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Komatsu Ltd.
(6301)
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Rating:78Outperform
Price Target:
¥8,620.00
▲(20.44% Upside)
Action:Reiterated
Date:08/28/26
The score is driven primarily by strong financial performance (healthy margins, manageable leverage, and positive free cash flow despite moderate cash conversion) and a clearly bullish technical setup with strong trend/momentum. Valuation is supportive but not a major upside catalyst given the mid-to-high-teens P/E and a modest ~2.5% dividend yield.
Positive Factors
Aftermarket Recurring Revenue
A >50% aftermarket share and steady parts growth anchor recurring revenue and service demand across machine lifecycles. This supports margin stability and resilience through new-equipment cycles, sustaining cash generation and dealer service franchises over the coming 2–6 months and beyond.
Negative Factors
Material U.S. Tariff Headwind
Rising and uncertain U.S. tariffs introduce a persistent cost shock that erodes margins and creates P&L volatility. Lack of certainty on refunds or offsets forces price or cost adjustments, weighing on profitability and planning over the next several quarters.
Read all positive and negative factors
Positive Factors
Negative Factors
Aftermarket Recurring Revenue
A >50% aftermarket share and steady parts growth anchor recurring revenue and service demand across machine lifecycles. This supports margin stability and resilience through new-equipment cycles, sustaining cash generation and dealer service franchises over the coming 2–6 months and beyond.
Read all positive factors
Komatsu Ltd. (6301) vs. iShares MSCI Japan ETF (EWJ)
Market Cap
¥6.63T
Dividend Yield2.51%
Average Volume (3M)2.54M
Price to Earnings (P/E)18.0
Beta (1Y)1.23
Revenue Growth5.24%
EPS Growth-7.42%
CountryJP
Employees67,279
SectorGeneral
Sector StrengthN/A
IndustryIndustrial - Machinery
Share Statistics
EPS (TTM)421.94
Shares Outstanding930,340,640
10 Day Avg. Volume2,633,020
30 Day Avg. Volume2,544,656
Financial Highlights & Ratios
PEG Ratio-1.16
Price to Book (P/B)1.56
Price to Sales (P/S)1.32
P/FCF Ratio23.09
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
¥7,671.67Price Target Upside7.19% Upside
Rating ConsensusHold
Number of Analyst Covering6
EPS Forecast (FY)432.02
Revenue Forecast (FY)¥4.33T
Komatsu Ltd. Business Overview & Revenue Model
Company Description
Komatsu Ltd. manufactures and sells construction, mining, and utility equipment in Japan, the Americas, Europe, China, rest of Asia, Oceania, the Middle East, Africa, and CIS countries. It operates in three segments: Construction, Mining and Utili...
How the Company Makes Money
Komatsu primarily makes money by selling new equipment and by monetizing the lifecycle of that equipment through parts, maintenance, and related services.
1) New equipment sales (core product revenue)
- Construction and earthmoving equipment: Rev...
Komatsu Ltd. Earnings Call Summary
Earnings Call Date:Apr 28, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:Nov 03, 2026
Earnings Call Sentiment Neutral
The call presents a mixed picture: strong top-line resilience (record sales), solid aftermarket, retail finance and industrial machinery performances, strategic M&A and technology milestones (AHS, hydrogen POC, reman expansion) and positive cash generation/return actions. However, profitability was materially pressured by volume declines, unfavorable product and regional mix (notably Indonesia and mining), tariff impacts (U.S. tariffs expected to increase materially in FY26) and cost inflation tied to the Middle East situation. Given meaningful operational and macro headwinds offsetting several operational achievements, the balance of positives and negatives is roughly even.Positive Updates
Record Fifth Consecutive Year of Net Sales
Net sales reached a record high for the fifth consecutive year, increasing 0.7% year-on-year to JPY 4,132.8 billion.
Negative Updates
Operating and Net Income Declines
Operating income declined 13.7% year-on-year to JPY 567.3 billion and operating income ratio fell to 13.7% (down 2.3 percentage points). Net income attributable to Komatsu decreased 14.4% to JPY 376.4 billion.
Read all updates
Q4-2025 Updates
Positive
Negative
Record Fifth Consecutive Year of Net Sales
Net sales reached a record high for the fifth consecutive year, increasing 0.7% year-on-year to JPY 4,132.8 billion.
