tiprankstipranks
Trending News
More News >
Sumitomo Dainippon Pharma Co Ltd (JP:4506)
:4506

Sumitomo Dainippon Pharma Co (4506) AI Stock Analysis

Compare
1 Followers

Top Page

JP

Sumitomo Dainippon Pharma Co

(OTC:4506)

Rating:64Neutral
Price Target:
¥942.00
▲(6.44%Upside)
The most significant factor influencing the score is the company's financial transition with positive cash flow but high leverage and profitability volatility. Technical indicators provide some optimism, while valuation remains fair. The earnings call highlighted significant financial challenges, which weigh down the overall score.

Sumitomo Dainippon Pharma Co (4506) vs. iShares MSCI Japan ETF (EWJ)

Sumitomo Dainippon Pharma Co Business Overview & Revenue Model

Company DescriptionSumitomo 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 MoneySumitomo Dainippon Pharma generates revenue through the sale of its pharmaceutical products across various therapeutic areas. The company invests heavily in research and development to bring new drugs to market, thereby expanding its product portfolio and increasing sales opportunities. Key revenue streams include direct sales of proprietary pharmaceuticals, licensing agreements, and collaborations with other pharmaceutical companies, which provide both upfront payments and royalties. Additionally, Sumitomo Dainippon Pharma leverages strategic partnerships and alliances to enhance its global reach and access to new markets, further contributing to its earnings.

Sumitomo Dainippon Pharma Co Earnings Call Summary

Earnings Call Date:May 13, 2025
(Q3-2024)
|
% Change Since: -3.17%|
Next Earnings Date:Jul 30, 2025
Earnings Call Sentiment Negative
The earnings call highlighted promising developments in the oncology and regenerative medicine pipelines but was overshadowed by significant financial losses, decreased revenue across all segments, and underperformance of key products, leading to a revised downward financial forecast. The call focused on strategic adjustments to address market challenges and improve profitability.
Q3-2024 Updates
Positive Updates
Development Progress in iPS Cell-Derived Therapies
Significant progress in clinical development in regenerative medicine, particularly in Parkinson's disease using iPS cell-derived dopaminergic progenitor cells. The University of California San Diego began a study in November 2023, with ongoing trials in Japan.
Oncology Pipeline Advancements
Promising interim results for TP-3654 in myelofibrosis and DSP-5336 in acute leukemia, with observed reductions in spleen volume and bone marrow blasts respectively, and good tolerability in trials.
Negative Updates
Significant Revenue Decline
Revenue was JPY 235 billion, a decrease of JPY 225.2 billion compared to the same period last year, with declines across all segments, including Japan, North America, and Asia.
Core Operating and Net Profit Losses
Core operating profit decreased by JPY 139.3 billion year-on-year, resulting in a loss of JPY 96.4 billion. Net profit attributable to owners also decreased, resulting in a loss of JPY 117.7 billion.
Challenges in North America
The North America segment saw a revenue decrease of JPY 164 billion compared to the same period last year, heavily impacted by the end of the exclusive sales period of LATUDA.
Underperformance of Key Products
Significant downward revisions for ORGOVYX, MYFEMBREE, and GEMTESA forecasts due to slower than expected market penetration and increased competition.
Financial Forecast Revisions
Revenue forecast revised down by JPY 45 billion, with core operating profit expected to see a reduction of JPY 72 billion, forecasting a loss of JPY 134 billion.
Potential Impairment Concerns
Possibility of impairment for key products due to underperformance and downward revisions of their outlook.
Company Guidance
During the Q3 2024 earnings call for Sumitomo Pharma, several key financial metrics and strategic adjustments were discussed. Revenue for Q3 2023 was reported at JPY 235 billion, which marked a significant decrease of JPY 225.2 billion from the same period in the previous year. The decline was attributed to reduced revenue across all segments, including Japan, North America, and Asia. Despite a decrease in SG&A expenses and some operating income from the sale of shares in Sumitomo Pharma Animal Health, the core operating profit decreased by JPY 139.3 billion, resulting in a core operating loss of JPY 96.4 billion. The company also recorded a JPY 20.5 billion nonrecurring expense related to restructuring in North America, contributing to an operating loss of JPY 117.7 billion. Additionally, profit before taxes saw a year-on-year decrease of JPY 107.4 billion, resulting in a quarterly loss of JPY 105.2 billion. Consequently, the net profit attributable to owners of the parent decreased significantly, resulting in a loss of JPY 117.7 billion. The full-year financial forecast was revised downward, with expectations for revenue at JPY 317 billion, a reduction of JPY 45 billion from previous forecasts. The forecasted core operating profit was expected to see a reduction of JPY 72 billion, projecting a loss of JPY 134 billion. The company is also anticipating a decrease in profit attributable to owners by JPY 61 billion, forecasting a loss of JPY 141 billion. The underperformance was largely due to the North American segment, where key products like ORGOVYX, MYFEMBREE, and GEMTESA fell short of their sales plans.

