Micronics Japan Co., Ltd. (6871) AI Stock Analysis

• Market Cap: ¥342.62B
• Dividend Yield: 1.02%
• Average Volume (3M): 953.16K
• Price to Earnings (P/E): 34.0
• Beta (1Y): 1.61
• Revenue Growth: 29.60%
• EPS Growth: 24.39%
• Country: JP
• Employees: 1,620
• Sector: Technology
• Sector Strength: 88
• Industry: Semiconductors
• EPS (TTM): 59.58
• Shares Outstanding: 40,025,314
• 10 Day Avg. Volume: 722,800
• 30 Day Avg. Volume: 953,160
• PEG Ratio: 0.15
• Price to Book (P/B): 2.93
• Price to Sales (P/S): 2.62
• P/FCF Ratio: 18.08
• 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: ¥9,500.00
• Price Target Upside: 6.50% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 1
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 70 Outperform
• Price Target: ¥9,592.00 ▲(7.53% Upside)

The score is driven primarily by strong financial performance (rapid revenue growth, expanding margins, and low leverage). Technicals are supportive but look overextended, which tempers the outlook. Valuation is a headwind given the elevated P/E and modest dividend yield.

Positive Factors

Strong revenue and margins

Sustained high revenue growth alongside robust gross and operating margins indicates durable demand and efficient cost structure. This combination supports reinvestment in R&D and capacity, underpins operating leverage, and strengthens earnings durability over the next several quarters.

Conservative leverage with high ROE

Extremely low leverage provides financial flexibility and reduces solvency risk, allowing the firm to fund growth internally or pursue opportunistic investments. A strong ROE signals effective capital allocation that can sustain shareholder returns despite market cycles.

Strong operating cash generation

Robust operating cash flow and a FCF-to-net-income ratio above 50% show the business converts earnings into cash, supporting capex, R&D and working capital needs without heavy external funding, improving resilience and funding optionality over the medium term.

Negative Factors

Volatile free cash flow

Intermittent negative free cash flow growth signals uneven cash conversion despite strong income, which can constrain discretionary spending and heighten reliance on external financing during downturns, risking slower execution of long-term investment plans.

Need to improve asset utilization

Explicitly noted room to improve asset utilization implies capital may not be fully productive. Persistent inefficiency can cap returns and require higher investment to sustain growth, pressuring margins and ROIC unless management improves asset deployment.

Exposure to cyclical semiconductor end markets

Concentration in semiconductor and B2B end markets like automotive and telecom exposes revenue to demand cycles and OEM order variability. Such cyclicality can produce material revenue and margin swings over 2-6 months, challenging predictability and planning.

Micronics Japan Co., Ltd. Business Overview & Revenue Model

Company Description

Micronics Japan Co., Ltd. develops, manufactures, and sells testing and measurement equipment for semiconductors and LCD testing system worldwide. The company's semiconductor products include probe cards, package probes, semiconductor test equipment, and wafer prober. It also provides flat panel display (FPD) products, such as automated optical inspection equipment under the PIXQUIRE name; and mura inspection and compensation system under the Gaterumph name, as well as probe units, FPD lighting units, manual probers for FPD substrates, and array probers/cell probers. Micronics Japan Co., Ltd. was formerly known as Towa Electric Co., Ltd. and changed to Micronics Japan Co., Ltd. in April 1975. The company was founded in 1970 and is headquartered in Musashino, Japan.

How the Company Makes Money

Micronics Japan generates revenue through multiple key streams, primarily by selling its electronic components and systems to a diverse clientele, including manufacturers in the automotive, telecommunications, and industrial sectors. The company employs a business-to-business (B2B) model, where it supplies products directly to other businesses, which further integrate these components into their own systems. Additionally, Micronics may engage in partnerships with technology firms and research institutions to co-develop new products, enhancing its market offerings and increasing sales potential. Significant factors contributing to its earnings include ongoing investments in research and development to innovate and improve product performance, as well as maintaining strong relationships with key industry players that drive consistent demand for its products.

