Assessing Meiko Electronics (TSE:6787) Valuation After New US$50 Million Vietnam Subsidiary Plan

Meiko Electronics (TSE:6787) has drawn fresh attention after its board approved the creation of MEIKO ELECTRONICS YEN QUANG CO., LTD in Phu Tho Province, Vietnam, a new US$50 million wholly owned PCB manufacturing subsidiary. See our latest analysis for Meiko Electronics. That Vietnam expansion comes against a backdrop of strong recent momentum, with a 90 day share price return of 181.99% and a 1 year total shareholder return of 412.44%, suggesting sentiment around Meiko Electronics has shifted meaningfully. If you are curious about other potential opportunities around supply chain and electronics themes, this is a good moment to scan the market using our 34 robotics and automation stocks After such a strong move, Meiko Electronics now trades at a level that sits above the current analyst price target, even though some models still indicate an intrinsic discount. This raises the question: is this a fresh buying opportunity, or is the market already fully reflecting expectations for future growth? Preferred P/E of 43.7x: Is it justified? Meiko Electronics currently trades on a P/E of 43.7x, which sits well above both its estimated fair P/E of 32.2x and the broader JP Electronic industry average of 16.7x. The P/E ratio compares the current share price to earnings per share, so a higher P/E usually reflects stronger expectations for future profit growth. In Meiko Electronics' case, earnings forecasts of 25.59% growth per year and revenue forecasts of 17.7% per year give some context for why the market might be willing to pay a higher multiple for those profits. That said, the gap is wide. The current 43.7x P/E is comfortably above the 16.7x industry average, which signals that investors are paying a premium relative to other JP Electronic names. It also exceeds the 32.2x fair P/E estimate, a level the market could potentially converge toward if expectations or sentiment cool from current levels. Explore the SWS fair ratio for Meiko Electronics Result: Price-to-earnings of 43.7x (OVERVALUED) However, with current pricing above the analyst target, any wobble in earnings or sentiment could quickly pressure that premium P/E multiple. Find out about the key risks to this Meiko Electronics narrative. Another view: DCF points in the opposite direction While the 43.7x P/E suggests Meiko Electronics looks expensive, the SWS DCF model tells a different story. With the shares at ¥28,650, they are trading 31.6% below an estimated future cash flow value of ¥41,902.01. If earnings unfold as forecast, is the current premium multiple really the whole story? Look into how the SWS DCF model arrives at its fair value. 6787 Discounted Cash Flow as at Apr 2026Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out Meiko Electronics for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover 17 high quality undervalued stocks. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity. Next Steps Given the mixed signals on valuation and sentiment, it makes sense to look under the hood yourself and move before views settle. To see how the positives and concerns line up in one place, start with these 3 key rewards and 2 important warning signs Looking for more investment ideas? Meiko Electronics may already be on your radar, but some of the most interesting opportunities often sit just outside the obvious picks, so do not let them slip by. Target potential mispricings by scanning for quality companies trading below what their fundamentals suggest using the 17 high quality undervalued stocks. Strengthen your income stream by reviewing companies that appear built to sustain higher yields through the 29 dividend fortresses. Reduce portfolio stress by focusing on companies that score well on financial resilience through the 51 resilient stocks with low risk scores. This article by Simply Wall St is general in nature. We provide commentary 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. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.New: Manage All Your Stock Portfolios in One PlaceWe've created the ultimate portfolio companion for stock investors, and it's free.• Connect an unlimited number of Portfolios and see your total in one currency• Be alerted to new Warning Signs or Risks via email or mobile• Track the Fair Value of your stocksTry a Demo Portfolio for Free