Kao Corp. (JP:4452)
:4452
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Kao
(4452)
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Rating:64Neutral
Price Target:
¥6,233.00
▼(-0.57% Downside)
Action:Downgraded
Date:05/14/26
The score is primarily supported by solid financial performance (recovered profitability, conservative leverage, and healthy free cash flow). This is partially offset by weak technicals (below key moving averages with negative MACD) and a valuation that is only moderately attractive given the P/E, despite a supportive dividend yield.
Positive Factors
Conservative leverage and balance-sheet flexibility
Kao’s debt runs at roughly a quarter of equity and has improved versus earlier years, giving the company durable financial flexibility. This conservatism supports investment in brands, capex or tuck-in deals and provides a buffer against raw-material or demand shocks over 2–6 months and beyond.
Negative Factors
Uneven top-line growth
Kao’s top-line growth is modest and uneven across years, limiting the company’s ability to leverage fixed costs and sustainably expand operating income. Persistent variability in revenue makes long-term planning, capacity utilization and consistent margin expansion harder to achieve across 2–6 months.
Read all positive and negative factors
Positive Factors
Negative Factors
Conservative leverage and balance-sheet flexibility
Kao’s debt runs at roughly a quarter of equity and has improved versus earlier years, giving the company durable financial flexibility. This conservatism supports investment in brands, capex or tuck-in deals and provides a buffer against raw-material or demand shocks over 2–6 months and beyond.
Read all positive factors
Kao (4452) vs. iShares MSCI Japan ETF (EWJ)
Market Cap
¥2.75T
Dividend Yield2.41%
Average Volume (3M)1.47M
Price to Earnings (P/E)21.6
Beta (1Y)0.29
Revenue Growth3.60%
EPS Growth13.80%
CountryJP
Employees32,566
SectorConsumer Defensive
Sector Strength42
IndustryHousehold & Personal Products
Share Statistics
EPS (TTM)278.64
Shares Outstanding453,600,000
10 Day Avg. Volume1,645,420
30 Day Avg. Volume1,466,456
Financial Highlights & Ratios
PEG Ratio1.97
Price to Book (P/B)2.71
Price to Sales (P/S)1.71
P/FCF Ratio20.86
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
¥7,325.00Price Target Upside16.84% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering6
EPS Forecast (FY)300.92
Revenue Forecast (FY)¥1.77T
Kao Business Overview & Revenue Model
Company Description
Kao Corporation is a multifaceted enterprise engaged in the development and sale of a broad spectrum of products, encompassing cosmetics, skin and hair care items, human health solutions, household cleaning and fabric care goods, and various chemi...
How the Company Makes Money
Kao makes money primarily by selling branded consumer products and chemical products through a mix of retail, e-commerce, and business-to-business channels. Its largest revenue stream is typically consumer-facing packaged goods: the company earns ...
Kao Earnings Call Summary
Earnings Call Date:May 08, 2025
(Q1-2025)
| % Change Since: |
Next Earnings Date:Aug 05, 2026
Earnings Call Sentiment Positive
The earnings call reflects a generally positive outlook with strong growth in sales and operating income, improvements in key business segments, and effective cost management. However, challenges such as overseas market competition, U.S. tariffs, and raw material price increases introduce some risk factors.Positive Updates
Strong Sales and Operating Income Growth
Net sales increased by 6.6% to ¥389.9 billion, with operating income reaching ¥31.2 billion. Operating margin improved significantly to 8%.
Negative Updates
Challenges in Overseas Markets
Overseas sales fell by 1.9%, with issues arising from intensified competition in the Americas and Europe.
Read all updates
Q1-2025 Updates
Positive
Negative
Strong Sales and Operating Income Growth
Net sales increased by 6.6% to ¥389.9 billion, with operating income reaching ¥31.2 billion. Operating margin improved significantly to 8%.
