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Nidec (NJDCY)
OTHER OTC:NJDCY
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Nidec
(OTC:NJDCY)
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Rating:58Neutral
Price Target:
$4.00
â–²(21.21% Upside)
Action:ReiteratedDate:01/13/26
The score is driven primarily by improved profitability and a healthier balance sheet, but it is held back by the sharp TTM revenue contraction and only moderate/softening cash-flow conversion. Technicals add additional caution given the weak longer-term price trend, while valuation is neutral with a modest dividend.
Positive Factors
Profitability Improvement
Sustained improvement in EBIT and net margins indicates better operational efficiency and pricing power. Over 2–6 months this supports reinvestment in product development and competitiveness, improves resilience to cost shocks, and underpins steady earnings generation for OEM program commitments.
Strong Balance Sheet
Material equity relative to low leverage reduces refinancing and liquidity risk, enabling sustained capex, program ramp-ups, and potential M&A. A resilient balance sheet supports multi-year supply contracts with OEMs and cushions cyclical downturns without forcing fire-sales of assets.
Diversified Motor Franchise
Broad product mix across precision, appliance, industrial and automotive motors limits single-market dependency and leverages scale in manufacturing and control electronics. Structural exposure to vehicle electrification and diverse end markets supports multi-year revenue opportunities.
Negative Factors
Sharp TTM Revenue Decline
A meaningful recent revenue contraction signals demand or mix headwinds that can persist across quarters. Reduced volumes harm operating leverage, pressure margins and R&D investment, and may indicate lost programs or slower OEM production that weigh on medium-term growth.
Moderate Cash Conversion
Lower cash conversion and a falling free cash flow trend constrain the company’s ability to fund capex, dividends and strategic investments from operations. Persistent working-capital drag or uneven cash realization raises execution risk on long lead-time EV and factory programs.
OEM-Driven Cyclicality
Heavy dependence on OEM production cycles creates structural revenue volatility and timing risk for program ramps. This makes long-term planning and margin stability sensitive to auto and electronics demand swings, potentially exacerbating downturns in multi-quarter windows.
Nidec (NJDCY) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$16.26B
Dividend Yield1.54%
Average Volume (3M)24.75K
Price to Earnings (P/E)17.9
Beta (1Y)0.70
Revenue Growth6.23%
EPS Growth27.64%
CountryUS
Employees101,112
SectorIndustrials
Sector Strength72
IndustryIndustrial - Machinery
Share Statistics
EPS (TTM)0.06
Shares Outstanding4,770,276,000
10 Day Avg. Volume0
30 Day Avg. Volume24,750
Financial Highlights & Ratios
PEG Ratio0.51
Price to Book (P/B)1.68
Price to Sales (P/S)1.11
P/FCF Ratio17.62
Enterprise Value/Market Cap182.02
Enterprise Value/Revenue1.13
Enterprise Value/Gross Profit6.27
Enterprise Value/Ebitda7.65
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
EPS Forecast (FY)0.17
Revenue Forecast (FY)$16.73B
Nidec Business Overview & Revenue Model
Company DescriptionNidec Corporation, together with its subsidiaries, develops, manufactures, and sells motors, electronics and optical components, and other related products in Japan and internationally. The company offers medium- and large-size motors, small-size and precision motors, motor-related products, units and modules, automotive components, mechanical equipment, inspection and measuring equipment, electronic devices, sensors, and other products. Its products are used for applications in robotics, IoT products, automotive components, home appliances, logistics/agriculture, information technology, office automation, mobile devices and optical components, medical and health care products, housing equipment, commercial and professional products, industrial machinery, and processing/inspection equipment. The company was incorporated in 1973 and is headquartered in Kyoto, Japan.
How the Company Makes MoneyNidec makes money primarily by manufacturing and selling motors, motor systems, and related components to OEMs and other manufacturers across multiple end markets. Key revenue streams include: (1) Small precision motors—high-volume motors used in applications such as hard disk drives and other precision devices, generating revenue through unit sales to electronics and storage-industry customers; (2) Appliance, commercial, and industrial motors and drive solutions—motors and motor-driven systems sold into home appliances, building equipment, factory automation, and other industrial uses, with revenue driven by equipment demand and long-term customer supply relationships; (3) Automotive products—traction motors and motor-related systems for electric and hybrid vehicles and other automotive motor applications, earning revenue through supply agreements and production programs with automotive OEMs and tier suppliers; and (4) Related components, machinery, and electronics—sales of motor control electronics, actuators, and production equipment associated with Nidec’s manufacturing and motion-control businesses. Across these segments, earnings are influenced by OEM production volumes in end markets (notably automotive and electronics), product mix (higher value-added motor systems versus commodity motors), and the company’s ability to win and retain large supply programs that require scale manufacturing, quality control, and ongoing engineering support.
