Santec Corporation (6777) AI Stock Analysis

• Market Cap: ¥122.19B
• Dividend Yield: 2.3%
• Average Volume (3M): 43.49K
• Price to Earnings (P/E): 19.8
• Beta (1Y): 1.77
• Revenue Growth: 6.85%
• EPS Growth: 10.88%
• Country: JP
• Employees: 310
• Sector: Technology
• Sector Strength: 88
• Industry: Hardware, Equipment & Parts
• EPS (TTM): 173.77
• Shares Outstanding: 11,961,100
• 10 Day Avg. Volume: 42,240
• 30 Day Avg. Volume: 43,493
• PEG Ratio: 0.36
• Price to Book (P/B): 2.66
• Price to Sales (P/S): 2.38
• P/FCF Ratio: 13.38
• 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): N/A
• Revenue Forecast (FY): N/A

• Rating: 78 Outperform
• Price Target: ¥11,845.00 ▲(29.74% Upside)

Santec Corporation's strong financial performance is the most significant factor driving its stock score, supported by robust revenue growth and profitability. The technical analysis indicates a moderate outlook with mixed signals, while the valuation suggests the stock is fairly priced with a reasonable dividend yield. The absence of earnings call data and notable corporate events means these factors do not influence the score.

Positive Factors

Sustained revenue expansion

Material multi-year revenue expansion indicates strong product demand and successful market penetration in photonics. Such scale-up supports durable top-line momentum, enables reinvestment in R&D and production capacity, and reduces per-unit costs over the medium term.

Robust cash generation

Consistent operating and free cash flow growth underpins financial flexibility: it funds capex, R&D, dividends and buybacks without reliance on external financing, and provides a buffer through cyclical downturns in capital equipment spending.

Strong balance sheet and low leverage

A solid equity base and low leverage reduce refinancing and solvency risk, enabling strategic investments and M&A optionality. This defensive capital structure supports resilience during industry cyclicality and preserves capacity to fund growth opportunistically.

Negative Factors

Cyclicality of end-market demand

Revenue is exposed to telecommunications and datacom capex cycles, making sales lumpy and timing-dependent. As high‑value capital equipment buyers delay or accelerate purchases, Santec’s topline and utilization can fluctuate materially over multi-quarter horizons.

Narrow product niche concentration

A concentrated focus on optical measurement instruments and photonic components creates expertise but limits diversification across end markets. Structural reliance on a niche restricts addressable market breadth and heightens sensitivity to technology shifts within optical communications.

Limited public forward disclosure

Sparse earnings call content and absent guidance reduce visibility into management’s near-term plans and capital allocation priorities. For long‑term investors this can hinder assessment of strategic initiatives, cadence of R&D spending, and readiness for industry inflection points.

Santec Corporation Business Overview & Revenue Model

Company Description

santec Holdings Corporation develops, manufactures, and sells components for fiber optic telecommunication systems. The company offers optical instruments, including tunable lasers, tunable filters, component testing products, IL/RL meters, polarity testers, switches, optical power meters, attenuators, light sources, launch conditioning, inspection scopes, cable assembly software, interferometers, and adapters, as well as inspection scopes; and optical components, such as liquid crystal on silicon based spatial light modulators, programmable optical filters, power monitor instruments, power monitors, variable attenuators, optical filters, filter chips, and optical submodules. It also provides optical imaging and sensing products, including 3D optical profilers, software and image analysis tools, wafer thickness mapping systems, swept-source OCT systems, and lasers for swept-source OCT and sensing, as well as accessories comprising OCT grade balanced photo detectors, flexible SS-OTC DAQ boards, and OCT grade interferometer modules; and medical devices comprising biometers. The company was formerly known as Santec Corporation and changed its name to santec Holdings Corporation in April 2023. santec Holdings Corporation was incorporated in 1979 and is headquartered in Komaki, Japan.

