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Canon (TSE:7751) Stock Looks Cheap After EPS And Margin Jump

Simply Wall St · 3d ago

Canon stock closed at ¥4,494, leaving the 7 day return slightly in the red even as the latest earnings landed. The headline is not the share price move. The headline is that Q2 basic earnings per share came in at ¥143.16, helping lift trailing 12 month earnings per share to ¥396.44 and supporting a P/E of about 11x against peers on roughly double that multiple.

Short term traders see a muted tape. Longer term investors see a company that has expanded net profit margins and is still priced as if that improvement might not last.

Is Canon trading at a genuine 11x P/E bargain, or has the market already priced in the earnings and margin lift? See how that gap between share price and fair value stacks up in the full valuation analysis for Canon

Q2 2026 Earnings Summary

  • Revenue (Q2 2026 vs Q2 2025): ¥1,180,889m vs. ¥1,140,171m (steady year on year increase)
  • Net Income (Excl. Extra Items, Q2 2026 vs Q2 2025): ¥122,881m vs. ¥83,673m (solid year on year rise)
  • Basic EPS (Q2 2026 vs Q2 2025): ¥143.16 vs. ¥92.05 (clear step up in earnings per share)
  • Trailing 12 Month Net Profit Margin (to Q2 2026 vs prior year): 7.4% vs. 3.6% (meaningfully higher profitability on each yen of revenue)

Prefer clean charts over staring at another wall of earnings figures and ratios? Get a full visual picture of Canon, including how its valuation fits with the recent margin lift in the company report for Canon.

TSE:7751 Trailing 12-Month Earnings & Revenue History as at Jul 2026
TSE:7751 Trailing 12-Month Earnings & Revenue History as at Jul 2026

Canon’s Earnings Momentum Supports Diversification Story

For investors leaning positive on Canon, the latest quarter gives some backing. Revenue in Q2 2026 is above Q2 2025 and net income excluding extra items is higher too, which fits a picture of a broader portfolio that is pulling its weight. Basic EPS rising from ¥92.05 to ¥143.16 sits well with the idea that medical, industrial and higher value imaging lines are doing more of the heavy lifting, not just legacy office print.

Short-Term Softness Still Leaves Room For Caution

There is also material for a more cautious view. The 7 day return is slightly negative even after the earnings release, which indicates the market is not rushing to re-rate Canon on these numbers alone. Revenue growth is relatively modest compared with the jump in net margin from 3.6% to 7.4%. That raises fair questions on how much of the profit lift comes from mix and efficiency, and how much can be repeated if end markets for printers and consumer cameras stay sluggish.

Review Canon’s recent margin jump against an unstable dividend record. Explore whether this is the tip of the iceberg in our risk analysis for Canon which shows 1 important warning sign.

Stay Ahead With Canon And Simply Wall St

If Canon’s margin shift and 11x P/E raise questions for you, register for free with Simply Wall St and add it to a Watchlist to track share price against fair value and watch how the story develops. After you invest, use the Portfolio Command Center to cut through noise and focus on the most important updates for your holdings. For a broader view, tap into the Community to see how other investors are thinking about opportunities and risks. By spotting potential catalysts and pressure points early, you give yourself a better chance of staying ahead of the market.

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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.