Mitsubishi Chemical Holdings (4188) AI Stock Analysis

• Market Cap: ¥1.02T
• Dividend Yield: 4.27%
• Average Volume (3M): 5.53M
• Price to Earnings (P/E): 13.7
• Beta (1Y): 0.80
• Revenue Growth: <0.01%
• EPS Growth: -58.95%
• Country: JP
• Employees: 66,358
• Sector: Basic Materials
• Sector Strength: 63
• Industry: Chemicals
• EPS (TTM): 52.78
• Shares Outstanding: 1,506,288,100
• 10 Day Avg. Volume: 3,849,540
• 30 Day Avg. Volume: 5,525,870
• PEG Ratio: -0.70
• Price to Book (P/B): 0.57
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 4.91
• 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: ¥853.46
• Price Target Upside: 18.40% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 0

Mitsubishi Chemical Holdings shows resilience in financial performance with robust cash flow and cost management, though profitability in some segments remains a challenge. Technical indicators suggest caution with a bearish trend, but the stock's reasonable valuation and attractive dividend yield provide a counterbalance. The mixed earnings call results reflect ongoing operational challenges alongside strategic cost improvements.

Mitsubishi Chemical Holdings Business Overview & Revenue Model

Company Description

Mitsubishi Chemical Group Corporation provides performance products, chemicals, industrial gases, health care products, and other products in Japan and internationally. The company's performance products include specialty chemicals, functional food materials, inorganic materials, electronic and electrical components and products, molding and processed products, film and sheet products, synthetic paper and fiber, carbon fiber, equipment, instruments and systems, materials and products for industrial use, construction materials, civil engineering materials, aqua-related materials and products, leisure, sports, and daily goods. Its health care products comprise pharmaceuticals, pharmaceutical formulation materials and related products, drug discovery solutions, diagnostic reagents and instruments, health apparatus and instruments for medical use, medical support, nursing care and health support, and clinical examination and service. The company also offers industrial materials, such as basic chemicals, carbon materials, synthetic resins, and industrial gases; and engineering, information systems, analysis and inspection, packaging and logistics, survey, consulting, and other services. In addition, it provides engineering, transportation, and warehousing services. The company was incorporated in 2005 and is headquartered in Tokyo, Japan.

How the Company Makes Money

Mitsubishi Chemical Holdings makes money through a diversified revenue model that includes the sale of chemicals, performance products, and industrial materials. The company's key revenue streams are derived from its broad portfolio of offerings, which cater to multiple industries such as automotive, electronics, and healthcare. Mitsubishi Chemical Holdings also generates income from its healthcare segment, which includes pharmaceuticals and medical devices. Additionally, strategic partnerships and collaborations with other companies and research institutions play a significant role in driving innovation and expanding market reach, further contributing to its earnings.

Mitsubishi Chemical Holdings Financial Statement Overview

Summary

Mitsubishi Chemical Holdings exhibits a robust gross profit margin and strong cash flow management, indicating solid financial health. The net profit margin has slightly decreased, but revenue growth and operational efficiency are commendable. The balance sheet shows improvement in leverage, though further reduction is needed.

Income Statement

Mitsubishi Chemical Holdings exhibits a robust gross profit margin of 27.9% TTM, indicating solid cost management. However, the net profit margin has decreased from 2.7% in the previous year to 1.7% TTM, signaling a potential area of concern. Revenue has shown resilience, with a TTM growth rate of 2.0%. The EBIT margin has improved to 5.9% TTM, reflecting enhanced operational efficiency, while the EBITDA margin stood at 11.2% TTM.

Balance Sheet

The company maintains a high debt-to-equity ratio of 1.19 TTM, suggesting significant leverage, but it has been improving compared to previous years. The return on equity is 4.2% TTM, which is relatively modest. The equity ratio of 29.7% TTM reflects a balanced capital structure, although there is room for strengthening equity.

Cash Flow

Mitsubishi Chemical Holdings demonstrates strong cash flow management, with an operating cash flow to net income ratio of 7.0 TTM, highlighting effective cash generation relative to profit. The free cash flow to net income ratio of 2.8 TTM assures solid liquidity. Moreover, free cash flow has increased by 9.5% from the previous year, indicating healthy cash flow growth.

