Towa Pharmaceutical Co (4553) AI Stock Analysis

• Market Cap: ¥147.30B
• Dividend Yield: 2.67%
• Average Volume (3M): 144.75K
• Price to Earnings (P/E): 7.8
• Beta (1Y): 0.68
• Revenue Growth: 13.89%
• EPS Growth: 17.38%
• Country: JP
• Employees: 4,588
• Sector: Healthcare
• Sector Strength: 44
• Industry: Drug Manufacturers - Specialty & Generic
• EPS (TTM): 88.61
• Shares Outstanding: 51,516,000
• 10 Day Avg. Volume: 139,480
• 30 Day Avg. Volume: 144,746
• PEG Ratio: -0.49
• Price to Book (P/B): 0.68
• Price to Sales (P/S): 0.00
• P/FCF Ratio: -3.34
• 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: ¥3,689.43
• Price Target Upside: 23.27% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 2

• Rating: 81 Outperform
• Price Target: ¥3,546.00 ▲(18.48%Upside)

Towa Pharmaceutical Co's strong valuation and technical indicators drive its high score, indicating potential undervaluation and strong market momentum. While financial performance is robust, attention to free cash flow and debt management remains crucial.

Towa Pharmaceutical Co Business Overview & Revenue Model

Company Description

Towa Pharmaceutical Co., Ltd., together with its subsidiaries, researches, develops, produces, and sells ethical drugs, active pharmaceutical ingredients, and intermediates in Japan. The company provides its products in the therapeutic areas of diabetes, digestive system, nervous system, and allergic diseases, as well as vitamins, antibiotics, and oncology products. It had a portfolio of approximately 700 drug products. Towa Pharmaceutical Co., Ltd. was founded in 1951 and is headquartered in Osaka, Japan.

How the Company Makes Money

Towa Pharmaceutical Co., Ltd. generates revenue primarily through the sale of its generic pharmaceutical products. The company manufactures and markets a wide array of generic drugs that are sold to hospitals, pharmacies, and other healthcare facilities. By offering generic alternatives, Towa Pharmaceutical provides more affordable options to healthcare providers and patients, which drives demand and sales. Additional revenue streams may include contract manufacturing for other pharmaceutical companies and potential collaborations or partnerships with other entities in the healthcare sector. The company’s revenue is influenced by factors such as healthcare policies, market demand for generics, and its ability to innovate and maintain a competitive edge in the generic pharmaceuticals market.

Towa Pharmaceutical Co Financial Statement Overview

Summary

Towa Pharmaceutical Co shows a strong financial position with consistent revenue and profit growth, supported by effective cost management. However, negative free cash flow due to high capital expenditures suggests potential liquidity pressures, and moderate leverage requires careful debt management.

Income Statement

Towa Pharmaceutical Co has demonstrated strong revenue growth with a Revenue Growth Rate of 13.9% in 2025, indicating an upward trend over recent years. The Gross Profit Margin is healthy at 36.5%, showing effective cost management. The Net Profit Margin stands at 7.3%, which is competitive within the industry. While the EBIT Margin improved to 8.9%, up from previous years, the EBITDA Margin at 18.5% reflects substantial non-cash expenses, suggesting room for improvement.

Balance Sheet

The Debt-to-Equity Ratio is 1.35, which indicates moderate leverage and is manageable given the industry's capital demands. Return on Equity (ROE) is robust at 11.1%, demonstrating effective use of shareholders' equity to generate profits. The Equity Ratio is stable at 36.5%, showing a solid equity base relative to total assets, although there is a need to monitor debt levels.

Cash Flow

Operating Cash Flow to Net Income Ratio is 1.23, indicating strong cash generation relative to reported earnings. However, the Free Cash Flow is negative, primarily due to high capital expenditures, leading to a negative Free Cash Flow to Net Income Ratio. This suggests potential liquidity pressures if capital investments don't translate into future cash flows.

Breakdown	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	259.59B	227.93B	208.86B	165.62B	154.90B
Gross Profit	94.73B	81.38B	72.71B	70.19B	65.45B
EBITDA	48.05B	35.54B	24.92B	29.49B	30.35B
Net Income	18.99B	16.17B	2.20B	15.91B	13.96B
Balance Sheet
Total Assets	470.82B	430.65B	371.35B	329.94B	245.67B
Cash, Cash Equivalents and Short-Term Investments	45.47B	29.65B	24.26B	32.83B	22.91B
Total Debt	230.98B	202.36B	173.06B	144.13B	84.77B
Total Liabilities	299.19B	274.76B	234.45B	197.77B	129.07B
Stockholders Equity	171.63B	155.89B	136.89B	132.17B	116.60B
Cash Flow
Free Cash Flow	-5.33B	-31.11B	-27.93B	8.55B	2.13B
Operating Cash Flow	23.40B	8.21B	2.54B	22.13B	12.01B
Investing Cash Flow	-31.29B	-40.39B	-30.28B	-59.73B	-9.10B
Financing Cash Flow	21.57B	35.41B	17.48B	46.54B	184.00M

Towa Pharmaceutical Co Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 2993.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:4553, the sentiment is Positive. The current price of 2993 is below the 20-day moving average (MA) of 3038.35, above the 50-day MA of 2854.38, and above the 200-day MA of 2883.77, indicating a neutral trend. The MACD of 18.28 indicates Positive momentum. The RSI at 52.61 is Neutral, neither overbought nor oversold. The STOCH value of 69.14 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:4553.