Nidec Earnings Call Summary
Earnings Call Date:Jan 22, 2026
(Q3-2025)
| % Change Since: |
Next Earnings Date:Apr 29, 2026
Earnings Call Sentiment Neutral
The earnings call highlighted record-high net sales and operating profit, growing demand in AI servers and water cooling systems, and successful profitability in the Chinese traction business. However, there were significant challenges such as decreases in operating profit before taxes due to currency fluctuations, delivery delays, and sluggish automotive markets in Europe and America. Despite these challenges, the company remains optimistic about future growth and improvements in various segments.Q3-2025 Updates
Positive Updates
Record High Net Sales and Operating Profit
Net sales increased by 11.5% to JPY1.946 trillion, and operating profit increased by 5.0% to JPY175.5 billion, both achieving record-high results.
Growing AI Server Demand
The demand for AI servers has been growing rapidly, contributing positively to the company's revenue.
Water Cooling System Business Expansion
The water cooling system business, including GPU and chipsets, is enjoying growing momentum, with expectations to become a JPY500 billion business in the future.
Profit in Chinese Traction Business
The traction business based in China has started generating profit from Q3, with expectations for continuing profits in Q4 and beyond.
Strong Order Intake in Machine Tool Segment
Machine tool segment has seen a 1.5x increase in order intake, with significant growth in China and the United States.
Participation in IOWN
Nidec decided to participate in the IOWN initiative to acquire technology necessary for their five business pillars.
Negative Updates
Decrease in Operating Profit Before Income Taxes
Operating profit before income taxes decreased by 4.7% due to currency exchange rate fluctuations and financial losses amounting to JPY22.5 billion.
Loss Due to Delivery Delays
There was a loss incurred in the latest quarter due to delays in product delivery to customers.
Sluggish Automotive Market in Europe and America
The automotive segment faced a sluggish situation in the European and American markets, leading to restructuring efforts and profit losses.
Seasonal Loss in U.S. Motor Products
The U.S. motor products experienced a seasonal temporary loss in momentum, affecting overall profitability.
Challenges in ACIM and AMEC Business Units
The ACIM and AMEC business units are facing severe situations and restructuring costs, with expectations for future improvements.
Company Guidance
During the call, Nidec Corporation provided detailed guidance on their financial performance and strategic initiatives. The company reported a record high in net sales, up 11.5% to JPY1.946 trillion, and operating profit, up 5.0% to JPY175.5 billion, despite a financial loss of JPY22.5 billion due to currency fluctuations. The demand for AI server products is growing rapidly, while the hard disk motor demand remains high. The automotive segment in China is profitable, though European and American markets lag. The company is focusing on cash flow management, with JPY41.1 billion in operating cash flow. Nidec plans significant structural reforms and business expansions in fiscal year 2025, including broadening their water cooling system business and participating in the IOWN initiative. They aim to enhance their competitive edge and global presence, setting a course for double-digit profitability by FY '25. The company also discussed their intention to acquire Makino Milling Machine, emphasizing the strategic synergies and growth potential from this acquisition.Nidec Financial Statement Overview
Summary
Profitability has improved (TTM net margin ~6.8%, EBIT margin ~9.3%) and leverage is moderate with a strong equity base (TTM debt-to-equity ~0.15). Offsetting this, TTM revenue fell sharply (-24.7%) and cash conversion is only moderate with softer recent free cash flow (TTM FCF down ~14.5%).Income Statement
