Iwatsuka Confectionery Co., Ltd. (2221) AI Stock Analysis

• Market Cap: ¥37.87B
• Dividend Yield: 0.84%
• Average Volume (3M): 5.66K
• Price to Earnings (P/E): 14.7
• Beta (1Y): 0.23
• Revenue Growth: 15.03%
• EPS Growth: -26.43%
• Country: JP
• Employees: 828
• Sector: Consumer Defensive
• Sector Strength: 42
• Industry: Food Confectioners
• EPS (TTM): 54.13
• Shares Outstanding: 11,990,000
• 10 Day Avg. Volume: 7,010
• 30 Day Avg. Volume: 5,663
• PEG Ratio: 0.17
• Price to Book (P/B): 0.43
• Price to Sales (P/S): 1.18
• P/FCF Ratio: 15.12
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 66 Neutral
• Price Target: ¥3,638.00 ▲(19.67% Upside)

Iwatsuka Confectionery Co., Ltd. has a strong financial foundation with consistent revenue growth and profitability, contributing significantly to the overall score. However, technical analysis indicates bearish momentum, which negatively impacts the score. The valuation is reasonable, suggesting potential undervaluation. The absence of earnings call data and corporate events means these factors do not influence the score.

Positive Factors

Consistent revenue growth

A 13.4% year-over-year revenue increase (and ~16.2% multi-year revenue growth metric) signals durable consumer demand and successful product distribution. Sustained top-line momentum supports scale economics, funds new product launches and helps maintain margins over the medium term.

Robust cash generation

Free cash flow growth of 131.4% and an operating cash flow to net income ratio of 1.35 show the company reliably converts profits into cash. Strong cash generation provides durable internal funding for capex, working capital, shareholder returns or strategic investments without raising leverage.

Conservative balance sheet, low leverage

An equity ratio of 74.6% and debt-to-equity of 0.01 indicate very low financial leverage, enhancing resilience to demand shocks or input-cost volatility. This conservatism maintains strategic optionality to invest, pursue M&A or support operations without materially increasing financial risk.

Negative Factors

Declining EPS

A roughly 14.7% decline in EPS points to pressure on per-share profitability or potential one-off impacts. Continued EPS contraction can reduce retained earnings, limit dividend capacity and weaken the company's ability to self-fund future growth initiatives over the medium term.

Modest returns on equity / operating efficiency

ROE of 4.3% alongside commentary that EBIT margins remain relatively modest suggests limited efficiency in converting capital and sales into shareholder returns. Persistently low ROE can signal suboptimal capital allocation and constrain long-term value creation versus higher-return peers.

High domestic market concentration

A business model focused largely on Japan's snack retail channels limits geographic diversification and addressable market expansion. This structural concentration increases sensitivity to domestic consumption patterns and demographics, constraining scalable growth opportunities over time.

Iwatsuka Confectionery Co., Ltd. Business Overview & Revenue Model

Company Description

Iwatsuka Confectionery Co., Ltd. manufactures and sells rice crackers in Japan. It offers black soybean rice crackers; vegetable rice crackers with carrot, cabbage, and spinach; fish rice crackers with domestic sardine powder and carrot; quick-dissolving crackers; and rice crackers with soy sauce, roasted salt, and sugar coating. The company was formerly known as Iwatsuka Nosan Kakojo Co., Ltd. and changed its name to Iwatsuka Confectionery Co., Ltd. in 1960. Iwatsuka Confectionery Co., Ltd. was founded in 1947 and is headquartered in Nagaoka, Japan.

How the Company Makes Money

Iwatsuka Confectionery generates revenue through multiple streams, primarily by selling its confectionery products to retail and wholesale distributors both in Japan and overseas. The company benefits from strong brand loyalty and a well-established distribution network that includes supermarkets, convenience stores, and online platforms. Key revenue streams include the sale of seasonal and specialty items, which tend to see higher demand during festivals and holidays. Additionally, Iwatsuka Confectionery may engage in partnerships with other food companies or brands to co-develop products or packaging solutions, further diversifying its revenue sources. Factors contributing to its earnings include effective marketing strategies, product innovation, and the ability to adapt to changing consumer preferences.

