F12/26 3Q Results: 4Q Plan Appears Conservative, But Supply Constraints on Semiconductor MFCs are the Bottleneck

AI research summary

Horiba reported a strong F12/26 3Q, with sales of ¥101.8bn (+25% YoY) and OP of ¥20.2bn (+74%), beating Morgan Stanley and consensus, driven by Materials & Semiconductors (semiconductor MFCs) and Mobility. Management raised the FY OP plan to ¥73.0bn from ¥70.0bn but kept 4Q conservative, implying about a 10% QoQ revenue decline in Materials & Semiconductors due to broad component shortages in MFCs. The 4Q plan sits below consensus of ¥74.0bn. Energy and Bio & Healthcare profit plans were cut on project delays and higher life-science development spending. The key catalyst is normalization of MFC supply; additionally, Horiba may announce bold structural reform of its hydrogen business at FY results. Valuation uses 12.5x F12/28e EPS, the average semiconductor capex upcycle multiple minus one standard deviation, reflecting expected 2028 WFE deceleration. With Equal-weight and a ¥25,000 target below the ¥25,670 share price, upside is limited until supply normalizes. Main risks are prolonged MFC shortages, weaker semiconductor demand, and yen appreciation.

Bull case：3Q OP of ¥20.2bn beat Morgan Stanley and consensus, led by semiconductor MFCs and mobility; FY OP plan was raised to ¥73.0bn from ¥70.0bn; MFC supply conditions are gradually improving as the company takes measures; potential hydrogen structural reform could provide an early earnings catalyst

Key risks：MFC component shortages persist, with 4Q Materials & Semiconductors revenue guided down about 10% QoQ; the 4Q plan is below consensus and Energy/Bio profit plans were cut; a 2028 semiconductor WFE deceleration could compress valuation multiples; yen appreciation of ¥1/USD cuts annual OP by about ¥400mn

Stocks：Horiba（6856.T/6856 JT）

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