Fuso Chemical Co., Ltd. (4368) AI Stock Analysis

• Market Cap: ¥262.21B
• Dividend Yield: 1.23%
• Average Volume (3M): 88.52K
• Price to Earnings (P/E): 20.3
• Beta (1Y): 0.85
• Revenue Growth: 8.80%
• EPS Growth: 33.39%
• Country: JP
• Employees: 930
• Sector: Basic Materials
• Sector Strength: 58
• Industry: Chemicals
• EPS (TTM): 107.05
• Shares Outstanding: 35,511,000
• 10 Day Avg. Volume: 99,450
• 30 Day Avg. Volume: 88,523
• PEG Ratio: 0.27
• Price to Book (P/B): 1.17
• Price to Sales (P/S): 1.74
• P/FCF Ratio: 27.72
• 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: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 74 Outperform
• Price Target: ¥8,254.00 ▲(29.17% Upside)

The score is primarily supported by strong financial performance (healthy margins, low leverage, solid cash conversion) and a strong upward technical trend (price above key moving averages, positive MACD). This is offset by stretched momentum signals (RSI/Stoch elevated) and only moderate valuation support (P/E ~18.6 and ~1.07% dividend yield).

Positive Factors

High Profitability & Margins

Fuso’s sustained high gross and operating margins reflect specialized formulations and manufacturing for industrial/electronics customers. Durable margin levels indicate pricing power and structural cost advantages from process know‑how, supporting long‑term cash generation and reinvestment capacity.

Low Financial Leverage

A low debt-to-equity ratio and strong equity base provide financial flexibility to fund capex, weather industry cyclicality, and pursue strategic investments without stressing liquidity. This stability reduces refinancing risk and supports multi‑month resilience in operations and supply continuity.

Strong Operating Cash Conversion & FCF Growth

Operating cash conversion above 1.0 and a material increase in free cash flow show improved cash generation from core operations. This enhances the company’s ability to self‑fund working capital and strategic investments, strengthening long‑term financial self‑sufficiency.

Negative Factors

Low Free Cash Flow Relative to Net Income

Despite headline FCF growth, FCF converts only ~4% of net income, suggesting substantial capex, working capital needs, or timing differences. Persistently low FCF conversion can limit sustainable shareholder distributions and reduce flexibility for reinvestment over coming quarters.

Limited Revenue Diversification

The business is concentrated on manufacturing and selling specialty chemicals with no documented licensing, services, or recurring non‑product revenue. This reliance on B2B product sales increases cyclicality exposure and makes revenue resilience more dependent on a narrow set of industrial customer demand drivers.

Exposure to Raw Material Cost Volatility

Margins depend on the company’s ability to pass raw material cost changes to customers. If pass‑through is delayed or customers resist increases, input volatility could compress margins. Over several months this structural exposure may pressure profitability absent sustained pricing power or input hedging.

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

Company Description

Fuso Chemical Co., Ltd. (4368) is a Japan-based company primarily engaged in the manufacturing and distribution of specialty chemicals. The company operates across various sectors, including electronics, automotive, and pharmaceuticals, providing innovative solutions and high-performance materials. Fuso Chemical's core products include chemical intermediates, electronic materials, and fine chemicals, catering to a diverse range of industries and applications.

How the Company Makes Money

Fuso Chemical generates revenue through the sale of its specialty chemicals and materials to various industries. The company's revenue model is built around multiple key revenue streams, including direct sales to manufacturers in the electronics and automotive sectors, as well as partnerships with pharmaceutical companies for the supply of fine chemicals. Additionally, Fuso Chemical benefits from long-term contracts and collaborations with key clients, which provide stable income and foster customer loyalty. The company also invests in research and development to innovate and expand its product offerings, which helps in capturing new market opportunities and driving growth.

Fuso Chemical Co., Ltd. Financial Statement Overview

Summary

Strong profitability and margins (TTM gross margin 38.09%, net margin 16.75%, EBITDA margin 34.72%) and a solid balance sheet with low leverage (debt-to-equity 0.19, equity ratio 76%). Cash generation is strong vs. earnings (operating cash flow to net income 1.47) and free cash flow growth is very high, but free cash flow to net income is relatively low (4.06%), tempering the score.

Income Statement

Fuso Chemical Co., Ltd. shows strong financial performance with consistent revenue growth and healthy profit margins. The TTM data indicates a gross profit margin of 38.09% and a net profit margin of 16.75%, reflecting efficient cost management and profitability. The EBIT and EBITDA margins are robust at 22.43% and 34.72%, respectively. Revenue growth is positive, indicating a stable upward trajectory.

Balance Sheet

The company's balance sheet is solid with a low debt-to-equity ratio of 0.19, indicating low financial leverage and reduced risk. The return on equity (ROE) is healthy at 11.53%, showcasing effective use of equity capital. The equity ratio stands at 76.00%, highlighting a strong equity base relative to total assets, which enhances financial stability.

