tiprankstipranks
Trending News
More News >
DENSO CORPORATION (JP:6902)
:6902
Advertisement

DENSO (6902) AI Stock Analysis

Compare
3 Followers

Top Page

JP:6902

DENSO

(OTC:6902)

Rating:78Outperform
Price Target:
¥2,401.00
▲(12.30% Upside)
DENSO's solid financial performance is the primary driver of its overall stock score, supported by strong operational efficiency and revenue growth. The technical indicators suggest positive momentum, though caution is warranted due to the high RSI. Valuation metrics are fair, offering a balance of growth and income potential.
Positive Factors
Competitive Edge
Denso is a leading Tier 1 automobile component manufacturer with a competitive edge in xEV components.
Financial Performance
Management guided for FY3/26F EBIT margins of 9.6%, exceeding the consensus estimate of 8.9%.
Market Recommendation
Analyst maintains a BUY recommendation with an unchanged target price of ¥2,800.
Negative Factors
Cost Impact
4QFY25 results a miss on rising parts/material costs.
Market Demand
Slowing US/EU auto demand and depreciating USD/EUR against the JPY can pose downside risks to earnings, given Denso’s 35% revenue exposure to both markets.
Operational Challenges
The company's earnings were impacted by the suspension of operations by key Japanese customers due to quality-related issues.

DENSO (6902) vs. iShares MSCI Japan ETF (EWJ)

DENSO Business Overview & Revenue Model

Company DescriptionDENSO Corporation, headquartered in Kariya, Aichi Prefecture, Japan, is a global leader in advanced automotive technology, systems, and components. Established in 1949, the company operates across several sectors, including automotive original equipment, aftermarket products, and industrial solutions. DENSO's core offerings encompass powertrain control systems, thermal systems, information and safety systems, and electronic systems, providing innovative solutions to enhance vehicle performance, safety, and sustainability.
How the Company Makes MoneyDENSO makes money primarily through the design, manufacture, and sale of automotive components and systems to major automobile manufacturers worldwide. Its revenue model is heavily reliant on its position as a Tier 1 supplier to leading automakers, providing essential components such as engine management systems, air conditioning units, and various electronic and safety systems. Key revenue streams include its powertrain systems, which improve fuel efficiency and reduce emissions, and its thermal systems, which manage vehicle climate control. DENSO also generates income from its aftermarket services, offering repair and maintenance parts for vehicles. Significant partnerships with automotive giants, along with continuous investment in research and development for next-generation automotive technologies, further bolster its revenue. The company's commitment to innovation in areas like electrification, autonomous driving, and connectivity plays a crucial role in sustaining its competitive edge and profitability.

DENSO Financial Statement Overview

Summary
DENSO demonstrates strong financial performance with consistent revenue and profit growth, efficient operations, and a stable balance sheet. While leverage and cash flow stability could be improved, the overall financial health is robust.
Income Statement
85
Very Positive
DENSO exhibits strong revenue growth and improving profitability. The gross profit margin is healthy, and the net profit margin has shown consistent improvement over the years, indicating effective cost management. EBIT and EBITDA margins are also solid, suggesting robust operational efficiency.
Balance Sheet
78
Positive
The balance sheet is stable with a strong equity base, as evidenced by a solid equity ratio. The debt-to-equity ratio is manageable, reflecting prudent leverage. Return on equity has improved, demonstrating effective use of shareholders' funds, though there is room for further enhancement.
Cash Flow
82
Very Positive
DENSO's cash flow generation capabilities are strong, with increasing free cash flows. The operating cash flow to net income ratio indicates efficient cash conversion, and free cash flow growth is promising, although there was a slight decline in operating cash flows recently.
BreakdownDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue7.16T7.14T6.40T5.52T4.94T
Gross Profit1.10T1.09T911.14B801.49B661.49B
EBITDA971.41B846.45B875.11B765.38B561.38B
Net Income419.08B312.79B314.63B263.90B125.06B
Balance Sheet
Total Assets8.13T9.09T7.41T7.43T6.77T
Cash, Cash Equivalents and Short-Term Investments986.53B789.39B767.57B885.54B912.92B
Total Debt699.38B850.72B889.27B991.43B854.22B
Total Liabilities2.94T3.35T2.83T2.94T2.69T
Stockholders Equity4.98T5.53T4.38T4.30T3.89T
Cash Flow
Free Cash Flow378.67B515.42B188.41B23.49B2.55B
Operating Cash Flow758.74B961.83B602.72B395.64B437.24B
Investing Cash Flow121.90B-459.49B-363.68B-301.58B-395.90B
Financing Cash Flow-677.43B-496.66B-400.10B-159.54B238.66B

