Otsuka Holdings Co (4578) AI Stock Analysis

• Market Cap: ¥4.19T
• Dividend Yield: 1.62%
• Average Volume (3M): 1.46M
• Price to Earnings (P/E): 10.6
• Beta (1Y): 0.82
• Revenue Growth: 10.17%
• EPS Growth: 226.18%
• Country: JP
• Employees: 35,338
• Sector: Healthcare
• Sector Strength: 51
• Industry: Drug Manufacturers - General
• EPS (TTM): 167.55
• Shares Outstanding: 542,988,900
• 10 Day Avg. Volume: 1,092,550
• 30 Day Avg. Volume: 1,455,680
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• 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: ¥9,879.45
• Price Target Upside: 22.85% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 5

• Rating: 79 Outperform
• Price Target: ¥8,975.00 ▲(11.60% Upside)

Otsuka Holdings Co's strong financial performance, characterized by robust revenue and profit growth, low leverage, and efficient cash flow generation, is the primary driver of its stock score. Technical indicators support a positive outlook, with the stock trading above key moving averages and showing bullish momentum. The valuation is attractive with a reasonable P/E ratio and a decent dividend yield, enhancing the stock's appeal.

Otsuka Holdings Co Business Overview & Revenue Model

Company Description

Otsuka Holdings Co., Ltd. engages in pharmaceuticals, nutraceuticals, consumer products, and other businesses worldwide. The company develops pharmaceutical products in the fields of oncology, cardiovascular system, renal system, digestive system, ophthalmology, diagnostics, and intravenous solutions, as well as medical devices businesses. It also provides EQUELLE, a product for women's health and beauty; BODYMAINTÉ Jelly, a conditioning food product; BODYMAINTÉ Drink, a drinkable-liquid; POCARI SWEAT, a drink; Calorie Mate, a nutritional food; OS-1, an oral rehydration solution; HINEX-R, a concentrated liquid diet; and Oronine H Ointment, a household antiseptic medicine. In addition, the company offers soft drinks, food products, and wines; chemicals; clinical testing and medical equipment; cosmetics; warehousing and transport services; analysis and measurement equipment; pharmaceutical intermediates; vehicle headlight testers; synthetic resin molded products; paper products; artificial turf; ceramic boards, ceramic walls, reliefs, terracotta, OT ceramics, and ceramic portraits and sign boards; functional films; stable isotopes; software and services to enhance management of mental healthcare systems; potassium titanate; polyolefin foams; spring and mineral water; industrial chemicals; hydrazine; insecticide and toiletry products; and adhesive tapes. Further, it operates a hotel. Otsuka Holdings Co., Ltd. was founded in 1921 and is based in Tokyo, Japan.

How the Company Makes Money

Otsuka Holdings Co. makes money primarily through the sales of its pharmaceutical products, which constitute the largest portion of its revenue. The company develops and markets a range of prescription medications, notably in the fields of mental health, oncology, and cardiovascular health. Additionally, Otsuka generates revenue from its nutraceutical and consumer products divisions, which offer health and wellness products such as nutritional supplements and functional foods. The company leverages strategic partnerships and collaborations with other pharmaceutical and biotechnology companies to enhance its product offerings and market reach, further contributing to its revenue streams. Otsuka also invests in research and development to drive innovation and maintain a competitive edge in the healthcare market.

Otsuka Holdings Co Financial Statement Overview

Summary

Otsuka Holdings Co exhibits strong financial health with impressive revenue and profit growth, a stable balance sheet with low leverage, and robust cash flow generation. Minor concerns include a slight increase in debt and cost pressures affecting EBIT margins.

Income Statement

Otsuka Holdings Co has demonstrated strong revenue growth, with a TTM revenue growth rate of 35.6%. The company maintains healthy profitability metrics, with a gross profit margin of 72.2% and a net profit margin of 14.7% in the TTM period. EBIT and EBITDA margins are also robust, indicating efficient operations. However, the slight decline in EBIT margin from the previous year suggests potential cost pressures.

Balance Sheet

The balance sheet of Otsuka Holdings Co is solid, with a low debt-to-equity ratio of 0.095, indicating conservative leverage. The return on equity is strong at 13.3%, reflecting effective use of shareholder funds. The equity ratio stands at a healthy level, showcasing financial stability. However, the slight increase in total debt over the period could be monitored for future leverage trends.

Cash Flow

Cash flow analysis reveals a significant improvement in free cash flow growth, with a TTM growth rate of 382.6%. The operating cash flow to net income ratio is stable, and the free cash flow to net income ratio is strong at 66.9%, indicating efficient cash conversion. The company has shown resilience in generating cash, supporting its operational and strategic initiatives.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	2.40T	2.33T	2.02T	1.74T	1.50T	1.42T
Gross Profit	1.73T	1.67T	1.41T	1.17T	1.00T	983.08B
EBITDA	515.32B	452.62B	224.20B	266.93B	244.25B	273.37B
Net Income	408.85B	343.12B	121.62B	133.91B	125.46B	148.14B
Balance Sheet
Total Assets	3.79T	3.74T	3.36T	3.10T	2.82T	2.63T
Cash, Cash Equivalents and Short-Term Investments	411.11B	426.17B	513.34B	471.63B	410.68B	356.85B
Total Debt	211.51B	189.38B	214.19B	194.16B	212.45B	226.08B
Total Liabilities	1.00T	961.09B	924.93B	840.17B	775.73B	744.38B
Stockholders Equity	2.72T	2.73T	2.39T	2.23T	2.01T	1.85T
Cash Flow
Free Cash Flow	340.80B	225.28B	168.56B	104.06B	115.71B	134.96B
Operating Cash Flow	434.32B	354.64B	283.23B	211.85B	228.86B	232.84B
Investing Cash Flow	-239.59B	-268.27B	-190.54B	-81.58B	-95.29B	-99.86B
Financing Cash Flow	-246.53B	-186.89B	-60.17B	-95.47B	-95.84B	-104.93B

