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Kyocera Corp ADR KYOCY

Rating as of

Morningstar’s Analysis

Valuation
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1-Star Price

PREMIUM

5-Star Price

PREMIUM

Economic Moat

PREMIUM

Capital Allocation

PREMIUM

Kyocera Remains Slower on Recovery Owing to Its Diversified Product Portfolio; Shares Fairly Valued

Analyst Note

| Kazunori Ito |

No-moat Kyocera’s December quarter operating income was JPY 18.9 billion, which is materially above our forecast of JPY 22.7 billion, considering the one-time impairment loss of JPY 11.5 billion for the smart energy business. However, our overall impression about the December quarter result is somewhat mixed, as while one business group has exceeded our forecasts, two business groups went below our expectation (and three other groups were broadly in line). That said, we retain our view that solid revenue growth driven by the demand from the auto and smartphone sectors will be mitigated by Kyocera’s fragmented product portfolio. Kyocera’s fair value estimate of JPY 7,300 is maintained, and we view its shares as fairly valued.

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Company Profile

Business Description

Kyocera is a Japanese conglomerate whose original business consisted of manufacturing fine ceramic components; the firm has since expanded into manufacturing handsets, printers, solar cells, and industrial tools. The firm has six major business segments, with the three largest segments, industrial and automotive components segment, electronic devices segment, and document solutions segment, each accounting for roughly 20%-22% of total revenue.

Contact
6, Takeda Tobadono-cho, Fushimi-ku
Kyoto, 612-8501, Japan
T +81 756043556
Sector Technology
Industry Consumer Electronics
Most Recent Earnings Dec 31, 2020
Fiscal Year End Mar 31, 2020
Stock Type
Employees 75,505