Cash Flow

Cash flow analysis reveals a significant improvement in free cash flow growth, with a remarkable increase of 779.79% in the TTM period. The operating cash flow to net income ratio is 1.47, indicating strong cash generation relative to net income. However, the free cash flow to net income ratio is relatively low at 4.06%, suggesting potential reinvestment or capital expenditure needs.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	72.45B	69.50B	58.97B	68.46B	55.76B	42.21B
Gross Profit	27.89B	25.97B	20.57B	28.41B	23.08B	16.35B
EBITDA	26.60B	24.71B	19.29B	24.42B	19.49B	14.66B
Net Income	12.89B	11.62B	8.34B	14.13B	10.89B	6.81B
Balance Sheet
Total Assets	144.45B	141.50B	133.74B	113.53B	92.01B	76.03B
Cash, Cash Equivalents and Short-Term Investments	33.46B	31.30B	31.47B	23.41B	24.36B	25.71B
Total Debt	18.90B	20.00B	20.00B	24.82M	19.77M	21.87M
Total Liabilities	34.66B	37.45B	38.72B	26.03B	16.71B	9.86B
Stockholders Equity	109.79B	104.05B	95.03B	87.50B	75.30B	66.17B
Cash Flow
Free Cash Flow	7.21B	4.38B	-10.52B	291.18M	577.39M	10.61B
Operating Cash Flow	19.73B	22.73B	7.06B	13.93B	10.20B	12.82B
Investing Cash Flow	-14.59B	-20.57B	-18.58B	-13.42B	-9.38B	-2.62B
Financing Cash Flow	-3.69B	-2.41B	17.66B	-2.12B	-2.88B	-1.64B

Fuso Chemical Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 6390.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:4368, the sentiment is Positive. The current price of 6390 is below the 20-day moving average (MA) of 7033.50, below the 50-day MA of 6625.60, and above the 200-day MA of 4903.03, indicating a bullish trend. The MACD of 277.26 indicates Negative momentum. The RSI at 59.50 is Neutral, neither overbought nor oversold. The STOCH value of 56.32 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:4368.

Fuso Chemical Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
4368	74 Outperform	¥262.21B	20.34	―	1.23%	8.80%	33.39%
4041	74 Outperform	¥205.76B	13.10	―	4.09%	1.69%	0.94%
4045	74 Outperform	¥186.95B	20.53	4.41%	3.80%	-1.50%	-32.46%
4272	73 Outperform	¥283.54B	12.27	8.79%	3.97%	6.60%	503.36%
4061	64 Neutral	¥255.90B	-21.74	-4.00%	3.71%	0.24%	-234.36%
4189	64 Neutral	¥94.31B	10.20	―	3.88%	2.61%	30.29%
Sector *	61 Neutral	$10.43B	7.12	-0.05%	2.87%	2.86%	-36.73%

Fuso Chemical Co., Ltd. Corporate Events

Fuso Chemical Co., Ltd. Increases Dividend Forecasts for FY3/2026

Fuso Chemical Co., Ltd. has announced an increase in its interim and year-end dividend forecasts for the fiscal year ending March 2026. The decision, made during a Board of Directors meeting, reflects the company’s revised earnings forecasts and commitment to progressive dividends, resulting in an annual dividend forecast of ¥82 per share, up from the previous forecast of ¥76.

The most recent analyst rating on (JP:4368) stock is a Buy with a Yen5239.00 price target. To see the full list of analyst forecasts on Fuso Chemical Co., Ltd. stock, see the JP:4368 Stock Forecast page.

Fuso Chemical Co., Ltd. Revises Earnings Forecasts Upward Amid Strong Semiconductor Market Performance

Fuso Chemical Co., Ltd. has revised its earnings and dividend forecasts for the fiscal year ending March 2026, citing strong sales of colloidal silica in the semiconductor market and favorable foreign exchange conditions. The company has reported higher-than-expected profits and sales, driven by increased demand in the semiconductor industry and advantageous currency fluctuations, leading to an upward revision of its full-year earnings forecasts.

The most recent analyst rating on (JP:4368) stock is a Buy with a Yen5239.00 price target. To see the full list of analyst forecasts on Fuso Chemical Co., Ltd. stock, see the JP:4368 Stock Forecast page.

Fuso Chemical Reports Strong Financial Growth and Dividend Increase

Fuso Chemical Co., Ltd. reported a notable increase in its consolidated financial results for the six months ended September 30, 2025, with net sales rising by 8.5% and operating profit by 19.7% compared to the previous year. The company also announced a revision in its cash dividend forecast, indicating a positive outlook for stakeholders.

The most recent analyst rating on (JP:4368) stock is a Buy with a Yen5239.00 price target. To see the full list of analyst forecasts on Fuso Chemical Co., Ltd. stock, see the JP:4368 Stock Forecast page.