Japan Electronic Materials Corporation (6855) AI Stock Analysis

• Market Cap: ¥96.84B
• Dividend Yield: 1.72%
• Average Volume (3M): 388.46K
• Price to Earnings (P/E): 6.9
• Beta (1Y): 1.67
• Revenue Growth: 36.31%
• EPS Growth: 101.77%
• Country: JP
• Employees: 1,084
• Sector: Technology
• Sector Strength: 88
• Industry: Semiconductors
• EPS (TTM): 139.95
• Shares Outstanding: 14,405,710
• 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): 260.9
• Revenue Forecast (FY): ¥26.50B

• Rating: 81 Outperform
• Price Target: ¥7,565.00 ▲(96.75% Upside)
• Action: Reiterated Date: 03/06/26
• Date: Action: Reiterated 03/06/26

The score is driven primarily by strong fundamentals (growth, margins, and a conservative balance sheet) and attractive valuation (low P/E). Technicals are supportive overall due to a strong multi-month uptrend and positive MACD, but mixed short-term momentum and cash flow/negative free cash flow temper the rating.

Positive Factors

High margins

Sustained gross and net margins near reported levels indicate structural pricing power and cost discipline in test-materials manufacturing. High margins support reinvestment and resilience to cyclical revenue swings, enabling durable profitability and funding for R&D or capacity expansion.

Conservative balance sheet

Low leverage and a high equity ratio provide long-term financial flexibility, lowering solvency risk through semiconductor cycles. Strong cash reserves and limited debt capacity allow the company to fund capex or weather downturns without forcing dilutive financing, a durable stability anchor.

Robust top-line and margin improvement

Rapid revenue growth combined with improving operational margins signals durable demand for its test-related products and improving scale economics. This supports longer-term earnings power and operational leverage if the company sustains product adoption in semiconductor test supply chains.

Negative Factors

Negative free cash flow

Persistent negative free cash flow despite profitability constrains the firm's ability to self-fund investments, dividends, or buybacks over the medium term. If sustained, negative FCF forces reliance on external financing or asset sales, reducing strategic optionality and resilience.

Weak cash conversion

A cash conversion ratio around 0.52 suggests earnings are not fully translating into operating cash, indicating working capital or accruals pressures. Lower cash quality raises the likelihood of earnings volatility and limits internal funding for growth even when reported profits are solid.

End-market cyclicality

Revenue dependence on semiconductor production cycles and customers' capex creates structural demand volatility. Technology transitions and shifting test requirements can materially alter product mix and volumes, making multi-quarter predictability and capacity planning more challenging.

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 generates revenue primarily by manufacturing and selling semiconductor test-related materials and components to semiconductor manufacturers and companies involved in semiconductor testing. Its earnings are driven by product sales volume and product mix (e.g., demand for specific test/inspection consumables and components used in device testing), with revenue fluctuating alongside semiconductor production levels, customers’ capital and operating spending for testing, and technology transitions that change test requirements. null

Japan Electronic Materials Corporation Financial Statement Overview

Summary

Strong profitability and growth with a healthy gross margin (39.2%) and solid net margin (14.5%), plus robust balance sheet leverage (debt-to-equity 0.21) and equity ratio (70.0%). The main offset is weaker cash generation, with negative free cash flow in recent years and a modest operating cash flow to net income ratio (0.52).

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	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	24.27B	23.83B	17.46B	20.78B	23.60B	18.52B
Gross Profit	9.98B	9.35B	5.19B	7.34B	8.93B	6.41B
EBITDA	6.15B	5.78B	1.94B	4.31B	5.97B	3.59B
Net Income	3.57B	3.45B	622.00M	2.61B	3.80B	2.04B
Balance Sheet
Total Assets	37.80B	39.86B	35.08B	32.96B	33.21B	25.77B
Cash, Cash Equivalents and Short-Term Investments	13.71B	12.19B	14.25B	12.81B	11.87B	6.81B
Total Debt	5.50B	5.88B	5.66B	4.18B	5.19B	6.46B
Total Liabilities	9.75B	11.94B	10.41B	8.72B	11.42B	10.36B
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: Neutral
• Last Price: 3845.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• 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 Neutral. The current price of 3845 is below the 20-day moving average (MA) of 7616.00, below the 50-day MA of 6311.60, and below the 200-day MA of 3916.03, indicating a neutral trend. The MACD of 43.76 indicates Positive momentum. The RSI at 46.89 is Neutral, neither overbought nor oversold. The STOCH value of 29.69 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral 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
6855	81 Outperform	¥96.84B	6.87	―	1.72%	36.31%	101.77%
5384	78 Outperform	¥219.91B	14.21	―	3.09%	14.85%	29.86%
6890	76 Outperform	¥282.61B	15.35	5.77%	3.28%	11.15%	-19.39%
6871	71 Outperform	¥417.91B	22.63	―	1.02%	29.60%	24.39%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
3436	50 Neutral	¥589.16B	-42.71	―	1.14%	0.66%	-87.63%