Iwatsuka Confectionery Co., Ltd. Financial Statement Overview

Summary

Iwatsuka Confectionery Co., Ltd. demonstrates solid financial performance with consistent revenue growth and strong profitability. The company maintains robust margins and effective cost management. The balance sheet shows financial stability with low leverage, and cash flow analysis indicates strong cash generation capabilities. However, there is room for improvement in operating efficiency and return on equity.

Income Statement

Iwatsuka Confectionery Co., Ltd. shows strong profitability with a consistent increase in total revenue over the years, marking a 13.4% growth from 2024 to 2025. The company has maintained solid gross and EBIT margins, indicating efficient cost management and operational effectiveness. The net profit margin also improved significantly, reaching 11.7% in 2025, which is a strong indicator of net profitability. However, the EBIT margin remains relatively modest, highlighting some potential inefficiencies in converting revenue into operating profit.

Balance Sheet

The balance sheet of Iwatsuka Confectionery Co., Ltd. is strong, with a high equity ratio of 74.6% in 2025, indicating financial stability and low leverage. The debt-to-equity ratio is minimal at 0.01, showcasing prudent financial management and low reliance on debt. Return on Equity (ROE) stands at a healthy 4.3%, although there is potential room for improvement in terms of generating higher returns on shareholders' equity.

Cash Flow

Cash flow analysis reveals robust financial health, with a substantial increase in free cash flow by 131.4% from 2024 to 2025. The operating cash flow to net income ratio is 1.35, reflecting efficient cash generation relative to net earnings. Free cash flow to net income ratio is 0.67, indicating a solid capacity to generate cash surplus after covering capital expenditures. These metrics emphasize strong cash flow management and the company's ability to fund operations and growth.

Breakdown	TTM	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	26.11B	24.95B	22.00B	20.39B	18.04B	22.17B
Gross Profit	7.12B	6.96B	5.76B	4.66B	4.26B	8.54B
EBITDA	5.65B	5.52B	4.26B	6.93B	2.49B	3.71B
Net Income	2.86B	2.91B	1.96B	3.97B	828.07M	2.01B
Balance Sheet
Total Assets	94.77B	91.10B	85.75B	83.56B	96.28B	76.37B
Cash, Cash Equivalents and Short-Term Investments	3.31B	4.06B	2.84B	4.54B	1.78B	1.27B
Total Debt	796.16M	405.20M	806.00M	1.21B	2.01B	2.02B
Total Liabilities	24.40B	23.15B	21.95B	21.49B	26.59B	20.32B
Stockholders Equity	70.37B	67.95B	63.81B	62.06B	69.69B	56.05B
Cash Flow
Free Cash Flow	0.00	1.95B	842.78M	3.74B	662.41M	-2.43B
Operating Cash Flow	0.00	3.94B	2.76B	5.34B	2.38B	3.57B
Investing Cash Flow	0.00	-2.07B	-1.84B	-1.56B	-1.76B	-5.83B
Financing Cash Flow	0.00	-653.71M	-2.61B	-1.02B	-108.53M	1.77B

Iwatsuka Confectionery Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 3040.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:2221, the sentiment is Positive. The current price of 3040 is below the 20-day moving average (MA) of 3124.50, below the 50-day MA of 3061.62, and above the 200-day MA of 3034.98, indicating a bullish trend. The MACD of 71.08 indicates Negative momentum. The RSI at 96.24 is Negative, neither overbought nor oversold. The STOCH value of 96.07 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:2221.

Iwatsuka Confectionery Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
2201	76 Outperform	¥230.66B	12.07	13.33%	3.47%	4.21%	23.86%
2209	75 Outperform	¥33.06B	13.48	―	1.23%	6.74%	29.20%
2208	72 Outperform	¥73.51B	13.94	―	1.55%	5.78%	14.23%
2216	69 Neutral	¥62.25B	17.12	―	4.63%	7.74%	0.96%
2221	66 Neutral	¥37.87B	14.70	―	0.84%	15.03%	-26.43%
Sector *	62 Neutral	$20.33B	14.63	-3.31%	3.23%	1.93%	-12.26%
2211	49 Neutral	¥63.95B	31.49	―	1.14%	8.17%	10.65%