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Eisai Co Ltd (JP:4523)
:4523
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Eisai Co
(4523)
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Rating:74Outperform
Price Target:
¥5,628.00
▲(24.84% Upside)
Eisai Co's strong financial performance and positive technical indicators are the primary drivers of its stock score. The company's robust revenue growth, efficient cost management, and solid balance sheet provide a stable foundation. However, the high P/E ratio suggests the stock may be overvalued, which is a key risk factor. The absence of earnings call data and corporate events means these components did not influence the score.
Positive Factors
Revenue Growth
The robust revenue growth indicates strong demand for Eisai's products, supporting long-term business expansion and market presence.
Cash Flow Generation
Significant growth in free cash flow enhances Eisai's ability to invest in R&D and strategic initiatives, supporting sustainable growth.
Balance Sheet Health
A strong balance sheet with manageable leverage provides Eisai with financial stability and flexibility to navigate industry challenges.
Negative Factors
Net Profit Margin
A modest net profit margin suggests potential inefficiencies in operations, which could limit profitability and competitive edge.
Cash Conversion Efficiency
Suboptimal cash conversion efficiency may hinder Eisai's ability to effectively translate earnings into cash, impacting liquidity.
Operational Efficiency
Improving operational efficiency is crucial for Eisai to enhance margins and sustain competitive positioning in the pharmaceutical industry.
Eisai Co (4523) vs. iShares MSCI Japan ETF (EWJ)
Market Cap
$1.27T
Dividend Yield3.55%
Average Volume (3M)1.34M
Price to Earnings (P/E)25.8
Beta (1Y)0.89
Revenue Growth6.79%
EPS Growth22.14%
CountryJP
Employees11,067
SectorHealthcare
Sector Strength45
IndustryDrug Manufacturers - Specialty & Generic
Share Statistics
EPS (TTM)36.02
Shares Outstanding291,649,140
10 Day Avg. Volume1,231,250
30 Day Avg. Volume1,336,443
Financial Highlights & Ratios
PEG Ratio2.35
Price to Book (P/B)1.40
Price to Sales (P/S)1.49
P/FCF Ratio64.63
Enterprise Value/Market Cap0.90
Enterprise Value/Revenue1.43
Enterprise Value/Gross Profit1.82
Enterprise Value/Ebitda10.56
Forecast
1Y Price Target
$5,348.08Price Target Upside18.64% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering3
EPS Forecast (FY)N/A
Revenue Forecast (FY)N/A
Eisai Co Business Overview & Revenue Model
Company DescriptionEisai Co., Ltd. offers pharmaceutical products in Japan. It offers Aricept for the treatment of alzheimer's disease/dementia with Lewy bodies; Methycobal for the treatment of peripheral neuropathy; and Fycompa, an antiepileptic drug for the adjunctive treatment of partial-onset and primary generalized tonic-clonic seizures. The company also provides Lyrica for pain treatment; Dayvigo, an anti-insomnia drug for the treatment of adults with insomnia; Lenvima, an anticancer agent/molecular targeted medicine for the treatment of thyroid cancer, renal cell carcinoma in combination with everolimus, and hepatocellular carcinoma; and Halaven, an anticancer agent/microtubule dynamics inhibitor for the treatment of breast cancer and liposarcoma. In addition, it offers Pariet, a proton-pump inhibitor for the treatment of gastric and duodenal ulcers, reflux esophagitis, and eradication of Helicobacter pylori infections, etc.; Humira, a fully human anti-TNF-a monoclonal antibody for the treatment of autoimmune diseases, such as rheumatoid arthritis; and Chocola BB plus, a vitamin B2 preparation for rough skin and stomatitis, as well as various products, which include third-class OTC drugs, designated quasi-drugs, and food with nutrient function. The company was formerly known as Nihon Eisai Co., Ltd. and changed its name to Eisai Co., Ltd. in 1955. Eisai Co., Ltd. was incorporated in 1941 and is headquartered in Tokyo, Japan.
