Nidec (TSE:6594) Is Down 11.1% After Profit Surges Sharply in Q2 – Has The Bull Case Changed?

• Nidec Corporation recently reported its earnings for the second quarter and six months ended September 30, 2025, disclosing sales of ¥664.28 billion and net income of ¥40.57 billion for the quarter.
• Net income more than doubled compared to the previous year’s second quarter, signaling a sharp increase in profitability over the period.
• Following this stronger-than-expected profit growth, we will examine how Nidec’s refreshed earnings outlook could influence its investment narrative.

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Nidec Investment Narrative Recap

For investors considering Nidec, the core narrative is belief in the company’s ability to leverage global demand for advanced motor solutions in sectors like data centers and electric vehicles, while managing the challenges of recent structural reforms. The sharp earnings uptick this quarter adds a positive signal, but ongoing investigations into trade compliance issues still represent a significant risk. Short term, the key catalyst remains operational execution, but the legal and reputational uncertainties could temper any near-term optimism if unresolved.

Possibly most relevant to this inflection point, Nidec’s announcement of a dividend suspension due to accounting investigations stands out. While recent profit growth might attract attention, the dividend halt directly reflects the regulatory and internal control risks that now frame the company’s investment case more prominently than before.

In contrast, investors should be aware that even with rising profits, the unresolved accounting probe could...

Read the full narrative on Nidec (it's free!)

Nidec's narrative projects ¥2,893.2 billion revenue and ¥247.5 billion earnings by 2028. This requires 3.7% yearly revenue growth and a ¥90.1 billion earnings increase from ¥157.4 billion today.

Uncover how Nidec's forecasts yield a ¥3330 fair value, a 64% upside to its current price.

Exploring Other Perspectives

Three individual fair value estimates for Nidec from the Simply Wall St Community span ¥2,947 to ¥3,666 per share. As profit momentum builds, the ongoing legal investigation could have wider implications for future growth and shareholder returns; see how other investors are interpreting these signals for themselves.

Explore 3 other fair value estimates on Nidec - why the stock might be worth just ¥2948!

Build Your Own Nidec Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

• A great starting point for your Nidec research is our analysis highlighting 3 key rewards and 1 important warning sign that could impact your investment decision.
• Our free Nidec research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Nidec's overall financial health at a glance.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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