Tokyo Electron Ltd. (JP:8035)
:8035
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Tokyo Electron
(8035)
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Rating:78Outperform
Price Target:
¥42,442.00
▼(-0.04% Downside)
Action:ReiteratedDate:01/14/26
The score is driven primarily by very strong financial performance (high profitability, low leverage, and solid cash flow). This is tempered by overbought technical signals and a relatively high P/E with only a modest dividend yield.
Positive Factors
High profitability and margins
Sustained high gross and operating margins indicate durable pricing power and efficient manufacturing for capital equipment. These margins enable reinvestment in product development and service infrastructure, supporting long-term competitiveness through semiconductor technology cycles and margin resilience.
Negative Factors
Modest revenue growth
Top-line expansion is relatively modest given the company’s scale and industry opportunity. Limited revenue growth constrains absolute earnings growth potential and puts greater reliance on margin expansion and buybacks to deliver shareholder returns over the medium term.
Read all positive and negative factors
Positive Factors
Negative Factors
High profitability and margins
Sustained high gross and operating margins indicate durable pricing power and efficient manufacturing for capital equipment. These margins enable reinvestment in product development and service infrastructure, supporting long-term competitiveness through semiconductor technology cycles and margin resilience.
Read all positive factors
Tokyo Electron (8035) vs. iShares MSCI Japan ETF (EWJ)
Market Cap
¥20.18T
Dividend Yield1.79%
Average Volume (3M)5.80M
Price to Earnings (P/E)33.2
Beta (1Y)1.35
Revenue Growth16.74%
EPS Growth16.03%
CountryJP
Employees17,702
SectorTechnology
Sector Strength88
IndustrySemiconductors
Share Statistics
EPS (TTM)258.59
Shares Outstanding471,632,720
10 Day Avg. Volume5,268,610
30 Day Avg. Volume5,798,936
Financial Highlights & Ratios
PEG Ratio0.33
Price to Book (P/B)4.99
Price to Sales (P/S)3.81
P/FCF Ratio21.84
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
¥50,681.42Price Target Upside19.36% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering14
EPS Forecast (FY)1,415
Revenue Forecast (FY)¥2.90T
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...
How the Company Makes Money
Tokyo Electron primarily makes money by selling capital equipment used in semiconductor wafer fabs and, to a lesser extent, equipment used in flat panel display manufacturing. Revenue is typically recognized from (1) tool sales: customers (IDMs, f...
Tokyo Electron Earnings Call Summary
Earnings Call Date:Feb 06, 2025
(Q3-2025)
| % Change Since: |
Next Earnings Date:Aug 06, 2026
Earnings Call Sentiment Positive
The earnings call reflects a positive outlook driven by strong financial performance, record growth projections, and advancements in AI technology. Despite challenges such as cash flow issues, China market volatility, and regulatory hurdles, the company remains confident in its strategic initiatives and technological advancements.Positive Updates
Strong Financial Performance
Net sales reached ¥654.5 billion, a 15.5% increase from the previous quarter. Gross profit was ¥311.7 billion, a 19.9% increase, and operating income reached ¥199.6 billion, a 34.7% increase. Net income attributable to owners of parent was ¥157.2 billion, a 33.6% increase.
Negative Updates
Cash Flow Challenges
The third quarter saw a free cash outflow of ¥64.1 billion due to transient increase in receivables and tax payments, though improvement is expected in the fourth quarter.
Read all updates
Q3-2025 Updates
Positive
Negative
Strong Financial Performance
Net sales reached ¥654.5 billion, a 15.5% increase from the previous quarter. Gross profit was ¥311.7 billion, a 19.9% increase, and operating income reached ¥199.6 billion, a 34.7% increase. Net income attributable to owners of parent was ¥157.2 billion, a 33.6% increase.
