Fanuc (6954): Earnings set to accelerate, though valuations may cap meaningful upside

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Fanuc (6954): Earnings set to accelerate, though valuations may cap meaningful upside

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Fanuc (6954)

Earnings set to accelerate, though

valuations may cap meaningful upside

Reiterate Rating: NEUTRAL | PO: 8,000 JPY | Price: 7,662 JPY

19 May 2026

Lift PO on higher earnings; reiterate Neutral rating Equity

Following Fanuc’s FY3/26 results, we lift our FY3/27 OP estimate by 10% and raise our

PO by 14% to ¥8,000 reflecting a shift in our valuation from using FY3/27-28 earnings

to using FY3/28. While near-term consensus upgrades supported by solid 4Q orders Key Changes

should underpin the shares, we see limited meaningful upside from current levels. We (¥) Previous Current

reiterate our Neutral rating. Price Obj. 7,000 8,000

2027E Rev (m) 946,910 968,382

FA momentum and resilient robotics underpin FY3/27 2028E Rev (m) 1,023,272 1,041,755

We lift our FA segment revenue forecast to ¥255.1bn (+22.3% YoY vs. +12% previously), 2029E Rev (m) NA 1,073,619

reflecting strong 4Q FY3/26 orders and continued firm machine tool demand in China 2027E EPS 200.0 215.6

and Japan, though growth momentum may fade into 2H. For Robomachines, we forecast 2028E EPS 218.0 243.3

FY3/27 revenue growth of c.7% YoY to ¥138.0bn, with strength driven by consumer 2029E EPS NA 251.0

electronics. We remain constructive on robotics, forecasting c.13% YoY growth to 2027E EBITDA (m) 271,482 282,050

¥427.1bn in FY3/27, supported by non-automotive demand, with physical AI-enabled 2028E EBITDA (m) 294,313 313,501

robots providing gradual longer-term upside. 2029E EBITDA (m) NA 321,060

Guidance suggests no visible headwinds to cost structure 2027E DPS 120.0 129

We were surprised by Fanuc’s OP guidance, which implies an incremental OP margin of Kenjin Hotta >>