How the Company Makes MoneyEisai generates revenue primarily through the sale of its pharmaceutical products, which are distributed globally across various markets. The company derives significant income from its flagship products, particularly in oncology and neurology. Additionally, Eisai engages in licensing agreements and collaborations with other pharmaceutical companies, allowing it to share research and development costs while also generating upfront payments and royalties from successful product sales. The company's strategic partnerships, particularly in the development of new therapies and clinical trials, play a crucial role in enhancing its product portfolio and revenue streams.
Eisai Co Earnings Call Summary
Earnings Call Date:―
(Q4-2025)
| Next Earnings Date:Jan 29, 2026
Earnings Call Sentiment Neutral
The earnings call presented a strong performance of their global brands and significant global expansion of LEQEMBI, contributing to positive revenue growth. However, challenges in controlling cost of sales, slower-than-expected U.S. market expansion, and concerns about competitive threats were notable downsides.Q4-2025 Updates
Positive Updates
Strong Performance of Global Brands
Three global products, LENVIMA, Lemborexant, and LEQEMBI, achieved ¥426.5 billion in revenue, with a year-over-year increase of 24%.
LEQEMBI Global Reach
LEQEMBI was approved in 44 countries and is under regulatory review in 12 countries, marking significant global expansion.
Positive Revenue Growth
The company achieved ¥789.4 billion in revenue, a 6% increase from the previous year, exceeding forecasts.
LEQEMBI Revenue Exceeded Forecast
Global LEQEMBI revenue for FY 2024 was ¥44.3 billion, exceeding the full-year forecast.
LENVIMA's Double-Digit Growth
LENVIMA achieved over ¥328 billion in global revenue with a 28% year-over-year growth in the Americas.
Negative Updates
Increased Cost of Sales
Cost of sales increased by 1.7 percentage points due to the Inflation Reduction Act related expenses for Lenvima and product mix changes.
Challenges in U.S. Market Expansion
LEQEMBI's penetration in the U.S. was slower than expected, with the market just approaching the end of the demand stimulation phase.
High R&D and SG&A Expenses
Significant resources were allocated to LEQEMBI, impacting operating profit, although R&D expenses for LEQEMBI are expected to decrease.
Concerns About Competitive Threats
Questions were raised about the competitive impact from other products like Cassella, although the company downplayed the threat.
Company Guidance
In the recent financial results briefing session for Eisai Co. Limited, the company reported exceeding its revenue and profit forecasts for fiscal year 2024, driven mainly by its global brands: LENVIMA, Lemborexant (Dayvigo), and LEQEMBI, which together achieved a year-on-year revenue increase of 24%, contributing ¥426.5 billion. LEQEMBI alone saw a substantial revenue increase of ¥40 billion. Despite a 0.5 percentage point rise in the cost of sales due to one-time revenue decreases, the company managed to reduce its R&D expenses ratio by 1.6 percentage points, largely because of the closure of inactive research laboratories. SG&A expenses increased by 1.2 percentage points due to ongoing investments in LEQEMBI's marketing, yet the company controlled these expenses within anticipated limits. Globally, LEQEMBI's revenue was reported at JPY 44.3 billion, surpassing the full-year forecast. The company also highlighted LEQEMBI's approval in 44 countries, with plans to launch in Europe, particularly Germany and Austria, in the second half of fiscal year 2025. For the upcoming fiscal year 2025, Eisai forecasts LEQEMBI's global revenue to reach ¥76.5 billion, with significant contributions expected from the United States and Japan as they enter the demand expansion phase.Eisai Co Financial Statement Overview
Summary
Eisai Co exhibits a robust financial position with strong revenue growth and efficient cost management. The balance sheet is solid with manageable leverage and a strong equity base. Cash flow generation is impressive, although there is room for improving cash conversion efficiency. Overall, the company is well-positioned for future growth, with a stable financial foundation and effective operational strategies.Income Statement
