Konoshima Chemical Co., Ltd. (4026) AI Stock Analysis

• Market Cap: ¥18.14B
• Dividend Yield: 2.81%
• Average Volume (3M): 152.24K
• Price to Earnings (P/E): 11.8
• Beta (1Y): 1.15
• Revenue Growth: 0.23%
• EPS Growth: -8.64%
• Country: JP
• Employees: 448
• Sector: Industrials
• Sector Strength: 72
• Industry: Construction
• EPS (TTM): N/A
• Shares Outstanding: 9,240,000
• 10 Day Avg. Volume: 182,080
• 30 Day Avg. Volume: 152,236
• PEG Ratio: -0.70
• Price to Book (P/B): 0.90
• Price to Sales (P/S): 0.43
• P/FCF Ratio: 6.28
• 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: 74 Outperform
• Price Target: ¥2,251.00 ▲(46.93% Upside)
• Action: Reiterated Date: 12/11/25
• Date: Action: Reiterated 12/11/25

Konoshima Chemical Co., Ltd. receives a strong overall score driven by positive technical indicators and reasonable valuation metrics. The company's financial performance is solid, but the decline in cash flow generation is a concern that needs addressing. The absence of recent earnings call data and corporate events means these factors do not influence the score.

Positive Factors

Revenue Growth

A 9.1% annual revenue increase indicates persistent demand expansion and market penetration. Sustained top-line growth improves fixed-cost absorption and scale economics, enabling continued investment in R&D and capacity which supports long-term competitive positioning and cash generation.

Improved Leverage & ROE

Lower leverage with a debt/equity of 0.69 and ROE above 11% strengthens financial flexibility. This balance-sheet improvement reduces interest burden and credit risk, enabling the company to fund capex, acquisitions or dividends and better withstand cyclical industry shocks over the medium term.

Healthy Margins

A gross margin around 25% and a stable net margin indicate durable unit economics and the ability to retain value across the supply chain. These margins support reinvestment, dividend capacity and buffer against cost swings, underpinning sustainable profitability if pricing and cost control persist.

Negative Factors

Free Cash Flow Decline

A 35.5% drop in free cash flow growth signals weakening cash generation relative to prior periods. Persistent FCF decline constrains the company’s ability to self-fund capex, reduce debt or sustain dividends, increasing reliance on external financing and limiting strategic flexibility long term.

Margin Erosion

Falling EBIT/EBITDA margins point to rising costs or operational inefficiencies that erode profitability. Without corrective cost management or productivity gains, margin deterioration can reduce returns on invested capital and the funds available for growth and shareholder returns over multiple quarters.

Low Cash Conversion

An OCF-to-net-income ratio of 0.23 implies weak conversion of accounting profits into cash, raising earnings quality concerns. Low cash conversion can reflect working-capital strain or non-cash gains and limits internal liquidity for capex, debt paydown or resilience in downturns.

Konoshima Chemical Co., Ltd. Business Overview & Revenue Model

Company Description

Konoshima Chemical Co.,Ltd. manufactures and sells building materials, chemicals, and ceramics. The company offers residential and non-residential ceramic siding, eaves, gable boards, and refractory panels; and non-combustible building materials for residential and non-residential buildings. It also provides chemicals, such as magnesium oxide, flame retardant magnesium hydroxide, and magnesium carbonate; and functional ceramics. The company was founded in 1917 and is headquartered in Osaka, Japan.

How the Company Makes Money

Konoshima Chemical Co., Ltd. generates revenue primarily through the sale of its chemical products across multiple industries. Key revenue streams include the agricultural sector, where it supplies fertilizers and agrochemicals to farmers, contributing significantly to its earnings. The company also earns income from the sale of specialty chemicals used in electronics manufacturing, which cater to the growing demand for advanced technological solutions. Strategic partnerships with agricultural distributors and technology firms enhance its market reach and sales capabilities. Additionally, Konoshima's focus on research and development allows it to innovate and introduce new products, thereby maintaining a competitive edge and driving revenue growth.

