Sugai Chemical Industry Co., Ltd. (4120) AI Stock Analysis

• Market Cap: ¥3.13B
• Dividend Yield: 3.06%
• Average Volume (3M): 370.00
• Price to Earnings (P/E): 10.5
• Beta (1Y): 0.27
• Revenue Growth: 1.14%
• EPS Growth: 50.47%
• Country: JP
• Employees: 182
• Sector: Basic Materials
• Sector Strength: 58
• Industry: Chemicals - Specialty
• EPS (TTM): 85.51
• Shares Outstanding: 1,373,000
• 10 Day Avg. Volume: 390
• 30 Day Avg. Volume: 370
• PEG Ratio: -0.33
• Price to Book (P/B): 0.42
• Price to Sales (P/S): 0.47
• P/FCF Ratio: -6.72
• 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: Hold
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 71 Outperform
• Price Target: ¥2,481.00 ▲(9.68% Upside)

Sugai Chemical Industry Co., Ltd. is supported by strong financial performance and attractive valuation, making it a compelling investment opportunity. However, recent declines in net income and free cash flow, along with mixed technical indicators, suggest caution. The stock's positive valuation metrics and stable balance sheet provide a solid foundation for potential growth.

Positive Factors

Revenue Growth

Consistent revenue growth indicates expanding market reach and product adoption, supporting long-term business sustainability.

Operational Efficiency

Stable gross profit margins reflect effective cost control, enhancing profitability and competitive positioning over time.

Balance Sheet Health

A strong balance sheet with moderate debt levels ensures financial stability and flexibility for future growth initiatives.

Negative Factors

Decline in Net Income

Decreasing net income can strain profitability, potentially affecting the company's ability to reinvest and grow.

Free Cash Flow Decline

Reduced free cash flow limits the company's ability to fund operations and investments, impacting long-term growth potential.

Return on Equity Decline

A declining return on equity suggests reduced efficiency in generating profits from shareholders' equity, impacting investor confidence.

Sugai Chemical Industry Co., Ltd. Business Overview & Revenue Model

Company Description

Sugai Chemical Industry Co., Ltd. (4120) is a prominent player in the chemical manufacturing sector, specializing in the production of high-quality chemical products for various industries. The company focuses on the development and supply of specialty chemicals, including polymers, resins, and additives, which are utilized in sectors such as automotive, construction, and consumer goods. With a commitment to innovation and sustainability, Sugai Chemical strives to meet the evolving needs of its clients while adhering to stringent environmental standards.

How the Company Makes Money

Sugai Chemical Industry Co., Ltd. generates revenue primarily through the sale of its specialty chemical products to a diverse range of industries. The company's revenue model is based on direct sales to manufacturers and distributors, providing them with essential raw materials for their production processes. Key revenue streams include long-term contracts with major clients in the automotive and construction sectors, as well as spot sales to smaller enterprises. Additionally, Sugai Chemical benefits from strategic partnerships with research institutions and industry leaders, enabling them to innovate and expand their product offerings, which in turn drives revenue growth. The company's focus on sustainable practices also attracts environmentally-conscious clients, contributing positively to its earnings.

Sugai Chemical Industry Co., Ltd. Financial Statement Overview

Summary

Sugai Chemical Industry Co., Ltd. shows strong revenue growth and operational efficiency, but recent declines in net income and free cash flow could pose challenges. The balance sheet is solid, providing a stable financial foundation, though attention to profitability and cash flow management is needed.

Income Statement

Sugai Chemical Industry Co., Ltd. has demonstrated solid revenue growth over the years, with a notable increase from 2020 to 2024. Gross profit margins have been stable, indicating efficient cost management. However, there was a decline in net income in 2025, impacting the net profit margin. The EBIT and EBITDA margins are strong, reflecting healthy operational efficiency.

Balance Sheet

The company's balance sheet is relatively robust, with a moderate debt-to-equity ratio and a strong equity ratio, indicating financial stability. The return on equity has been declining, which could be a concern if it continues. Overall, the company maintains a balanced financial structure, although the decreasing net income affects ROE.

Cash Flow

Sugai Chemical Industry Co., Ltd. has experienced fluctuations in free cash flow, with a significant drop in 2025. The operating cash flow to net income ratio indicates that the company generates sufficient cash from its operations, but the recent decline in free cash flow needs attention. The capital expenditures have been substantial, impacting free cash flow.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	6.88B	6.62B	7.62B	7.06B	6.23B	6.01B
Gross Profit	1.31B	1.44B	1.55B	1.53B	1.37B	1.30B
EBITDA	972.30M	997.01M	944.80M	1.21B	954.14M	734.12M
Net Income	283.83M	363.12M	489.11M	578.93M	404.47M	317.90M
Balance Sheet
Total Assets	10.71B	11.48B	11.38B	11.29B	11.21B	11.60B
Cash, Cash Equivalents and Short-Term Investments	857.81M	409.42M	731.01M	431.08M	693.99M	791.07M
Total Debt	1.02B	1.89B	1.71B	2.02B	2.50B	3.20B
Total Liabilities	3.22B	4.02B	4.12B	4.57B	4.83B	5.59B
Stockholders Equity	7.49B	7.45B	7.26B	6.72B	6.37B	6.01B
Cash Flow
Free Cash Flow	0.00	-465.36M	707.05M	315.88M	466.48M	-388.94M
Operating Cash Flow	0.00	71.85M	1.19B	931.90M	1.44B	245.25M
Investing Cash Flow	0.00	-543.51M	-495.88M	-658.30M	-948.86M	-634.30M
Financing Cash Flow	0.00	149.69M	-396.23M	-537.75M	-595.84M	599.01M

Sugai Chemical Industry Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 2262.00
• 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:4120, the sentiment is Positive. The current price of 2262 is above the 20-day moving average (MA) of 2250.80, above the 50-day MA of 2232.06, and above the 200-day MA of 2164.34, indicating a bullish trend. The MACD of 3.80 indicates Negative momentum. The RSI at 55.85 is Neutral, neither overbought nor oversold. The STOCH value of 89.63 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:4120.

Sugai Chemical Industry Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
4361	79 Outperform	¥1.95B	8.11	―	4.15%	-0.77%	-29.54%
4625	78 Outperform	¥3.61B	12.88	―	2.47%	1.79%	31.63%
4120	71 Outperform	¥3.13B	10.52	―	3.06%	1.14%	50.47%
5199	64 Neutral	¥2.56B	11.59	―	4.01%	-4.09%	59.57%
4098	63 Neutral	¥2.48B	18.18	―	1.19%	-1.01%	―
Sector *	61 Neutral	$10.43B	7.12	-0.05%	2.87%	2.86%	-36.73%
5103	52 Neutral	¥3.56B	-13.49	―	―	-3.45%	56.08%