Eisai Co has demonstrated strong revenue growth with a 17% increase in TTM, indicating robust demand for its products. The gross profit margin remains high at approximately 78.6%, showcasing efficient cost management. However, the net profit margin is relatively modest at 6.27%, suggesting room for improvement in operational efficiency. The EBIT and EBITDA margins are healthy, reflecting solid core earnings performance.85
Very Positive
Balance Sheet
The company's balance sheet is stable with a manageable debt-to-equity ratio of 0.29, indicating prudent leverage. Return on equity is moderate at 5.99%, suggesting decent profitability relative to shareholder investment. The equity ratio of 59.4% highlights a strong capital structure, providing a cushion against financial volatility.78
Positive
Cash Flow
Eisai Co's cash flow performance is commendable with a significant 42.6% growth in free cash flow, reflecting improved cash generation capabilities. The operating cash flow to net income ratio is below 1, indicating potential areas for enhancing cash conversion efficiency. The free cash flow to net income ratio is strong at 0.68, underscoring effective cash management.82
Very Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 804.39B | 789.40B | 741.75B | 744.40B | 756.23B | 645.94B |
| Gross Profit | 629.73B | 620.59B | 586.42B | 566.57B | 581.39B | 484.63B |
| EBITDA | 108.66B | 104.49B | 103.11B | 87.26B | 94.55B | 90.05B |
| Net Income | 49.37B | 46.43B | 42.41B | 55.43B | 47.95B | 41.94B |
Balance Sheet | ||||||
| Total Assets | 1.44T | 1.39T | 1.39T | 1.26T | 1.24T | 1.09T |
| Cash, Cash Equivalents and Short-Term Investments | 302.12B | 265.56B | 305.12B | 267.89B | 310.06B | 249.01B |
| Total Debt | 236.66B | 187.52B | 159.41B | 126.11B | 94.89B | 89.89B |
| Total Liabilities | 558.23B | 520.58B | 494.82B | 440.78B | 467.78B | 362.07B |
| Stockholders Equity | 854.43B | 841.42B | 875.61B | 799.96B | 748.82B | 703.18B |
Cash Flow | ||||||
| Free Cash Flow | 38.39B | 18.18B | 31.17B | -36.33B | 77.12B | 35.71B |
| Operating Cash Flow | 51.51B | 30.12B | 55.99B | -1.77B | 117.59B | 73.85B |
| Investing Cash Flow | -23.72B | -10.10B | -25.32B | -22.72B | -28.85B | -36.87B |
| Financing Cash Flow | -4.76B | -57.81B | -22.72B | -24.52B | -48.97B | -55.91B |
Eisai Co Technical Analysis
Negative
4508.00
Price Trends
4613.48
Negative
4653.62
Negative
4305.95
Positive
Market Momentum
-29.84
Positive
41.35
Neutral
23.78
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:4523, the sentiment is Negative. The current price of 4508 is below the 20-day moving average (MA) of 4710.25, below the 50-day MA of 4613.48, and above the 200-day MA of 4305.95, indicating a neutral trend. The MACD of -29.84 indicates Positive momentum. The RSI at 41.35 is Neutral, neither overbought nor oversold. The STOCH value of 23.78 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:4523.
Eisai Co Peers Comparison
UnderperformOutperform
Sector (51)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
76 Outperform | ¥309.55B | 11.12 | 9.05% | 3.36% | 10.51% | 9.62% | |
75 Outperform | ¥2.39T | 13.53 | 12.22% | 2.28% | 4.48% | 11.08% | |
74 Outperform | $1.27T | 25.75 | 5.75% | 3.55% | 6.79% | 22.14% | |
73 Outperform | ¥311.41B | 15.78 | 7.11% | 2.46% | 3.53% | 38.23% | |
66 Neutral | ¥910.60B | 5.89 | 79.99% | ― | 29.92% | ― | |
66 Neutral | ¥7.30T | 213.29 | 0.54% | 4.30% | -2.84% | -88.29% | |
51 Neutral | $7.86B | -0.30 | -43.30% | 2.27% | 22.53% | -2.21% |
* Healthcare Sector Average
JP:4523
Eisai Co
4,508.00
379.01
9.18%
JP:4506
Sumitomo Dainippon Pharma Co
2,292.00
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301.40%
JP:4530
Hisamitsu Pharmaceutical Co
4,268.00
268.20
6.71%
JP:4507
Shionogi & Co
2,716.00
562.90
26.14%
JP:4502
Takeda Pharmaceutical Co
4,604.00
661.36
16.77%
JP:4540
Tsumura & Co
4,046.00
-522.77
-11.44%
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.