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Daito Pharmaceutical Co., Ltd. (JP:4577)
:4577
Japanese Market

Daito Pharmaceutical Co., Ltd. (4577) AI Stock Analysis

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JP

Daito Pharmaceutical Co., Ltd.

(4577)

Rating:73Outperform
Price Target:
¥1,134.00
▲(14.31%Upside)
Daito Pharmaceutical Co., Ltd. scores well in valuation due to its low P/E ratio and unusually high dividend yield, significantly boosting its overall score. Despite stable financial performance, improvements in cash flow management and profitability are necessary. Mixed technical indicators suggest caution in the short term.

Daito Pharmaceutical Co., Ltd. (4577) vs. iShares MSCI Japan ETF (EWJ)

Daito Pharmaceutical Co., Ltd. Business Overview & Revenue Model

Company DescriptionDaito Pharmaceutical Co., Ltd. (4577) is a Japanese company engaged in the pharmaceutical industry, primarily focusing on the development, manufacturing, and marketing of generic drugs. The company plays a crucial role in providing cost-effective medication options, which are bioequivalent to brand-name drugs, thereby contributing to the healthcare system by making essential medications more accessible and affordable to the public.
How the Company Makes MoneyDaito Pharmaceutical Co., Ltd. generates revenue through the production and sale of generic pharmaceutical products. The company's primary revenue streams include sales to hospitals, pharmacies, and wholesalers who distribute the generic drugs to end consumers. Additionally, Daito may engage in contract manufacturing, providing production services for other pharmaceutical companies. The company's financial performance may be influenced by factors such as drug approval rates, patent expirations of branded drugs, and healthcare policies that encourage the use of generics. Strategic partnerships with other pharmaceutical firms or research institutions can also play a role in expanding their product offerings and market reach.

Daito Pharmaceutical Co., Ltd. Financial Statement Overview

Summary
Daito Pharmaceutical Co., Ltd. exhibits a stable income statement with healthy operational efficiency, as indicated by its margins. However, challenges include a decline in EBIT and net income, and negative free cash flow, which may impact long-term financial health.
Income Statement
72
Positive
Daito Pharmaceutical Co., Ltd. exhibits a stable income statement with a Gross Profit Margin of 20.99% and a Net Profit Margin of 7.03% for the latest fiscal year. Although the Revenue Growth Rate is moderate at 3.97%, the EBIT Margin of 8.30% and EBITDA Margin of 16.89% indicate healthy operational efficiency. However, the decline in both EBIT and net income compared to previous years suggests potential challenges in maintaining profitability.
Balance Sheet
78
Positive
The company maintains a strong balance sheet with a Debt-to-Equity Ratio of 0.17, indicating conservative financial leverage. The Return on Equity (ROE) stands at 6.33%, reflecting moderate returns for shareholders. An Equity Ratio of 66.99% highlights a robust capital structure. However, the recent increase in total debt and a slight decline in equity could pose potential risks if not managed effectively.
Cash Flow
65
Positive
Daito Pharmaceutical's cash flow statement shows a concerning Free Cash Flow of -1.09 billion JPY, albeit an improvement from the previous year. The Operating Cash Flow to Net Income Ratio of 1.57 indicates efficient cash generation relative to net income. However, the Free Cash Flow to Net Income Ratio is negative, signaling challenges in covering capital expenditures and other financial obligations.
BreakdownTTMJun 2024Jun 2023Jun 2022Jun 2021Jun 2020
Income Statement
Total Revenue47.37B46.90B45.10B43.46B48.71B45.00B
Gross Profit9.03B9.84B10.33B11.46B10.79B9.48B
EBITDA6.06B7.92B9.08B9.88B9.04B8.56B
Net Income2.65B3.29B3.60B4.67B4.25B3.94B
Balance Sheet
Total Assets79.63B77.71B70.55B64.94B57.74B54.25B
Cash, Cash Equivalents and Short-Term Investments3.24B2.73B3.61B4.38B3.37B3.08B
Total Debt11.32B8.72B4.96B3.45B3.39B3.37B
Total Liabilities27.61B25.44B19.58B17.27B15.82B17.38B
Stockholders Equity52.01B52.07B50.67B47.30B41.62B36.51B
Cash Flow
Free Cash Flow-3.05B-1.09B-1.40B-363.00M-1.17B1.53B
Operating Cash Flow1.84B5.18B4.16B4.37B5.18B4.31B
Investing Cash Flow-5.29B-5.93B-5.57B-4.40B-6.32B-2.68B
Financing Cash Flow3.96B-183.00M616.00M989.00M1.42B-350.46M

