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OMRON Corp 6645

Morningstar Rating
JPY 5,327.00 −9.00 (0.17%)
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Company Report

Omron Affected by Weakening Industrial Automation Demand, but Expect Medium-Term Recovery

Omron uses its sensing and control-related technologies to cover a broad spectrum of fields, and its core focus will be in industrial automation and healthcare. The firm is one of the leading domestic players in the factory automation, or FA, control equipment market (which include programmable logic controllers, relays, sensors, and switches). It also has the leading global share with its home-use blood pressure monitors, BPMs, at a 50% share. As the main driver, we expect the industrial automation segment is well-positioned for secular growth, driven by an aging population, increasing labor costs in key Asian markets, and the coronavirus exposing manufacturers to risks related to supply chain contingency/continuity and safety. As trends related to the "Internet of Things" gain prominence, automation equipment such as PLCs will be required to connect to networks/databases in factories. Also, Omron’s recent acquisitions allowed it to expand its product line, as the firm continues to focus on providing automation solutions to customers, based on its products.

Price vs Fair Value

6645 is trading at a 33% discount.
Price
JPY 5,336.00
Fair Value
JPY 7,659.00
Uncertainty
Medium
1-Star Price
JPY 56,668.00
5-Star Price
JPY 9,268.00
Economic Moat
Dtszc
Capital Allocation
Wqrgdrvtgx

Bulls Say, Bears Say

Bulls

The industrial automation business is likely to grow above PLC market growth as Omron builds out its offerings with higher-growth products.

Bears

Social infrastructure and electronic components businesses have lower margins than its main industrial automation/healthcare businesses and cross-segment synergies are unclear.

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News

Trading Information

Previous Close Price
JPY 5,336.00
Day Range
JPY 5,327.005,439.00
52-Week Range
JPY 5,245.009,329.00
Bid/Ask
JPY 5,326.00 / JPY 5,331.00
Market Cap
JPY 1.05 Tril
Volume/Avg
974,100 / 1.3 Mil

Key Statistics

Price/Earnings (Normalized)
37.35
Price/Sales
1.24
Dividend Yield (Trailing)
1.96%
Dividend Yield (Forward)
1.96%
Total Yield
2.17%

Company Profile

Omron Corporation is an diversified industrials company that engages mainly in industrial automation, healthcare, and social systems, electronic/mechanical components businesses. The industrial automation business offers automation control systems, motion/drives, sensors, and robotics. The social systems business provides automated ticket gates in train stations, ticket vending machines, as well as onboard driver monitoring service in mainly Japan. The company’s healthcare business offers BPMs, nebulizers, electrotherapy devices, thermometers, and others. The electronic/mechanical components business offers mainly switches, safety and control components, and relays. Omron was founded in 1933 and is headquartered in Kyoto, Japan.
Sector
Technology
Industry
Electronic Components
Stock Style Box
Mid Core
Total Number of Employees
28,034

Competitors

Valuation

Metric
6645
6506
SIE
Price/Earnings (Normalized)
37.3536.2214.31
Price/Book Value
1.384.322.97
Price/Sales
1.243.001.78
Price/Cash Flow
17.6526.2112.15
Price/Earnings
6645
6506
SIE

Financial Strength

Metric
6645
6506
SIE
Quick Ratio
1.011.061.02
Current Ratio
1.882.241.32
Interest Coverage
19.847.36
Quick Ratio
6645
6506
SIE

Profitability

Metric
6645
6506
SIE
Return on Assets (Normalized)
2.70%7.52%5.14%
Return on Equity (Normalized)
3.82%14.15%16.08%
Return on Invested Capital (Normalized)
3.37%11.11%6.58%
Return on Assets
6645
6506
SIE
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