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Denka Co
(4061)
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Rating:56Neutral
Price Target:
¥3,987.00
▲(45.11% Upside)
Action:Reiterated
Date:05/30/26
The score is held back primarily by weak cash generation (negative free cash flow in most recent years) and a cyclical, uneven earnings history despite a 2026 rebound. Offsetting this, the technical setup is constructive with an uptrend across major moving averages, while valuation is middling with a relatively high P/E and only moderate dividend support.
Positive Factors
Diversified end-market exposure
Denka's broad product set across electronics/semiconductors, mobility, infrastructure, packaging and healthcare reduces single-market risk and smooths demand cycles. This structural diversification supports revenue resilience and cross-market customer relationships over the medium term.
Negative Factors
Persistent negative free cash flow
Sustained negative free cash flow implies the company relies on external funding or asset sales to fund capex and operations. This erodes the ability to self-fund growth, increases refinancing risk, and limits capacity for sustained dividends or buybacks absent a durable cash-flow recovery.
Read all positive and negative factors
Positive Factors
Negative Factors
Diversified end-market exposure
Denka's broad product set across electronics/semiconductors, mobility, infrastructure, packaging and healthcare reduces single-market risk and smooths demand cycles. This structural diversification supports revenue resilience and cross-market customer relationships over the medium term.
Read all positive factors
Denka Co (4061) vs. iShares MSCI Japan ETF (EWJ)
Market Cap
¥295.58B
Dividend Yield2.92%
Average Volume (3M)424.75K
Price to Earnings (P/E)18.8
Beta (1Y)1.03
Revenue Growth-4.00%
EPS GrowthN/A
CountryJP
Employees6,454
SectorBasic Materials
Sector Strength58
IndustryChemicals
Share Statistics
EPS (TTM)182.09
Shares Outstanding88,555,840
10 Day Avg. Volume419,400
30 Day Avg. Volume424,753
Financial Highlights & Ratios
PEG Ratio-0.09
Price to Book (P/B)0.98
Price to Sales (P/S)0.79
P/FCF Ratio-9.81
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
¥4,390.00Price Target Upside59.78% Upside
Rating ConsensusHold
Number of Analyst Covering1
EPS Forecast (FY)207.66
Revenue Forecast (FY)¥449.99B
Denka Co Business Overview & Revenue Model
Company Description
Denka Company Limited, a Tokyo, Japan-based entity founded in 1915, operates internationally as a manufacturer and supplier of a wide array of organic and inorganic materials, electronic components, and pharmaceutical products. Its Electronics & I...
How the Company Makes Money
Denka makes money primarily by manufacturing and selling chemical and materials products to business customers (B2B) across multiple end markets. Revenue is generated through: (1) Product sales: the core income source comes from selling proprietar...
Denka Co Financial Statement Overview
Summary
Income Statement
56
Neutral
Balance Sheet
63
Positive
Cash Flow
38
Negative
| Breakdown | Mar 2026 | Mar 2026 | Mar 2025 | Mar 2024 | Mar 2023 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 384.25B | 400.25B | 389.26B | 407.56B | 384.85B |
| Gross Profit | 94.26B | 87.04B | 84.98B | 104.59B | 109.46B |
| EBITDA | 52.63B | 12.87B | 43.09B | 42.79B | 59.44B |
| Net Income | 15.70B | -12.30B | 11.95B | 12.77B | 26.01B |
Balance Sheet | |||||
| Total Assets | 681.01B | 655.52B | 616.24B | 592.16B | 557.65B |
| Cash, Cash Equivalents and Short-Term Investments | 35.27B | 37.00B | 35.39B | 20.20B | 20.21B |
| Total Debt | 221.71B | 221.88B | 178.03B | 172.68B | 139.43B |
| Total Liabilities | 342.18B | 347.23B | 299.33B | 291.81B | 265.55B |
| Stockholders Equity | 310.71B | 296.18B | 307.54B | 296.48B | 288.47B |
Cash Flow | |||||
| Free Cash Flow | -31.01B | -40.13B | -7.59B | -29.86B | 5.28B |
| Operating Cash Flow | 36.15B | 18.62B | 36.26B | 8.95B | 42.63B |
| Investing Cash Flow | -30.81B | -52.63B | -17.33B | -28.27B | -36.84B |
| Financing Cash Flow | -6.61B | 33.16B | -4.53B | 18.36B | -12.34B |
Denka Co Technical Analysis
Positive
2747.50
Price Trends
3992.70
Negative
3880.78
Negative
3313.96
Positive
Market Momentum
-122.35
Negative
50.08
Neutral
78.55
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:4061, the sentiment is Positive. The current price of 2747.5 is below the 20-day moving average (MA) of 3677.65, below the 50-day MA of 3992.70, and below the 200-day MA of 3313.96, indicating a neutral trend. The MACD of -122.35 indicates Negative momentum. The RSI at 50.08 is Neutral, neither overbought nor oversold. The STOCH value of 78.55 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:4061.
Denka Co Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
69 Neutral | ¥11.45T | 22.60 | 10.90% | 1.58% | 0.62% | -2.72% | |
61 Neutral | $10.43B | 7.12 | -0.05% | 2.87% | 2.86% | -36.73% | |
61 Neutral | ¥321.70B | 19.18 | ― | 5.28% | -2.31% | -1.30% | |
59 Neutral | ¥853.84B | 14.04 | 6.28% | 2.51% | -10.66% | 58.38% | |
57 Neutral | ¥1.61T | -39.48 | 0.66% | 2.69% | -7.96% | 106.67% | |
57 Neutral | ¥862.51B | 20.48 | 5.11% | 3.52% | -4.09% | -26.93% | |
56 Neutral | ¥295.58B | 18.84 | 5.26% | 3.71% | -4.00% | ― |
* Basic Materials Sector Average
JP:4061
Denka Co
3,759.00
1,716.54
84.04%
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Denka Co Corporate Events
Denka Books Large Extraordinary Items on U.S. Elastomer Exit and Toyo Styrene Deal
May 13, 2026
Denka Company Limited has booked significant extraordinary items for the fiscal year ended March 31, 2026, chiefly a ¥21.1 billion loss on liquidation of business tied to Denka Performance Elastomer LLC’s decision not to restart its U.S...
Denka Ramps Up SNECTON Capacities to Capture AI-Related Materials Demand
May 13, 2026
Denka is advancing its position in electronic materials for AI-related hardware by expanding its SNECTON product line, a low-dielectric organic insulation resin designed to reduce transmission loss while maintaining processability. The company rep...
Denka Swings Back to Profit as Earnings Surge Despite Lower Sales
May 13, 2026
Denka Co. reported fiscal 2026 consolidated net sales of ¥384.2 billion, down 4.0% year on year, but operating profit surged 82.0% to ¥26.2 billion and ordinary profit more than doubled, lifting profit attributable to owners of parent to...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.