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Keyence

6861.TMEDIUM

Factory Automation / AI Vision · Weight: 8%· Data as of 2026-06-01

Also in:Robotics
¥76,460+7.24%
6-month daily

Investment Thesis

HOLD — FY2025 full-year DELIVERED; 5th consecutive record. Revenue ¥1.17T (+10.4%, beat analyst forecast by 2.3%), OP margin expanded to 51.0% (from 49.9%), net income ¥445.2B (+11.7%). Most profitable industrial company globally. Dividend raised 57% to ¥550/share; payout ratio now 30%. Market cap ¥19.43T (+28% from April). Fabless model continues to insulate from tariff/supply-chain risk. FY2027 analyst consensus: revenue ¥1.28T (+9.4%), EPS ¥2,007. Caveat: PE 43.64x is elevated; re-rating has absorbed near-term earnings growth. Thesis intact but entry point has passed — hold, don't add at current valuation. Thesis breaks if: China revenue (16%) contracts >20% from tariff escalation, OR OP margin structurally falls below 48% from competition.

Risk

PE 43.64x TTM at ¥80,110/share — not cheap even for this quality. FY2027 EPS forecast ¥2,007 implies forward PE ~40x — premium requires consistent 10%+ growth. China ~16% of revenue at risk if trade tensions escalate. Chinese FA automation players (Hikrobot, Zhejiang Dahua) gaining share in domestic China market.

Monitoring Trigger

FY2025 results DELIVERED (Apr 29, 2026). New triggers: Q1 FY2026 (Jul 2026) — if China revenue grows YoY, ADD to 10%. If PE exceeds 50x without commensurate EPS upgrade, TRIM to 6%. If OP margin falls below 48% in any quarter, investigate. Cognex Q2 2026 results as competitive read.

Key Dates

2026-06-30rebalanceSemiannual portfolio rebalance — hold at 8% (no add at PE 44x)
2026-07earningsQ1 FY2026 results — watch China revenue trend and Americas momentum
2026-10earningsQ2 FY2026 results + FY2027 guidance revision signal

Update History

2026-04-15evolveUPGRADED
View report →

UPGRADED: Q3 +11.4% revenue acceleration. ROE resolved to 12.4%. Dividend +57% YoY. 5 product launches Q1 2026. ROIC 28.75%.

roe:N/A12.4%thesis:Generic compounderRevenue acceleration + product launches + tariff insulation
2026-06-01evolveHOLD
View report →

FY2025 full-year results DELIVERED: Revenue ¥1.17T (+10.4%), OP margin 51.0%, net income +11.7%, dividend raised to ¥550/share. PE re-rated to 43.64x (from 36.68x), market cap +28% to ¥19.43T. Valuation flag raised. HOLD — no add at current price.

pe:36.6843.64forward_pe:32.5239.9pb:4.565.6roe:12.4%13.5%op_margin:49.9%51.0%div_yield:0.9%0.69%market_cap:¥15.22T¥19.43Tthesis:FY2025 pendingFY2025 delivered — 5th consecutive recordkey_dates:Apr 29 earnings pendingApr 29 delivered; updated to Jul/Oct Q1/Q2 FY2026

Key Metrics

43.64
PE
39.9
Fwd PE
5.6
P/B
13.5%
ROE
51.0%
Op Margin
0%
D/E
0.69%
Div Yield
+¥451B (cash equivalents; FCF strongly positive given asset-light model)
FCF
¥19.43T
Mkt Cap

Business Segments

SegmentRevenueShareDescription
Sensors/Switches~¥250B (9M)~30%IV4 with built-in AI (99.8% detection accuracy)
Vision Systems~¥209B (9M)~25%VS-G (AI + full-image storage), XG-X (edge AI 10K images/sec)
Laser Markers~¥167B (9M)~20%CO2/fiber/UV lasers
Measurement~¥125B (9M)~15%LJ-X8000 2D/3D laser profiler, VK-X4000 microscope
Safety / 3D Printing~¥84B (9M)~10%Light curtains + GX-1000 3D printers (new market entry Apr 2026)

Supply Chain Evidence

EvidenceCustomerProductDetail
confirmedToyota / major auto OEMsFA vision and sensor systemsLargest industrial automation customer base in Japan. Direct sales model creates switching costs. Auto OEM demand driver for EV/hybrid production lines.[source](2026-04)
confirmedSemiconductor fabs (TSMC, Samsung, Intel reshoring)VS Series AI vision systems for wafer/PCB inspectionKeyence VS Series widely used in semiconductor inspection applications. CHIPS Act fab buildouts (TSMC Arizona, Samsung Texas, Intel Ohio) driving Americas growth (+14% overseas in FY2025).[source](2026-06)
confirmedUS reshoring factoriesFull FA sensor/vision/measurement suiteAmericas segment +14% FY2025 full-year. CHIPS Act fabs + EV plants + general manufacturing reshoring. Americas now ~14% of total revenue and growing fastest.[source](2026-04)
confirmedAsian manufacturing (Japan, Korea, Southeast Asia)FA sensors, vision systems, measurement — full product suiteAsia segment +18.9% in FY2025 Q3; China ~16% of revenue with continued growth despite macro headwinds. Japan domestic ~50% of revenue.[source](2026-04)

Sources & References

↗Keyence FY2025 Full Year Results (Globe and Mail)https://www.theglobeandmail.com/investing/markets/stocks/KYCCF/pressreleases/1514350/keyence-delivers-double-digit-profit-growth-and-hikes-dividend-on-strong-fy2026-results/↗Simply Wall St FY2025 Valuationhttps://simplywall.st/stocks/jp/tech/tse-6861/keyence-shares/news/assessing-keyence-tse6861-valuation-after-strong-full-year-2↗Keyence VS Series Semiconductorhttps://www.keyence.com/products/vision/vision-sys/industries/semiconductor-manufacturing-electronics/

Peer Comparison

CompanyPEFwd PEROEOp MarginFCF
Advantest544449.3%44.2%+¥375B est.
Tokyo Electron40.2130.8523.9%24.2%+¥398B
SCREEN Holdings23.2917.8519.8%19.0%+¥49.4B
DISCO Corp55.4443N/A42.3%+¥63.7B (OCF ¥133.5B minus capex ¥69.8B; capex doubled FY2025→FY2026)
Lasertec44.1745.0643.0%46.1%+¥96B
Shin-Etsu Chemical2523.511.1%24.7%+¥346B
Keyence43.6439.913.5%51.0%+¥451B (cash equivalents; FCF strongly positive given asset-light model)
Renesas ElectronicsLoss17.78-2.1% GAAP / ~10.5% Non-GAAP33.7% Non-GAAP Q1 2026 (H1 guided 31.3%)+¥364B (confirmed: OCF ¥453B minus capex ¥89B)
SoftBank Group~6.8x nominal (meaningless — non-recurring OpenAI gains)22.09~43% nominal (OpenAI-inflated)N/A (holding company)-¥1,396B (approx)
SUMCOLossN/A-1.54%-0.8%-¥11B
Socionext36.7722.446.0%7.5%-¥4B
Nitto Boseki~25x operating basis2213%13%N/A
Asahi Kasei13.4127.8%7%N/A
Mitsubishi Gas Chemical12118%8%N/A
Meiko Electronics161415.6%12%N/A
Fujimi Inc181612%15%N/A
Hirose Electric22208%15%N/A