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

• Market Cap: ¥39.87B
• Dividend Yield: 2.77%
• Average Volume (3M): 63.87K
• Price to Earnings (P/E): 20.2
• Beta (1Y): 0.29
• Revenue Growth: 7.56%
• EPS Growth: -48.91%
• Country: JP
• Employees: 1,070
• Sector: Healthcare
• Sector Strength: 45
• Industry: Drug Manufacturers - Specialty & Generic
• EPS (TTM): 23.24
• Shares Outstanding: 30,096,880
• 10 Day Avg. Volume: 54,390
• 30 Day Avg. Volume: 63,866
• PEG Ratio: -0.39
• Price to Book (P/B): 0.58
• Price to Sales (P/S): 0.59
• P/FCF Ratio: -31.31
• 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: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 63 Neutral
• Price Target: ¥1,261.00 ▼(-4.83% Downside)

Daito Pharmaceutical Co., Ltd. receives an overall score of 63, primarily influenced by its mixed financial performance and bearish technical indicators. While the company shows revenue growth, declining profit margins and increasing leverage are concerns. The stock's valuation is reasonable with an attractive dividend yield, but technical indicators suggest a lack of strong momentum. The absence of earnings call and corporate events data limits further insights.

Positive Factors

Revenue Growth

Consistent revenue growth indicates a strong market position and the ability to expand its customer base, supporting long-term business sustainability.

Research and Development Focus

A strong R&D focus enables innovation and the development of new products, which can drive future growth and enhance competitive positioning.

Diverse Revenue Streams

Diverse revenue streams reduce dependency on a single market segment, providing stability and resilience against market fluctuations.

Negative Factors

Declining Profit Margins

Declining profit margins suggest rising costs or pricing pressures, which could impact profitability and limit reinvestment capacity.

Rising Leverage

Increasing leverage can strain financial flexibility and increase risk, potentially affecting the company's ability to invest in growth opportunities.

Negative Free Cash Flow

Negative free cash flow indicates challenges in covering investments and obligations, which may hinder strategic initiatives and long-term growth.

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

Company Description

Daito Pharmaceutical Co.,Ltd. manufactures and sells pharmaceutical products worldwide. The company offers various active pharmaceutical ingredients and intermediates, prescription drugs, OTC drugs, and home-delivery medicines; formulations in various forms, such as tablets, capsules, troches, granules, and powders; and contract manufacturing services for formulations of medicinal products to pharmaceutical companies. It also sells health food products. The company was formerly known as Daito Corporation and changed its name to Daito Pharmaceutical Co.,Ltd. in 1992. Daito Pharmaceutical Co.,Ltd. was incorporated in 1942 and is headquartered in Toyama, Japan.

How the Company Makes Money

Daito Pharmaceutical generates revenue through the sale of its pharmaceutical products, which include both prescription drugs and over-the-counter medications. The company earns income from direct sales to healthcare providers, pharmacies, and hospitals. Additionally, Daito may engage in partnerships with other pharmaceutical firms for collaborative research and development, licensing agreements, and distribution deals, which can provide substantial revenue streams. The company's financial performance is also influenced by factors such as patent protection on its products, market demand, and regulatory approvals, which can impact the pricing and availability of its medications.

Daito Pharmaceutical Co., Ltd. Financial Statement Overview

Summary

Daito Pharmaceutical Co., Ltd. demonstrates a mixed financial performance with revenue growth but declining profit margins and increasing leverage. The balance sheet shows a stable equity position, but rising debt levels could impact future financial flexibility. Cash flow challenges, particularly in free cash flow, suggest the need for strategic adjustments to enhance cash generation and profitability.

Income Statement

Daito Pharmaceutical Co., Ltd. has shown a consistent revenue growth rate of 6.91% in the latest year, indicating a positive trajectory. However, the gross profit margin has decreased over the years, from 26.36% in 2022 to 17.06% in 2025, which could suggest rising costs or pricing pressures. The net profit margin has also declined from 10.74% in 2022 to 3.77% in 2025, reflecting challenges in maintaining profitability. Despite these challenges, the company has managed to maintain a positive EBIT and EBITDA margin, although both have seen a downward trend.

Balance Sheet

The company's debt-to-equity ratio has increased from 0.07 in 2022 to 0.23 in 2025, indicating a rising leverage which could pose a risk if not managed properly. The return on equity has decreased from 9.87% in 2022 to 3.67% in 2025, suggesting a decline in the efficiency of generating profits from shareholders' equity. The equity ratio remains stable, indicating a solid capital structure, but the increasing debt levels warrant caution.

