Goldman Sachs has identified nine leading stocks in Japan’s electronic components and semiconductors sector that are positioned to benefit from strong demand in artificial intelligence (AI) and data‑center applications. The investment bank issued a Buy rating on each of the following companies, outlining specific catalysts and quantitative expectations.
Ibiden – Goldman Sachs expects Ibiden to revise its medium‑term plan upward and announce additional capacity expansion. The electronics division operating‑margin guidance was lifted from 22.7% to 29.3% for the full year, driven primarily by higher selling prices. For CPUs, operating margins for the largest customer could rise from just under 20% in the first quarter to nearly 30% by the fourth quarter. The medium‑term profit targets of ¥150 billion for fiscal year 2028 and ¥300 billion or more for fiscal year 2031 may be revised upward at the second‑quarter results. Ibiden’s first‑quarter fiscal 2026 results beat analyst expectations for both revenue and earnings, and the company raised its full‑year outlook citing strong demand for AI server substrates.
Murata Manufacturing – The firm is expected to deliver second‑quarter earnings upside and further upward revisions to its full‑year guidance. Murata’s MLCC (multi‑layer ceramic capacitor) book‑to‑bill ratio was 1.47× in the first quarter, suggesting conservative assumptions for the second quarter. Annual sales growth for MLCCs used in AI and data‑center applications was revised upward from 85‑90% to 100‑105%. Management has gradually shifted toward considering partial price hikes as market conditions improve.
Taiyo Yuden – Goldman Sachs anticipates a rapid earnings recovery in the second and third quarters. The MLCC book‑to‑bill ratio reached 1.72×, and utilization rates rose from 85% in the first quarter to 95% in the second quarter. Sales for AI servers were revised upward from 80‑85% growth to 150% growth. Although Taiyo Yuden’s first‑quarter operating profit fell short of consensus estimates, the company raised its full‑year operating‑profit guidance to a level that exceeds forecasts.
Renesas – Near‑term quarterly earnings expansion and profitability improvement are expected in fiscal year 2027, driven by in‑house capacity expansion. Data‑center sales are on track to exceed ¥300 billion in fiscal year 2026, representing an 85‑90% year‑over‑year increase from slightly over ¥160 billion in fiscal year 2025.
Rohm – A significant full‑year upward revision is seen as a potential catalyst. Second‑quarter earnings could be boosted by sales growth supported by a first‑quarter book‑to‑bill ratio of 1.2× and utilization rates heading toward 70% or more by September. Fiscal year 2027 sales guidance for AI and data‑center products was raised from ¥25.0 billion to ¥30.0 billion.
TDK – The possibility of a substantial full‑year upward revision is highlighted. First‑quarter results and outlook for all business segments exceeded expectations, and second‑quarter operating profits could surpass ¥100 billion. Annual sales guidance for industrial batteries was increased from roughly ¥110 billion to roughly ¥150 billion, primarily for UPS batteries serving AI and data‑center applications.
Kyocera – The firm expects news flow regarding further upside to fiscal year 2027 guidance driven mainly by AI and data‑center‑related components, and the possibility of an upward revision to the return‑on‑equity (ROE) target in the next medium‑term plan.
MinebeaMitsumi – The next focus points are upside potential for fiscal year 2027 guidance driven mainly by bearings and motors, together with increased visibility on achieving the medium‑term plan.
Nidec – The primary focus is the status of the filing of its securities report, which is due on September 30.
The article was generated with AI assistance and reviewed by an editor, with the source credited to Reuters.