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

• Market Cap: ¥39.05B
• Dividend Yield: 2.37%
• Average Volume (3M): 79.15K
• Price to Earnings (P/E): 16.6
• Beta (1Y): 1.23
• Revenue Growth: -11.70%
• EPS Growth: -54.82%
• Country: JP
• Employees: 922
• Sector: Basic Materials
• Sector Strength: 58
• Industry: Chemicals - Specialty
• EPS (TTM): N/A
• 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: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 67 Neutral
• Price Target: ¥2,592.00 ▲(38.09% Upside)
• Action: Reiterated Date: 02/18/26
• Date: Action: Reiterated 02/18/26

The score is driven primarily by solid financial stability from low leverage and steady revenue, but it is capped by the recent profitability step-down and weak, volatile free cash flow. Technicals are supportive with an uptrend and positive momentum, while valuation looks reasonable with a mid-range P/E and moderate dividend yield.

Positive Factors

Low leverage / strong balance sheet

A low debt-to-equity (~0.18–0.21 historically; 0.19 TTM) and rising equity provide durable financial flexibility. This balance-sheet strength supports capital expenditure, cyclical resilience, targeted acquisitions, and ability to absorb industry downturns without forcing dilutive financing.

Diversified specialty-chemicals portfolio

Hodogaya’s exposure across pigments, electronic-materials, and other performance chemicals gives structurally diversified end markets. That product mix supports steady demand across cycles, reduces single-market concentration risk, and preserves long-term revenue stability as industrial and electronics demand evolves.

Stable, above-average gross margins

Sustained gross margins in the high 30s percent reflect differentiated specialty products and pricing leverage versus commodity peers. That margin base helps absorb input-cost volatility, underpins operating profit potential over time, and supports reinvestment in R&D and customer-facing capabilities.

Negative Factors

Profitability step-down

Recent margin compression and lower returns on equity indicate weakening earnings power versus prior years. Persistently lower operating and net margins reduce cash available for reinvestment and dividend support, pressuring medium-term returns and the company’s ability to finance growth organically.

Volatile and weak free cash flow

High variability in free cash flow driven by working-capital and investment swings weakens cash reliability. Weak FCF constrains capital allocation flexibility for capex, dividends or M&A, and increases the risk that management may need external financing during investment or cyclical downcycles.

Recent revenue and EPS deterioration

Material declines in reported revenue and EPS growth point to near-term demand softness or margin pressure that could persist. Continued top-line contraction and large EPS decline undermine scale economies and raise the bar for management to restore sustainable earnings growth over the next several quarters.

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

Company Description

Hodogaya Chemical Co., Ltd. (4112) is a Japan-based company engaged in the development, manufacture, and sale of chemical products. The company operates primarily in sectors such as specialty chemicals, fine chemicals, and synthetic resins. Hodogaya's core products include a wide range of chemical intermediates, pigments, and additives used in various industries, including automotive, electronics, and agriculture.

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

Financials are stable overall, supported by a strong balance sheet (low leverage; debt-to-equity ~0.19) and modest positive revenue growth (TTM +2.86%). The main drag is a clear step-down in profitability (TTM operating margin ~5.1%, net margin ~4.2%) and weak/volatile cash conversion with sharply lower TTM free cash flow (~¥0.55B).

Income Statement

Revenue growth has been modest but generally positive (TTM (Trailing-Twelve-Months) +2.86% following a stronger FY2025), indicating steady demand. Profitability is mixed: gross margin remains solid (~36–39%), but earnings power has compressed versus earlier years—TTM operating and net margins (~5.1% and ~4.2%) are notably below FY2022–FY2025 levels, suggesting cost pressure and/or weaker mix. Overall, the income statement reflects stability with a clear recent margin step-down as the main concern.

Balance Sheet

Leverage appears conservative with low debt relative to equity (debt-to-equity ~0.18–0.21 historically; 0.19 in TTM (Trailing-Twelve-Months)), providing balance-sheet flexibility for a specialty chemicals business. Equity has grown over time and assets have expanded, supporting financial resilience. The key weakness is profitability on equity trending lower (TTM ~3.8% vs ~5–8% in prior years), implying the capital base is strong but currently generating less return.

