Hakudo Co., Ltd. (7637) AI Stock Analysis

• Market Cap: ¥26.20B
• Dividend Yield: 3.85%
• Average Volume (3M): 18.80K
• Price to Earnings (P/E): 14.2
• Beta (1Y): 0.85
• Revenue Growth: 16.20%
• EPS Growth: -13.47%
• Country: JP
• Employees: 390
• Sector: Industrials
• Sector Strength: 70
• Industry: Manufacturing - Metal Fabrication
• EPS (TTM): 25.61
• Shares Outstanding: 11,343,300
• 10 Day Avg. Volume: 10,100
• 30 Day Avg. Volume: 18,796
• 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: ¥2,564.00
• Price Target Upside: 11.00% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 1

• Rating: 72 Outperform
• Price Target: ¥2,564.00 ▲(11.00% Upside)

Hakudo Co., Ltd. has a solid financial foundation with strong balance sheet metrics and improving cash flow management. The valuation is attractive with a reasonable P/E ratio and a high dividend yield. However, technical indicators suggest potential short-term weakness, which slightly tempers the overall score.

Positive Factors

Revenue Growth

Consistent revenue growth indicates strong demand for Hakudo's products and effective market strategies, supporting long-term business expansion.

Financial Stability

Low leverage enhances financial flexibility and reduces risk, providing a stable foundation for future growth and investment opportunities.

Cash Flow Management

Improved cash flow management enhances liquidity and supports reinvestment in business operations, driving sustainable growth.

Negative Factors

Profitability Margins

Pressure on profitability margins may limit reinvestment capabilities and affect competitive positioning in the long term.

Operational Efficiency

Decreasing operational efficiency can impact cost management and profitability, potentially hindering long-term growth.

Earnings Growth

Negative EPS growth suggests challenges in profitability and may affect investor confidence, impacting future capital raising and expansion efforts.

Hakudo Co., Ltd. Business Overview & Revenue Model

Company Description

Hakudo Co., Ltd. (7637) is a Japanese company engaged primarily in the manufacturing and distribution of high-quality industrial adhesive products. Operating within the chemical sector, Hakudo specializes in producing adhesives for various applications, including automotive, electronics, and construction industries. The company is recognized for its commitment to innovation and sustainability, offering a diverse range of products that meet the evolving needs of its customers.

How the Company Makes Money

Hakudo Co., Ltd. generates revenue primarily through the sale of its adhesive products to a wide array of industries. The company's revenue model is built on B2B sales, focusing on long-term contracts and relationships with manufacturers in sectors such as automotive and electronics, which require specialized adhesive solutions. Key revenue streams include direct sales of standard and customized adhesive products, as well as consulting services that help clients select and implement the best adhesive solutions for their specific needs. Additionally, Hakudo may engage in partnerships with other manufacturers and suppliers, enhancing its market reach and product offerings, which contributes to its overall earnings.

Hakudo Co., Ltd. Financial Statement Overview

Summary

Hakudo Co., Ltd. demonstrates strong financial health with stable revenue growth and low leverage. While profitability margins are under slight pressure, the company's robust balance sheet and improving cash flow management provide a solid foundation for future growth.

Income Statement

Hakudo Co., Ltd. has shown consistent revenue growth with a 3% increase in the latest year, indicating a positive trajectory. The gross profit margin is stable around 16%, and the net profit margin is modest at 3.37%. However, the EBIT and EBITDA margins have slightly decreased over the years, suggesting some pressure on operational efficiency.

Balance Sheet

The company maintains a very low debt-to-equity ratio, indicating strong financial stability and low leverage risk. Return on equity is healthy at 9.42%, reflecting efficient use of equity capital. The equity ratio is robust, highlighting a solid financial foundation.

Cash Flow

Free cash flow has shown significant growth, but the operating cash flow to net income ratio is relatively low, suggesting potential challenges in converting income into cash. The free cash flow to net income ratio is improving, indicating better cash management.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	66.41B	66.41B	57.25B	61.60B	55.44B	39.22B
Gross Profit	10.30B	10.57B	9.27B	10.15B	10.31B	6.67B
EBITDA	4.41B	4.41B	3.94B	4.62B	5.10B	2.82B
Net Income	2.24B	2.24B	1.92B	2.74B	2.96B	1.28B
Balance Sheet
Total Assets	44.75B	44.75B	42.02B	43.15B	41.78B	33.12B
Cash, Cash Equivalents and Short-Term Investments	5.47B	5.47B	5.70B	6.04B	8.67B	5.92B
Total Debt	75.04M	75.04M	137.83M	350.82M	0.00	0.00
Total Liabilities	20.99B	20.99B	19.53B	21.92B	21.95B	15.25B
Stockholders Equity	23.76B	23.76B	22.48B	21.21B	19.83B	17.87B
Cash Flow
Free Cash Flow	0.00	1.10B	979.20M	-374.37M	3.89B	1.58B
Operating Cash Flow	0.00	1.78B	2.53B	321.45M	4.56B	2.13B
Investing Cash Flow	0.00	-893.35M	-1.61B	-1.55B	-677.06M	-553.00M
Financing Cash Flow	0.00	-1.13B	-1.33B	-1.42B	-1.20B	-657.42M

Hakudo Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 2310.00
• 50DMA: Negative
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:7637, the sentiment is Positive. The current price of 2310 is below the 20-day moving average (MA) of 2310.15, below the 50-day MA of 2347.34, and above the 200-day MA of 2276.63, indicating a neutral trend. The MACD of -12.11 indicates Negative momentum. The RSI at 45.91 is Neutral, neither overbought nor oversold. The STOCH value of 32.80 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:7637.

Hakudo Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
3449	79 Outperform	¥28.64B	14.21		3.47%	15.98%	93.47%
5922	76 Outperform	¥17.32B	9.56		3.08%	2.75%	-9.49%
5757	72 Outperform	¥34.42B	4.99		2.18%	15.50%	146.67%
7637	72 Outperform	¥26.20B	14.25		3.85%	16.20%	-13.47%
7414	72 Outperform	¥35.78B	8.69		4.79%	-7.43%	-27.31%
5852	64 Neutral	¥23.20B	―		3.06%	5.53%	68.16%
Sector *	63 Neutral	$10.84B	15.52	7.44%	2.00%	2.86%	-14.57%

Hakudo Co., Ltd. Corporate Events

Hakudo Co., Ltd. Revises Director Remuneration Plan to Enhance Shareholder Alignment

Hakudo Co., Ltd. announced a revision to its performance-linked remuneration plan, aiming to adjust the ratio of cash and shares with transfer restrictions to better align with shareholder value. The revised plan, set to take effect in July 2026, introduces changes in the remuneration structure for directors, including a shift from cash to shares with transfer restrictions for certain bonuses, while maintaining cash bonuses for outside directors. This move is expected to strengthen the relationship between shareholder interests and director decisions, potentially impacting the company’s governance and stakeholder engagement.

Hakudo Co., Ltd. Reports Q2 2025 Financial Results: Revenue Up, Profits Down

Hakudo Co., Ltd. reported its consolidated financial results for the three months ended June 30, 2025, showing an increase in net sales by 8.3% year-on-year to ¥17,059 million. However, the company experienced a significant decline in profits, with operating profit down by 55.6% and ordinary profit by 52.3%, indicating challenges in maintaining profitability despite revenue growth.