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TDK Corporation (JP:6762)
:6762
Japanese Market

TDK Corporation (6762) AI Stock Analysis

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JP

TDK Corporation

(6762)

Rating:76Outperform
Price Target:
¥1,847.00
▲(13.04%Upside)
TDK Corporation's strong financial performance is the most significant factor, underpinned by robust revenue growth and profitability. Technical analysis supports a positive momentum outlook, while valuation metrics indicate a fair market price with a modest dividend yield. The absence of earnings call data and notable corporate events means these areas do not currently impact the overall assessment.
Positive Factors
Innovation in Battery Technology
TDK's development of CeraCharge, a next-generation solid-state battery with a remarkable energy density of 1,000 Wh/L, positions the company at the forefront of wearable technology innovation.
Market Position
TDK is a leading Japanese electronics component manufacturer with a 50%-60% market share in the cellphone battery worldwide market.
Strategic Partnerships
The company's strategic joint venture with CATL for mid-sized battery production enhances its production capacity and market reach, enabling TDK to scale up and meet the growing needs of the EV market.
Negative Factors
Demand Decline
Prolonged decline in demand in the hard disk drive HDD market and slower-than-expected recovery in consumer electronics devices due to economic uncertainties.

TDK Corporation (6762) vs. iShares MSCI Japan ETF (EWJ)

TDK Corporation Business Overview & Revenue Model

Company DescriptionTDK Corporation, founded in 1935 and headquartered in Tokyo, Japan, is a leading global electronics company specializing in the development and manufacturing of electronic components, modules, and systems. The company operates in various sectors, including automotive, industrial, consumer electronics, and information and communication technology. TDK's core products include passive components such as capacitors and inductors, sensor systems, magnetic products, and energy devices like batteries and power supplies.
How the Company Makes MoneyTDK Corporation generates revenue through the sale of its diverse range of electronic components and solutions. The company's key revenue streams include passive components, sensor application products, magnetic application products, and energy appliances. TDK serves a broad array of industries, with significant contributions from the automotive sector, where its components are integral to electric vehicles and advanced driver-assistance systems (ADAS). Additionally, TDK's partnerships with major technology firms and its investments in research and development drive innovation, enhancing its product offerings and market position. The company also benefits from its global manufacturing and sales network, which enables it to efficiently serve customers worldwide and capitalize on emerging market opportunities.

TDK Corporation Earnings Call Summary

Earnings Call Date:Apr 28, 2025
(Q3-2025)
|
% Change Since: 11.31%|
Next Earnings Date:Aug 01, 2025
Earnings Call Sentiment Neutral
The earnings call presented a balanced view with strong growth in operating profit and HDD components, offset by challenges in the BEV and industrial equipment markets as well as declines in some product segments.
Q3-2025 Updates
Positive Updates
Record Operating Profit Increase
Operating profit increased by 34.3% year-on-year, marking the highest record for the third quarter. This was driven by the depreciation of the yen, increased shipments for the ICT market, and rationalization measures.
Significant Growth in HDD Components
Net sales for Magnetic Application Products increased by 25% year-on-year. HDD Heads and Suspension Assemblies returned to profitability with increased sales volumes, marking a significant recovery in the nearline HDD demand for data centers.
Improved Free Cash Flow
Free cash flow reached JPY213.5 billion, exceeding the previous year's JPY185.5 billion and surpassing the targeted level due to decreased CapEx and increased profit.
Increased Net Sales
Net sales grew by 3.2% year-on-year, driven by increased sales of small rechargeable batteries, HDD-related components, and sensors for the ICT market.
Negative Updates
Decline in BEV and Industrial Equipment Markets
Demand for BEVs and industrial equipment remained weak, leading to decreased sales of passive components and sensors for these markets.
Decreased Sales in Passive Components
Net sales for passive components decreased by 0.6% year-on-year, with a significant 18.6% decline in operating profit due to weak demand in industrial equipment and auto markets.
Challenges in Sensor Application Products
Operating profit for sensor application products decreased by 45.2% year-on-year despite a 5.7% increase in net sales, largely due to increased expenses and a one-time gain from the previous fiscal year not repeating.
Company Guidance
During the TDK Corporation's earnings call for the third quarter of the fiscal year ending in March 2025, a comprehensive overview of financial performance was provided, highlighting a 3.2% year-on-year increase in net sales to JPY1,670.5 trillion and a record 34.3% rise in operating profit to JPY209.1 billion. The net profit stood at JPY160.9 billion, reflecting a 34.6% increase year-on-year. Key segments showed varied performance: passive components experienced a 0.6% decline in sales, sensor application products saw a 5.7% sales increase, and magnetic application products achieved a significant 25% sales growth. The Energy Application Products segment also saw a 1.4% sales rise with operating profit up by 26.7%. Foreign exchange fluctuations contributed positively, adding JPY8.5 billion to net sales and JPY16.8 billion to operating profit. The company anticipates changes in sales volumes across segments in Q4, with a projected upward revision in full-year net sales from JPY2,120.0 billion to JPY2,180.0 billion, despite expected one-off expenses totaling JPY18 billion for structural reforms and potential write-downs.