Sumitomo Dainippon Pharma Co Financial Statement Overview

Summary
Sumitomo Dainippon Pharma Co is experiencing a transition phase with encouraging revenue growth and cash flow returns. However, volatility in profitability and high leverage pose significant risks.
Income Statement
45
Neutral
Sumitomo Dainippon Pharma Co has experienced significant fluctuations in its income statement metrics. The company's gross profit margin based on the latest annual report is healthy, but net income has seen a volatile trajectory with significant losses in recent years. Revenue growth showed a positive turnaround in 2025, suggesting potential recovery. However, the EBIT and EBITDA margins have been erratic, indicating instability in operational efficiency.
Balance Sheet
50
Neutral
The balance sheet reflects a mixed financial position. While the equity ratio is reasonable, the debt-to-equity ratio indicates a high level of leverage, which could pose risks if not managed carefully. Return on equity has been negative in recent periods due to net losses, but stockholders' equity remains substantial, providing some stability.
Cash Flow
55
Neutral
Cash flow metrics show signs of improvement. The company has returned to generating positive free cash flow in the latest period after significant negative cash flows previously. The operating cash flow to net income ratio is positive, reflecting improved cash generation capability, but the overall cash flow situation remains fragile due to past inconsistencies.
Breakdown
TTMMar 2025Mar 2024Mar 2023Mar 2022Mar 2021
Income StatementTotal Revenue
520.48B398.83B314.56B555.54B560.03B515.95B
Gross Profit
379.35B245.40B187.98B376.63B402.91B378.18B
EBIT
89.31B14.93B-354.19B-76.98B60.23B71.22B
EBITDA
109.76B57.58B-281.07B-3.50B124.36B103.11B
Net Income Common Stockholders
67.03B23.63B-314.97B-74.51B56.41B56.22B
Balance SheetCash, Cash Equivalents and Short-Term Investments
23.12B23.12B29.05B163.65B238.58B223.18B
Total Assets
742.60B742.60B907.51B1.13T1.31T1.31T
Total Debt
305.42B305.42B418.88B334.72B269.05B273.82B
Net Debt
282.31B282.31B389.84B191.24B66.06B80.12B
Total Liabilities
573.13B573.13B751.37B727.96B634.44B659.95B
Stockholders Equity
169.48B169.48B156.06B406.75B607.89B580.57B
Cash FlowFree Cash Flow
105.33B8.00B-257.62B-805.00M17.75B124.80B
Operating Cash Flow
117.23B16.50B-241.89B11.94B31.24B135.60B
Investing Cash Flow
7.59B99.75B33.04B52.42B-18.28B8.88B
Financing Cash Flow
-27.81B-108.84B77.85B-146.82B-21.43B-57.22B