How the Company Makes Money

Santec Corporation generates revenue through the sale of its optical and electronic components, catering to various industries, including telecommunications and data centers. The company's primary revenue streams include the direct sale of products, such as lasers and optical filters, and the provision of customized solutions tailored to client specifications. Additionally, Santec may engage in partnerships with other technology firms and research institutions, allowing it to co-develop products and expand its market reach. The company also benefits from ongoing service contracts and maintenance agreements, creating a steady stream of income from existing clients.

Santec Corporation Financial Statement Overview

Summary

Santec Corporation exhibits strong financial performance with impressive revenue growth, high profitability margins, and stable balance sheet metrics. The company's prudent financial management is evident in its low leverage and strong cash flow generation, positioning it well for future growth and stability.

Income Statement

Santec Corporation demonstrates strong revenue growth with a consistent upward trajectory over recent years, highlighted by a substantial increase in total revenue from 8,890 million to 24,027 million JPY in 2025. The gross profit margin is robust, reflecting efficient cost management. Notably, the net profit margin has improved significantly, underscoring enhanced profitability and operational efficiency. The EBIT and EBITDA margins suggest solid operational performance and capability to generate earnings before certain expenses.

Balance Sheet

The balance sheet is strong, with a high equity ratio indicating stability and financial health. Santec maintains a low debt-to-equity ratio, reflecting prudent financial management and low leverage risk. The substantial increase in stockholders' equity over the years highlights the company's robust equity position. Return on Equity (ROE) has shown improvement, suggesting effective use of equity to generate profits.

Cash Flow

Santec Corporation's cash flow statement shows positive trends, with significant growth in both operating and free cash flow, indicating strong cash-generating capabilities. The free cash flow growth rate is impressive, reflecting efficient capital expenditure management. The operating cash flow to net income ratio suggests healthy cash flow generation relative to net earnings, reinforcing the company's liquidity and financial flexibility.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	23.91B	24.03B	18.87B	15.25B	8.89B	7.51B
Gross Profit	13.96B	13.92B	10.42B	8.07B	4.34B	3.59B
EBITDA	7.86B	8.14B	6.57B	4.88B	2.30B	1.81B
Net Income	4.85B	5.07B	3.85B	3.00B	1.65B	1.11B
Balance Sheet
Total Assets	29.35B	29.53B	25.83B	19.61B	16.35B	12.56B
Cash, Cash Equivalents and Short-Term Investments	13.49B	12.54B	9.45B	6.64B	4.72B	4.57B
Total Debt	3.29B	2.72B	1.97B	1.12B	1.25B	42.95M
Total Liabilities	8.24B	8.10B	8.09B	5.27B	4.48B	2.18B
Stockholders Equity	21.11B	21.43B	17.74B	14.33B	11.87B	10.39B
Cash Flow
Free Cash Flow	0.00	4.27B	2.87B	2.55B	1.00B	1.29B
Operating Cash Flow	0.00	6.00B	3.28B	3.11B	1.41B	1.61B
Investing Cash Flow	0.00	-1.88B	-194.81M	-788.10M	-2.10B	-321.06M
Financing Cash Flow	0.00	-700.47M	-213.34M	-773.99M	832.59M	-236.17M

Santec Corporation Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 9130.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:6777, the sentiment is Positive. The current price of 9130 is below the 20-day moving average (MA) of 9713.50, below the 50-day MA of 9345.40, and above the 200-day MA of 7150.94, indicating a bullish trend. The MACD of 299.52 indicates Negative momentum. The RSI at 63.72 is Neutral, neither overbought nor oversold. The STOCH value of 65.75 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:6777.

Santec Corporation Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
6850	80 Outperform	¥24.89B	13.08	―	2.89%	6.15%	2.98%
7745	80 Outperform	¥62.42B	9.76	―	2.31%	6.50%	30.54%
6866	79 Outperform	¥84.06B	15.28	―	3.23%	7.28%	4.16%
6777	78 Outperform	¥122.19B	19.81	25.32%	2.30%	6.85%	10.88%
6859	75 Outperform	¥76.84B	13.73	―	3.12%	2.78%	-5.32%
6914	71 Outperform	¥86.52B	12.48	―	1.68%	2.72%	33.10%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%