Nippon Pigment Company, Limited (4119) AI Stock Analysis

• Market Cap: ¥8.27B
• Dividend Yield: 2.84%
• Average Volume (3M): 2.10K
• Price to Earnings (P/E): 2.7
• Beta (1Y): 0.62
• Revenue Growth: 37.67%
• EPS Growth: -117.29%
• Country: JP
• Employees: 808
• Sector: Basic Materials
• Sector Strength: 58
• Industry: Chemicals - Specialty
• EPS (TTM): 341.19
• Shares Outstanding: 1,575,899
• 10 Day Avg. Volume: 2,550
• 30 Day Avg. Volume: 2,096
• PEG Ratio: <0.01
• Price to Book (P/B): 0.25
• Price to Sales (P/S): 0.13
• P/FCF Ratio: -3.62
• 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: 66 Neutral
• Price Target: ¥5,692.00 ▲(56.59% Upside)
• Action: Reiterated Date: 02/21/26
• Date: Action: Reiterated 02/21/26

The score is driven primarily by strong financial performance (rapid revenue growth and improved profitability with a solid balance sheet), but is held back by recent negative free cash flow. Technicals are supportive due to a strong uptrend, though very overbought momentum raises near-term pullback risk. Valuation is mixed given a moderate dividend but an unhelpful negative P/E.

Positive Factors

Revenue Growth

A 42.1% year-over-year revenue increase signals durable demand expansion and stronger market penetration across end markets. Sustained top-line growth supports scale economies, funds higher-value product development and long-term customer contracts, improving resilience over multiple quarters.

Net Margin Improvement

A trailing-12-month net margin near 13.8% indicates improved profit conversion and likely better product mix or pricing power. Higher sustainable net margins strengthen internal cash generation capacity, support reinvestment in specialty grades, and enhance ability to weather raw-material cost cycles over time.

Capital Structure Strength

A nearly 45% equity ratio with modest leverage (0.33 D/E) provides financial flexibility for capex and strategic projects. Manageable debt levels reduce refinancing risk and preserve borrowing capacity, enabling the company to sustain investments in specialized product lines and long-term contracts through cycles.

Negative Factors

Negative Free Cash Flow

Recent negative free cash flow driven by higher capex reduces near-term financial flexibility and may force reliance on external financing or slower shareholder returns. If capex persists without commensurate operating cash improvements, liquidity and funding of strategic initiatives could be constrained.

Volatile Return on Equity

Marked ROE volatility suggests earnings swings rather than steady operational improvement, complicating forecasting and capital-allocation decisions. Irregular ROE can reflect cyclical end-market exposure or one-off gains, undermining confidence in sustained shareholder returns over multiple quarters.

Relatively Low EBIT Margin

A comparatively low EBIT margin points to structural cost or efficiency challenges versus peers; persistent pressure from raw material and energy costs could compress operating profit. Limited operating leverage reduces internal cash generation and constrains ability to absorb input cost shocks over time.

Nippon Pigment Company, Limited Business Overview & Revenue Model

Company Description

Nippon Pigment Company Limited manufactures and sells liquid dispersion products, colorants, and resin compounds. It primarily offers various resin compounds, such as olefin and styrene resins, and engineering plastic products; coloring agents for automobile interior skin materials, sealing materials, and floor materials; processed colors; colorants for resins; and liquid dispersions for FPD color filters. The company provides coloring agents for automobile interior and exterior parts, plastic containers, such as shampoo, films, sheets, fibers, etc. Nippon Pigment Company Limited was founded in 1925 and is headquartered in Tokyo, Japan.

How the Company Makes Money

Nippon Pigment generates revenue primarily by selling pigments and pigment-based chemical materials to business customers that incorporate these inputs into their own products (e.g., coatings, inks, plastics, and other formulated materials). Its earnings are driven by shipment volumes, product mix (standard versus higher-value functional/color-specific grades), and pricing relative to raw-material and energy costs. Additional revenue may come from value-added processing (such as dispersions or customized formulations) and long-term supply relationships with manufacturers and formulators, but specific breakdowns by segment, customer industry, or named partnerships are null.