Cash Flow

Cash generation is the most volatile area. While operating cash flow is positive in TTM (Trailing-Twelve-Months) (~¥6.1B), it covers a relatively small portion of earnings, and free cash flow is weak in TTM (Trailing-Twelve-Months) (~¥0.55B) with a sharp decline versus the prior year. The history shows meaningful swings (including negative free cash flow in FY2023 and strong free cash flow in FY2022/FY2024), indicating working-capital and/or investment-driven variability that reduces cash flow reliability.

Breakdown	TTM	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	45.79B	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	6.24B	7.93B	7.17B	6.26B	7.94B	7.25B
Net Income	2.29B	3.18B	2.48B	2.22B	3.25B	3.12B
Balance Sheet
Total Assets	87.48B	79.86B	81.16B	72.05B	66.45B	62.61B
Cash, Cash Equivalents and Short-Term Investments	11.66B	10.77B	12.96B	10.49B	11.45B	9.45B
Total Debt	9.46B	8.90B	9.81B	11.08B	7.02B	8.19B
Total Liabilities	23.81B	21.32B	23.71B	22.16B	18.54B	18.96B
Stockholders Equity	52.45B	48.60B	47.73B	42.83B	41.41B	38.67B
Cash Flow
Free Cash Flow	549.00M	248.00M	2.99B	-2.06B	4.38B	3.07B
Operating Cash Flow	6.12B	5.67B	8.34B	1.06B	6.14B	5.38B
Investing Cash Flow	-4.51B	-6.55B	-3.95B	-7.04B	-3.57B	-2.69B
Financing Cash Flow	-685.00M	-1.88B	-2.07B	2.29B	-1.85B	-424.00M

Hodogaya Chemical Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 1877.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

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 1877 is below the 20-day moving average (MA) of 2346.75, below the 50-day MA of 2293.24, and above the 200-day MA of 1794.25, indicating a bullish trend. The MACD of 26.48 indicates Positive momentum. The RSI at 58.42 is Neutral, neither overbought nor oversold. The STOCH value of 61.62 is Neutral, 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
4462	78 Outperform	¥42.03B	15.65	―	1.90%	2.15%	16.14%
4362	75 Outperform	¥62.08B	13.67	―	2.92%	3.03%	28.27%
4027	74 Outperform	¥38.97B	26.79	―	3.24%	1.83%	-8.54%
4611	74 Outperform	¥42.32B	5.50	―	3.70%	14.83%	51.42%
4078	70 Outperform	¥65.80B	15.82	―	4.37%	-1.09%	―
4112	67 Neutral	¥39.05B	16.63	―	2.37%	-11.70%	-54.82%
Sector *	61 Neutral	$10.43B	7.12	-0.05%	2.87%	2.86%	-36.73%

Hodogaya Chemical Co., Ltd. Corporate Events

Hodogaya Chemical Unveils FY2025 Third-Quarter Consolidated Results Overview

Hodogaya Chemical Co., Ltd. released its consolidated financial results presentation for the third quarter of fiscal year 2025, which ends in March 2026. The materials outline an overview of group performance, segment-by-segment results, and reference indicators such as net sales, operating profit, and EBITDA, signaling continued emphasis on transparency around earnings quality and segment contributions for investors and other stakeholders.

The most recent analyst rating on (JP:4112) stock is a Hold with a Yen2673.00 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 Profit Slumps as Company Sticks to Weaker Full-Year Outlook

Hodogaya Chemical reported consolidated net sales of ¥34.45 billion for the nine months to December 31, 2025, down 7.5% year on year, with operating profit plunging 47.1% to ¥2.43 billion and profit attributable to owners of parent falling 30.9% to ¥1.99 billion. Despite weaker earnings and a lower equity-to-asset ratio of 60.0%, comprehensive income nearly doubled, and the company maintained its full-year forecast, signaling confidence while forecasting a 3.2% revenue decline and a roughly 28% drop in operating profit for the year to March 31, 2026.

The company plans an annual dividend of ¥50 per share for the fiscal year ending March 31, 2026 on a post-split basis, compared with an effective ¥90 per share in the prior year before a 2-for-1 stock split, pointing to a reduced shareholder payout. Hodogaya also reported an increase in total assets and net assets, minor changes in treasury share levels, and the exclusion of one subsidiary from its consolidation scope, moves that may subtly reshape its balance sheet and group structure without altering its earnings guidance.

The most recent analyst rating on (JP:4112) stock is a Hold with a Yen2673.00 price target. To see the full list of analyst forecasts on Hodogaya Chemical Co., Ltd. stock, see the JP:4112 Stock Forecast page.