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TDK Corporation (TTDKY)
OTHER OTC:TTDKY
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TDK
(OTC:TTDKY)
Select Model
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Rating:54Neutral
Price Target:
$14.50
▲(7.49% Upside)
The overall stock score of 54 reflects a combination of mixed financial performance, bearish technical indicators, and valuation concerns. The company's strong profitability margins are offset by liquidity challenges and a high P/E ratio. Technical analysis indicates bearish momentum, contributing to a cautious outlook.
Positive Factors
Profitability Margins
TDK maintains a healthy gross profit margin of 31.08% and a net profit margin of 6.71%, indicating effective cost management and operational efficiency.
Balance Sheet Health
A stable balance sheet with moderate leverage and a solid equity base suggests financial stability, supporting long-term business sustainability.
Market Position
As a leader in electronic components, TDK's strong market position and innovative solutions provide a competitive advantage in high-growth sectors.
Negative Factors
Revenue Decline
A notable revenue decline poses challenges to growth and market competitiveness, potentially impacting future profitability and market share.
Cash Flow Challenges
Declining free cash flow growth limits financial flexibility, affecting the company's ability to invest in growth opportunities and manage debt.
Earnings Growth
Negative EPS growth indicates potential issues in profitability and earnings generation, which could affect investor confidence and future valuations.
TDK (TTDKY) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$25.74B
Dividend Yield1.4%
Average Volume (3M)19.05K
Price to Earnings (P/E)22.1
Beta (1Y)1.12
Revenue Growth8.57%
EPS Growth-0.32%
CountryUS
Employees105,067
SectorTechnology
Sector Strength88
IndustryHardware, Equipment & Parts
Share Statistics
EPS (TTM)0.24
Shares Outstanding1,943,859,900
10 Day Avg. Volume27,071
30 Day Avg. Volume19,046
Financial Highlights & Ratios
PEG Ratio0.53
Price to Book (P/B)1.67
Price to Sales (P/S)1.37
P/FCF Ratio13.67
Enterprise Value/Market Cap153.16
Enterprise Value/Revenue2.38
Enterprise Value/Gross Profit7.81
Enterprise Value/Ebitda13.25
Forecast
1Y Price Target
$18.13Price Target Upside34.40% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering1
EPS Forecast (FY)N/A
Revenue Forecast (FY)N/A
TDK Business Overview & Revenue Model
Company DescriptionTDK Corporation, together with its subsidiaries, engages in manufacture and sale of electronic components in Japan, Europe, China, Asia, the Americas, and internationally. The company operates through four segments: Passive Components, Sensor Application Products, Magnetic Application Products, Energy Application Products, and Other segments. The Passive Components segment offers ceramic capacitors, aluminum electrolytic capacitors, film capacitors, inductive devices, ferrite cores, transformers, high-frequency devices, piezoelectric materials, and circuit protection components. The Sensor Application Products segment provides temperature and pressure, magnetic, and MEMS sensors. The Magnetic Application Products segment offers hard disk drives (HDD) heads, HDD suspension assemblies, and magnets. The Energy Application Products segment provides energy devices, such as rechargeable batteries and power supplies. The Other segment provides mechatronics production equipment and camera module micro actuators for smartphones and other products. The company was formerly known as Tokyo Denki Kagaku Kogyo K.K. and changed its name to TDK Corporation in 1983. TDK Corporation was founded in 1935 and is headquartered in Tokyo, Japan.
How the Company Makes MoneyTDK generates revenue primarily through the sale of electronic components and materials to original equipment manufacturers (OEMs) and other businesses across multiple industries. Key revenue streams include the production of passive components like capacitors and inductors, which are critical for various electronic devices. Additionally, TDK earns income from its magnetic and sensor technologies, as well as energy devices, which are increasingly in demand due to the rise of electric vehicles and renewable energy solutions. The company also engages in strategic partnerships and collaborations with technology firms and research institutions, enhancing its innovation capabilities and market reach. Factors contributing to TDK's earnings include global demand for advanced electronic components, a focus on high-growth sectors, and ongoing investments in R&D to develop next-generation products.
TDK Earnings Call Summary
Earnings Call Date:Aug 01, 2025
(Q1-2026)
| % Change Since: |
Next Earnings Date:Feb 02, 2026
Earnings Call Sentiment Neutral
The earnings call presented a mixed financial outlook. While there were positive developments such as overall revenue growth and improvements in specific segments like energy application products and MEMS sensors, these were offset by notable declines in operating and net profit, mainly due to foreign exchange impacts and struggles in the automotive market. The forecast for upcoming quarters maintains uncertainty, particularly with ongoing geopolitical and market challenges.Q1-2026 Updates
Positive Updates
Overall Revenue Growth
Net sales for Q1 increased by 3.3% YoY to JPY535.8 billion, indicating a positive trend in overall revenue.
Energy Application Products Performance
The energy application products segment saw net sales of JPY285.5 billion, up 8.6% YoY, with operating profit slightly higher than the previous year.
Improvement in MEMS Sensors
MEMS sensors achieved sales growth driven by increased microphone sales for the ICT market and higher motion sensor sales for the industrial equipment market, resulting in a significant improvement in profit.
Magnetic Application Products Profitability
Operating profit for the magnetic application products segment increased by JPY7 billion, thanks to improved product mix and cost efficiency.
Negative Updates
Decline in Operating Profit
Operating profit decreased by 2.5% YoY due to the significant appreciation of the yen and a decline in shipments for automotive applications.