Towa Pharmaceutical Co Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
4553	81 Outperform	¥147.30B	7.76	11.38%	2.67%	13.89%	17.38%
Sector *	63 Neutral	CHF22.72B	15.28	10.81%	2.14%	47.85%	-11.82%
KKPCF		$955.70M	11.17	9.44%	0.03%	―	―
KSPHF		$1.14B	15.08	5.47%	0.02%	―	―
TRXPF		$1.23B	28.25	4.56%	2.30%	―	―
4569	77 Outperform	¥80.33B	9.65		0.66%	8.83%	70.61%
4887	70 Outperform	¥181.27B	18.88		2.96%	-3.69%	-18.73%

Towa Pharmaceutical Co Corporate Events

Towa Pharmaceutical Affirms Independence Amidst Shareholder Control

Towa Pharmaceutical Co., Ltd. has announced details regarding its controlling shareholder, YOSHIDA JIMUSHO, which holds 45.74% of its voting rights. Despite the significant shareholding, the company maintains its independence with no business transactions or influence from YOSHIDA JIMUSHO on its operations.

The most recent analyst rating on (JP:4553) stock is a Hold with a Yen3200.00 price target. To see the full list of analyst forecasts on Towa Pharmaceutical Co stock, see the JP:4553 Stock Forecast page.

Towa Pharmaceutical’s Parent Company Financial Results Announced

Towa Pharmaceutical Co., Ltd. has announced the financial results of its parent company, YOSHIDA JIMUSHO, for the fiscal year ending March 31, 2025. YOSHIDA JIMUSHO, which holds a 40.85% voting rights in Towa Pharmaceutical, is involved in investment, trading, leasing, and real estate management. This announcement provides insights into the financial health and strategic positioning of Towa Pharmaceutical’s parent company, potentially impacting stakeholders’ perceptions and the company’s future operations.

The most recent analyst rating on (JP:4553) stock is a Hold with a Yen3200.00 price target. To see the full list of analyst forecasts on Towa Pharmaceutical Co stock, see the JP:4553 Stock Forecast page.

Towa Pharmaceutical Announces Disposal of Treasury Shares for Director Compensation

Towa Pharmaceutical Co., Ltd. has announced a resolution to dispose of 800 treasury shares as part of a restricted stock compensation plan for its directors. This move is designed to align the directors’ compensation with the company’s performance and shareholder value, fostering a long-term increase in corporate value and strengthening shareholder-oriented management.

The most recent analyst rating on (JP:4553) stock is a Buy with a Yen4200.00 price target. To see the full list of analyst forecasts on Towa Pharmaceutical Co stock, see the JP:4553 Stock Forecast page.

Towa Pharmaceutical Announces Executive Changes

Towa Pharmaceutical Co., Ltd. has announced changes in its executive structure following its Ordinary General Meeting of Shareholders and Board of Directors meeting. The reappointments include Itsuro Yoshida as President and Representative Director, and several other directors maintaining their positions, reflecting stability in the company’s leadership. These changes are aligned with the revised Act on Securing Quality, Efficacy and Safety of Products Including Pharmaceuticals and Medical Devices, indicating a continued focus on regulatory compliance.

The most recent analyst rating on (JP:4553) stock is a Buy with a Yen4200.00 price target. To see the full list of analyst forecasts on Towa Pharmaceutical Co stock, see the JP:4553 Stock Forecast page.

Towa Pharmaceutical Announces Strategic Changes and Financial Revisions

Towa Pharmaceutical Co. has announced several strategic changes, including mergers and revisions to its financial forecasts and business plans. These developments are likely to impact the company’s financial performance and market positioning, reflecting its ongoing efforts to optimize operations and achieve growth targets.

The most recent analyst rating on (JP:4553) stock is a Hold with a Yen3000.00 price target. To see the full list of analyst forecasts on Towa Pharmaceutical Co stock, see the JP:4553 Stock Forecast page.

Towa Pharmaceutical Revises Financial Objectives Amid Strong Performance

Towa Pharmaceutical Co., Ltd. has revised its financial objectives for its 6th Medium-term Business Plan (2024-2026) due to better-than-expected financial results for the fiscal year ending March 2025. The company anticipates an increase in operating profit, driven by enhanced production capacity at the Yamagata Plant and improved cost optimization strategies, including R&D expenses. The revisions reflect the company’s commitment to increasing corporate value while maintaining its strategic challenges, policies, and themes.

The most recent analyst rating on (JP:4553) stock is a Hold with a Yen3000.00 price target. To see the full list of analyst forecasts on Towa Pharmaceutical Co stock, see the JP:4553 Stock Forecast page.

Towa Pharmaceutical Reports Strong Financial Results and Increased Dividends

Towa Pharmaceutical Co., Ltd. reported a strong financial performance for the year ended March 31, 2025, with net sales increasing by 13.9% to ¥259,594 million and operating profit rising by 31.7% to ¥23,242 million. The company also announced an increase in dividends, reflecting its robust financial health and commitment to returning value to shareholders. The positive results indicate a solid market position and potential for future growth, benefiting stakeholders and reinforcing its competitive stance in the pharmaceutical industry.

The most recent analyst rating on (JP:4553) stock is a Hold with a Yen3000.00 price target. To see the full list of analyst forecasts on Towa Pharmaceutical Co stock, see the JP:4553 Stock Forecast page.

Towa Pharmaceutical Revises Financial Forecasts for FY 2025

Towa Pharmaceutical Co., Ltd. has revised its financial forecasts for the fiscal year ending March 31, 2025, reflecting a slight decrease in net sales and operating profit but a significant increase in ordinary profit and profit attributable to owners of the parent. The adjustments are attributed to foreign exchange gains, valuation of derivatives, and effective tax incentives, which have positively impacted the company’s financial outlook.