Read all positive updates
Company Guidance
The company’s fiscal 2026 guidance assumes FX of JPY150/USD, JPY170/EUR and JPY106/AUD and calls for net sales of JPY 4,118.0 billion (‑0.4% YoY), operating income of JPY 508.0 billion (‑10.5%), and net income of JPY 318.0 billion (‑15.5%), with ROE projected at 9.1%; dividends are JPY 190/share (unchanged) with a consolidated payout ratio of 53.8% and a board‑approved buyback up to JPY 100.0 billion (25 million shares) to be cancelled (total payout including buyback 85.4%). By segment, Construction, Mining & Utility revenue is guided to JPY 3.79 trillion (‑0.4%) with segment profit JPY 440.0 billion (‑10.4%) and a margin of 11.6% (‑1.3 ppt), mining equipment sales JPY 1,858.5 billion (‑2.4%) and construction equipment JPY 1,919.7 billion (+1.5%); Retail Finance revenue JPY 127.5 billion (+1.1%) and profit JPY 36.0 billion (‑1.6%; ROA 2.3%), and Industrial Machinery revenue JPY 239.0 billion (+0.1%) and profit JPY 37.0 billion (‑2.5%; margin 15.5%, ‑0.4 ppt). The outlook factors in JPY 67.8 billion of additional U.S. tariff costs partially offset by JPY 30.0 billion of refunds (net JPY 37.8 billion), a JPY 90.1 billion sales headwind and JPY 18.8 billion cost rise from Middle East turmoil, parts/aftermarket growth (parts sales JPY 1,078.5 billion, +2.2%; aftermarket ratio 53%; aftermarket ex‑FX +3.1%), higher capex/R&D and wage‑related fixed costs, and a commitment to generate JPY 300 billion+ free cash flow annually (≈JPY 1 trillion over 3 years, ex‑M&A).Komatsu Ltd. Financial Statement Overview
Summary
Income Statement
82
Very Positive
Balance Sheet
78
Positive
Cash Flow
70
Positive
| Breakdown | TTM | Mar 2026 | Mar 2026 | Mar 2025 | Mar 2024 | Mar 2023 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 4.27T | 4.13T | 4.10T | 3.87T | 3.54T | 2.80T |
| Gross Profit | 1.30T | 1.26T | 1.32T | 1.21T | 1.04T | 779.58B |
| EBITDA | 768.96B | 762.46B | 834.96B | 767.53B | 646.39B | 457.42B |
| Net Income | 381.03B | 376.39B | 439.61B | 393.43B | 326.40B | 224.93B |
Balance Sheet | ||||||
| Total Assets | 6.78T | 6.42T | 5.77T | 5.64T | 4.88T | 4.35T |
| Cash, Cash Equivalents and Short-Term Investments | 571.87B | 439.70B | 385.57B | 403.18B | 289.98B | 316.67B |
| Total Debt | 1.73T | 1.42T | 1.22T | 1.27T | 1.12T | 1.01T |
| Total Liabilities | 3.07T | 2.72T | 2.43T | 2.44T | 2.20T | 1.99T |
| Stockholders Equity | 3.52T | 3.51T | 3.17T | 3.03T | 2.54T | 2.23T |
Cash Flow | ||||||
| Free Cash Flow | 247.21B | 236.70B | 311.31B | 231.83B | 22.94B | 138.01B |
| Operating Cash Flow | 484.31B | 448.96B | 517.17B | 434.78B | 206.47B | 300.97B |
| Investing Cash Flow | -218.76B | -199.23B | -210.67B | -204.43B | -174.25B | -163.64B |
| Financing Cash Flow | -167.96B | -208.54B | -321.42B | -122.03B | -61.88B | -73.80B |
Komatsu Ltd. Peers Comparison
UnderperformOutperform
Sector (55)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
78 Outperform | ¥6.63T | 17.97 | ― | 2.72% | 5.24% | -7.42% | |
78 Outperform | ¥93.29B | 13.44 | ― | 4.79% | 8.11% | 38.06% | |
78 Outperform | ¥360.98B | 12.66 | ― | 2.99% | 10.92% | 14.74% | |
68 Neutral | ¥1.24T | 13.65 | 8.61% | 3.08% | 5.87% | 32.02% | |
63 Neutral | ¥3.18T | 12.04 | 8.59% | 1.82% | 12.54% | 57.90% | |
55 Neutral | $6.65B | 3.83 | -15.92% | 6.20% | 10.91% | 7.18% |
* General Sector Average
JP:6301
Komatsu Ltd.
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53.93%
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1,111.35
64.33%
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Aichi Corporation
1,441.00
176.12
13.92%
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7,750.00
2,663.76
52.37%
Komatsu Ltd. Corporate Events
Komatsu Nears 100 Billion Yen Target in Aggressive Share Buyback
Aug 3, 2026
Komatsu Ltd. has reported the latest status of its ongoing share buyback program, repurchasing 3,434,200 common shares for about 21.8 billion yen on the Tokyo Stock Exchange between July 1 and July 31, 2026. The buyback is being executed under a B...
Komatsu Delivers Strong Q1 but Flags Softer Full-Year Earnings Outlook
Jul 29, 2026
Komatsu Ltd. reported solid growth for the quarter ended June 30, 2026, with net sales up 14.7% to ¥1.04 trillion and operating income rising 8.0% to ¥151.6 billion. Net income attributable to the company increased 5.4% to ¥96.2 bil...
Komatsu Advances ¥100 Billion Share Buyback Program with June Repurchases
Jul 1, 2026
Komatsu has reported the latest progress of its ongoing share buyback program authorized under Japan’s Companies Act, repurchasing nearly 2 million shares of common stock on the Tokyo Stock Exchange in June 2026 for about ¥12.85 billion...
Komatsu Advances Share Buyback, Nears ¥49 Billion in Repurchases Under 2026 Mandate
Jun 1, 2026
Komatsu has repurchased 6,541,800 shares of its common stock on the Tokyo Stock Exchange between May 1 and May 31, 2026, at a total cost of about ¥41.8 billion, as part of a board-approved share buyback program. This latest tranche brings cum...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.