DENSO Technical Analysis

Technical Analysis Sentiment
Positive
Last Price2138.00
Price Trends
50DMA
1983.02
Positive
100DMA
1921.35
Positive
200DMA
1999.53
Positive
Market Momentum
MACD
38.73
Negative
RSI
65.58
Neutral
STOCH
81.64
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:6902, the sentiment is Positive. The current price of 2138 is above the 20-day moving average (MA) of 2057.30, above the 50-day MA of 1983.02, and above the 200-day MA of 1999.53, indicating a bullish trend. The MACD of 38.73 indicates Negative momentum. The RSI at 65.58 is Neutral, neither overbought nor oversold. The STOCH value of 81.64 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:6902.

DENSO Peers Comparison

Overall Rating
UnderperformOutperform
Sector (67)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
81
Outperform
¥436.15B14.186.27%2.39%5.36%11.21%
78
Outperform
$5.65T15.007.99%2.99%-0.33%29.09%
76
Outperform
$3.08T15.638.70%1.91%4.17%9.78%
72
Outperform
¥624.47B11.837.68%2.74%-4.97%57.64%
69
Neutral
$1.67T12.886.66%2.61%0.62%124.47%
67
Neutral
¥277.28B14.746.81%2.50%5.07%-23.76%
66
Neutral
$439.04B22.284.26%3.66%-1.03%-64.10%
* Consumer Cyclical Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
JP:6902
DENSO
2,138.00
-49.02
-2.24%
JP:7276
Koito Manufacturing Co
2,044.00
106.80
5.51%
JP:6923
Stanley Electric Co
2,937.00
235.12
8.70%
JP:3116
Toyota Boshoku
2,359.50
575.58
32.26%
JP:5802
Sumitomo Electric Industries
4,025.00
1,713.18
74.11%
JP:7259
Aisin Seiki Co
2,302.50
697.25
43.44%

DENSO Corporate Events

DENSO Revises Full-Year Revenue Forecast Upwards
Jul 31, 2025

DENSO Corporation has revised its consolidated full-year financial results forecast for the fiscal year ending March 31, 2026, increasing its revenue projection by 2.13% to 7.2 trillion yen. This adjustment reflects the company’s first-quarter performance and anticipated sales growth due to tariff cost reflections from the second quarter onwards, while other financial metrics remain unchanged.

The most recent analyst rating on (JP:6902) stock is a Buy with a Yen2900.00 price target. To see the full list of analyst forecasts on DENSO stock, see the JP:6902 Stock Forecast page.

DENSO Announces Progress in Share Repurchase Program
Jul 4, 2025

DENSO Corporation announced the repurchase of 16,550,500 shares of its common stock at a total cost of 31,850,459,250 yen during June 2025. This move is part of a larger share repurchase program approved in October 2024, aiming to buy back up to 280 million shares by October 2025, indicating a strategic effort to enhance shareholder value and optimize capital structure.

The most recent analyst rating on (JP:6902) stock is a Buy with a Yen2800.00 price target. To see the full list of analyst forecasts on DENSO stock, see the JP:6902 Stock Forecast page.

DENSO Completes Disposal of Treasury Stock for Compensation
Jun 16, 2025

DENSO CORPORATION has completed the disposal of 267,679 shares of its treasury stock as restricted stock compensation, a move resolved by its Board of Directors on May 19, 2025. This disposal, valued at 514,479,038 yen, is aimed at compensating directors and senior executive officers, potentially impacting the company’s financial structuring and aligning the interests of its leadership with company performance.

The most recent analyst rating on (JP:6902) stock is a Buy with a Yen2800.00 price target. To see the full list of analyst forecasts on DENSO stock, see the JP:6902 Stock Forecast page.

DENSO Announces Share Repurchase Plan Linked to Toyota Industries Tender Offer
Jun 3, 2025

DENSO Corporation has announced its intention to repurchase its own shares through a tender offer, contingent on the successful completion of a related tender offer for Toyota Industries by Toyota Fudosan. This strategic move is expected to impact DENSO’s shareholding structure and could have implications for its market positioning and stakeholder interests.

