Tosoh (4042) AI Stock Analysis

• Market Cap: ¥810.48B
• Dividend Yield: 4.21%
• Average Volume (3M): 1.42M
• Price to Earnings (P/E): 20.1
• Beta (1Y): 0.74
• Revenue Growth: -1.21%
• EPS Growth: -27.21%
• Country: JP
• Employees: 14,394
• Sector: Basic Materials
• Sector Strength: 58
• Industry: Chemicals
• EPS (TTM): N/A
• Shares Outstanding: 325,080,960
• 10 Day Avg. Volume: 1,159,440
• 30 Day Avg. Volume: 1,423,120
• PEG Ratio: 9.67
• Price to Book (P/B): 0.79
• Price to Sales (P/S): 0.62
• P/FCF Ratio: 24.82
• 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: 71 Outperform
• Price Target: ¥2,814.00 ▲(16.64% Upside)

Tosoh's overall stock score is driven by its solid financial performance and attractive valuation, despite some challenges in cash flow management. Technical indicators suggest potential for recovery, but current momentum is slightly bearish.

Positive Factors

Balance Sheet Strength

Low leverage and a high equity ratio provide durable financial flexibility for a capital-intensive chemical business. This strength reduces refinancing risk, supports sustained capex for specialty product lines, and enables strategic investments or M&A without overreliance on debt.

Stable Operational Margins

Consistent gross and net margins, alongside stable EBIT/EBITDA, indicate structural cost control and pricing power in specialty chemicals. Durably healthy margins support reinvestment in R&D and dividends, and provide a buffer through commodity and cyclicality in end markets.

Diversified Product & Market Exposure

A broad portfolio across electronics, healthcare and automotive reduces single-market cyclicality and leverages R&D to move up the value chain. Long-term diversification supports steadier revenue streams and positions Tosoh to capture secular growth in advanced materials and diagnostics.

Negative Factors

Declining Free Cash Flow

A notable drop in free cash flow is a durable concern: sustained declines constrain funding for capex, dividends, and debt reduction. Even with strong operating cash flow, higher capex or working capital needs can limit strategic flexibility and raise financing dependence over months.

Earnings Per Share Pressure

A marked decline in EPS growth signals lasting earnings pressure that may stem from lower operating leverage, higher costs, or non-recurring charges. Persistent EPS contraction would weaken cash available for shareholders and may indicate the need for operational or portfolio adjustments.

Modest Return on Equity

An ROE around 7% is modest for a diversified chemical manufacturer and suggests room to improve capital allocation or margin expansion. Over time, subpar ROE can limit the company’s ability to compound shareholder value versus peers and may pressure long-term return expectations.

Tosoh Business Overview & Revenue Model

Company Description

Tosoh Corporation manufactures and sells basic chemicals, petrochemicals, specialty products, and fine chemicals worldwide. It operates through four segments: Petrochemical, Chlor-Alkali, Specialty, and Engineering. The company provides materials, including battery, fabricated quartzware, silica glass, thin film depositions, zeolites for catalysts and molecular sieves, zirconia injection mold components and compounds, zirconia grinding and dispersion media, and zirconia fine beads and powders. It also offers chromatographic columns, and media and diagnostic systems; clinical diagnostic systems; Portland cement and blast-furnace slag cement; and caustic soda, vinyl chloride monomer, calcium hypochlorite, and sodium bicarbonate. In addition, the company provides ethylene, propylene, C4 fraction, tertiary butyl alcohol, cumene, and aromatic compounds; and ethyleneamines, bromine, hydrobromic acids, flame retardants, non-aqueous solvents, chelating agents, ethylene dichloride, and sodium styrenesulfonate. Further, it offers polymers, such as ethylene vinyl-acetate copolymers, adhesive polymers, low and high-density polyethylene products, synthetic rubbers, functional polymers, and polyvinyl chloride pastes; and polyurethanes (PU), including methylene diphenyl diisocyanate, toluene diisocyanate, hexamethylene diisocyanate, adhesives, coating resins, elastomers, polyisocyanates for PU paints, and polyols. Additionally, it manufactures and sells water treatment systems; and engages in the construction and repair businesses. It also offers logistics, analytic, personnel management, and information technology services.

