Japan Electronic Materials Corporation (6855) AI Stock Analysis

• Market Cap: ¥60.60B
• Dividend Yield: 1.72%
• Average Volume (3M): 388.46K
• Price to Earnings (P/E): 15.9
• Beta (1Y): 1.63
• Revenue Growth: 36.31%
• EPS Growth: 101.77%
• Country: JP
• Employees: 1,084
• Sector: Technology
• Sector Strength: 88
• Industry: Semiconductors
• EPS (TTM): 56.13
• Shares Outstanding: 12,666,510
• 10 Day Avg. Volume: 386,270
• 30 Day Avg. Volume: 388,460
• PEG Ratio: 0.01
• Price to Book (P/B): 0.82
• Price to Sales (P/S): 0.96
• P/FCF Ratio: -13.72
• 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: 74 Outperform
• Price Target: ¥5,320.00 ▲(38.36% Upside)

Overall score is driven primarily by strong growth/profitability and a robust balance sheet, partially offset by negative free cash flow. Technicals are bullish but overextended, and valuation is reasonable with a modest dividend yield.

Positive Factors

Strong Revenue Growth

A 36.4% year-over-year revenue gain indicates sustained demand for the company's semiconductor test materials and expanding market penetration. Durable topline growth supports reinvestment in capacity and R&D, improving long-term competitiveness and scale economies.

High Profit Margins

Robust gross (39.2%) and net (14.5%) margins, with improving EBIT/EBITDA, reflect structural pricing power and operational efficiency. Sustained margin levels bolster the company's ability to fund R&D and capex, and provide resilience against input-cost volatility over the medium term.

Robust Balance Sheet

Low leverage (D/E 0.21) and a 70% equity ratio create long-term financial flexibility to fund strategic investments, weather semiconductor downturns, and avoid costly refinancing. A strong balance sheet enhances survival odds and optionality through industry cycles.

Negative Factors

Negative Free Cash Flow

Persistent negative free cash flow and declining operating cash flow point to structural cash-generation weakness. Over the coming months this can limit the firm's ability to self-fund growth, pay dividends, or absorb shocks, increasing reliance on external financing.

Weak Cash Conversion

An operating cash flow to net income ratio around 0.52 indicates only half of reported earnings convert to cash, suggesting working capital or capital intensity issues. Weak cash conversion undermines earnings quality and reduces internal funding for capex and R&D.

Cyclicality Exposure

The business is structurally tied to semiconductor production cycles and customer capex, creating durable demand volatility. Even with recent growth, multi-quarter swings in fab investment and technology transitions can materially affect revenue and margin planning.

Japan Electronic Materials Corporation Business Overview & Revenue Model

Company Description

Japan Electronic Materials Corporation engages in the manufacture and sale of probe cards and electron tube parts in Japan and internationally. The company offers cantilever type and advanced probe cards; and heaters and cathodes for receiving tubes and CRTs, filaments for fluorescent character display tubes, and directly heated cathodes, as well as measuring instruments. It also provides a range of products for displays, which include color TV displays, such as high-definition TV displays; computer displays; measurement displays; and radar displays. In addition, the company is involved in the precision processing and assembly of heat-resistant metals comprising tungsten, molybdenum, and tantalum. Japan Electronic Materials Corporation was founded in 1960 and is headquartered in Amagasaki, Japan.

How the Company Makes Money

Japan Electronic Materials Corporation generates revenue through the sale of its specialized electronic materials and chemicals, with key revenue streams originating from its core products such as photoresists and semiconductor materials. The company primarily serves major players in the semiconductor industry, including foundries and manufacturers of electronic devices, thereby securing long-term contracts and partnerships that ensure consistent demand. Additionally, Japan Electronic Materials Corporation invests in research and development to create innovative products that meet emerging market needs, which further enhances its competitive edge and revenue potential. Strategic collaborations with technology companies and partnerships for joint development projects also contribute significantly to its earnings by expanding market reach and facilitating entry into new sectors.

Japan Electronic Materials Corporation Financial Statement Overview

Summary

Strong income statement and balance sheet (revenue up 36.4% from 2024 to 2025, healthy 39.2% gross margin, 14.5% net margin, low 0.21 debt-to-equity, 70% equity ratio). Main offset is weaker cash generation, with declining operating cash flow and negative free cash flow in recent years.

Income Statement

Japan Electronic Materials Corporation has demonstrated strong revenue growth, particularly from 2024 to 2025 with a 36.4% increase. The gross profit margin is healthy at 39.2%, and the net profit margin is solid at 14.5%. The company shows a consistent improvement in EBIT and EBITDA margins, indicating efficient operations and cost management.

Balance Sheet

The company's balance sheet is robust with a low debt-to-equity ratio of 0.21 and a strong equity ratio of 70.0%. Return on equity is also commendable at 12.4%, showcasing effective use of equity to generate profits. The significant cash reserves provide a cushion for future investments or downturns.

Cash Flow

Despite a decline in operating cash flow, the company maintains a positive operating cash flow to net income ratio of 0.52. However, free cash flow has turned negative in recent years, indicating potential challenges in managing capital expenditures. The free cash flow to net income ratio is concerning and suggests cash management improvements are needed.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	24.27B	23.83B	17.46B	20.78B	23.60B	18.52B
Gross Profit	9.87B	9.35B	5.24B	7.39B	8.97B	6.47B
EBITDA	5.92B	5.86B	1.94B	4.60B	6.14B	3.53B
Net Income	3.57B	3.45B	622.00M	2.61B	3.80B	2.04B
Balance Sheet
Total Assets	37.80B	39.86B	34.77B	32.69B	32.99B	25.58B
Cash, Cash Equivalents and Short-Term Investments	13.71B	12.19B	14.25B	12.81B	11.82B	6.66B
Total Debt	5.50B	5.88B	5.66B	4.18B	5.19B	6.46B
Total Liabilities	9.75B	11.94B	10.10B	8.45B	11.20B	10.17B
Stockholders Equity	28.05B	27.91B	24.67B	24.24B	21.79B	15.41B
Cash Flow
Free Cash Flow	0.00	-1.66B	397.00M	2.43B	3.89B	19.00M
Operating Cash Flow	0.00	1.80B	2.31B	3.35B	4.81B	1.42B
Investing Cash Flow	0.00	-3.58B	-2.20B	-849.00M	-562.00M	-1.50B
Financing Cash Flow	0.00	-514.00M	879.00M	-1.58B	947.00M	2.97B

Japan Electronic Materials Corporation Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 3845.00
• 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:6855, the sentiment is Positive. The current price of 3845 is below the 20-day moving average (MA) of 4388.75, below the 50-day MA of 3984.70, and above the 200-day MA of 3022.11, indicating a bullish trend. The MACD of 271.20 indicates Negative momentum. The RSI at 64.49 is Neutral, neither overbought nor oversold. The STOCH value of 71.70 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:6855.

Japan Electronic Materials Corporation Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
7609	81 Outperform	¥53.76B	10.32	―	2.87%	10.24%	61.61%
6855	74 Outperform	¥60.60B	15.91	―	1.72%	36.31%	101.77%
6627	74 Outperform	¥67.32B	21.65	―	1.85%	3.60%	-17.45%
7510	66 Neutral	¥36.40B	12.90	―	3.02%	7.09%	13.13%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
6707	55 Neutral	¥146.38B	127.51	―	―	-51.82%	-96.08%
6616	45 Neutral	¥16.14B	-8.04	―	3.98%	-6.84%	50.71%