86% | 0.76% | -14.55% | 100.23% | |
67 Neutral | ¥6.22T | 14.32 | -2.51% | 1.31% | 6.68% | -106.55% | |
67 Neutral | ¥26.76B | 14.10 | ― | 3.98% | 4.66% | ― | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% | |
53 Neutral | ¥1.67T | -7.44 | -4.26% | 2.30% | 7.29% | -216.41% | |
52 Neutral | ¥11.95B | -5.95 | ― | 1.86% | 11.06% | -804.16% | |
47 Neutral | ¥181.58B | -15.00 | ― | ― | -34.08% | -122.57% |
* Technology Sector Average
JP:6723
Renesas Electronics
3,785.00
2,030.02
115.67%
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Renesas Electronics Corporate Events
Renesas Highlights Non-GAAP Metrics in Q1 2026 Financial Presentation
Apr 24, 2026
Renesas Electronics has outlined its use of non-GAAP financial measures in its first-quarter 2026 presentation, explaining that these figures exclude non-recurring items and other adjustments from IFRS-based results. Management believes this appro...
Renesas Lifts Six-Month Outlook With Strong Revenue and Margin Forecasts
Apr 24, 2026
Renesas Electronics has issued its consolidated non-GAAP forecast for the six months ending June 30, 2026, projecting revenue between ¥752.8 billion and ¥767.8 billion. At the midpoint, the company expects a gross margin of 58.1% and an ...
Renesas Delivers Profit Surge and Higher Margins in First Quarter 2026
Apr 24, 2026
Renesas Electronics reported a strong rebound in the first quarter ended March 31, 2026, with revenue climbing 23.2% year-on-year to ¥380.3 billion and operating profit surging more than fourfold to ¥90.6 billion, as profitability recove...
Renesas Files New Shelf Registration to Expand Equity-Based Compensation Plan
Apr 10, 2026
Renesas Electronics has withdrawn a previously filed shelf registration and submitted a new one to support stock-based compensation, enabling the issuance of new shares or disposal of treasury shares for equity awards. The new framework, effective...
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.