Otsuka Holdings Co Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 8042.00
• 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:4578, the sentiment is Positive. The current price of 8042 is above the 20-day moving average (MA) of 7879.95, above the 50-day MA of 7288.74, and above the 200-day MA of 7587.98, indicating a bullish trend. The MACD of 184.97 indicates Positive momentum. The RSI at 64.24 is Neutral, neither overbought nor oversold. The STOCH value of 38.29 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

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
4578	79 Outperform	¥4.19T	10.55	15.51%	1.62%	10.17%	226.18%
Sector *	51 Neutral	$7.86B	-0.33	-41.57%	2.23%	23.26%	-2.03%
ALPMF	―	$19.89B	35.35	5.46%	4.52%	―	―
CHGCF	―	$72.03B	26.29	21.48%	3.76%	―	―
DSKYF	―	$44.65B	22.29	18.32%	1.72%	―	―
SGIOF	―	$15.12B	12.77	13.71%	4.53%	―	―
TKPHF	―	$47.48B	45.09	1.99%	4.83%	―	―

Otsuka Holdings Co Corporate Events

Otsuka Holdings Reports Strong H1 2025 Financial Results and Increases Dividend Forecast

Otsuka Holdings reported a significant increase in its consolidated financial results for the first half of 2025, with revenue rising by 6.5% and operating profit surging by 91.7% compared to the previous year. The company also announced a revision in its dividend forecast, increasing the annual dividend per share to 140 yen, reflecting confidence in its financial stability and growth prospects.

Otsuka Holdings Increases Interim and Annual Dividend Forecast

Otsuka Holdings Co., Ltd. announced an increase in its interim dividend to JPY 70.00 per share, up from the previous JPY 60.00, based on strong financial results for the first half of FY2025. Additionally, the company revised its annual dividend forecast, raising the year-end dividend to JPY 70.00 per share, resulting in a total annual dividend of JPY 140.00 per share, reflecting a JPY 20.00 increase. This decision underscores Otsuka’s stable dividend policy and its aim to enhance shareholder returns.

Otsuka Holdings Upgrades Financial Forecast for FY2025

Otsuka Holdings Co., Ltd. has revised its financial forecast for the first half of FY2025, projecting higher revenues and profits due to strong performance in its pharmaceutical and nutraceutical sectors. Despite the yen’s appreciation, key products like Rexulti and POCARI SWEAT have driven growth, and lower-than-expected expenses have contributed to the favorable outlook.

Otsuka Medical Devices Sells Stake in MicroPort to Boost Growth

Otsuka Medical Devices Co., Ltd., a subsidiary of Otsuka Holdings, has decided to sell a portion of its shares in MicroPort Scientific Corporation, resulting in MicroPort no longer being an equity-method affiliate of Otsuka. This strategic move aims to enhance sustainable growth and corporate value by reassessing the economic and qualitative significance of its holdings. The transaction involves multiple counterparties and is expected to impact Otsuka’s financial positioning and stakeholder relationships.

FDA Committee Reviews Otsuka and Lundbeck’s PTSD Treatment Application

Otsuka Pharmaceutical Co., Ltd. and H. Lundbeck A/S have announced that the FDA’s Psychopharmacologic Drugs Advisory Committee has reviewed their supplemental New Drug Application for REXULTI (brexpiprazole) in combination with sertraline for treating PTSD in adults. The committee voted against the efficacy of this combination, which may impact the approval process and the companies’ market positioning in PTSD treatment.

Otsuka’s Sibeprenlimab Shows Promising Results in Phase 3 IgAN Study

Otsuka Holdings has announced promising interim results from its Phase 3 VISIONARY study, showing that its investigational drug sibeprenlimab achieved a significant 51.2% reduction in proteinuria for patients with Immunoglobulin A Nephropathy (IgAN). The study’s findings, presented at the European Renal Association Congress, highlight sibeprenlimab’s potential as a new treatment option, with a favorable safety profile and a novel mechanism targeting the disease’s immunologic pathogenesis. The drug has received Priority Review from the FDA, indicating its potential impact on the treatment landscape for this chronic kidney disease.

Otsuka’s Sibeprenlimab BLA Accepted by FDA for Priority Review

Otsuka Holdings Co., Ltd. announced that the FDA has accepted the Biologics License Application for sibeprenlimab, a monoclonal antibody for treating IgA nephropathy, with a priority review. This development could significantly impact Otsuka’s positioning in the nephrology market by offering a new treatment option that allows patients to self-administer the medication, potentially improving convenience and clinical outcomes for those with this chronic kidney disease.