Cash Flow

The free cash flow has been negative in recent years, with a significant decline in free cash flow growth rate of -68.60% in 2025. This indicates potential challenges in generating sufficient cash to cover investments and obligations. The operating cash flow to net income ratio has been relatively stable, suggesting that the company is still generating cash from its operations, but the negative free cash flow to net income ratio highlights the need for improved cash management.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	50.98B	50.64B	46.90B	45.10B	43.46B	48.71B
Gross Profit	8.95B	8.64B	9.84B	10.33B	11.46B	10.79B
EBITDA	7.12B	7.41B	7.92B	8.96B	9.88B	9.04B
Net Income	1.99B	1.91B	3.29B	3.60B	4.67B	4.25B
Balance Sheet
Total Assets	78.84B	78.00B	77.71B	70.55B	64.94B	57.74B
Cash, Cash Equivalents and Short-Term Investments	2.15B	2.21B	2.73B	3.61B	4.38B	3.37B
Total Debt	11.94B	11.88B	8.72B	4.96B	3.45B	3.39B
Total Liabilities	26.63B	25.93B	25.44B	19.58B	17.27B	15.82B
Stockholders Equity	52.17B	52.00B	52.07B	50.67B	47.30B	41.62B
Cash Flow
Free Cash Flow	-1.52B	-957.00M	-1.09B	-1.40B	-363.00M	-1.17B
Operating Cash Flow	920.00M	5.90B	5.18B	4.16B	4.37B	5.18B
Investing Cash Flow	-2.64B	-7.37B	-5.93B	-5.57B	-4.40B	-6.32B
Financing Cash Flow	1.98B	1.00B	-183.00M	616.00M	989.00M	1.42B

Daito Pharmaceutical Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 1325.00
• 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:4577, the sentiment is Positive. The current price of 1325 is above the 20-day moving average (MA) of 1298.93, above the 50-day MA of 1244.04, and above the 200-day MA of 1121.75, indicating a bullish trend. The MACD of 24.15 indicates Positive momentum. The RSI at 64.90 is Neutral, neither overbought nor oversold. The STOCH value of 77.03 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:4577.

Daito Pharmaceutical Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
4554	71 Outperform	¥44.87B	14.94	6.49%	2.48%	12.01%	-51.35%
4595	71 Outperform	¥30.96B	11.01	―	6.77%	-12.03%	-19.61%
4577	63 Neutral	¥39.87B	20.16	―	2.77%	7.56%	-48.91%
4574	63 Neutral	¥14.87B	17.49	―	―	-5.41%	―
4538	60 Neutral	¥19.72B	-4.87	―	3.87%	7.50%	-281.41%
Sector *	51 Neutral	$7.86B	-0.30	-43.30%	2.27%	22.53%	-2.21%
2929	47 Neutral	¥19.29B	-10.45	―	3.62%	9.53%	-155.76%

Daito Pharmaceutical Co., Ltd. Corporate Events

Daito Pharmaceutical Announces Share Repurchase

Daito Pharmaceutical Co., Ltd. has announced the repurchase of its own shares, acquiring 124,100 shares at a total cost of 153,432,400 yen through market purchases on the Tokyo Stock Exchange. This move is part of a larger plan approved by the Board of Directors to repurchase up to 1,000,000 shares, equivalent to 3.3% of the total issued shares, with a budget of up to 1,500 million yen, aiming to enhance shareholder value.

Daito Pharmaceutical Announces Share Repurchase Plan

Daito Pharmaceutical Co., Ltd. announced the repurchase of 134,000 of its own shares, amounting to 163,958,000 yen, as part of a broader plan to buy back up to 1,000,000 shares by May 2026. This strategic move is likely aimed at enhancing shareholder value and optimizing the company’s capital structure.

Daito Pharmaceutical Completes Treasury Share Acquisition and Plans Cancellation

Daito Pharmaceutical Co., Ltd. has completed the acquisition of 242,000 treasury shares, equivalent to 0.8% of its total shares, as part of its capital policy to enhance shareholder returns and improve capital efficiency. The company plans to cancel these shares by May 2026, which will reduce the total number of shares issued, potentially impacting shareholder value and market perception.

Daito Pharmaceutical Announces Strategic Treasury Share Acquisition and Cancellation

Daito Pharmaceutical Co., Ltd. has announced a strategic move to acquire and subsequently cancel a significant portion of its treasury shares, amounting to up to 1,250,000 shares or 4.2% of the total shares issued. This decision, part of the company’s Medium-Term Management Plan, aims to enhance shareholder returns and improve capital efficiency, reflecting a proactive approach to capital management and shareholder value enhancement.

Daito Pharmaceutical to Acquire and Cancel Treasury Shares

Daito Pharmaceutical Co., Ltd. announced its decision to acquire and subsequently cancel a significant portion of its treasury shares as part of its capital policy under the Medium-Term Management Plan. This move aims to enhance shareholder returns and improve capital efficiency, with up to 1,250,000 shares, representing 4.2% of the total shares issued, set to be acquired and cancelled. The acquisition will be conducted through the Tokyo Stock Exchange, with the cancellation scheduled for May 2026.

Daito Pharmaceutical Reports Positive Q3 Financial Results

Daito Pharmaceutical Co., Ltd. reported a 2.6% increase in net sales for the three months ended August 31, 2025, compared to the same period last year. The company also saw significant improvements in operating profit and profit attributable to owners of the parent, with increases of 17.6% and 12.8% respectively. These results reflect a positive financial trajectory and suggest a strengthening position within the industry, despite the exclusion of Daiwa Pharmaceutical Co., Ltd. from consolidation due to a merger.