Sumitomo Dainippon Pharma Co Technical Analysis

Technical Analysis Sentiment
Positive
Last Price885.00
Price Trends
50DMA
744.18
Positive
100DMA
719.80
Positive
200DMA
659.90
Positive
Market Momentum
MACD
24.40
Negative
RSI
59.54
Neutral
STOCH
64.93
Neutral
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 885 is above the 20-day moving average (MA) of 816.60, above the 50-day MA of 744.18, and above the 200-day MA of 659.90, indicating a bullish trend. The MACD of 24.40 indicates Negative momentum. The RSI at 59.54 is Neutral, neither overbought nor oversold. The STOCH value of 64.93 is Neutral, 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

Overall Rating
UnderperformOutperform
Sector (54)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
64
Neutral
$359.15B14.8813.50%26.79%
54
Neutral
$5.38B3.40-45.06%3.28%16.75%-0.02%
$7.86B25.735.34%3.86%
$2.30B14.937.90%0.01%
$15.12B11.5712.99%2.67%
$47.69B65.731.50%4.43%
82
Outperform
¥238.77B7.33
3.50%8.08%25.92%
* Healthcare Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
JP:4506
Sumitomo Dainippon Pharma Co
885.00
537.00
154.31%
ESALF
Eisai Co
27.84
-11.46
-29.16%
HTSUF
Hisamitsu Pharmaceutical Co
29.07
5.57
23.70%
SGIOF
Shionogi & Co
15.20
2.49
19.59%
TKPHF
Takeda Pharmaceutical Co
27.91
2.24
8.73%
JP:4516
Nippon Shinyaku Co., Ltd.
3,697.00
629.30
20.51%

Sumitomo Dainippon Pharma Co Corporate Events

Sumitomo Pharma Restructures Asian Business with Marubeni Partnership
May 28, 2025

Sumitomo Pharma Co., Ltd. has announced a strategic restructuring of its Asian business through a simplified absorption-type company split. This involves transferring 60% of shares of a newly established subsidiary to Marubeni Global Pharma Corporation, with the option to transfer the remaining 40% in the future. This move is expected to enhance Sumitomo Pharma’s operational focus and market positioning in Asia, potentially impacting stakeholders by aligning with Marubeni’s resources and market reach.

The most recent analyst rating on (JP:4506) stock is a Hold with a Yen460.00 price target. To see the full list of analyst forecasts on Sumitomo Dainippon Pharma Co stock, see the JP:4506 Stock Forecast page.

Sumitomo Pharma Unveils ‘Reboot 2027’ for Strategic Growth
May 13, 2025

Sumitomo Pharma has announced ‘Reboot 2027,’ a strategic plan for FY2025-FY2027, aiming to stabilize its revenue base and enhance its position as an R&D-driven pharmaceutical company. The plan includes financial targets such as expanding sales of key products and reducing debt, alongside initiatives to innovate in oncology and regenerative medicine. The company seeks to improve its value creation cycle and establish a distinctive global presence, with a focus on strategic growth and innovation.

The most recent analyst rating on (JP:4506) stock is a Hold with a Yen460.00 price target. To see the full list of analyst forecasts on Sumitomo Dainippon Pharma Co stock, see the JP:4506 Stock Forecast page.

Sumitomo Pharma Announces Significant Share Transfer in Asian Business
May 13, 2025

Sumitomo Pharma Co., Ltd. announced the transfer of its Asian business to a new subsidiary, with 60% of shares being acquired by Marubeni Global Pharma Corporation. This transaction is expected to generate a gain of approximately 45 billion yen, impacting the company’s financial forecast for the fiscal year ending March 2026.

The most recent analyst rating on (JP:4506) stock is a Hold with a Yen460.00 price target. To see the full list of analyst forecasts on Sumitomo Dainippon Pharma Co stock, see the JP:4506 Stock Forecast page.

