- Denso has increased its net sales forecast for the fiscal year to 7.20 trillion yen, higher than the previously anticipated 7.05 trillion yen and above analyst estimates of 7.14 trillion yen.
- The company maintains its forecast for operating income at 675.00 billion yen, surpassing estimated figures of 624.73 billion yen.
- Net income is projected to remain at 515.00 billion yen, exceeding the estimated 480.74 billion yen.
- The expected dividend remains slightly below estimates at 64.00 yen, compared to the expected 65.00 yen.
- In the first quarter, Denso reported an operating income of 107.21 billion yen, marking an 11% decline year-over-year, and falling short of the expected 125.4 billion yen.
- Japanese operations recorded a significant 70% drop in operating profit to 13.34 billion yen, against an estimate of 56.22 billion yen.
- European operations saw a 4.4% increase in operating profit, reaching 5.22 billion yen, above the forecasted 4.93 billion yen.
- North America reported a 3% decline in operating profit at 22.58 billion yen, slightly above the expected 20.56 billion yen.
- Asia posted a robust 33% increase in operating profit, totaling 47.66 billion yen, well above the estimated 39.7 billion yen.
- Other regions experienced a 7.3% decrease in operating profit to 5.51 billion yen, lower than the anticipated 5.81 billion yen.
- First quarter net income fell 16% year-over-year to 79.27 billion yen, missing estimates of 100.84 billion yen.
- Net sales remained stable at 1.75 trillion yen, matching the previous year’s figures and slightly exceeding the estimate of 1.74 trillion yen.
- Japan’s revenue rose 2.9% to 1.01 trillion yen, slightly below the estimate of 1.03 trillion yen.
- North America’s revenue declined by 5.4% to 473.23 billion yen, missing the projected 492.68 billion yen.
- Europe’s revenue decreased by 6.4% to 186.94 billion yen, below the estimated 197.83 billion yen.
- Asia’s revenue was nearly stable at 458.96 billion yen, slightly ahead of the predicted 458.6 billion yen.
- Revenue from other regions grew 4% to 30.12 billion yen, surpassing the forecasted 29.61 billion yen.
- Denso’s equity is highly rated by analysts, with 20 buy recommendations, 3 hold ratings, and no sell ratings.
Denso Corp on Smartkarma
Analyst coverage on Smartkarma by Sreemant Dudhoria, CFA, highlights Denso Corp‘s positive outlook in a recent research report titled “Denso Corp(6902 JP)–Value Zone, Upgraded Growth Outlook, Sooner Resolution of Cross-Holding Overhang.” The analysis points to Denso’s accelerated exit from the Toyota Industries stake as a move that enhances profitability and sets the stage for a potential re-rating. With the stock currently trading below its historical valuation range, the easing of cross-holding overhang is seen as a positive development, aligning with capital efficiency and governance reforms.
The report further emphasizes Denso Corp‘s promising future, with a strong profit outlook for FY2026 driven by factors such as reduced quality-related costs, improved operating leverage, and effective cost controls following a fuel pump recall. Additionally, the stock’s valuation is deemed comfortable given its growth drivers, including strategic focus on SDV, electrification, and semiconductors, positioning Denso well for a potential re-rating in the future amidst favorable sector trends.
A look at Denso Corp Smart Scores
| Factor | Score | Magnitude |
|---|---|---|
| Value | 4 | |
| Dividend | 4 | |
| Growth | 4 | |
| Resilience | 3 | |
| Momentum | 4 | |
| OVERALL SMART SCORE | 3.8 |
Smart Score is a compound score for the Company indicating its overall outlook. It is derived by taking an equally weighted average of underlying Factor scores computed by Smartkarma
Denso Corp, a manufacturer of electronic parts for automobiles, is poised for a positive long-term outlook based on its Smartkarma Smart Scores. With strong scores across key factors including Value, Dividend, Growth, and Momentum, the company showcases robust fundamentals and growth potential. A high Value score signifies that Denso Corp is attractively priced relative to its intrinsic value, while a healthy Dividend score indicates its ability to provide stable income to investors. Furthermore, with a solid Growth score, the company is expected to expand its operations and increase its market share over time.
Although facing slightly lower scores in Resilience, Denso Corp‘s overall outlook remains optimistic. The company’s ability to adapt to market challenges is reflected in its Resilience score. Additionally, a strong Momentum score suggests that Denso Corp has positive price momentum, indicating investor interest and potential for further upside. In summary, Denso Corp‘s positive Smartkarma Smart Scores paint a promising picture for its long-term performance and underline its position as a reputable player in the automotive electronic parts industry.
Disclaimer: This article by Smartkarma is general in nature and 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. Note that our articles may not factor in the latest price-sensitive company announcements or qualitative material.
While all reasonable care has been taken in the preparation, Smartkarma makes no assurance about the accuracy of any generated data or content. All content is indicative only and should be independently checked for accuracy and confirmed before use. Smartkarma accepts no responsibility for any loss or damage caused as a result of any inaccuracy or error within the Lab online tools or generated data.
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