Kawaguchi Chemical Industry Co., Ltd. (4361) AI Stock Analysis

• Market Cap: ¥1.65B
• Dividend Yield: 3.68%
• Average Volume (3M): 1.80K
• Price to Earnings (P/E): 5.9
• Beta (1Y): 0.75
• Revenue Growth: 3.87%
• EPS Growth: -15.14%
• Country: JP
• Employees: 171
• Sector: Basic Materials
• Sector Strength: 63
• Industry: Chemicals - Specialty
• EPS (TTM): 63.80
• Shares Outstanding: 1,220,000
• 10 Day Avg. Volume: 2,870
• 30 Day Avg. Volume: 1,800
• PEG Ratio: 2.25
• Price to Book (P/B): 0.58
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 0.00
• 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: ¥1,610.00
• Price Target Upside: 18.56% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 0

• Rating: 80 Outperform
• Price Target: ¥1,600.00 ▲(17.82%Upside)

The overall stock score is driven primarily by strong valuation metrics, with a low P/E ratio and a solid dividend yield making the stock attractive to value investors. Technical analysis supports a positive outlook, as the stock's price trends and momentum indicators are favorable. Financial performance is stable but could be improved by addressing liquidity and leverage challenges.

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

Company Description

Kawaguchi Chemical Industry Co., Ltd. (4361) is a Japanese company that specializes in the production and distribution of chemical products. Operating primarily in the chemical industry, the company offers a variety of chemical solutions that cater to diverse sectors such as manufacturing, pharmaceuticals, agriculture, and more. Its core products include specialty chemicals, resins, industrial chemicals, and other related chemical materials. With a focus on innovation and quality, Kawaguchi Chemical Industry Co., Ltd. aims to meet the evolving needs of its clients across different industries.

How the Company Makes Money

Kawaguchi Chemical Industry Co., Ltd. generates revenue through the sale of its chemical products. Its primary revenue streams include direct sales to manufacturers and industries that utilize its chemicals for production purposes. The company may also engage in long-term supply contracts with key clients, ensuring a steady flow of income. Additionally, partnerships with distributors and agents help expand its market reach, thus contributing to its earnings. The company's commitment to research and development allows it to introduce new and improved products, which can lead to increased sales and market share. Factors such as industry demand, raw material costs, and technological advancements can significantly impact the company's revenue generation.

Kawaguchi Chemical Industry Co., Ltd. Financial Statement Overview

Summary

Kawaguchi Chemical Industry Co., Ltd. exhibits strong revenue growth and operational stability with a solid return on equity. However, the company faces challenges with high leverage and declining free cash flow, which could impact its liquidity position. The overall financial health is solid, but attention should be given to improving cash flow metrics and managing debt levels.

Income Statement

The company has demonstrated consistent revenue growth over the years, with a robust increase in net income and gross profit margin. The revenue growth from 2023 to 2024 is approximately 3.6%, showcasing positive momentum. The gross profit margin stands at about 18.1%, indicating efficient cost management. However, the net profit margin is moderate at 3.8%, suggesting room for profitability improvement. The EBIT margin of 4.2% and EBITDA margin of 9.6% reflect stable operational performance.

Balance Sheet

The balance sheet shows a stable equity base with stockholders' equity at 33.8% of total assets, indicating a healthy equity ratio. The debt-to-equity ratio is relatively high at 1.07, indicating significant leverage. Return on Equity is strong at 11.7%, demonstrating effective use of equity to generate profits. While the equity ratio is healthy, the high leverage could pose risks if not managed properly.

Cash Flow

The cash flow analysis reveals a decline in free cash flow, with negative free cash flow growth compared to the previous year. The operating cash flow to net income ratio is 0.43, indicating moderate cash generation relative to net income. The company needs to focus on improving its free cash flow to net income ratio, which is currently negative, highlighting potential liquidity challenges.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	8.92B	8.61B	8.37B	7.94B	6.63B
Gross Profit	1.61B	1.51B	1.50B	1.57B	1.17B
EBITDA	858.26M	765.47M	697.01M	789.17M	491.74M
Net Income	336.27M	255.53M	218.86M	281.27M	59.35M
Balance Sheet
Total Assets	8.53B	8.34B	8.32B	7.89B	7.19B
Cash, Cash Equivalents and Short-Term Investments	744.64M	1.04B	910.92M	1.32B	882.86M
Total Debt	3.09B	3.26B	3.17B	3.20B	3.26B
Total Liabilities	5.65B	5.70B	5.91B	5.64B	5.22B
Stockholders Equity	2.88B	2.64B	2.41B	2.25B	1.97B
Cash Flow
Free Cash Flow	-214.14M	91.86M	-271.47M	520.95M	296.74M
Operating Cash Flow	143.37M	469.93M	-20.80M	785.46M	654.23M
Investing Cash Flow	-305.08M	-370.24M	-242.94M	-245.70M	-392.09M
Financing Cash Flow	-138.97M	20.86M	-162.17M	-119.43M	222.50M

Kawaguchi Chemical Industry Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 1358.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:4361, the sentiment is Neutral. The current price of 1358 is below the 20-day moving average (MA) of 1369.85, above the 50-day MA of 1341.04, and below the 200-day MA of 1358.94, indicating a neutral trend. The MACD of 5.74 indicates Positive momentum. The RSI at 49.18 is Neutral, neither overbought nor oversold. The STOCH value of 47.61 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for JP:4361.

Kawaguchi Chemical Industry Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
4361	80 Outperform	¥1.65B	5.93		3.68%	3.87%	-15.14%
4625	78 Outperform	¥3.45B	15.28		2.61%	1.87%	-4.33%
4624	71 Outperform	¥5.20B	11.98		1.45%	2.02%	5.55%
4623	66 Neutral	¥6.46B	8.95		3.52%	0.26%	82.94%
4616	65 Neutral	¥1.79B	17.66		1.67%	-5.28%	-45.77%
Sector *	59 Neutral	HK$16.42B	4.45	-5.52%	4.84%	-3.57%	-61.41%
4615	47 Neutral	¥4.46B	20.50		―	9.52%	88.23%