Towa Pharmaceutical Co Ltd (JP:4553)
:4553
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Towa Pharmaceutical Co
(4553)
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Rating:48Neutral
Price Target:
¥3,742.00
▲(3.37% Upside)
Action:Reiterated
Date:05/16/26
The score is held back primarily by uneven financial quality (volatile earnings, historically negative free cash flow, and elevated leverage) and weak technical momentum (oversold readings with bearish trend vs key moving averages). Valuation is also a headwind due to a high P/E, only partly supported by the dividend yield.
Positive Factors
Durable Generics Business Model
Towa’s core model—manufacture and sale of post-patent generic medicines into Japan’s national health system—creates recurring, predictable demand. A broad portfolio and institutional distribution reduce single-product risk and support stable revenue and capacity utilization over multiple years.
Negative Factors
Elevated Leverage
A debt-heavy capital structure reduces resilience to profit shocks and raises interest obligations. With leverage elevated across multiple years, the company faces less financial flexibility for investment or M&A and greater refinancing risk if earnings or cash flows weaken again.
Read all positive and negative factors
Positive Factors
Negative Factors
Durable Generics Business Model
Towa’s core model—manufacture and sale of post-patent generic medicines into Japan’s national health system—creates recurring, predictable demand. A broad portfolio and institutional distribution reduce single-product risk and support stable revenue and capacity utilization over multiple years.
Read all positive factors
Towa Pharmaceutical Co (4553) vs. iShares MSCI Japan ETF (EWJ)
Market Cap
¥193.66B
Dividend Yield2.14%
Average Volume (3M)112.31K
Price to Earnings (P/E)37.6
Beta (1Y)0.68
Revenue Growth5.44%
EPS Growth-72.35%
CountryJP
Employees4,588
SectorHealthcare
Sector Strength45
IndustryDrug Manufacturers - Specialty & Generic
Share Statistics
EPS (TTM)106.65
Shares Outstanding51,516,000
10 Day Avg. Volume138,760
30 Day Avg. Volume112,306
Financial Highlights & Ratios
PEG Ratio-0.52
Price to Book (P/B)1.11
Price to Sales (P/S)0.72
P/FCF Ratio24.19
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
¥4,500.00Price Target Upside24.31% Upside
Rating ConsensusHold
Number of Analyst Covering1
EPS Forecast (FY)418.46
Revenue Forecast (FY)¥297.65B
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 di...
How the Company Makes Money
Towa Pharmaceutical primarily makes money by selling prescription generic drugs in Japan. Its core revenue stream comes from supplying generic equivalents of branded medicines after patent/market exclusivity expires; these products are sold throug...
Towa Pharmaceutical Co Financial Statement Overview
Summary
Income Statement
58
Neutral
Balance Sheet
52
Neutral
Cash Flow
41
Neutral
| Breakdown | Mar 2026 | Mar 2026 | Mar 2025 | Mar 2024 | Mar 2023 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 273.71B | 259.59B | 227.93B | 208.86B | 165.62B |
| Gross Profit | 99.10B | 94.73B | 81.38B | 72.71B | 70.19B |
| EBITDA | 45.94B | 43.34B | 35.54B | 24.92B | 29.49B |
| Net Income | 5.25B | 18.99B | 16.17B | 2.20B | 15.91B |
Balance Sheet | |||||
| Total Assets | 475.29B | 470.82B | 430.65B | 371.35B | 332.10B |
| Cash, Cash Equivalents and Short-Term Investments | 45.31B | 45.47B | 29.65B | 24.26B | 32.83B |
| Total Debt | 226.74B | 230.98B | 202.36B | 161.52B | 140.70B |
| Total Liabilities | 297.18B | 299.19B | 274.76B | 234.45B | 199.93B |
| Stockholders Equity | 178.10B | 171.63B | 155.89B | 136.89B | 132.17B |
Cash Flow | |||||
| Free Cash Flow | 8.15B | -5.33B | -29.64B | -26.19B | 10.99B |
| Operating Cash Flow | 30.43B | 23.40B | 8.21B | 2.54B | 22.13B |
| Investing Cash Flow | -25.66B | -31.29B | -40.39B | -30.28B | -59.73B |
| Financing Cash Flow | -6.83B | 21.57B | 35.41B | 17.48B | 46.54B |
Towa Pharmaceutical Co Technical Analysis
Positive
3620.00
Price Trends
4037.78
Negative
3911.93
Positive
3463.35
Positive
Market Momentum
-70.90
Negative
51.11
Neutral
86.81
Negative
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 3620 is below the 20-day moving average (MA) of 3862.25, below the 50-day MA of 4037.78, and above the 200-day MA of 3463.35, indicating a neutral trend. The MACD of -70.90 indicates Negative momentum. The RSI at 51.11 is Neutral, neither overbought nor oversold. The STOCH value of 86.81 is Negative, 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
UnderperformOutperform
Sector (51)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
66 Neutral | ¥120.46B | 19.64 | 4.81% | 2.34% | 11.21% | 39.02% | |
58 Neutral | ¥164.41B | 17.42 | 6.70% | 2.48% | 10.28% | 20.78% | |
55 Neutral | ¥177.90B | 24.45 | ― | 2.28% | 6.69% | 6.72% | |
54 Neutral | ¥68.48B | 27.41 | ― | 3.36% | -2.94% | -62.05% | |
51 Neutral | $7.86B | -0.30 | -43.30% | 2.27% | 22.53% | -2.21% | |
50 Neutral | ¥147.14B | 52.56 | -2.58% | 4.16% | -18.25% | -84.71% | |
48 Neutral | ¥193.66B | 37.55 | 12.02% | 2.14% | 5.44% | -72.35% |
* Healthcare Sector Average
JP:4553
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Towa Pharmaceutical Co Corporate Events
Towa Pharmaceutical Flags Impairment and Reshapes Group Structure
May 14, 2026
Towa Pharmaceutical has clarified the structure of its domestic and overseas segments in materials accompanying its financial results for the year ended March 31, 2026, grouping several subsidiaries under the umbrella of its core domestic operatio...
Towa Pharmaceutical Profit Slumps but Dividend Rises as Company Forecasts Strong Rebound
May 14, 2026
Towa Pharmaceutical reported consolidated net sales of ¥273.7 billion for the year ended March 31, 2026, up 5.4% year on year, while operating profit was roughly flat at ¥23.1 billion and ordinary profit rose 7.4%. Profit attributable to...
Towa Pharmaceutical Books Sunsho Impairment and Cuts Profit Outlook
May 11, 2026
Towa Pharmaceutical said it will book a ¥14.7 billion goodwill impairment at subsidiary Sunsho Pharmaceutical after weaker-than-expected performance in domestic health foods, tougher overseas competition and delays in synergy realization, and...
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.