Micronics Japan Co., Ltd. Financial Statement Overview

Summary

Strong operating performance with 42.74% revenue growth and improved profitability (gross margin 48.78%, net margin 15.83%, EBIT margin 21.57%). Balance sheet is conservatively levered (debt-to-equity 0.02) with solid ROE (17.75%). Cash generation is supportive, but free cash flow consistency has shown volatility.

Income Statement

Micronics Japan Co., Ltd. has demonstrated strong revenue growth with a 42.74% increase in 2024, indicating robust demand and market position. The gross profit margin improved to 48.78%, reflecting efficient cost management. The net profit margin also increased to 15.83%, showcasing enhanced profitability. EBIT and EBITDA margins are healthy at 21.57% and 26.68%, respectively, indicating strong operational performance. Overall, the income statement reflects a positive growth trajectory and profitability.

Balance Sheet

The company maintains a low debt-to-equity ratio of 0.02, suggesting conservative leverage and financial stability. Return on equity is strong at 17.75%, indicating effective use of shareholder funds. The equity ratio is not explicitly calculated, but the balance sheet shows a solid equity base relative to assets. Overall, the balance sheet reflects financial stability and prudent capital management, though further improvement in asset utilization could enhance performance.

Cash Flow

Operating cash flow increased significantly, supporting the company's ability to fund operations and growth. The free cash flow to net income ratio is 53.38%, indicating efficient cash generation relative to earnings. However, the previous year's negative free cash flow growth highlights potential volatility in cash generation. Overall, the cash flow statement shows strong operational cash generation, but attention to consistent free cash flow growth is needed.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	62.59B	55.64B	38.29B	44.32B	40.00B	31.59B
Gross Profit	30.99B	27.14B	17.10B	20.23B	17.02B	10.28B
EBITDA	17.73B	14.85B	7.71B	12.56B	10.63B	4.25B
Net Income	9.90B	8.81B	4.13B	7.53B	8.24B	1.50B
Balance Sheet
Total Assets	81.63B	79.99B	55.85B	54.38B	49.74B	37.87B
Cash, Cash Equivalents and Short-Term Investments	16.46B	23.95B	17.99B	21.55B	19.20B	12.10B
Total Debt	6.61B	1.18B	1.34B	1.27B	1.33B	1.53B
Total Liabilities	29.63B	30.34B	14.65B	15.75B	16.68B	13.45B
Stockholders Equity	52.00B	49.64B	41.20B	38.63B	33.06B	24.42B
Cash Flow
Free Cash Flow	0.00	8.06B	-1.53B	4.55B	4.23B	1.27B
Operating Cash Flow	0.00	15.10B	4.84B	8.39B	7.38B	3.55B
Investing Cash Flow	0.00	-7.83B	-7.50B	-2.27B	-1.94B	-3.05B
Financing Cash Flow	0.00	-1.44B	-2.17B	-2.48B	-1.25B	-483.00M

Micronics Japan Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 8920.00
• 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:6871, the sentiment is Positive. The current price of 8920 is above the 20-day moving average (MA) of 8450.50, above the 50-day MA of 7292.31, and above the 200-day MA of 5649.90, indicating a bullish trend. The MACD of 509.20 indicates Positive momentum. The RSI at 65.20 is Neutral, neither overbought nor oversold. The STOCH value of 58.39 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:6871.

Micronics Japan Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
5384	77 Outperform	¥207.81B	20.82	―	3.09%	14.85%	29.86%
3156	76 Outperform	¥88.28B	17.35	―	4.31%	4.77%	-36.62%
6966	75 Outperform	¥135.97B	13.22	―	2.45%	4.60%	-21.64%
6871	70 Outperform	¥342.62B	34.00	―	1.02%	29.60%	24.39%
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%