Ferrotec Holdings (6890) AI Stock Analysis

• Market Cap: ¥222.89B
• Dividend Yield: 3.38%
• Average Volume (3M): 466.89K
• Price to Earnings (P/E): 17.3
• Beta (1Y): 1.49
• Revenue Growth: 11.15%
• EPS Growth: -19.39%
• Country: JP
• Employees: 14,192
• Sector: Technology
• Sector Strength: 88
• Industry: Semiconductors
• EPS (TTM): 65.86
• Shares Outstanding: 47,117,950
• 10 Day Avg. Volume: 447,710
• 30 Day Avg. Volume: 466,890
• PEG Ratio: 2.25
• Price to Book (P/B): 0.53
• Price to Sales (P/S): 0.46
• P/FCF Ratio: -4.99
• 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: ¥5,305.30
• Price Target Upside: 11.93% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 1
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 75 Outperform
• Price Target: ¥5,614.00 ▲(18.44% Upside)

Ferrotec Holdings' strong financial performance and bullish technical indicators are the primary drivers of the stock's score. The company's strategic investments and solid balance sheet position it well for future growth, though careful management of cash flows is necessary. The valuation is reasonable, with a supportive dividend yield.

Positive Factors

Revenue Growth

The company's robust revenue growth over the past five years indicates strong market demand and effective business strategies, positioning it well for future expansion.

Market Position

As a leader in the semiconductor industry, Ferrotec benefits from strong market positioning, enabling it to leverage industry growth and maintain competitive advantages.

Balance Sheet Health

A strong equity base and manageable debt levels provide financial stability and flexibility, supporting long-term strategic investments and growth initiatives.

Negative Factors

Free Cash Flow Challenges

Negative free cash flow, driven by high capital expenditures, could limit the company's ability to fund operations and investments without relying on external financing.

EBIT Margin Decline

A declining EBIT margin may indicate rising costs or pricing pressures, which could affect profitability and operational efficiency in the long term.

Increased Leverage

Higher leverage can increase financial risk, potentially impacting the company's ability to invest in growth opportunities and manage economic downturns effectively.

Ferrotec Holdings Business Overview & Revenue Model

Company Description

Ferrotec Holdings Corporation (6890) is a global leader in the manufacturing and supply of advanced materials and equipment used primarily in the semiconductor, flat panel display, and solar industries. The company operates across multiple sectors, including semiconductor materials, thermal management solutions, and precision components, providing innovative products such as magnetic materials, vacuum technology systems, and high-purity chemicals. Ferrotec is committed to technological advancement and sustainability, positioning itself as a key player in the high-tech supply chain.

How the Company Makes Money

Ferrotec generates revenue through several key streams, primarily from the sale of specialized materials and equipment used in semiconductor manufacturing and other high-tech industries. The company's revenue model is built on direct sales to large manufacturers and technology firms, as well as long-term contracts for ongoing supply agreements. Significant partnerships with major players in the semiconductor and electronics sectors enhance its market reach and stability. Additionally, Ferrotec benefits from its ability to innovate and deliver tailored solutions that meet the evolving demands of its customers, which further drives sales and profitability.

Ferrotec Holdings Financial Statement Overview

Summary

Ferrotec Holdings showcases strong revenue and profit growth, with a robust income statement and a solid balance sheet. However, challenges in free cash flow due to high capital expenditures slightly offset these strengths.

Income Statement

Ferrotec Holdings has demonstrated strong revenue growth with a significant increase from ¥81.6 billion in 2020 to ¥274.39 billion in 2025. The company's gross profit margin and EBIT margin are stable, although the EBIT margin saw a decrease from 16.62% in 2023 to 8.78% in 2025. Net profit margin has improved since 2020, indicating strong profitability. The consistency in EBITDA margin suggests operational efficiency. Overall, the income statement reflects robust growth and profitability, with minor fluctuations in margins that are typical in the semiconductor industry.

Balance Sheet

The company's balance sheet reveals a healthy equity base, with stockholders' equity increasing from ¥48.47 billion in 2020 to ¥236.83 billion in 2025. The debt-to-equity ratio is manageable, though the increase in total debt to ¥168.28 billion by 2025 suggests increased leverage. The equity ratio has been stable, reflecting a solid financial foundation. Return on Equity (ROE) is strong, showing effective utilization of equity. While there is a rise in liabilities, the overall balance sheet remains solid with good equity coverage.

Cash Flow

Ferrotec Holdings' cash flow statement highlights challenges in free cash flow, which has been negative over the years, with an increase in capital expenditure impacting free cash flow from -¥13.95 billion in 2023 to -¥25.17 billion in 2025. The operating cash flow remains strong, but the free cash flow to net income ratio indicates potential concerns with cash generation relative to profits. The company appears to be investing heavily in growth, which affects short-term cash flow metrics.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	282.18B	274.39B	222.43B	210.81B	133.82B	91.31B
Gross Profit	74.53B	73.36B	69.86B	72.08B	48.68B	30.78B
EBITDA	53.71B	51.63B	44.59B	55.98B	42.61B	21.95B
Net Income	13.52B	15.69B	15.15B	29.70B	26.66B	8.28B
Balance Sheet
Total Assets	580.96B	600.59B	510.03B	410.65B	264.77B	177.19B
Cash, Cash Equivalents and Short-Term Investments	103.08B	117.73B	117.25B	103.11B	52.58B	30.20B
Total Debt	169.38B	168.28B	140.85B	72.26B	39.52B	49.77B
Total Liabilities	274.25B	277.04B	231.86B	161.00B	103.82B	98.95B
Stockholders Equity	223.31B	236.83B	204.41B	183.77B	131.07B	67.18B
Cash Flow
Free Cash Flow	0.00	-25.17B	-46.51B	-13.95B	-15.99B	-1.08B
Operating Cash Flow	0.00	26.07B	28.72B	43.02B	17.83B	13.22B
Investing Cash Flow	0.00	-39.63B	-92.40B	-68.76B	-29.40B	-20.88B
Financing Cash Flow	0.00	18.96B	60.42B	68.72B	30.60B	21.69B

Ferrotec Holdings Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 4740.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:6890, the sentiment is Positive. The current price of 4740 is below the 20-day moving average (MA) of 4805.25, above the 50-day MA of 4602.70, and above the 200-day MA of 3374.87, indicating a neutral trend. The MACD of 60.29 indicates Positive momentum. The RSI at 48.83 is Neutral, neither overbought nor oversold. The STOCH value of 8.96 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:6890.

Ferrotec Holdings Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
5384	77 Outperform	¥180.03B	18.03	―	3.10%	14.85%	29.86%
6890	75 Outperform	¥222.89B	17.33	5.41%	3.38%	11.15%	-19.39%
6966	75 Outperform	¥142.91B	13.90	―	2.30%	4.60%	-21.64%
3445	73 Outperform	¥96.81B	9.18	―	0.96%	28.52%	43.16%
6871	67 Neutral	¥245.83B	24.40	―	1.09%	29.60%	24.39%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
6707	46 Neutral	¥115.69B	100.78	―	―	-51.82%	-96.08%