Konoshima Chemical Co., Ltd. Financial Statement Overview

Summary

Konoshima Chemical Co., Ltd. demonstrates strong revenue growth and stable profitability, with a solid balance sheet characterized by improved leverage and return on equity. However, the decline in cash flow generation poses a risk that needs to be addressed to sustain long-term growth. The company should focus on enhancing operational efficiency and cash flow management to strengthen its financial position.

Income Statement

Konoshima Chemical Co., Ltd. has shown a strong revenue growth rate of 9.1% in the latest year, indicating a positive trajectory in sales. The gross profit margin is healthy at 25.28%, although it has slightly decreased from previous years. The net profit margin is stable at 5.23%, reflecting consistent profitability. However, the EBIT and EBITDA margins have declined, suggesting potential cost pressures or operational inefficiencies.

Balance Sheet

The company's debt-to-equity ratio has improved to 0.69, indicating a reduction in leverage and a stronger equity position. The return on equity is solid at 11.06%, showcasing effective use of shareholder funds. The equity ratio stands at 42.19%, reflecting a stable financial structure. However, the company should continue to monitor its debt levels to maintain financial stability.

Cash Flow

The free cash flow growth rate has significantly declined by 35.5%, raising concerns about cash generation. The operating cash flow to net income ratio is 0.23, indicating moderate cash flow efficiency. The free cash flow to net income ratio is 0.60, suggesting that a substantial portion of earnings is converted into free cash flow. The company needs to focus on improving its cash flow generation to support future growth.

Breakdown	TTM	Apr 2024	Apr 2023	Apr 2023	Apr 2022	Apr 2021
Income Statement
Total Revenue	25.12B	27.41B	25.97B	23.98B	21.79B	19.78B
Gross Profit	6.65B	6.93B	6.83B	6.74B	6.62B	5.84B
EBITDA	3.60B	3.76B	3.96B	3.51B	3.10B	2.64B
Net Income	1.57B	1.43B	1.62B	1.53B	1.36B	1.09B
Balance Sheet
Total Assets	30.68B	30.73B	29.75B	29.39B	24.70B	18.60B
Cash, Cash Equivalents and Short-Term Investments	1.30B	1.44B	1.17B	2.15B	1.87B	967.00M
Total Debt	9.31B	8.93B	10.44B	8.00B	4.91B	3.09B
Total Liabilities	19.60B	17.77B	17.84B	18.83B	15.33B	10.06B
Stockholders Equity	11.08B	12.96B	11.91B	10.56B	9.36B	8.54B
Cash Flow
Free Cash Flow	2.89B	1.86B	-2.25B	-2.36B	-345.00M	1.83B
Operating Cash Flow	2.89B	3.09B	3.34B	1.82B	2.06B	3.01B
Investing Cash Flow	0.00	-1.24B	-5.64B	-4.17B	-2.37B	-1.14B
Financing Cash Flow	0.00	-1.59B	1.32B	2.63B	1.22B	-2.35B

Konoshima Chemical Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 1532.00
• 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:4026, the sentiment is Positive. The current price of 1532 is below the 20-day moving average (MA) of 1769.30, below the 50-day MA of 1669.62, and above the 200-day MA of 1444.41, indicating a bullish trend. The MACD of 80.91 indicates Negative momentum. The RSI at 79.24 is Negative, neither overbought nor oversold. The STOCH value of 95.87 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:4026.

Konoshima Chemical Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
5351	80 Outperform	¥117.53B	3.59	―	4.28%	12.87%	-13.69%
7871	80 Outperform	¥19.35B	11.28	―	3.09%	0.27%	7.57%
4026	74 Outperform	¥18.14B	11.80	―	2.81%	0.23%	-8.64%
4216	68 Neutral	¥116.44B	17.16	―	2.17%	-2.39%	-29.17%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
5391	62 Neutral	¥11.12B	102.88	―	4.54%	7.32%	-93.45%
4212	60 Neutral	¥79.02B	18.16	―	3.27%	12.09%	5.46%