Sumitomo Dainippon Pharma Co (4506) AI Stock Analysis

• Market Cap: ¥890.93B
• Dividend Yield: N/A
• Average Volume (3M): 5.45M
• Price to Earnings (P/E): 5.9
• Beta (1Y): 0.81
• Revenue Growth: 29.92%
• EPS Growth: N/A
• Country: JP
• Employees: 4,980
• Sector: Healthcare
• Sector Strength: 45
• Industry: Drug Manufacturers - Specialty & Generic
• EPS (TTM): 220.63
• Shares Outstanding: 397,900,150
• 10 Day Avg. Volume: 5,265,230
• 30 Day Avg. Volume: 5,454,233
• PEG Ratio: -0.11
• Price to Book (P/B): 1.71
• Price to Sales (P/S): 0.73
• P/FCF Ratio: 83.47
• 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: ¥2,700.11
• Price Target Upside: 17.88% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 1
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 66 Neutral
• Price Target: ¥2,661.00 ▲(16.18% Upside)

Sumitomo Dainippon Pharma Co's stock is moderately attractive, driven by strong technical indicators and an undervalued P/E ratio. However, financial performance concerns, particularly high leverage and cash flow challenges, temper the overall score. Investors should weigh the potential for price appreciation against financial risks.

Positive Factors

Revenue Growth

The company's consistent revenue growth indicates a strong market position and effective product strategy, supporting long-term business sustainability.

Gross Profit Margin

A robust gross profit margin reflects efficient cost management and pricing power, enhancing the company's ability to invest in growth and innovation.

Innovative Drug Development

Strategic partnerships in drug development can lead to breakthrough therapies, ensuring competitive advantage and long-term revenue streams.

Negative Factors

High Leverage

Significant leverage poses financial risks, potentially limiting the company's ability to invest in growth and weather economic downturns.

Cash Flow Challenges

Declining cash flow can strain operations and limit flexibility, impacting the company's capacity to fund new projects and manage debt.

Low Net Profit Margin

A low net profit margin suggests inefficiencies and cost pressures, which may hinder profitability and long-term financial health.

Sumitomo Dainippon Pharma Co Business Overview & Revenue Model

Company Description

Sumitomo Pharma Co., Ltd. manufactures and sells pharmaceuticals, food ingredients and additives, veterinary medicines, and others in Japan, North America, China, and internationally. The company offers pharmaceutical products, such as therapeutic agents for Parkinson's disease, depression, type 2 diabetes, systemic fungal infection, hypertension, pruritus, chronic obstructive pulmonary disease, angina pectoris, and arrhythmia. It also provides products for atypical antipsychotic, antiepileptic, carbapenem antibiotic, and gastrointestinal; and Anderson-Fabry disease drugs. In addition, the company offers food ingredients and additives, such as polysaccharides, as well as seasonings, such as soups or bouillons; and chemical product materials, which include pharmaceutical excipients, personal care products, coatings and industrial materials, and electronic materials. Further, it provides veterinary medicines for companion animals, such as dogs and cats; and livestock comprising cattle, swine, poultry, horses, and aquacultured fish. Sumitomo Pharma Co., Ltd. has partnerships with Healios K.K.; Keio University; RIKEN; the Center for iPS Cell Research and Application; Kyoto University; and Aikomi Co., Ltd., as well as a joint development agreement with SanBio Company Limited; and collaboration and license agreement with Otsuka Pharmaceutical Co., Ltd. It also has a strategic alliance with Roivant Sciences Ltd. The company was formerly known as Sumitomo Dainippon Pharma Co., Ltd. and changed its name to Sumitomo Pharma Co., Ltd. in April 2022. The company was founded in 1897 and is headquartered in Osaka, Japan. Sumitomo Pharma Co., Ltd. is a subsidiary of Sumitomo Chemical Company, Limited.

How the Company Makes Money

Sumitomo Dainippon Pharma generates revenue primarily through the sale of its pharmaceutical products, which include a diverse portfolio of prescription drugs and specialty medications. The company has established key revenue streams from its proprietary drugs, particularly in psychiatry and neurology, as well as from partnerships and collaborations that enhance its drug pipeline. Additionally, the company engages in licensing agreements and joint ventures with other pharmaceutical companies to expand its market reach and share the costs of research and development. Collaborations with biotech firms and research institutions also provide access to innovative therapies, further contributing to Sumitomo Dainippon Pharma's earnings. The company is also involved in the global market, which helps diversify its revenue sources.

Sumitomo Dainippon Pharma Co Financial Statement Overview

Summary

Sumitomo Dainippon Pharma Co is showing signs of recovery with positive revenue and free cash flow growth. While profitability margins are improving, high leverage remains a concern. The company needs to focus on enhancing net profit margins and managing debt levels to ensure long-term financial stability.

