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Keyence Corp 6861

Morningstar Rating
JPY 62,600.00 −2,370.00 (3.65%)
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Company Report

Keyence’s Overseas Expansion to Drive Medium-Term Revenue Growth

As a “fabless manufacturer,” Keyence outsources its production in a highly effective manner that minimizes risk of potential competition by suppliers. With its consistently high gross margins over the long term, even with an outsourcing model, we believe Keyence has some negotiating leverage regarding cost with its network of suppliers. The company buys raw materials in bulk, which are then sent to the suppliers of its products’ components. It then collects the finished components before sending them to the assemblers. This way, the assemblers do not know the component suppliers, and this prevents Keyence’s suppliers from being aware of the entire production process of the end product, thus preventing them from becoming competitors.

Price vs Fair Value

6861 is trading at a 1% discount.
Price
JPY 62,600.01
Fair Value
JPY 77,931.00
Uncertainty
Medium
1-Star Price
JPY 93,122.00
5-Star Price
JPY 58,399.00
Economic Moat
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Capital Allocation
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Bulls Say, Bears Say

Bulls

Keyence has a strong demand outlook, as machine vision/sensors address secular issues like energy savings, product quality control, and labor shortages.

Bears

The machine vision and sensors market is fragmented and subject to threats of technology replication and pricing pressures over the long term.

Is it the right time to buy, sell, or hold?
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Trading Information

Previous Close Price
JPY 64,970.00
Day Range
JPY 62,080.0064,170.00
52-Week Range
JPY 52,080.0075,040.00
Bid/Ask
JPY 62,430.00 / JPY 62,610.00
Market Cap
JPY 15.18 Tril
Volume/Avg
808,700 / 601,993

Key Statistics

Price/Earnings (Normalized)
43.63
Price/Sales
16.60
Dividend Yield (Trailing)
0.47%
Dividend Yield (Forward)
0.47%
Total Yield
0.46%

Company Profile

Keyence develops and sells factory automation sensors, machine vision systems, barcode readers, programmable logic controllers, laser markers, measuring instruments, and digital microscopes. The company has a fabless business model where manufacturing of its products is outsourced to qualified contract manufacturing companies, while it focuses on product planning and development. It serves customers in automotive, metals/machining, semiconductor/electronics, food, pharmaceutical, and other industries. Keyence was founded in 1972 and is headquartered in Osaka, Japan.
Sector
Technology
Industry
Scientific & Technical Instruments
Stock Style Box
Large Growth
Total Number of Employees
10,580

Competitors

Valuation

Metric
6861
6324
6645
Price/Earnings (Normalized)
43.63191.2935.83
Price/Book Value
5.833.461.33
Price/Sales
16.606.111.19
Price/Cash Flow
42.9126.2416.93
Price/Earnings
6861
6324
6645

Financial Strength

Metric
6861
6324
6645
Quick Ratio
11.712.711.01
Current Ratio
12.644.231.88
Interest Coverage
18.46
Quick Ratio
6861
6324
6645

Profitability

Metric
6861
6324
6645
Return on Assets (Normalized)
18.97%2.05%2.70%
Return on Equity (Normalized)
19.95%3.01%3.82%
Return on Invested Capital (Normalized)
19.83%2.33%3.37%
Return on Assets
6861
6324
6645
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Scientific & Technical Instruments Industry Comparables

Ticker
Name
Morningstar Rating for Stocks
Capital Allocation
Economic Moat
Market Cap
KYCCF
Keyence CorpFddjj$102.1 Bil
HXGBY
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HXGBF
Hexagon AB Class BSszz$29.4 Bil
FTV
Fortive CorpHqdvlnhxbRfbbfy$28.2 Bil
GRMN
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KEYS
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TDY
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TRMB
Trimble IncLxxhhsxzkXtsql$14.2 Bil
VNT
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ST
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