How the Company Makes Money

Tosoh generates revenue primarily through the sale of its chemical products across different sectors. The company's key revenue streams include the production and distribution of specialty chemicals, petrochemicals, and advanced materials, which are utilized in various industries such as electronics and healthcare. Significant partnerships with other companies in the chemical and electronics sectors enhance its market reach and product development capabilities. Additionally, Tosoh capitalizes on its research and development efforts to create high-value products that meet the evolving needs of its customers, contributing to its overall earnings.

Tosoh Financial Statement Overview

Summary

Tosoh demonstrates solid financial health with consistent revenue growth and stable profitability margins. The balance sheet is strong, with moderate leverage and a healthy equity base. However, the decline in free cash flow signals potential challenges in cash management.

Income Statement

Tosoh's financial performance shows robust revenue growth from 2024 to 2025, with a 5.75% increase. The company maintains a healthy gross profit margin of around 24.4% and a net profit margin of 5.46% for 2025. However, the net profit margin has slightly decreased compared to the previous year. EBIT and EBITDA margins are stable, indicating consistent operational profitability.

Balance Sheet

Tosoh's balance sheet reveals a reasonable debt-to-equity ratio of 0.22, reflecting moderate leverage that is typical for the industry. The equity ratio of 62.32% indicates a strong equity base supporting its assets. Return on equity stands at 7.01%, showing profitability, though it has room for improvement.

Cash Flow

The cash flow analysis highlights a significant decrease in free cash flow from 2024 to 2025, with a negative growth rate. Operating cash flow remains strong, although free cash flow to net income ratio is lower, indicating higher capital expenditures. The operating cash flow to net income ratio of 1.83 shows efficient cash generation relative to net income.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	1.03T	1.06T	1.01T	1.06T	918.58B	732.85B
Gross Profit	257.01B	259.01B	226.23B	219.18B	272.02B	204.39B
EBITDA	135.50B	151.69B	140.48B	126.11B	201.40B	136.86B
Net Income	40.44B	58.00B	57.32B	50.34B	107.94B	63.28B
Balance Sheet
Total Assets	1.30T	1.33T	1.29T	1.19T	1.09T	982.78B
Cash, Cash Equivalents and Short-Term Investments	134.78B	141.55B	149.81B	120.15B	161.52B	149.16B
Total Debt	172.31B	179.10B	176.34B	176.73B	91.91B	126.53B
Total Liabilities	410.81B	424.88B	431.19B	400.06B	327.94B	321.10B
Stockholders Equity	810.36B	827.11B	794.56B	738.89B	709.09B	615.78B
Cash Flow
Free Cash Flow	42.00B	26.35B	58.26B	-95.86B	64.13B	44.95B
Operating Cash Flow	114.17B	106.24B	116.97B	-16.24B	108.61B	95.11B
Investing Cash Flow	-69.69B	-81.57B	-59.94B	-78.73B	-43.52B	-46.35B
Financing Cash Flow	-49.28B	-37.92B	-31.22B	50.17B	-57.85B	1.58B

Tosoh Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 2412.50
• 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:4042, the sentiment is Positive. The current price of 2412.5 is above the 20-day moving average (MA) of 2405.37, above the 50-day MA of 2338.59, and above the 200-day MA of 2179.62, indicating a bullish trend. The MACD of 50.18 indicates Negative momentum. The RSI at 73.78 is Negative, neither overbought nor oversold. The STOCH value of 94.91 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:4042.

