Otsuka Holdings Co Ltd (JP:4578)
:4578
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Otsuka Holdings Co
(4578)
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Rating:80Outperform
Price Target:
¥12,857.00
▲(57.75% Upside)
Action:Reiterated
Date:04/30/26
The score is driven primarily by strong financial quality (high profitability and a very low-leverage balance sheet), with supportive technical uptrend signals. Valuation is reasonable (P/E ~13) but the dividend is modest, and cash-flow volatility/OCF conversion is the main near-term risk factor.
Positive Factors
Revenue and margin expansion
Sustained top-line expansion and improved gross and operating margins versus the 2022–2023 trough indicate the company is regaining pricing power and product mix advantages. This supports durable internal funding for R&D and lifecycle management, strengthening long-term competitiveness.
Negative Factors
Operating cash flow below net income
Persistent OCF substantially below reported net income suggests working-capital timing or noncash income items that reduce cash available for reinvestment. Over time this can constrain funding for capex, R&D, dividends or buybacks despite strong accounting earnings.
Read all positive and negative factors
Positive Factors
Negative Factors
Revenue and margin expansion
Sustained top-line expansion and improved gross and operating margins versus the 2022–2023 trough indicate the company is regaining pricing power and product mix advantages. This supports durable internal funding for R&D and lifecycle management, strengthening long-term competitiveness.
Read all positive factors
Otsuka Holdings Co (4578) vs. iShares MSCI Japan ETF (EWJ)
Market Cap
¥6.02T
Dividend Yield1.42%
Average Volume (3M)1.11M
Price to Earnings (P/E)14.8
Beta (1Y)0.64
Revenue Growth5.15%
EPS Growth9.56%
CountryJP
Employees35,338
SectorHealthcare
Sector Strength45
IndustryDrug Manufacturers - General
Share Statistics
EPS (TTM)713.14
Shares Outstanding542,988,900
10 Day Avg. Volume977,130
30 Day Avg. Volume1,112,043
Financial Highlights & Ratios
PEG Ratio1.60
Price to Book (P/B)1.55
Price to Sales (P/S)1.91
P/FCF Ratio14.90
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
¥12,458.00Price Target Upside52.86% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering10
EPS Forecast (FY)583.69
Revenue Forecast (FY)¥2.57T
Otsuka Holdings Co Business Overview & Revenue Model
Company Description
Otsuka Holdings Co., Ltd. is a global healthcare company based in Japan, primarily engaged in the pharmaceutical and nutraceutical sectors. The company operates through two main segments: Pharmaceuticals, which focuses on the development of innova...
How the Company Makes Money
Otsuka Holdings makes money primarily by selling products from its two main business domains: (1) Pharmaceuticals and (2) Nutraceutical/consumer health. In the Pharmaceuticals business, revenue is generated from prescription drug sales to wholesal...
Otsuka Holdings Co Earnings Call Summary
Earnings Call Date:Aug 01, 2024
(Q2-2024)
| % Change Since: |
Next Earnings Date:Jul 30, 2026
Earnings Call Sentiment Positive
The earnings call highlighted strong growth in revenue and business profit, driven by pharmaceutical and nutraceutical segments. Forecasts have been revised upward, and there is an acquisition to further enhance drug discovery capabilities. However, there were some negatives, such as impairment losses and a decrease in certain revenues. Overall, the positive aspects significantly outweigh the negatives, indicating a strong performance and optimistic outlook.Positive Updates
Significant Revenue and Business Profit Growth
Revenue increased by 17.0% to JPY 1,108.9 billion and business profit increased by 37.8% to JPY 213.6 billion year-on-year, led by strong sales in pharmaceutical and nutraceutical businesses.
Negative Updates
Impairment Loss Impact
Operating profit was affected by an impairment loss on AVP-786, although net profit still increased by 5.1%.