Read all positive updates
Company Guidance
During the third quarter of the fiscal year ending March 2025, Tokyo Electron reported robust financial performance, with net sales reaching ¥654.5 billion, marking a 15.5% increase from the previous quarter. The company achieved a gross profit of ¥311.7 billion, representing a 19.9% rise, and an improved gross profit margin of 47.6%, up by 1.7 percentage points. Operating income surged by 34.7% to ¥199.6 billion, with an operating profit margin of 30.5%, up by 4.3 percentage points. Income before income taxes increased by 30.3% to ¥200.1 billion, and net income attributable to owners stood at ¥157.2 billion, a 33.6% rise. The company reported capital expenditures of ¥50.2 billion, focusing on future growth investments. The balance sheet showed total assets at ¥2,501.9 billion, with a notable decline in cash and cash equivalents by ¥230.0 billion due to dividends, share repurchase, and tax payments. Free cash outflow was reported at ¥64.1 billion, with expectations for positive figures in the fourth quarter. The ongoing strategic share repurchase program saw the acquisition of 2,024,200 shares at ¥46.9 billion, completed in January 2025.Tokyo Electron Financial Statement Overview
Summary
Income Statement
92
Very Positive
Balance Sheet
88
Very Positive
Cash Flow
85
Very Positive
| Breakdown | TTM | Mar 2025 | Mar 2024 | Mar 2023 | Mar 2022 | Mar 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 2.39T | 2.43T | 1.83T | 2.21T | 2.00T | 1.40T |
| Gross Profit | 1.09T | 1.15T | 830.27B | 984.41B | 911.82B | 564.95B |
| EBITDA | 718.41B | 768.38B | 508.68B | 660.82B | 636.20B | 354.73B |
| Net Income | 503.13B | 544.13B | 363.96B | 471.58B | 437.08B | 242.94B |
Balance Sheet | ||||||
| Total Assets | 2.64T | 2.63T | 2.46T | 2.31T | 1.89T | 1.43T |
| Cash, Cash Equivalents and Short-Term Investments | 418.48B | 496.24B | 472.55B | 473.10B | 371.27B | 311.55B |
| Total Debt | 86.95B | 21.40B | 13.32B | 13.22B | 4.36B | 3.81B |
| Total Liabilities | 629.76B | 770.77B | 696.28B | 712.07B | 547.41B | 400.80B |
| Stockholders Equity | 2.01T | 1.86T | 1.76T | 1.60T | 1.35T | 1.02T |
Cash Flow | ||||||
| Free Cash Flow | 272.08B | 423.80B | 317.73B | 359.37B | 227.23B | 92.08B |
| Operating Cash Flow | 598.77B | 582.17B | 434.72B | 426.27B | 283.39B | 145.89B |
| Investing Cash Flow | -168.67B | -169.61B | -125.15B | -41.76B | -55.63B | -18.27B |
| Financing Cash Flow | -298.02B | -388.84B | -325.01B | -256.53B | -167.26B | -114.53B |
Tokyo Electron Technical Analysis
Positive
42460.00
Price Trends
40707.30
Positive
37790.40
Positive
31794.18
Positive
Market Momentum
459.17
Negative
57.54
Neutral
87.96
Negative
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 42460 is above the 20-day moving average (MA) of 39590.69, above the 50-day MA of 40707.30, and above the 200-day MA of 31794.18, indicating a bullish trend. The MACD of 459.17 indicates Negative momentum. The RSI at 57.54 is Neutral, neither overbought nor oversold. The STOCH value of 87.96 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:8035.
Tokyo Electron Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
81 Outperform | ¥3.75T | 25.03 | 53.12% | 1.11% | 32.51% | 57.19% | |
78 Outperform | ¥20.18T | 33.18 | 26.01% | 1.79% | 16.74% | 16.03% | |
78 Outperform | ¥2.00T | 15.60 | 21.73% | 2.29% | 11.29% | 11.38% | |
77 Outperform | ¥17.43T | 45.29 | 47.37% | 0.25% | 63.36% | 149.43% | |
77 Outperform | ¥652.44B | 24.84 | 12.66% | 2.28% | 9.53% | -11.17% | |
75 Outperform | ¥7.26T | 35.55 | 25.78% | 0.79% | 13.45% | 20.37% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% |
* Technology Sector Average
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Tokyo Electron Corporate Events
Tokyo Electron to Cancel 3.6 Million Treasury Shares to Streamline Capital Base
Mar 27, 2026
Tokyo Electron Limited has approved the cancellation of 3.6 million shares of its common stock, equivalent to 0.76% of its outstanding shares, under Article 178 of the Companies Act of Japan. The cancellation is scheduled for April 30, 2026, and w...
Tokyo Electron Completes ¥150 Billion Share Buyback Program
Mar 27, 2026
Tokyo Electron has completed a share repurchase program authorized by its board on February 6, 2026, under which it bought back 1,854,800 common shares for about ¥75.0 billion on the Tokyo Stock Exchange between March 1 and March 9, 2026. Thi...
Tokyo Electron Revamps Board Slate Ahead of June Shareholders’ Meeting
Mar 27, 2026
Tokyo Electron has announced a slate of nine candidates for its Board of Directors, combining reappointments with new nominees ahead of the Annual General Meeting of Shareholders scheduled for June 23, 2026. The proposed lineup includes a mix of i...
Tokyo Electron Progresses ¥150 Billion Share Buyback Program
Mar 2, 2026
Tokyo Electron has repurchased 1,765,600 shares of its common stock on the Tokyo Stock Exchange between February 9 and February 28, 2026, at a total cost of about ¥75.0 billion. This move is part of a broader share buyback program authorized ...
Tokyo Electron to Book ¥76 Billion Extraordinary Gain from Sale of Investment Securities
Feb 6, 2026
Tokyo Electron’s board has approved the sale of a portion of its listed investment securities, a move aimed at reducing strategic shareholdings and improving capital efficiency. The transactions, scheduled to occur between February and March...
Tokyo Electron Launches ¥150 Billion Share Buyback to Optimize Capital Structure
Feb 6, 2026
Tokyo Electron Limited’s board has approved a share repurchase program authorizing the buyback of up to 7.5 million common shares, representing about 1.6% of its outstanding stock excluding treasury shares, for a total consideration of up to...
Tokyo Electron Posts Strong Nine-Month Earnings and Lifts Full-Year Profit Outlook
Feb 6, 2026
Tokyo Electron reported robust consolidated results for the nine months ended December 31, 2025, with net sales of ¥1.78 trillion, up 38.4% year on year, and operating income surging 65.1% to ¥513.5 billion. Net income attributable to ow...
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.