Tokyo Electron (8035) AI Stock Analysis

• Market Cap: ¥14.29T
• Dividend Yield: 1.89%
• Average Volume (3M): 5.80M
• Price to Earnings (P/E): 26.4
• Beta (1Y): 1.45
• Revenue Growth: 16.74%
• EPS Growth: 16.03%
• Country: JP
• Employees: 17,702
• Sector: Technology
• Sector Strength: 88
• Industry: Semiconductors
• EPS (TTM): 311.99
• Shares Outstanding: 471,632,720
• 10 Day Avg. Volume: 5,268,610
• 30 Day Avg. Volume: 5,798,936
• PEG Ratio: 0.33
• Price to Book (P/B): 4.99
• Price to Sales (P/S): 3.81
• P/FCF Ratio: 21.84
• 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: ¥38,404.26
• Price Target Upside: 15.78% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 4
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 73 Outperform
• Price Target: ¥33,636.00 ▲(1.40% Upside)

Tokyo Electron's strong financial performance is the primary driver of its overall score, supported by robust profitability and financial stability. The technical analysis presents mixed signals, with potential short-term weakness but long-term strength. The valuation is reasonable, offering moderate growth potential and a modest dividend yield.

Positive Factors

Strong Financial Position

The company's low leverage and high return on equity underscore its financial health, positioning it well for future growth in the semiconductor industry.

Revenue Growth

Consistent revenue growth indicates expanding market reach and product adoption, vital for maintaining competitive advantage in the semiconductor industry.

Cash Generation Ability

Strong cash flow management supports operational and strategic initiatives, enhancing the company's ability to invest in R&D and future growth.

Negative Factors

Geopolitical Risks

Involvement in Chinese semiconductor manufacturing poses geopolitical risks, potentially impacting long-term business operations due to regulatory scrutiny.

Cyclical Industry Exposure

Dependence on the cyclical semiconductor industry can lead to revenue volatility, affecting long-term financial stability during downturns.

Regulatory Scrutiny

Increased regulatory scrutiny due to national security concerns could lead to restrictions, impacting Tokyo Electron's market access and growth prospects.

Tokyo Electron Business Overview & Revenue Model

Company Description

Tokyo Electron Limited, together with its subsidiaries, develops, manufactures, and sells semiconductor and flat panel display (FPD) production equipment in Japan, Europe, North America, Taiwan, China, South Korea, and internationally. The company's Semiconductor Production Equipment segment offers coaters/developers, etch systems, deposition systems, and cleaning systems used in wafer processing; wafer probers used in wafer testing process; and wafer bonders/debonders. Its Flat Panel Display Production Equipment segment provides coaters/developers and etch/ash systems for use in the manufacture of FPDs, as well as inkjet printing systems for manufacturing OLED panels. The company also offers logistic, facility maintenance, and insurance services. Tokyo Electron Limited was incorporated in 1951 and is headquartered in Tokyo, Japan.

How the Company Makes Money

Tokyo Electron generates revenue primarily through the sale of semiconductor manufacturing equipment and services, which constitute the bulk of its earnings. The company’s revenue model is heavily reliant on the cyclical nature of the semiconductor industry, where demand for equipment tends to increase in line with technological advancements and consumer electronics growth. Key revenue streams include the sale of capital equipment, maintenance and support services, and spare parts for existing equipment. Additionally, TEL benefits from strategic partnerships with leading semiconductor manufacturers, which can lead to long-term contracts and collaborations on new technologies. The company also invests in research and development to innovate and improve its product offerings, ensuring a competitive edge in the market.

Tokyo Electron Financial Statement Overview

Summary

Tokyo Electron exhibits a strong financial position with robust profitability, efficient cash flow management, and a stable balance sheet. The company's low leverage and high return on equity further underscore its financial health, positioning it well for future growth in the semiconductor industry.

Income Statement

Tokyo Electron has demonstrated strong revenue growth of 4.65% in the latest year, with impressive gross and net profit margins of 47.14% and 22.38%, respectively. The EBIT and EBITDA margins are also robust at 29.04% and 31.60%, indicating efficient operational management. These metrics highlight the company's strong profitability and growth trajectory in the semiconductor industry.