Read all updates
Q2-2024 Updates
Positive
Negative
Significant Revenue and Business Profit Growth
Revenue increased by 17.0% to JPY 1,108.9 billion and business profit increased by 37.8% to JPY 213.6 billion year-on-year, led by strong sales in pharmaceutical and nutraceutical businesses.
Read all positive updates
Company Guidance
During the Q2 2024 earnings call for 4578.T, the executives provided detailed guidance reflecting significant growth in both their pharmaceutical and nutraceutical segments. Revenue increased by 17.0% year-on-year to JPY 1,108.9 billion, while business profit surged by 37.8% to JPY 213.6 billion, driven primarily by strong sales of Core 2 pharmaceutical products like ABILIFY MAINTENA and JYNARQUE, and nutraceuticals, particularly in the For Women’s Health category. Despite an impairment loss on AVP-786, net profit rose by 5.1% due to finance income. The company also revised its full-year forecast upwards, with revenue now expected to reach JPY 2,315 billion and business profit JPY 390 billion. Nutraceutical revenue saw a notable increase, achieving over a 20% growth rate to JPY 271.8 billion, fueled by the expansion of products like Bonafide and Nature Made. Additionally, the company announced plans for share repurchases amounting to JPY 50 billion as part of their shareholder return policy.Otsuka Holdings Co Financial Statement Overview
Summary
Income Statement
84
Very Positive
Balance Sheet
90
Very Positive
Cash Flow
72
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 2.52T | 2.47T | 2.33T | 2.02T | 1.74T | 1.50T |
| Gross Profit | 1.80T | 1.77T | 1.67T | 1.41T | 1.17T | 1.00T |
| EBITDA | 572.34B | 528.60B | 522.98B | 385.37B | 279.83B | 231.43B |
| Net Income | 376.50B | 363.15B | 343.12B | 121.62B | 133.91B | 125.46B |
Balance Sheet | ||||||
| Total Assets | 4.21T | 4.20T | 3.74T | 3.36T | 3.10T | 2.82T |
| Cash, Cash Equivalents and Short-Term Investments | 538.30B | 534.64B | 426.17B | 513.34B | 471.63B | 410.68B |
| Total Debt | 194.63B | 227.97B | 189.38B | 214.19B | 194.16B | 212.45B |
| Total Liabilities | 1.04T | 1.10T | 961.08B | 924.92B | 840.26B | 775.72B |
| Stockholders Equity | 3.11T | 3.03T | 2.73T | 2.39T | 2.23T | 2.01T |
Cash Flow | ||||||
| Free Cash Flow | 314.13B | 315.74B | 259.08B | 192.50B | 150.90B | 176.41B |
| Operating Cash Flow | 407.03B | 403.58B | 354.64B | 283.23B | 211.85B | 228.86B |
| Investing Cash Flow | -104.10B | -162.56B | -268.27B | -190.63B | -81.58B | -95.29B |
| Financing Cash Flow | -191.13B | -136.37B | -186.89B | -60.17B | -95.47B | -95.84B |
Otsuka Holdings Co Technical Analysis
Positive
8150.00
Price Trends
10910.20
Positive
10212.37
Positive
9172.00
Positive
Market Momentum
125.15
Negative
59.18
Neutral
59.00
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:4578, the sentiment is Positive. The current price of 8150 is below the 20-day moving average (MA) of 11022.75, below the 50-day MA of 10910.20, and below the 200-day MA of 9172.00, indicating a bullish trend. The MACD of 125.15 indicates Negative momentum. The RSI at 59.18 is Neutral, neither overbought nor oversold. The STOCH value of 59.00 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:4578.