Read all positive updates
Company Guidance
In the first quarter of fiscal year 2025, the company demonstrated solid progress toward its K27 target by achieving both sales growth and an increase in operating margin. Net sales increased by 6.6% to ¥389.9 billion, with a 6% rise on a like-for-like basis, excluding currency impacts. The operating income reached ¥31.2 billion, marking a significant improvement in operating margin to 8%, while net income attributable to owners of the parent rose by 38.7% to ¥22.8 billion. Earnings per share saw a substantial increase of 38.9% year-on-year, reaching ¥49.19. The growth margin improved by 0.5 percentage points to 38%. The company's GC business, excluding the beverage segment, achieved a 4% increase in net sales, with operating income rising significantly by ¥8.2 billion to ¥22.8 billion, improving the operating margin by 2.6 points to 7.9%. The cosmetics segment made notable progress, achieving an increase of ¥4.2 billion in operating income, while the operating margin improved by 4.4 points in the sanitary products segment. Despite challenges from U.S. tariff policy, the company expects the impact to be limited, maintaining its fiscal year 2025 earnings forecast.Kao Financial Statement Overview
Summary
Income Statement
74
Positive
Balance Sheet
77
Positive
Cash Flow
70
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 1.71T | 1.69T | 1.63T | 1.53T | 1.55T | 1.42T |
| Gross Profit | 657.89B | 640.98B | 638.40B | 560.43B | 548.34B | 573.19B |
| EBITDA | 270.86B | 256.11B | 233.44B | 189.81B | 203.47B | 240.08B |
| Net Income | 128.23B | 120.08B | 107.77B | 43.87B | 86.04B | 109.64B |
Balance Sheet | ||||||
| Total Assets | 1.83T | 1.88T | 1.87T | 1.77T | 1.73T | 1.70T |
| Cash, Cash Equivalents and Short-Term Investments | 274.84B | 323.28B | 357.71B | 291.66B | 268.25B | 336.07B |
| Total Debt | 240.85B | 243.14B | 245.33B | 261.07B | 262.89B | 268.68B |
| Total Liabilities | 728.09B | 780.35B | 768.40B | 757.70B | 730.97B | 720.13B |
| Stockholders Equity | 1.07T | 1.06T | 1.07T | 983.66B | 972.06B | 965.14B |
Cash Flow | ||||||
| Free Cash Flow | 139.55B | 138.47B | 144.18B | 148.31B | 65.39B | 115.57B |
| Operating Cash Flow | 203.07B | 199.68B | 201.59B | 202.48B | 130.91B | 175.52B |
| Investing Cash Flow | -55.20B | -69.77B | -45.90B | -109.30B | -74.91B | -67.23B |
| Financing Cash Flow | -174.76B | -175.13B | -104.58B | -79.98B | -139.31B | -141.57B |
Kao Technical Analysis
Positive
6269.00
Price Trends
5999.90
Positive
6163.62
Negative
6280.95
Negative
Market Momentum
16.71
Negative
55.57
Neutral
77.20
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:4452, the sentiment is Positive. The current price of 6269 is above the 20-day moving average (MA) of 6000.35, above the 50-day MA of 5999.90, and below the 200-day MA of 6280.95, indicating a neutral trend. The MACD of 16.71 indicates Negative momentum. The RSI at 55.57 is Neutral, neither overbought nor oversold. The STOCH value of 77.20 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:4452.
Kao Peers Comparison
UnderperformOutperform
Sector (62)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
72 Outperform | ¥535.82B | 15.22 | 12.66% | 1.53% | 11.37% | 11.35% | |
69 Neutral | ¥296.89B | 28.59 | 2.72% | 2.61% | 1.63% | 74.87% | |
65 Neutral | ¥1.71T | 26.97 | 10.79% | 3.47% | -2.89% | -31.75% | |
64 Neutral | ¥2.75T | 21.64 | 11.50% | 2.41% | 3.60% | 13.80% | |
64 Neutral | ¥454.19B | 16.94 | 9.09% | 1.73% | 3.10% | 27.99% | |
62 Neutral | $20.33B | 14.63 | -3.31% | 3.23% | 1.93% | -12.26% | |
52 Neutral | ¥1.02T | -29.01 | ― | 2.11% | 0.45% | -836.50% |
* Consumer Defensive Sector Average
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Kao Corporate Events
Kao outlines first-quarter 2026 results and clarifies performance metrics
May 12, 2026
Kao Corporation released its consolidated financial results for the three months ended March 31, 2026, providing performance data such as net sales, volume growth, and core income for its global consumer care business. The disclosure emphasizes li...
Kao lifts Q1 profits, affirms 2026 outlook and plans stock split
May 12, 2026
Kao Corporation reported consolidated net sales of ¥413.2 billion for the quarter ended March 31, 2026, up 6.0% year on year, with operating income surging 45.3% to ¥44.9 billion and net income attributable to owners of the parent rising...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.