Nippon Pigment Company, Limited Financial Statement Overview

Summary

Strong revenue growth (+42.1% YoY) and improved profitability (TTM net margin ~13.77%) support the score, along with a solid capital structure (equity ratio ~44.97%, debt-to-equity ~0.33). The main constraint is weaker cash-flow quality, with recent negative free cash flow and a negative operating cash flow to net income ratio.

Income Statement

Nippon Pigment Company has demonstrated a strong recovery in its net income, achieving a significant increase from 2024 to 2025. The gross profit margin has been stable, and there is a notable improvement in net profit margin with TTM data showing a 13.77% net profit margin. Revenue growth has been impressive, with a 42.1% increase over the last year, indicating robust sales performance. However, the EBIT margin remains relatively low, suggesting room for operational efficiency improvements.

Balance Sheet

The company's balance sheet shows a healthy equity ratio of 44.97% in 2025, indicating a strong capital structure. The debt-to-equity ratio is moderate at 0.33, suggesting manageable leverage. However, the return on equity has been inconsistent with a significant jump in 2025 due to increased net income, reflecting potential volatility. The overall financial stability is bolstered by a solid asset base, yet the fluctuations in profitability could pose risks.

Cash Flow

Nippon Pigment Company's cash flow analysis reveals challenges with free cash flow, which turned negative in the latest period, mainly due to increased capital expenditures. The operating cash flow to net income ratio is negative, reflecting cash flow management issues. However, the company has shown resilience in past periods with positive operating cash flows, suggesting potential for improvement if investment activities are optimized.

Breakdown	TTM	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	40.77B	37.92B	26.68B	27.46B	27.57B	30.12B
Gross Profit	6.00B	5.47B	3.78B	3.19B	4.36B	3.05B
EBITDA	1.04B	1.06B	1.36B	1.09B	2.43B	1.46B
Net Income	-1.37B	5.03B	740.70M	-519.89M	885.51M	-116.83M
Balance Sheet
Total Assets	43.83B	44.41B	29.63B	29.08B	32.77B	32.34B
Cash, Cash Equivalents and Short-Term Investments	4.10B	4.26B	3.64B	2.80B	5.14B	5.91B
Total Debt	6.40B	6.70B	4.90B	5.55B	8.42B	10.04B
Total Liabilities	22.87B	22.83B	13.93B	13.89B	17.79B	18.55B
Stockholders Equity	19.28B	19.78B	14.50B	14.15B	13.98B	12.92B
Cash Flow
Free Cash Flow	0.00	-1.34B	910.61M	-7.23M	903.12M	926.35M
Operating Cash Flow	0.00	-413.96M	1.52B	993.15M	1.29B	1.76B
Investing Cash Flow	0.00	78.62M	191.69M	-698.65M	-366.67M	-721.52M
Financing Cash Flow	0.00	743.16M	-896.77M	-3.17B	-1.77B	2.34B

Nippon Pigment Company, Limited Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 3635.00
• 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:4119, the sentiment is Positive. The current price of 3635 is below the 20-day moving average (MA) of 4802.00, below the 50-day MA of 4323.50, and below the 200-day MA of 3649.57, indicating a bullish trend. The MACD of 237.91 indicates Negative momentum. The RSI at 72.61 is Negative, neither overbought nor oversold. The STOCH value of 89.40 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:4119.

Nippon Pigment Company, Limited Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
4275	80 Outperform	¥59.01B	9.61	―	1.92%	-0.86%	17.65%
4633	77 Outperform	¥111.02B	10.07	―	3.72%	5.40%	14.80%
4116	76 Outperform	¥79.56B	6.04	―	3.04%	1.57%	-33.97%
4635	71 Outperform	¥20.27B	4.28	―	3.61%	8.85%	110.05%
4022	67 Neutral	¥62.68B	10.30	―	2.22%	5.17%	79.36%
4119	66 Neutral	¥8.27B	2.66	―	2.84%	37.67%	-117.29%
Sector *	61 Neutral	$10.43B	7.12	-0.05%	2.87%	2.86%	-36.73%