Nidec (TSE:6594) - Share price, News & Analysis

Q: What is the Fair Price of 6594 when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

6594 (¥8159) is trading below our estimate of [[fair value]] (¥8349.01)

6594 fundamental analysis
Snowflake Score
Valuation	1/6
Future Growth	3/6
Past Performance	2/6
Financial Health	5/6
Dividends	0/6

6594 Stock Overview

Nidec Corporation, together with its subsidiaries, develops, manufactures, and sells motors, electronics and optical components, and other related products in Japan and internationally.

Rewards

Trading at 2.3% below our estimate of its fair value

Earnings are forecast to grow 14.74% per year

Risk Analysis

No risks detected for 6594 from our risk checks.

Nidec Competitors

Fuji Electric

TSE:6504

JP¥758.5b

Mabuchi Motor

TSE:6592

JP¥225.4b

Fujikura

TSE:5803

JP¥203.7b

GS Yuasa

TSE:6674

JP¥171.5b

Price History & Performance

Summary of all time highs, changes and price drops for Nidec
Historical stock prices
Current Share Price	JP¥8,159.00
52 Week High	JP¥14,000.00
52 Week Low	JP¥7,830.00
Beta	1.31
1 Month Change	-6.51%
3 Month Change	-14.72%
1 Year Change	-36.36%
3 Year Change	10.29%
5 Year Change	41.77%
Change since IPO	4,843.57%

Shareholder Returns

	6594	JP Electrical	JP Market
7D	-2.8%	-1.9%	-1.1%
1Y	-36.4%	-22.6%	-7.0%

Return vs Industry: 6594 underperformed the JP Electrical industry which returned -22.6% over the past year.

Return vs Market: 6594 underperformed the JP Market which returned -7% over the past year.

Price Volatility

Is 6594's price volatile compared to industry and market?
6594 volatility
6594 Average Weekly Movement	5.0%
Electrical Industry Average Movement	4.2%
Market Average Movement	4.2%
10% most volatile stocks in JP Market	8.4%
10% least volatile stocks in JP Market	2.2%

Stable Share Price: 6594 is not significantly more volatile than the rest of JP stocks over the past 3 months, typically moving +/- 5% a week.

Volatility Over Time: 6594's weekly volatility (5%) has been stable over the past year.

About the Company

Founded	Employees	CEO	Website
1973	114,371	Shigenobu Nagamori	https://www.nidec.com

Nidec Corporation, together with its subsidiaries, develops, manufactures, and sells motors, electronics and optical components, and other related products in Japan and internationally. The company offers medium- and large-size motors, small-size and precision motors, motor-related products, units and modules, automotive components, mechanical equipment, inspection and measuring equipment, electronic devices, sensors, and other products. Its products are used for applications in robotics, IoT products, automotive components, home appliances, logistics/agriculture, information technology, office automation, mobile devices and optical components, medical and health care products, housing equipment, commercial and professional products, industrial machinery, and processing/inspection equipment.

Nidec Fundamentals Summary

How do Nidec's earnings and revenue compare to its market cap?
6594 fundamental statistics
Market Cap	JP¥4.71t
Earnings (TTM)	JP¥137.20b
Revenue (TTM)	JP¥1.92t

34.4x

P/E Ratio

2.5x

P/S Ratio

Is 6594 overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
6594 income statement (TTM)
Revenue	JP¥1.92t
Cost of Revenue	JP¥1.51t
Gross Profit	JP¥403.34b
Other Expenses	JP¥266.14b
Earnings	JP¥137.20b

Last Reported Earnings

Mar 31, 2022

Next Earnings Date

Jul 20, 2022

Earnings per share (EPS)	237.42
Gross Margin	21.03%
Net Profit Margin	7.15%
Debt/Equity Ratio	42.1%

How did 6594 perform over the long term?

See historical performance and comparison

Dividends

0.9%

Current Dividend Yield

28%

Payout Ratio

We’ve recently updated our valuation analysis.

Valuation

Is 6594 undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

1/6

Valuation Score 1/6

Price-To-Earnings vs Peers
Price-To-Earnings vs Industry
Price-To-Earnings vs Fair Ratio
Below Fair Value
Significantly Below Fair Value
PEG Ratio

Key Valuation Metric

Which metric is best to use when looking at relative valuation for 6594?

Other financial metrics that can be useful for relative valuation.

The above table shows the n/a ratio for 6594. This is calculated by dividing 6594's market cap by their current preferred multiple.
What is 6594's n/a Ratio?
n/a Ratio	0x
n/a	n/a
Market Cap	JP¥4.71t

6594 key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue	2.7x
Enterprise Value/EBITDA	18.6x
PEG Ratio	2.3x

Price to Earnings Ratio vs Peers

How does 6594's PE Ratio compare to its peers?

6594 PE Ratio vs Peers

The above table shows the PE ratio for 6594 vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	PE	Estimated Growth	Market Cap
Peer Average	14.5x
6504 Fuji Electric	12.9x	7.3%	JP¥758.5b
6592 Mabuchi Motor	19.5x	12.7%	JP¥225.4b
5803 Fujikura	5.2x	-3.5%	JP¥203.7b
6674 GS Yuasa	20.3x	24.0%	JP¥171.5b
6594 Nidec	34.4x	14.7%	JP¥4.7t

Forward PE

Price-To-Earnings vs Peers: 6594 is expensive based on its Price-To-Earnings Ratio (34.4x) compared to the peer average (14.5x).