Net Profit Decline
Net profit was JPY41.5 billion, down JPY18.2 billion or 30.5%, due to foreign exchange losses and the absence of a tax expense reversal recorded in the previous year.
Challenges in Automotive Market
Sales of passive components and sensors decreased in the automotive market due to a slowdown in BEV demand, impacting overall segment profitability.
Negative Free Cash Flow
Free cash flow was negative at JPY3.9 billion, aligned with Q1 expectations but still a negative indicator.
Company Guidance
During the Q1 performance briefing for the fiscal year ending March 2026, TDK reported a 3.3% increase in net sales to JPY535.8 billion, despite a challenging global economic environment and significant yen appreciation. Operating profit decreased by 2.5% to JPY56.4 billion, influenced by foreign exchange losses of JPY7.1 billion. The company experienced a 30.5% decline in net profit to JPY41.5 billion, partly due to the absence of a tax expense reversal from the previous year. In terms of segment performance, the energy application products segment saw an 8.6% increase in net sales, driven by higher sales of small capacity batteries for the ICT market, while the passive components segment faced a 3.4% decline in net sales due to reduced demand in the automotive market. Looking ahead, TDK forecasts a 12% to 15% increase in revenue for energy application products in Q2, supported by seasonal demand for smartphones, and maintains its full-year projections based on a base scenario despite uncertain demand due to ongoing tariff negotiations.TDK Financial Statement Overview
Summary
TDK exhibits a mixed financial performance. The income statement shows strong profitability margins despite a notable revenue decline. The balance sheet is stable with moderate leverage, indicating financial health. However, the cash flow statement highlights liquidity challenges, with declining free cash flow growth. Overall, while profitability is strong, the company needs to address cash flow issues to ensure long-term financial stability.Income Statement
The income statement shows a mixed performance. The TTM data indicates a significant revenue decline of 25.49%, which is concerning. However, the company maintains a healthy gross profit margin of 31.08% and a net profit margin of 6.71%. The EBIT and EBITDA margins are also strong at 9.76% and 17.72% respectively, indicating operational efficiency. Despite the revenue drop, profitability margins remain robust, suggesting effective cost management.Balance Sheet
The balance sheet reflects a stable financial position with a debt-to-equity ratio of 0.38, which is manageable. The return on equity (ROE) is 8.29%, indicating decent profitability relative to shareholder equity. The equity ratio stands at 48.34%, showing a solid equity base. Overall, the balance sheet suggests financial stability with moderate leverage.Cash Flow
Cash flow analysis reveals challenges, with a significant decline in free cash flow growth by 43.36% in the TTM period. The operating cash flow to net income ratio is 0.38, indicating that cash generation from operations is lower relative to net income. The free cash flow to net income ratio is 0.44, suggesting limited cash available after capital expenditures. The cash flow situation requires attention to improve liquidity.| Breakdown | TTM | Dec 2025 | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 1.66T | ― | 2.20T | 2.10T | 2.18T | 1.90T |
| Gross Profit | 505.04B | ― | 688.04B | 603.02B | 584.52B | 563.85B |
| EBITDA | 297.59B | ― | 447.40B | 343.36B | 394.28B | 357.37B |
| Net Income | 103.39B | ― | 167.16B | 124.69B | 114.19B | 131.30B |
Balance Sheet | ||||||
| Total Assets | 26.80B | ― | 3.54T | 3.42T | 3.15T | 3.15T |
| Cash, Cash Equivalents and Short-Term Investments | 874.16B | ― | 774.61B | 697.05B | 558.33B | 558.33B |
| Total Debt | 670.31B | ― | 608.40B | 685.74B | 752.16B | 679.81B |
| Total Liabilities | 2.03T | ― | 1.73T | 1.70T | 1.68T | 1.68T |
| Stockholders Equity | 12.95B | ― | 1.80T | 1.71T | 1.46T | 1.30T |
Cash Flow | ||||||
| Free Cash Flow | 107.21B | ― | 220.55B | 228.42B | -12.94B | -12.94B |
| Operating Cash Flow | 299.92B | ― | 445.84B | 447.01B | 262.77B | 262.77B |
| Investing Cash Flow | -208.20B | ― | -244.84B | -216.59B | -234.40B | -234.40B |
| Financing Cash Flow | -79.33B | ― | -143.33B | -146.37B | 14.95B | 113.74B |
TDK Technical Analysis
Negative
13.49
Price Trends
15.41
Negative
14.83
Negative
12.88
Positive
Market Momentum
-0.39
Positive
32.30
Neutral
18.55
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TTDKY, the sentiment is Negative. The current price of 13.49 is below the 20-day moving average (MA) of 14.29, below the 50-day MA of 15.41, and above the 200-day MA of 12.88, indicating a neutral trend. The MACD of -0.39 indicates Positive momentum. The RSI at 32.30 is Neutral, neither overbought nor oversold. The STOCH value of 18.55 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TTDKY.
TDK Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
79 Outperform | $8.14B | 33.46 | 10.81% | ― | 7.40% | 13.79% | |
77 Outperform | $6.91B | 53.29 | 8.12% | ― | 17.88% | 91.41% | |
74 Outperform | $22.33B | 26.65 | 17.45% | ― | 0.77% | 0.51% | |
74 Outperform | $18.92B | 54.07 | 6.13% | ― | -0.86% | -75.37% | |
73 Outperform | $23.69B | 35.18 | 47.87% | 0.14% | 13.18% | -38.37% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% | |
54 Neutral | $25.74B | 22.10 | 9.32% | 1.40% | 8.57% | -0.32% |
* Technology Sector Average
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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.