Tosoh Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
4021	78 Outperform	¥743.94B	16.53	19.69%	3.15%	10.06%	18.03%
4042	71 Outperform	¥810.48B	20.06	4.79%	4.21%	-1.21%	-27.21%
4188	68 Neutral	¥1.34T	12.30	1.09%	3.50%	-11.50%	25.86%
4005	66 Neutral	¥819.38B	9.66	8.79%	2.68%	-1.64%	―
4004	65 Neutral	¥1.41T	131.27	1.67%	1.00%	-1.90%	-71.97%
3405	62 Neutral	¥519.54B	67.02	1.08%	3.37%	-1.94%	-84.08%
Sector *	61 Neutral	$10.43B	7.12	-0.05%	2.87%	2.86%	-36.73%

Tosoh Corporate Events

Tosoh Expands Ongoing Share Buyback, Reaching Over 8.2 Million Shares Repurchased

Tosoh Corporation has continued its share buyback program authorized by its board on August 5, 2025, acquiring 909,400 common shares on the market between December 1 and December 31, 2025 for a total of approximately ¥2.12 billion under a discretionary trading contract. This brings the cumulative execution under the current authorization to 8,246,400 shares repurchased for about ¥18.76 billion as of December 31, 2025, out of a maximum approved limit of 17 million shares and ¥25 billion through March 31, 2026, signaling an ongoing capital allocation effort that may enhance shareholder returns and support the company’s share price by reducing the free float.

The most recent analyst rating on (JP:4042) stock is a Buy with a Yen2448.00 price target. To see the full list of analyst forecasts on Tosoh stock, see the JP:4042 Stock Forecast page.

Tosoh Corporation Advances Share Buyback Strategy

Tosoh Corporation announced the acquisition of 1,869,100 of its own shares, costing approximately 4.2 billion yen, as part of a broader share buyback plan initiated in August 2025. This move is part of a strategic effort to enhance shareholder value and optimize capital structure, reflecting Tosoh’s commitment to maintaining a strong market position and delivering value to its stakeholders.

The most recent analyst rating on (JP:4042) stock is a Buy with a Yen2448.00 price target. To see the full list of analyst forecasts on Tosoh stock, see the JP:4042 Stock Forecast page.

Tosoh Corporation Reports Decline in Semi-Annual Financial Results

Tosoh Corporation reported a decline in its financial performance for the six months ending September 30, 2025, with net sales and operating income both decreasing by over 5% compared to the previous year. The company also revised its financial forecast for the fiscal year ending March 31, 2026, anticipating a decrease in net sales and income attributable to owners, which may impact its market positioning and stakeholder confidence.

The most recent analyst rating on (JP:4042) stock is a Buy with a Yen2448.00 price target. To see the full list of analyst forecasts on Tosoh stock, see the JP:4042 Stock Forecast page.

Tosoh Corporation Announces Share Buyback Initiative

Tosoh Corporation has announced the acquisition of its own shares, acquiring 2,673,900 common shares at a total cost of 5,936,042,650 yen between October 1 and October 31, 2025. This move is part of a broader strategy approved by the Board of Directors to acquire up to 17 million shares, aiming to enhance shareholder value and optimize capital structure.

The most recent analyst rating on (JP:4042) stock is a Buy with a Yen2448.00 price target. To see the full list of analyst forecasts on Tosoh stock, see the JP:4042 Stock Forecast page.

Tosoh Corporation Revises Financial Forecast Amid Market Challenges

Tosoh Corporation has revised its financial forecast for the fiscal year ending March 31, 2026, due to decreased sales volumes in its Chlor-alkali and Petrochemical Groups and challenging overseas market conditions. Despite a weaker yen and strong performance in water treatment engineering, the company anticipates lower net sales, operating income, and net income attributable to owners of the parent, impacted by sluggish demand, deteriorating trade terms, and an impairment loss on fixed assets.

The most recent analyst rating on (JP:4042) stock is a Buy with a Yen2448.00 price target. To see the full list of analyst forecasts on Tosoh stock, see the JP:4042 Stock Forecast page.

Tosoh Corporation Revises Financial Forecast Amid Impairment Loss

Tosoh Corporation announced it will record an impairment loss on the fixed assets of its subsidiary Tosoh SMD, Inc. due to decreased shipments in the U.S. semiconductor market, leading to a revised financial forecast. Despite challenges such as a weaker yen and rising raw material costs, the company expects improved operating and ordinary income due to increased sales in its Engineering Group and better trade terms for its Specialty Group, although net income will fall due to the impairment loss.

The most recent analyst rating on (JP:4042) stock is a Hold with a Yen2417.00 price target. To see the full list of analyst forecasts on Tosoh stock, see the JP:4042 Stock Forecast page.