Daito Pharmaceutical Co., Ltd. Technical Analysis

Technical Analysis Sentiment
Negative
Last Price992.00
Price Trends
50DMA
1010.21
Negative
100DMA
1022.91
Negative
200DMA
1037.45
Negative
Market Momentum
MACD
-6.74
Positive
RSI
42.65
Neutral
STOCH
7.50
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:4577, the sentiment is Negative. The current price of 992 is below the 20-day moving average (MA) of 1017.65, below the 50-day MA of 1010.21, and below the 200-day MA of 1037.45, indicating a bearish trend. The MACD of -6.74 indicates Positive momentum. The RSI at 42.65 is Neutral, neither overbought nor oversold. The STOCH value of 7.50 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:4577.

Daito Pharmaceutical Co., Ltd. Peers Comparison

Overall Rating
UnderperformOutperform
Sector (65)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
73
Outperform
¥29.85B14.04
3.51%8.07%-45.20%
71
Outperform
¥26.90B7.51
5.54%4.00%-0.03%
70
Outperform
¥34.52B10.847.01%2.83%13.46%-46.40%
65
Neutral
¥18.54B6.46
3.96%9.31%-340.82%
65
Neutral
¥343.99B10.56-2.88%2.55%11.80%-6.84%
56
Neutral
¥23.76B83.32
3.00%-2.24%-92.72%
* Healthcare Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
JP:4577
Daito Pharmaceutical Co., Ltd.
992.00
-102.38
-9.36%
JP:2929
Pharma Foods International Co., Ltd.
820.00
-178.79
-17.90%
JP:4538
Fuso Pharmaceutical Industries,Ltd.
2,113.00
-241.00
-10.24%
JP:4595
Mizuho Medy Co., Ltd.
1,412.00
-116.78
-7.64%
JP:4554
Fuji Pharma Co., Ltd.
1,355.00
-78.17
-5.45%

Daito Pharmaceutical Co., Ltd. Corporate Events

Daito Pharmaceutical Announces Share Repurchase
May 1, 2025

Daito Pharmaceutical Co., Ltd. announced the repurchase of 105,200 of its own shares for 220,726,800 yen, conducted through market purchases on the Tokyo Stock Exchange in April 2025. This move is part of a broader strategy approved by the Board of Directors to repurchase up to 300,000 shares, aiming to enhance shareholder value and optimize capital structure.

Daito Pharmaceutical Revises Earnings Forecast Amid Cost Challenges
Apr 14, 2025

Daito Pharmaceutical Co., Ltd. has revised its earnings forecast for the fiscal year ending May 31, 2025, due to lower than expected sales of high-value products and increased costs. Despite strong net sales, the company anticipates a decrease in operating, ordinary, and attributable profits, citing factors such as inventory valuation losses, higher outsourcing expenses, and increased R&D costs.

Daito Pharmaceutical Reports Increased Sales but Declining Profits
Apr 14, 2025

Daito Pharmaceutical Co., Ltd. reported a 5.6% increase in net sales for the nine months ending February 28, 2025, compared to the previous year. However, the company experienced a significant decline in profits, with operating profit down by 39.8% and ordinary profit by 34.9%. The financial results indicate challenges in maintaining profitability despite increased sales, which may impact the company’s strategic positioning and stakeholder confidence.

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.Date of analysis: Jun 19, 2025