Hodogaya Chemical Co., Ltd. (4112) AI Stock Analysis

• Market Cap: ¥29.74B
• Dividend Yield: 2.75%
• Average Volume (3M): 79.15K
• Price to Earnings (P/E): 13.9
• Beta (1Y): 1.22
• Revenue Growth: -11.70%
• EPS Growth: -54.82%
• Country: JP
• Employees: 922
• Sector: Basic Materials
• Sector Strength: 58
• Industry: Chemicals - Specialty
• EPS (TTM): 38.94
• Shares Outstanding: 16,827,452
• 10 Day Avg. Volume: 72,200
• 30 Day Avg. Volume: 79,146
• PEG Ratio: 0.28
• Price to Book (P/B): 0.51
• Price to Sales (P/S): 0.51
• P/FCF Ratio: 100.02
• 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: Moderate Buy
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 69 Neutral
• Price Target: ¥2,041.00 ▲(6.58% Upside)

Hodogaya Chemical Co., Ltd. presents a mixed financial picture with stable profit margins but declining revenue and cash flow issues. The technical analysis shows a positive trend, although short-term momentum is bearish. The stock is fairly valued with a reasonable P/E ratio and an attractive dividend yield. Addressing revenue and cash flow challenges is crucial for future growth.

Positive Factors

Stable Margins

Stable profit margins indicate operational efficiency and pricing power, which can help sustain profitability even in challenging market conditions.

Low Leverage

Low leverage enhances financial stability, providing flexibility to invest in growth opportunities and weather economic downturns without significant financial strain.

Diverse Revenue Streams

A diverse revenue base across various industries reduces dependency on any single market, enhancing resilience against sector-specific downturns.

Negative Factors

Declining Revenue Growth

Declining revenue growth can signal weakening demand or competitive pressures, potentially impacting long-term financial health and market position.

Cash Flow Challenges

Significant declines in free cash flow can limit the company's ability to invest in growth, pay down debt, or return capital to shareholders, impacting future operations.

Low Return on Equity

A low ROE indicates that the company may not be efficiently using its equity base to generate profits, which could deter investors seeking higher returns.

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

Company Description

Hodogaya Chemical Co., Ltd. manufactures and sells functional colorants, specialty polymers, basic chemicals, and agro-science products in Japan. Its Functional Colorants segment offers OLED materials that are used in smartphone display panels, tablets, smartwatches, and other devices; imaging materials for copiers and printers; dyes and colors for use in aluminum colorings, stationery inks, and hair dyes; and food additives that add appeal to processed foods. The company's Specialty Polymers segment manufactures and supplies polymer materials, release agents, and raw materials for antiseptic detergents, surfactants, dyestuffs, perfumes, etc.; construction materials, such as waterproofing, flooring and paving, and building materials; and specialty chemicals, such as intermediates and additives comprises phosgene derivatives, such as chloroformates, acid chlorides, and carbonyldiimidazole for use in pharmaceutical and cosmetic sectors. Its Basic Chemicals segment engages in the development, manufacture, and sale of hydrogen peroxide and its derivatives. The company's Agro-Science segment offers herbicides, agrochemical intermediates, pesticide formulations, Microbial Materials, and oxygen supply materials This segment products have application in various fields, such as controlling weeds, insect pest management, and environmental conservation for cropland, living environments, railways, forests, and golf courses. Its Logistic segment provides logistics solutions, such as outdoor and hazardous materials warehousing, forwarding and customs clearance, and overland cargo, maritime cargo, air cargo, and intermodal international transportation services. The company was formerly known as Hodogaya Soda Co., Ltd. and changed its name to Hodogaya Chemical Co., Ltd. in 1939. Hodogaya Chemical Co., Ltd. was incorporated in 1916 and is headquartered in Tokyo, Japan.

How the Company Makes Money

Hodogaya Chemical generates revenue through the sale of its chemical products to a diverse customer base across multiple industries. The company has a significant revenue stream from specialty chemicals, which are used in high-value applications, providing higher margins compared to commodity chemicals. Additionally, Hodogaya benefits from long-term partnerships with key clients in sectors like automotive and electronics, ensuring steady demand for its products. The company also invests in research and development to create innovative solutions and improve existing products, which helps maintain its competitive edge and drives revenue growth.

Hodogaya Chemical Co., Ltd. Financial Statement Overview

Summary

Hodogaya Chemical Co., Ltd. shows a mixed financial performance. The income statement reveals stable profit margins but declining revenue growth. The balance sheet is strong with low leverage, but cash flow issues are evident with a significant decline in free cash flow. Addressing revenue growth and cash flow generation are crucial for improvement.

Income Statement

Hodogaya Chemical Co., Ltd. shows a mixed performance in its income statement. The TTM data indicates a decline in revenue growth rate by 6.4%, which is concerning. However, the company maintains a stable gross profit margin of approximately 39%, and a net profit margin of 6.5%, which are decent for the industry. The EBIT and EBITDA margins are also stable, indicating operational efficiency. The company needs to address the declining revenue trend to improve its financial health.