Price to Earnings Ratio vs Industry

How does 6594's PE Ratio compare vs other companies in the JP Electrical Industry?

Price-To-Earnings vs Industry: 6594 is expensive based on its Price-To-Earnings Ratio (34.4x) compared to the JP Electrical industry average (10.6x)

Price to Earnings Ratio vs Fair Ratio

What is 6594's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

6594 PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio	34.4x
Fair PE Ratio	22.9x

Price-To-Earnings vs Fair Ratio: 6594 is expensive based on its Price-To-Earnings Ratio (34.4x) compared to the estimated Fair Price-To-Earnings Ratio (22.9x).

Share Price vs Fair Value

What is the Fair Price of 6594 when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: 6594 (¥8159) is trading below our estimate of fair value (¥8349.01)

Significantly Below Fair Value: 6594 is trading below fair value, but not by a significant amount.

Price to Earnings Growth Ratio

PEG Ratio: 6594 is poor value based on its PEG Ratio (2.3x)

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Future Growth

How is Nidec forecast to perform in the next 1 to 3 years based on estimates from 20 analysts?

Future Growth Score

3/6

Future Growth Score 3/6

Earnings vs Savings Rate
Earnings vs Market
High Growth Earnings
Revenue vs Market
High Growth Revenue
Future ROE

14.7%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: 6594's forecast earnings growth (14.7% per year) is above the savings rate (0.04%).

Earnings vs Market: 6594's earnings (14.7% per year) are forecast to grow faster than the JP market (8.9% per year).

High Growth Earnings: 6594's earnings are forecast to grow, but not significantly.

Revenue vs Market: 6594's revenue (8.4% per year) is forecast to grow faster than the JP market (4.5% per year).

High Growth Revenue: 6594's revenue (8.4% per year) is forecast to grow slower than 20% per year.

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: 6594's Return on Equity is forecast to be low in 3 years time (14.1%).

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Past Performance

How has Nidec performed over the past 5 years?

Past Performance Score

2/6

Past Performance Score 2/6

Quality Earnings
Growing Profit Margin
Earnings Trend
Accelerating Growth
Earnings vs Industry
High ROE

-0.6%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: 6594 has high quality earnings.

Growing Profit Margin: 6594's current net profit margins (7.2%) are lower than last year (7.6%).

Past Earnings Growth Analysis

Earnings Trend: 6594's earnings have declined by 0.6% per year over the past 5 years.

Accelerating Growth: 6594's earnings growth over the past year (12.3%) exceeds its 5-year average (-0.6% per year).

Earnings vs Industry: 6594 earnings growth over the past year (12.3%) underperformed the Electrical industry 16.7%.

Return on Equity

High ROE: 6594's Return on Equity (10.4%) is considered low.

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Financial Health

How is Nidec's financial position?

Financial Health Score

5/6

Financial Health Score 5/6

Short Term Liabilities
Long Term Liabilities
Debt Level
Reducing Debt
Debt Coverage
Interest Coverage

Financial Position Analysis

Short Term Liabilities: 6594's short term assets (¥1,292.7B) exceed its short term liabilities (¥938.8B).

Long Term Liabilities: 6594's short term assets (¥1,292.7B) exceed its long term liabilities (¥423.0B).

Debt to Equity History and Analysis

Debt Level: 6594's net debt to equity ratio (26.6%) is considered satisfactory.

Reducing Debt: 6594's debt to equity ratio has reduced from 47.3% to 42.1% over the past 5 years.

Debt Coverage: 6594's debt is not well covered by operating cash flow (17.1%).

Interest Coverage: 6594's interest payments on its debt are well covered by EBIT (132x coverage).

Balance Sheet

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Dividend

What is Nidec current dividend yield, its reliability and sustainability?

Dividend Score

0/6

Dividend Score 0/6

Notable Dividend
High Dividend
Stable Dividend
Growing Dividend
Earnings Coverage
Future Dividend Coverage

0.86%

Current Dividend Yield

Dividend Yield vs Market

Notable Dividend: 6594's dividend (0.86%) isn’t notable compared to the bottom 25% of dividend payers in the JP market (1.69%).

High Dividend: 6594's dividend (0.86%) is low compared to the top 25% of dividend payers in the JP market (3.74%).

Stability and Growth of Payments

Stable Dividend: 6594 is not paying a notable dividend for the JP market, therefore no need to check if payments are stable.

Growing Dividend: 6594 is not paying a notable dividend for the JP market, therefore no need to check if payments are increasing.

Earnings Payout to Shareholders

Earnings Coverage: 6594 is not paying a notable dividend for the JP market.

Cash Payout to Shareholders

Cash Flow Coverage: 6594 is paying a dividend but the company has no free cash flows.

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Management

How experienced are the management team and are they aligned to shareholders interests?

7.0yrs

Average management tenure

CEO

Shigenobu Nagamori (78 yo)

49yrs

Tenure

Mr. Shigenobu Nagamori is Founder of Nidec Corporation in July 1973 and has been its Chairman since July 1973 and serves as its Chief Executive Officer since April 2022. He served as Chief Executive Office...

Leadership Team

Experienced Management: 6594's management team is seasoned and experienced (7 years average tenure).

Board Members

Experienced Board: 6594's board of directors are not considered experienced ( 2.1 years average tenure), which suggests a new board.

Ownership

Who are the major shareholders and have insiders been buying or selling?

Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.

Data	Last Updated (UTC time)
Company Analysis	2022/07/02 00:00
End of Day Share Price	2022/07/01 00:00
Earnings	2022/03/31
Annual Earnings	2022/03/31