Otsuka Holdings Co Peers Comparison
UnderperformOutperform
Sector (51)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
80 Outperform | ¥6.02T | 14.77 | 16.30% | 1.42% | 5.15% | 9.56% | |
77 Outperform | ¥13.00T | 30.70 | 22.23% | 1.17% | 5.65% | 10.24% | |
67 Neutral | ¥4.13T | 25.93 | 7.97% | 3.61% | 11.87% | 474.27% | |
65 Neutral | ¥1.20T | 35.61 | 5.75% | 3.51% | 4.56% | -16.55% | |
61 Neutral | ¥4.86T | 19.69 | 18.56% | 2.07% | 12.55% | -10.18% | |
58 Neutral | ¥8.33T | 46.52 | 0.54% | 4.11% | -1.66% | 78.06% | |
51 Neutral | $7.86B | -0.30 | -43.30% | 2.27% | 22.53% | -2.21% |
* Healthcare Sector Average
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Otsuka Holdings Co Corporate Events
Otsuka Holdings Posts Solid Q1 Growth but Maintains Cautious 2026 Profit Outlook
Apr 28, 2026
Otsuka Holdings reported first-quarter 2026 revenue of ¥630.3 billion, up 8.2% year on year, with business profit essentially flat at ¥123.0 billion and operating profit up 1.5%. Profit attributable to owners rose 15.7% to ¥98.3 bil...
Otsuka Completes Treasury Share Disposal for Restricted Stock Compensation
Apr 24, 2026
Otsuka Holdings has completed the payment process for the disposal of 83,920 treasury shares, which were issued as restricted stock compensation to directors of the company and its subsidiaries. The transaction, valued at approximately ¥930.7...
Otsuka Advances ¥50 Billion Share Buyback Program on Tokyo Market
Apr 1, 2026
Otsuka Holdings has reported progress on a previously approved share repurchase program, buying back 499,800 common shares for approximately ¥5.14 billion on the Tokyo Stock Exchange between March 1 and March 31, 2026. These purchases form pa...
Otsuka to Buy Transcend Therapeutics to Deepen Push Into Next-Generation Psychiatric Drugs
Mar 27, 2026
Otsuka Pharmaceutical, a 100% subsidiary of Otsuka Holdings, has agreed to acquire all outstanding shares of U.S.-based Transcend Therapeutics via its North American holding company Otsuka America, Inc., with closing targeted for the second quarte...
Otsuka Holdings Grants Restricted Stock to Directors Tied to Medium-Term Performance Targets
Mar 27, 2026
Otsuka Holdings will dispose of 83,920 treasury shares as restricted stock compensation for eight directors of the parent company and 35 directors of major subsidiaries, at ¥11,090 per share for a total value of about ¥930.7 million. The...
Otsuka Holdings Begins Execution of ¥50 Billion Share Buyback Program
Mar 2, 2026
Otsuka Holdings has begun executing a previously approved share repurchase program, buying back 312,900 common shares on the Tokyo Stock Exchange between February 16 and February 27, 2026, for a total of about ¥3.3 billion. This is part of a ...
Otsuka Holdings to Repurchase and Cancel Up to ¥50 Billion in Shares
Feb 13, 2026
Otsuka Holdings has approved a share repurchase program and subsequent cancellation of treasury stock as part of a broader effort to enhance capital efficiency and return profits to shareholders. The board resolution allows the company to buy back...
Otsuka Weighs Investment Unit Cut to Attract Individual Investors
Feb 13, 2026
Otsuka Holdings has outlined its stance on potentially reducing its investment unit, acknowledging that smaller trading units can improve share accessibility for individual investors and help invigorate equity market participation. The company pos...
Otsuka Holdings’ Nonconsolidated Profit Falls on Lower Subsidiary Dividends
Feb 13, 2026
Otsuka Holdings Co., Ltd. reported a year-on-year decline in its nonconsolidated financial results for the fiscal year ended December 31, 2025, with operating revenues falling 16.3% to ¥98.8 billion and net profit dropping 15.5% to ¥89.9...
Otsuka Holdings Posts Profit Surge in 2025 but Guides to Lower Earnings in 2026
Feb 13, 2026
Otsuka Holdings reported fiscal 2025 revenue of ¥2.47 trillion, up 6% year on year, with business profit rising 3.6% to ¥446.1 billion and operating profit jumping 48.2% to ¥479.4 billion. Profit attributable to owners grew 5.8% to ...
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.