Tohoku Chemical Co., Ltd. (7446) AI Stock Analysis

• Market Cap: ¥4.38B
• Dividend Yield: 3.29%
• Average Volume (3M): 600.00
• Price to Earnings (P/E): 8.1
• Beta (1Y): 0.29
• Revenue Growth: 7.11%
• EPS Growth: 80.59%
• Country: JP
• Employees: 330
• Sector: Basic Materials
• Sector Strength: 58
• Industry: Chemicals - Specialty
• EPS (TTM): 217.61
• Shares Outstanding: 960,000
• 10 Day Avg. Volume: 800
• 30 Day Avg. Volume: 600
• PEG Ratio: 0.10
• Price to Book (P/B): 0.46
• Price to Sales (P/S): 0.10
• P/FCF Ratio: 26.89
• 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: 65 Neutral
• Price Target: ¥5,162.00 ▲(34.60% Upside)
• Action: Reiterated Date: 12/11/25
• Date: Action: Reiterated 12/11/25

Tohoku Chemical Co., Ltd. has a solid financial foundation with stable revenue growth and efficient cost management. However, the stock is currently experiencing bearish technical indicators, which may pose short-term risks. The attractive valuation with a low P/E ratio and high dividend yield offers potential upside for long-term investors.

Positive Factors

Stable Revenue Growth

Consistent top-line growth demonstrates sustained demand for the company's specialty-chemical products and underpins predictable revenue base. Over a 2-6 month horizon this supports planning for capacity, steady cash flows and incremental reinvestment in operations or product development.

Low Leverage / Healthy Equity Base

A low debt-to-equity ratio and healthy equity base provide financial flexibility to fund capex, smooth through cyclicality, and pursue strategic initiatives without relying on costly external funding. This bolsters resilience and supports multi-month investment execution.

Stable Gross Margins and Positive Operating Margins

Stable gross margins near 9-10% show durable cost control in production and pricing discipline. Positive EBIT/EBITDA margins indicate underlying operational efficiency that can sustain profitability through moderate input cost swings and support margin-preserving strategies over months.

Negative Factors

Low Net Profit Margin

A consistently low net margin constrains retained earnings and limits the firm's ability to fund growth, R&D, or higher dividends from internal cash. Over the medium term this reduces capacity to improve ROE and weakens returns to shareholders unless margins are structurally improved.

Volatile Free Cash Flow and Conversion

Inconsistent operating cash conversion and volatile free cash flow increase uncertainty around funding for capex, dividends and working capital. This volatility impairs long-term planning and raises the likelihood of external financing needs during weaker cash cycles.

Limited Scale / Market Liquidity

A relatively small workforce and thin average trading volume suggest limited scale and lower market liquidity. Smaller scale can restrict R&D breadth, bargaining power with suppliers, and ability to rapidly scale production or absorb shocks compared with larger peers.

Tohoku Chemical Co., Ltd. Business Overview & Revenue Model

Company Description

Tohoku Chemical Co., Ltd., a trading company, sells pesticides, food additives, and industrial chemicals and reagents in Japan. The company offers chemical industrial reagents/chemical industrial reagent-related apparatus. It also provides clinical diagnostic reagents/clinical diagnostic reagent-related equipment, such as kits inspecting for blood or bacteria helpful for medical examination and diagnosis of various diseases; medical devices that include clinical inspection apparatus and medical imaging systems; and external body diagnosing medicines, medical devices, medical materials, etc. In addition, the company offers food additives/food processing apparatus; and reagents for product inspection analysis hygiene materials, detergents, pesticides, and water treatment, as well as materials for transfer, analytical inspection, and product development. Further, it offers agricultural materials, such as pesticides, soil improvement materials, and agriculture-related materials; agricultural facilities, including steel greenhouses for floriculture; and healthcare products. In addition, the company engages in the sale and repair of computers, scientific instruments, medical equipment, educational devices, and measuring equipment; and cultivation and sale of flowers. Tohoku Chemical Co., Ltd. was founded in 1953 and is headquartered in Hirosaki, Japan.

How the Company Makes Money

Tohoku Chemical Co., Ltd. generates revenue through the sale of its specialty chemicals and materials across various industries. Its revenue model is primarily based on B2B transactions, where it supplies products to manufacturers in the electronics, automotive, and pharmaceutical sectors. Key revenue streams include the sale of high-performance resins and adhesives, which are essential in various applications such as circuit boards and automotive components. The company may also benefit from long-term contracts with major clients, ensuring a steady influx of revenue. Additionally, strategic partnerships with other firms in related industries can contribute to joint product development and expand market reach, further enhancing its earnings potential.

Tohoku Chemical Co., Ltd. Financial Statement Overview

Summary

Tohoku Chemical Co., Ltd. demonstrates stable financial performance with consistent revenue growth and efficient cost management. However, profitability margins and cash flow stability need improvement. The company's low leverage and strong equity base provide a solid foundation for future growth.