TDK Corporation Financial Statement Overview

Summary
TDK Corporation exhibits strong financial health with impressive revenue growth, solid profit margins, and effective cash flow management. The balance sheet is well-structured with low leverage, though continuous monitoring of debt is advisable.
Income Statement
85
Very Positive
TDK Corporation has demonstrated strong revenue growth with a significant increase from the previous year. The gross profit margin remains robust at approximately 31.2%, and the net profit margin has improved to 7.6%. Consistent EBIT and EBITDA margins at 8.8% and 20.3% respectively, indicate stable operational efficiency. These metrics suggest a healthy growth trajectory and profitability for the company.
Balance Sheet
78
Positive
The balance sheet shows a solid equity base with a debt-to-equity ratio of 0.34, indicating prudent financial leverage. Return on equity has improved to 9.3%, reflecting effective use of shareholder funds. The equity ratio stands at 50.8%, showcasing a strong financial position with adequate asset backing. However, vigilance on debt levels is recommended to maintain financial stability.
Cash Flow
82
Very Positive
TDK Corporation has shown a robust operating cash flow relative to net income, with a ratio of 2.67, indicating strong cash generation capabilities. The free cash flow growth rate has seen fluctuations but remains positive, providing flexibility for reinvestments or debt servicing. The free cash flow to net income ratio of 1.32 further underscores the company's efficient cash utilization.
BreakdownMar 2025Mar 2024Mar 2023Mar 2022Mar 2021
Income Statement
Total Revenue2.20T2.10T2.18T1.90T1.48T
Gross Profit688.04B603.02B584.52B563.85B434.32B
EBITDA447.47B355.47B364.01B337.67B271.40B
Net Income167.16B124.69B114.19B131.30B74.68B
Balance Sheet
Total Assets3.54T3.42T3.15T3.04T2.40T
Cash, Cash Equivalents and Short-Term Investments697.31B650.00B558.33B506.28B446.33B
Total Debt608.40B685.74B752.16B679.81B521.61B
Total Liabilities1.73T1.70T1.68T1.74T1.40T
Stockholders Equity1.80T1.71T1.46T1.30T1.00T
Cash Flow
Free Cash Flow220.55B228.42B-12.94B-112.35B10.46B
Operating Cash Flow445.84B447.01B262.77B178.99B222.81B
Investing Cash Flow-244.84B-216.59B-234.40B-281.55B-231.49B
Financing Cash Flow-143.33B-146.37B14.95B113.74B29.19B

TDK Corporation Technical Analysis

Technical Analysis Sentiment
Positive
Last Price1634.00
Price Trends
50DMA
1569.22
Positive
100DMA
1543.76
Positive
200DMA
1719.86
Negative
Market Momentum
MACD
23.90
Negative
RSI
57.10
Neutral
STOCH
32.72
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:6762, the sentiment is Positive. The current price of 1634 is above the 20-day moving average (MA) of 1588.33, above the 50-day MA of 1569.22, and below the 200-day MA of 1719.86, indicating a neutral trend. The MACD of 23.90 indicates Negative momentum. The RSI at 57.10 is Neutral, neither overbought nor oversold. The STOCH value of 32.72 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:6762.

TDK Corporation Peers Comparison

Overall Rating
UnderperformOutperform
Sector (50)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
76
Outperform
¥3.07T18.00
1.96%4.80%34.02%
76
Outperform
$3.81T16.678.98%2.88%6.29%30.60%
74
Outperform
$861.28B14.418.10%2.35%8.60%10.83%
66
Neutral
$921.97B27.376.76%0.60%-0.29%7.04%
61
Neutral
$745.59B45.842.10%2.75%-2.08%100.89%
58
Neutral
¥323.32B137.90
3.50%5.82%-71.97%
50
Neutral
C$2.92B1.79-63.12%2.58%11.24%-12.42%
* Technology Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
JP:6762
TDK Corporation
1,642.50
-523.67
-24.17%
JP:6976
Taiyo Yuden Co., Ltd.
2,606.00
-2,006.64
-43.50%
JP:6479
MinebeaMitsumi
2,193.50
-1,310.62
-37.40%
JP:6981
Murata Manufacturing Co
2,153.00
-1,372.19
-38.93%
JP:4062
IBIDEN CO
6,435.00
-308.36
-4.57%
JP:6645
OMRON
4,040.00
-1,629.92
-28.75%

TDK Corporation Corporate Events

TDK Corporation Reports Strong Fiscal Year 2025 Results Amid Upcoming Challenges
Apr 28, 2025

TDK Corporation reported a strong financial performance for the fiscal year ended March 2025, with net sales increasing by 4.8% and net profit rising by 35.1% compared to the previous year. The company also implemented a share split, which affected its earnings per share calculations. Looking ahead, TDK projects a slight decline in net sales and profits for the fiscal year ending March 2026, indicating potential challenges in maintaining its growth trajectory.

TDK Corporation Proposes Increased Year-End Dividend Amid Strong Performance
Apr 28, 2025

TDK Corporation announced a proposed increase in its year-end dividend to 16 yen per share, up from the previously forecasted 14 yen, reflecting its strong business performance for the fiscal year ending March 31, 2025. This move aligns with TDK’s strategy to enhance shareholder value through consistent dividend growth and a targeted payout ratio of 35%, indicating a positive outlook for stakeholders.

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.Date of analysis: Jul 09, 2025