Breakdown
TTM	Mar 2024	Mar 2023	Mar 2022	Mar 2021	Mar 2020
Income Statement		Total Revenue
4.47T	4.39T	4.63T	3.98T	3.26T	3.58T
	Gross Profit
1.25T	1.15T	1.24T	1.11T	926.25B	987.26B
	EBIT
264.92B	214.48B	182.72B	303.19B	47.52B	144.28B
	EBITDA
502.53B	552.97B	587.41B	502.36B	414.96B	423.85B
	Net Income Common Stockholders
75.10B	119.60B	96.46B	177.16B	-7.56B	54.08B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
336.96B	294.92B	371.69B	296.87B	397.39B	345.84B
	Total Assets
6.09T	6.10T	5.77T	5.57T	5.29T	5.13T
	Total Debt
2.15T	2.20T	2.24T	2.16T	2.35T	2.28T
	Net Debt
1.86T	1.91T	1.95T	1.91T	2.00T	2.06T
	Total Liabilities
3.73T	3.83T	3.79T	3.73T	3.72T	3.68T
	Stockholders Equity
1.81T	1.76T	1.56T	1.46T	1.24T	1.17T
Cash Flow		Free Cash Flow
208.83B	190.67B	74.19B	89.21B	210.12B	215.92B
	Operating Cash Flow
522.94B	465.15B	355.19B	346.87B	467.13B	452.00B
	Investing Cash Flow
-337.79B	-246.09B	-247.63B	-128.78B	-217.01B	-87.56B
	Financing Cash Flow
-291.39B	-241.72B	-60.78B	-336.28B	-142.77B	-450.52B

Mitsubishi Chemical Holdings Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 720.80
• 50DMA: Positive
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:4188, the sentiment is Neutral. The current price of 720.8 is above the 20-day moving average (MA) of 672.50, above the 50-day MA of 717.25, and below the 200-day MA of 789.80, indicating a neutral trend. The MACD of 0.70 indicates Negative momentum. The RSI at 60.24 is Neutral, neither overbought nor oversold. The STOCH value of 88.13 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for JP:4188.

Mitsubishi Chemical Holdings Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
4021	71 Outperform	¥584.25B	13.53	19.18%	3.87%	9.83%	22.31%
4042	70 Outperform	$647.87B	10.05	8.00%	4.80%	3.51%	42.02%
4188	67 Neutral	¥1.02T	13.66	4.16%	4.27%	<0.01%	-58.95%
4183	64 Neutral	¥612.61B	12.12	5.83%	4.49%	5.15%	-8.48%
4005	51 Neutral	$584.97B	―	-16.55%	2.16%	4.08%	-6.32%
Sector *	49 Neutral	$1.96B	-1.15	-21.28%	3.71%	1.17%	-30.86%
4208	45 Neutral	$219.43B	11.14	-2.54%	4.81%	7.76%	-171.50%

Mitsubishi Chemical Holdings Corporate Events

Mitsubishi Chemical Announces Strategic Company Split for Subsidiary Transfer

Mitsubishi Chemical Group Corporation has announced a company split to facilitate the transfer of its subsidiary, Mitsubishi Tanabe Pharma Corporation, to Bain Capital. This strategic move involves a cash transaction of approximately 510 billion yen and aims to streamline operations and focus on core business areas, potentially impacting stakeholders by altering the company’s market dynamics and investment strategies.

Mitsubishi Chemical Announces Strategic Transfer of Pharma Subsidiary

Mitsubishi Chemical Group has announced revisions to its third-quarter financial statements following a significant event: the decision to transfer Mitsubishi Tanabe Pharma Corporation to Bain Capital. This strategic move is expected to be completed by the second quarter of FY 2026, subject to shareholder and regulatory approvals. The transfer will categorize the pharmaceutical segment as discontinued operations, potentially leading to a pre-tax income of approximately 95 billion yen in FY 2025. This development underscores Mitsubishi Chemical’s strategic realignment efforts, potentially impacting its market positioning and financial outlook.

Mitsubishi Chemical to Transfer Pharma Subsidiary to Bain Capital

Mitsubishi Chemical Group Corporation has decided to transfer its subsidiary, Mitsubishi Tanabe Pharma Corporation, to Bain Capital. This strategic move aims to utilize the funds from the transfer to strengthen MCG’s financial base, enhance shareholder returns, and reinvest in its chemical business growth strategy.

Mitsubishi Chemical Sells Pharma Unit to Bain Capital for Strategic Growth

Mitsubishi Chemical Group has signed an agreement to transfer its subsidiary, Mitsubishi Tanabe Pharma, to Bain Capital for approximately 5,100 Oku yen. This move allows Mitsubishi Chemical to focus on its core chemicals business and is expected to result in a 950 Oku yen gain in the second quarter of FY3/26. The proceeds from the transaction will be allocated towards growth investments, debt repayment, and shareholder returns, aligning with the strategic goals outlined in ‘KAITEKI Vision 35’.

Mitsubishi Chemical Reports Mixed Q3 Financial Results

Mitsubishi Chemical Group Corporation reported its consolidated financial results for the third quarter of the fiscal year ending March 31, 2025, showing a slight increase in sales revenue by 2.7% compared to the previous year. However, the company experienced a notable decline in net income attributable to owners of the parent by 42.8%, indicating challenges that may impact its financial stability and investor confidence.