Income Statement

Tohoku Chemical Co., Ltd. has shown a consistent revenue growth trend, with a recent growth rate of 1.073% in the latest year. The gross profit margin has remained stable around 9-10%, indicating efficient cost management. However, the net profit margin has been relatively low, suggesting room for improvement in profitability. The EBIT and EBITDA margins have shown slight fluctuations but remain positive, reflecting operational efficiency.

Balance Sheet

The company's balance sheet is stable with a low debt-to-equity ratio, indicating prudent financial leverage. The equity ratio is healthy, showing a strong equity base relative to total assets. However, the return on equity has decreased over the years, signaling a need for improved profitability to enhance shareholder returns.

Cash Flow

The cash flow statement reveals a volatile free cash flow growth rate, with recent improvements. The operating cash flow to net income ratio has been inconsistent, indicating potential challenges in converting earnings into cash. The free cash flow to net income ratio is positive, suggesting that the company is generating cash relative to its net income, but there is room for improvement in cash flow stability.

Breakdown	Sep 2025	Sep 2024	Sep 2023	Sep 2022	Sep 2021
Income Statement
Total Revenue	34.44B	32.16B	35.09B	37.33B	36.22B
Gross Profit	3.29B	3.14B	3.34B	3.47B	3.18B
EBITDA	809.63M	551.46M	886.70M	1.07B	841.78M
Net Income	428.80M	237.45M	556.19M	657.62M	516.73M
Balance Sheet
Total Assets	18.42B	17.24B	18.92B	17.52B	16.13B
Cash, Cash Equivalents and Short-Term Investments	924.60M	763.00M	2.25B	1.41B	799.00M
Total Debt	813.75M	783.39M	576.30M	597.49M	714.65M
Total Liabilities	10.40B	9.73B	11.65B	10.84B	9.85B
Stockholders Equity	7.93B	7.42B	7.18B	6.61B	6.23B
Cash Flow
Free Cash Flow	134.36M	-1.22B	919.08M	814.79M	284.36M
Operating Cash Flow	154.37M	-1.04B	1.27B	886.12M	322.34M
Investing Cash Flow	14.59M	-107.84M	-335.38M	-92.01M	-171.79M
Financing Cash Flow	-2.95M	-209.98M	-95.52M	-185.64M	-221.00M

Tohoku Chemical Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 3835.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:7446, the sentiment is Positive. The current price of 3835 is below the 20-day moving average (MA) of 4351.25, below the 50-day MA of 4048.00, and below the 200-day MA of 3900.85, indicating a bullish trend. The MACD of 198.13 indicates Negative momentum. The RSI at 81.38 is Negative, neither overbought nor oversold. The STOCH value of 92.86 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:7446.

Tohoku Chemical Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
4625	80 Outperform	¥4.64B	13.73	―	2.27%	1.79%	31.63%
4247	75 Outperform	¥3.88B	17.69	―	2.98%	7.64%	37.45%
4120	71 Outperform	¥3.23B	17.49	―	3.15%	1.14%	50.47%
7446	65 Neutral	¥4.38B	8.09	―	3.29%	7.11%	80.59%
4098	64 Neutral	¥3.62B	84.76	―	1.28%	-1.01%	―
Sector *	61 Neutral	$10.43B	7.12	-0.05%	2.87%	2.86%	-36.73%
5103	52 Neutral	¥3.34B	-8.50	―	―	-3.45%	56.08%

Tohoku Chemical Co., Ltd. Corporate Events

Tohoku Chemical Delivers Strong Profit Growth on Flat Sales in First Quarter

Tohoku Chemical Co., Ltd. reported first-quarter consolidated results for the period ended December 2025 showing largely flat revenue but sharply improved profitability. Net sales edged down 0.8% year-on-year to ¥8,885 million, but operating profit more than doubled to ¥241 million, ordinary profit rose 92.2% to ¥267 million, and profit attributable to owners of parent jumped 116.5% to ¥196 million, lifting basic earnings per share to ¥217.61. Comprehensive income also surged 218.1% to ¥285 million. On the balance sheet, total assets increased to ¥20,515 million and net assets to ¥8,173 million, though the capital adequacy ratio slipped from 43.0% to 39.4%, indicating expansion accompanied by some dilution of capital strength. Overall, the results suggest improved cost efficiency or margin enhancement despite slightly lower sales, supporting a stronger earnings profile at the start of the fiscal year, while the modest decline in the capital ratio will be monitored by investors as the company continues to grow its asset base.

The most recent analyst rating on (JP:7446) stock is a Buy with a Yen4313.00 price target. To see the full list of analyst forecasts on Tohoku Chemical Co., Ltd. stock, see the JP:7446 Stock Forecast page.