Income Statement

Sumitomo Dainippon Pharma Co has shown a positive revenue growth rate of 4.34% in the TTM, indicating a recovery from previous declines. The gross profit margin remains strong at 61.53%, showcasing efficient cost management. However, the net profit margin is relatively low at 5.93%, suggesting room for improvement in profitability. The EBIT and EBITDA margins indicate moderate operational efficiency.

Balance Sheet

The company's debt-to-equity ratio is high at 1.80, indicating significant leverage, which could pose financial risks. However, the return on equity has improved to 15.48% in the TTM, reflecting better utilization of equity. The equity ratio is not provided, but the overall balance sheet shows a need for cautious financial management.

Cash Flow

The free cash flow growth rate has surged by 321.05% in the TTM, highlighting strong cash generation capabilities. The operating cash flow to net income ratio is low, suggesting potential issues in converting income into cash. However, the free cash flow to net income ratio of 0.48 indicates a reasonable level of cash flow relative to earnings.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	445.20B	398.83B	314.56B	555.54B	560.03B	515.95B
Gross Profit	274.39B	245.40B	187.98B	376.63B	402.91B	378.18B
EBITDA	145.41B	56.67B	-281.07B	-3.50B	124.36B	103.11B
Net Income	154.72B	23.63B	-314.97B	-74.51B	56.41B	56.22B
Balance Sheet
Total Assets	778.40B	742.60B	907.51B	1.13T	1.31T	1.31T
Cash, Cash Equivalents and Short-Term Investments	38.49B	39.96B	36.13B	143.48B	202.98B	193.70B
Total Debt	262.85B	305.42B	418.88B	346.37B	284.54B	290.68B
Total Liabilities	512.82B	573.13B	751.37B	727.96B	634.44B	659.95B
Stockholders Equity	265.59B	169.48B	156.06B	406.75B	607.89B	580.57B
Cash Flow
Free Cash Flow	23.02B	3.47B	-257.62B	-805.00M	17.75B	124.80B
Operating Cash Flow	29.97B	16.50B	-241.89B	11.94B	31.24B	135.60B
Investing Cash Flow	29.94B	99.75B	33.04B	52.42B	-18.28B	8.88B
Financing Cash Flow	-123.37B	-108.84B	77.85B	-146.82B	-21.43B	-57.22B

Sumitomo Dainippon Pharma Co Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 2290.50
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:4506, the sentiment is Positive. The current price of 2290.5 is below the 20-day moving average (MA) of 2479.13, above the 50-day MA of 2133.34, and above the 200-day MA of 1304.39, indicating a neutral trend. The MACD of 36.86 indicates Positive momentum. The RSI at 46.61 is Neutral, neither overbought nor oversold. The STOCH value of 17.50 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:4506.

Sumitomo Dainippon Pharma Co Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
4507	75 Outperform	¥2.35T	13.33	12.22%	2.26%	4.48%	11.08%
4523	74 Outperform	¥1.29T	26.06	5.75%	3.45%	6.79%	22.14%
4516	74 Outperform	¥376.91B	11.80	―	2.22%	4.07%	22.59%
4530	73 Outperform	¥305.06B	15.45	7.11%	2.51%	3.53%	38.23%
4506	66 Neutral	¥890.93B	5.88	79.99%	―	29.92%	―
4502	66 Neutral	¥7.05T	206.06	0.54%	4.45%	-2.84%	-88.29%
Sector *	51 Neutral	$7.86B	-0.30	-43.30%	2.27%	22.53%	-2.21%

Sumitomo Dainippon Pharma Co Corporate Events

Sumitomo Pharma Reports Strong Half-Year Results and Raises Full-Year Forecasts

Sumitomo Pharma Co., Ltd. announced a significant variance between its financial forecasts and actual results for the half-year ended September 30, 2025, and revised its financial forecasts for the year ending March 31, 2026. The company reported stronger-than-expected revenue and profit figures, driven by robust sales of ORGOVYX in North America and lower-than-anticipated expenses. This led to an upward revision of its full-year forecasts, reflecting continued strong sales and improved financial performance.

Sumitomo Pharma Completes Strategic Sale in Asian Business Restructuring

Sumitomo Pharma Co., Ltd. has finalized the sale of 60% of its newly established subsidiary, SMP Jumbi Kabushikigaisya, to Marubeni Global Pharma Corporation as part of a strategic restructuring of its Asian business. This transaction resulted in a gain of approximately 49.043 billion yen, which has been incorporated into the company’s financial results, potentially impacting its market positioning and financial forecasts.