Profitability is solid and has improved versus the weaker FY2023 year: net margin rose from ~2.0% (FY2023) to ~5.3% (FY2024) and ~6.4% (FY2025 annual), and TTM (Trailing-Twelve-Months) net margin remains healthy at ~6.8%. Operating profitability is steady-to-improving (EBIT margin ~9–10% in FY2024–FY2025 and ~9.3% in TTM). The key concern is growth momentum: revenue growth was positive in recent annual periods (FY2024 ~4.7%, FY2025 ~11.1%) but the TTM shows a sharp revenue decline (-24.7%), suggesting a meaningful demand/volume or mix headwind.63
Positive
Balance Sheet
Leverage is moderate and has improved materially from earlier peaks: debt-to-equity moved from ~0.52 (FY2023) down to ~0.11 (FY2024), ~0.37 (FY2025 annual), and ~0.15 in TTM (Trailing-Twelve-Months). Equity base is sizable relative to debt (TTM equity ~1.76T vs. debt ~0.26T), which supports balance sheet resilience. Return on equity has recovered from a weak FY2023 (~3.3%) to ~7.6% (FY2024) and ~9.8–10.2% (FY2025/TTM), but it is not yet consistently at a high level for the sector, indicating profitability/asset efficiency still has room to improve.72
Positive
Cash Flow
Cash generation is positive with TTM (Trailing-Twelve-Months) operating cash flow (~187B) and free cash flow (~120B) both solidly positive, following a return to stronger free cash flow in FY2024 (~193B) after negative free cash flow in FY2022 and FY2023. However, cash conversion is only moderate: free cash flow is ~58% of net income in TTM (similar in FY2024–FY2025), and operating cash flow relative to net income is low (~0.27x in TTM and ~0.27x in FY2025), which can signal working-capital drag or less consistent cash realization. Recent trend is also softer, with TTM free cash flow down ~14.5%.58
Neutral
| Breakdown | TTM | Mar 2026 | Mar 2025 | Mar 2024 | Mar 2023 | Mar 2022 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 2.63T | 2.61T | 2.35T | 2.23T | 1.92T | 1.62T |
| Gross Profit | 472.00B | 537.00B | 496.57B | 413.32B | 404.37B | 366.42B |
| EBITDA | 386.96B | 378.27B | 356.38B | 209.44B | 280.62B | 241.43B |
| Net Income | 178.91B | 167.69B | 125.39B | 44.96B | 135.76B | 121.94B |
Balance Sheet | ||||||
| Total Assets | 3.49T | 3.33T | 3.17T | 2.87T | 2.68T | 2.26T |
| Cash, Cash Equivalents and Short-Term Investments | 347.40B | 246.24B | 220.77B | 189.91B | 201.59B | 230.08B |
| Total Debt | 255.87B | 636.05B | 600.90B | 705.35B | 595.71B | 531.47B |
| Total Liabilities | 1.71T | 1.58T | 1.50T | 1.50T | 1.36T | 1.14T |
| Stockholders Equity | 1.76T | 1.72T | 1.64T | 1.35T | 1.29T | 1.10T |
Cash Flow | ||||||
| Free Cash Flow | 159.83B | 163.72B | 193.05B | -10.25B | -20.23B | 119.23B |
| Operating Cash Flow | 257.72B | 284.43B | 321.49B | 143.49B | 94.99B | 219.16B |
| Investing Cash Flow | -111.98B | -147.25B | -153.55B | -167.72B | -116.75B | -115.16B |
| Financing Cash Flow | -26.05B | -80.19B | -181.56B | -16.46B | -60.24B | -121.60B |
Nidec Technical Analysis
Negative
3.30
Price Trends
3.63
Negative
3.51
Positive
4.12
Negative
Market Momentum
-0.02
Positive
48.14
Neutral
34.14
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For NJDCY, the sentiment is Negative. The current price of 3.3 is below the 20-day moving average (MA) of 3.72, below the 50-day MA of 3.63, and below the 200-day MA of 4.12, indicating a bearish trend. The MACD of -0.02 indicates Positive momentum. The RSI at 48.14 is Neutral, neither overbought nor oversold. The STOCH value of 34.14 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for NJDCY.
Nidec Peers Comparison
UnderperformOutperform
Sector (63)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
70 Outperform | $32.82B | 54.24 | 5.70% | 0.10% | 4.20% | -34.47% | |
68 Neutral | $14.49B | 26.14 | 17.48% | 0.96% | 0.83% | -1.32% | |
68 Neutral | $40.90B | 35.94 | 27.69% | 1.33% | 0.98% | -7.51% | |
67 Neutral | $9.90B | 31.85 | 25.19% | 1.28% | 2.37% | -6.93% | |
63 Neutral | $10.79B | 15.43 | 7.44% | 2.01% | 2.89% | -14.66% | |
61 Neutral | $12.53B | 33.29 | 4.18% | 0.97% | -4.99% | 22.16% | |
58 Neutral | $16.26B | 17.85 | 10.18% | 1.54% | 6.23% | 27.64% |
* Industrials Sector Average
NJDCY
Nidec
3.55
-1.00
-22.00%
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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.