Sumitomo Pharma Proposes Amendments to Enhance Governance
May 13, 2025

Sumitomo Pharma Co., Ltd. announced a proposal to amend its Articles of Incorporation to transition to a company with an Audit & Supervisory Committee, aiming to enhance corporate governance and decision-making processes. The amendments will include changes to the roles of directors and the establishment of new provisions to support strategic discussions and improve oversight.

The most recent analyst rating on (JP:4506) stock is a Hold with a Yen460.00 price target. To see the full list of analyst forecasts on Sumitomo Dainippon Pharma Co stock, see the JP:4506 Stock Forecast page.

Sumitomo Pharma Announces Key Personnel Appointments Amid Governance Transition
May 13, 2025

Sumitomo Pharma Co., Ltd. announced its plan to transition to a company with an Audit and Supervisory Committee, pending approval at the upcoming Annual Shareholders’ Meeting. The Board of Directors has appointed candidates for executive and key personnel roles, with several directors and committee members being confirmed, subject to shareholder approval. This transition is expected to enhance the company’s governance structure, potentially impacting its operational oversight and strategic direction.

The most recent analyst rating on (JP:4506) stock is a Hold with a Yen460.00 price target. To see the full list of analyst forecasts on Sumitomo Dainippon Pharma Co stock, see the JP:4506 Stock Forecast page.

Sumitomo Pharma Announces Reversal of Doubtful Accounts Allowance
Apr 28, 2025

Sumitomo Pharma Co., Ltd. announced a reversal of allowance for doubtful accounts amounting to 46,556 million yen in its non-consolidated financial statements for the fiscal year ended March 31, 2025. This adjustment, recorded as extraordinary income, will not affect the company’s consolidated profit or loss as it will be eliminated in the consolidated financial statements.

Sumitomo Pharma Boosts Financial Forecasts and Records Gains from Equity Transfers
Apr 28, 2025

Sumitomo Pharma has revised its financial forecasts for the fiscal year ending March 31, 2025, showing an increase in expected revenue and profits due to higher-than-anticipated sales in North America. Additionally, the company recorded significant gains from the transfer of equity interests in its regenerative medicine and cell therapy business, which positively impacts its financial results.

Sumitomo Pharma Extends Executive Pay Cuts Amid Financial Challenges
Apr 4, 2025

Sumitomo Pharma Co., Ltd. has announced an extension of reduced remuneration for its directors due to ongoing financial challenges and a lack of dividend distribution for the fiscal year ended March 31, 2025. This decision reflects the company’s efforts to navigate its current business difficulties and its commitment to financial recovery, impacting its executive compensation structure.

Sumitomo Pharma Transfers Asian Business to Marubeni Subsidiary
Apr 1, 2025

Sumitomo Pharma Co., Ltd. has announced a strategic move involving the transfer of its Asian business to a new subsidiary, with 60% of the shares to be acquired by Marubeni Global Pharma Corporation. This decision is part of Sumitomo Pharma’s efforts to strengthen its financial foundation and achieve sustainable growth by leveraging Marubeni’s global network, with the company set to receive significant financial consideration from the transaction.

Sumitomo Pharma to Enhance Governance with New Audit Committee Structure
Mar 28, 2025

Sumitomo Pharma Co., Ltd. has announced its decision to transition from a company with an Audit & Supervisory Board to one with an Audit & Supervisory Committee, pending approval at the upcoming shareholders’ meeting. This move is intended to strengthen the company’s governance by enhancing the supervisory function of its board, allowing for faster decision-making and improved strategic discussions, ultimately aiming to increase corporate value.

Sumitomo Pharma Refinances Borrowings to Stabilize Finances
Mar 26, 2025

Sumitomo Pharma Co., Ltd. has announced the refinancing of its existing borrowings through a syndicated loan to stabilize its financial position after a breach of financial covenants. The refinancing involves a term loan and a commitment line totaling 233 billion yen, with minimal expected impact on the company’s financial results for the fiscal year ending March 2025.

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.