Balance Sheet

The company maintains a very low debt-to-equity ratio of 0.0115, showcasing financial stability and low leverage risk. With a high return on equity of 29.33%, Tokyo Electron effectively generates profits from its equity base. The equity ratio stands at 70.65%, reflecting a solid capital structure with significant equity financing.

Cash Flow

Tokyo Electron's free cash flow growth rate of 39.73% is a positive indicator of its cash-generating ability. The operating cash flow to net income ratio of 0.86 and free cash flow to net income ratio of 0.73 suggest strong cash flow management, supporting operational and strategic initiatives.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	2.49T	2.43T	1.83T	2.21T	2.00T	1.40T
Gross Profit	1.16T	1.15T	830.27B	984.41B	911.82B	564.95B
EBITDA	759.47B	768.38B	508.68B	660.82B	636.20B	354.73B
Net Income	541.86B	544.13B	363.96B	471.58B	437.08B	242.94B
Balance Sheet
Total Assets	2.67T	2.63T	2.46T	2.31T	1.89T	1.43T
Cash, Cash Equivalents and Short-Term Investments	455.24B	496.24B	472.55B	473.10B	371.27B	311.55B
Total Debt	0.00	21.40B	13.32B	13.22B	4.36B	3.81B
Total Liabilities	662.38B	770.77B	696.28B	712.07B	547.41B	400.80B
Stockholders Equity	2.00T	1.86T	1.76T	1.60T	1.35T	1.02T
Cash Flow
Free Cash Flow	284.78B	423.80B	317.73B	359.37B	227.23B	92.08B
Operating Cash Flow	500.59B	582.17B	434.72B	426.27B	283.39B	145.89B
Investing Cash Flow	-218.78B	-169.61B	-125.15B	-41.76B	-55.63B	-18.27B
Financing Cash Flow	-345.89B	-388.84B	-325.01B	-256.53B	-167.26B	-114.53B

Tokyo Electron Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 33170.00
• 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:8035, the sentiment is Positive. The current price of 33170 is above the 20-day moving average (MA) of 32050.00, above the 50-day MA of 31854.80, and above the 200-day MA of 25211.28, indicating a bullish trend. The MACD of -8.30 indicates Positive momentum. The RSI at 56.29 is Neutral, neither overbought nor oversold. The STOCH value of 37.69 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:8035.

Tokyo Electron Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
7735	77 Outperform	¥1.17T	13.31	21.73%	2.43%	11.29%	11.38%
6857	75 Outperform	¥14.05T	53.78	47.37%	0.24%	63.36%	149.43%
6146	73 Outperform	¥4.85T	38.36	25.78%	0.79%	13.45%	20.37%
8035	73 Outperform	¥14.29T	26.42	27.73%	1.89%	16.74%	16.03%
6920	67 Neutral	¥2.57T	27.13	53.12%	1.09%	32.51%	57.19%
6723	64 Neutral	¥3.62T	-75.87	-2.51%	1.31%	-10.97%	-118.87%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%

Tokyo Electron Corporate Events

Tokyo Electron Taiwan Indicted Over Information Leak Incident

Tokyo Electron Taiwan Ltd., a subsidiary of Tokyo Electron Limited, has been indicted by the Taiwan prosecutor’s office for a breach of supervisory obligations under Taiwan’s National Security Act, following an incident involving a former employee leaking confidential customer information. While the indictment does not allege organizational involvement or external leakage, Tokyo Electron Limited emphasizes its commitment to compliance and has pledged to strengthen its information security and compliance systems to prevent future incidents.

Tokyo Electron Increases Interim Dividend Amid Strong Performance

Tokyo Electron Limited announced an increase in its interim dividend for the first half of the fiscal year ending March 31, 2026, raising it to 264 yen per share from the previously forecasted 245 yen. This decision reflects the company’s improved consolidated results and its commitment to linking dividend payments to business performance, aiming to maintain a payout ratio of around 50% based on net income attributable to owners of the parent.

Tokyo Electron Reports Q2 Financial Results with Strategic Adjustments

Tokyo Electron Limited reported its consolidated financial results for the second quarter ending September 30, 2025, showing a slight decline in operating and ordinary income compared to the previous year. Despite this, the company maintains a strong equity position with an increased equity ratio and has revised its dividend forecast, reflecting strategic adjustments to sustain shareholder value amidst fluctuating market conditions.