The most recent analyst rating on (JP:6902) stock is a Buy with a Yen2800.00 price target. To see the full list of analyst forecasts on DENSO stock, see the JP:6902 Stock Forecast page.

DENSO to Participate in Toyota Industries Tender Offer, Anticipates Extraordinary Gains
Jun 3, 2025

DENSO CORPORATION has announced its decision to participate in a tender offer for its shares in Toyota Industries Corporation, aiming to maximize sale price and improve capital efficiency. The company expects to post significant extraordinary gains from this transaction in its non-consolidated results for the fiscal year ending March 31, 2026, while maintaining its business relationship with Toyota Industries.

The most recent analyst rating on (JP:6902) stock is a Buy with a Yen2800.00 price target. To see the full list of analyst forecasts on DENSO stock, see the JP:6902 Stock Forecast page.

DENSO Announces Progress in Treasury Stock Repurchase
Jun 2, 2025

DENSO CORPORATION has announced the status of its treasury stock repurchase, with 19,778,800 common shares repurchased at a total cost of 38,094,785,350 yen during May 2025. This move is part of a larger plan approved in October 2024 to repurchase up to 280 million shares, indicating a strategic effort to optimize capital structure and potentially enhance shareholder value.

The most recent analyst rating on (JP:6902) stock is a Buy with a Yen2800.00 price target. To see the full list of analyst forecasts on DENSO stock, see the JP:6902 Stock Forecast page.

DENSO Launches Employee Shareholding Incentive Plan
May 19, 2025

DENSO Corporation announced the implementation of an Employee Shareholding Association – Restricted Stock Incentive Plan, aimed at enhancing corporate value and stakeholder engagement by disposing of treasury stock to its Employee Shareholding Association. This initiative is designed to motivate employees and align their interests with the company’s long-term goals, potentially impacting employee engagement and asset-building efforts.

The most recent analyst rating on (JP:6902) stock is a Buy with a Yen2800.00 price target. To see the full list of analyst forecasts on DENSO stock, see the JP:6902 Stock Forecast page.

DENSO Announces Treasury Stock Disposal for Long-term Incentive Plan
May 19, 2025

DENSO CORPORATION has announced the disposal of 267,679 shares of its treasury stock as part of a restricted stock compensation plan aimed at providing medium- to long-term incentives to its directors and senior executive officers. This move is designed to align the interests of the company’s leadership with those of its shareholders by sharing shareholder value and enhancing motivation among eligible directors. The plan includes a 30-year transfer restriction period to ensure long-term commitment and value sharing.

The most recent analyst rating on (JP:6902) stock is a Buy with a Yen2800.00 price target. To see the full list of analyst forecasts on DENSO stock, see the JP:6902 Stock Forecast page.

DENSO Reports Extraordinary Gains from Investment Securities Sale
May 13, 2025

DENSO Corporation has announced the determination of extraordinary gains amounting to 105.8 billion JPY from the sale of investment securities. These gains will be reported in the non-consolidated financial results for the fiscal year ending March 31, 2026, with no impact on the consolidated results due to the adoption of International Financial Reporting Standards (IFRS).

The most recent analyst rating on (JP:6902) stock is a Buy with a Yen2800.00 price target. To see the full list of analyst forecasts on DENSO stock, see the JP:6902 Stock Forecast page.

DENSO to Sell Renesas Shares, Anticipates Financial Gains
May 12, 2025

DENSO Corporation has announced the sale of a portion of its investment in Renesas Electronics, expecting to post extraordinary gains in its non-consolidated financial results for the year ending March 31, 2026. This decision aligns with DENSO’s financial strategy to improve capital efficiency and reduce low-profit assets, while maintaining a collaborative relationship with Renesas to support its semiconductor strategy and business growth.

DENSO Reports Progress on Treasury Stock Repurchase
May 9, 2025

DENSO CORPORATION announced the status of its treasury stock repurchase, acquiring 27,941,200 shares at a cost of 48,647,041,950 yen during April 2025. This repurchase is part of a larger plan authorized in October 2024, allowing for the acquisition of up to 280 million shares by October 2025, indicating a strategic move to enhance shareholder value and optimize capital structure.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Jul 24, 2025