Balance Sheet

The balance sheet of Hodogaya Chemical Co., Ltd. reflects a solid financial position with a low debt-to-equity ratio of 0.18, indicating conservative leverage. The return on equity (ROE) is modest at 6.4%, suggesting room for improvement in generating returns for shareholders. The equity ratio stands at a healthy level, showcasing a strong capital structure. Overall, the balance sheet is stable, but enhancing ROE could further strengthen the company's financial standing.

Cash Flow

The cash flow statement reveals some challenges, particularly with a significant decline in free cash flow growth by 537% in the TTM period. The operating cash flow to net income ratio is 0.41, indicating that the company generates adequate cash from operations relative to its net income. However, the negative free cash flow and its low ratio to net income highlight potential liquidity concerns. Improving cash flow generation is crucial for sustaining operations and funding future growth.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	45.47B	48.58B	44.26B	43.32B	41.88B	41.20B
Gross Profit	16.81B	18.91B	17.10B	16.67B	17.66B	16.07B
EBITDA	6.25B	7.93B	7.17B	6.26B	7.94B	7.25B
Net Income	2.08B	3.18B	2.48B	2.22B	3.25B	3.12B
Balance Sheet
Total Assets	80.71B	79.86B	81.16B	72.05B	66.45B	62.61B
Cash, Cash Equivalents and Short-Term Investments	9.71B	10.77B	12.96B	10.49B	11.45B	9.45B
Total Debt	8.16B	8.90B	9.81B	11.08B	7.02B	8.19B
Total Liabilities	20.81B	21.32B	23.71B	22.16B	18.54B	18.96B
Stockholders Equity	49.51B	48.60B	47.73B	42.83B	41.41B	38.67B
Cash Flow
Free Cash Flow	-1.04B	248.00M	2.99B	-2.06B	4.38B	3.07B
Operating Cash Flow	4.24B	5.67B	8.34B	1.06B	6.14B	5.38B
Investing Cash Flow	-3.05B	-6.55B	-3.95B	-7.04B	-3.57B	-2.69B
Financing Cash Flow	-2.24B	-1.88B	-2.07B	2.29B	-1.85B	-424.00M

Hodogaya Chemical Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 1915.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:4112, the sentiment is Positive. The current price of 1915 is above the 20-day moving average (MA) of 1791.45, above the 50-day MA of 1789.39, and above the 200-day MA of 1579.03, indicating a bullish trend. The MACD of 18.77 indicates Negative momentum. The RSI at 62.12 is Neutral, neither overbought nor oversold. The STOCH value of 81.14 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:4112.

Hodogaya Chemical Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
4275	80 Outperform	¥36.29B	14.36	―	2.18%	-0.86%	17.65%
4462	78 Outperform	¥30.66B	11.79	―	1.96%	2.15%	16.14%
4022	77 Outperform	¥40.07B	11.50	―	2.76%	5.17%	79.36%
4027	75 Outperform	¥28.04B	13.64	―	3.04%	1.83%	-8.54%
4112	69 Neutral	¥29.74B	13.88	―	2.75%	-11.70%	-54.82%
4968	64 Neutral	¥22.54B	13.00	―	4.44%	5.72%	28.92%
Sector *	61 Neutral	$10.43B	7.12	-0.05%	2.87%	2.86%	-36.73%

Hodogaya Chemical Co., Ltd. Corporate Events

Hodogaya Chemical Revises Financial Forecasts Due to Lower OLED Sales

Hodogaya Chemical Co., Ltd. has revised its financial forecasts for the fiscal year ending March 2026, citing lower-than-expected sales of OLED materials in its functional colorants segment. This revision anticipates a decrease in revenue, operating profit, ordinary profit, and profit attributable to owners compared to previous forecasts, although the year-end dividend forecast remains unchanged.

The most recent analyst rating on (JP:4112) stock is a Buy with a Yen2185.00 price target. To see the full list of analyst forecasts on Hodogaya Chemical Co., Ltd. stock, see the JP:4112 Stock Forecast page.

Hodogaya Chemical Reports Decline in Financial Performance

Hodogaya Chemical Co., Ltd. reported a significant decline in its financial performance for the six months ended September 30, 2025, with net sales decreasing by 15.3% and operating profit dropping by 64.8% compared to the previous year. The company has revised its earnings forecast for the fiscal year ending March 31, 2026, indicating a continued challenging business environment, which may impact stakeholders and the company’s strategic positioning in the market.

The most recent analyst rating on (JP:4112) stock is a Buy with a Yen2185.00 price target. To see the full list of analyst forecasts on Hodogaya Chemical Co., Ltd. stock, see the JP:4112 Stock Forecast page.

Hodogaya Chemical’s Subsidiary SFC Prepares for KOSPI IPO

Hodogaya Chemical Co., Ltd. announced that its consolidated subsidiary, SFC CO., LTD., is preparing for an IPO on the Korea Exchange Securities Market (KOSPI). This move, pending approval from Korean authorities, could enhance SFC’s market positioning and potentially increase shareholder value, reflecting Hodogaya’s strategic expansion in the Asian market.

The most recent analyst rating on (JP:4112) stock is a Buy with a Yen1975.00 price target. To see the full list of analyst forecasts on Hodogaya Chemical Co., Ltd. stock, see the JP:4112 Stock Forecast page.