Hanwa Co., Ltd. (8078) AI Stock Analysis

• Market Cap: ¥316.97B
• Dividend Yield: 3.38%
• Average Volume (3M): 84.03K
• Price to Earnings (P/E): 7.9
• Beta (1Y): 0.96
• Revenue Growth: 3.44%
• EPS Growth: 6.97%
• Country: JP
• Employees: 5,508
• Sector: Industrials
• Sector Strength: 72
• Industry: Conglomerates
• EPS (TTM): 226.42
• Shares Outstanding: 42,332,640
• 10 Day Avg. Volume: 85,930
• 30 Day Avg. Volume: 84,033
• PEG Ratio: 0.23
• Price to Book (P/B): 0.52
• Price to Sales (P/S): 0.08
• P/FCF Ratio: 120.70
• 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): 1,014.61
• Revenue Forecast (FY): ¥2.57T

• Rating: 78 Outperform
• Price Target: ¥8,892.00 ▲(24.02% Upside)
• Action: Reiterated Date: 02/13/26
• Date: Action: Reiterated 02/13/26

The score is driven primarily by solid financial performance (strong revenue/profitability and a stable balance sheet) and attractive valuation (low P/E with a healthy dividend). Technicals remain supportive due to a clear uptrend, but overbought readings (high RSI/Stoch) reduce the overall score due to near-term pullback risk.

Positive Factors

Consistent Revenue and Profitability

Hanwa's multi-year revenue growth and consistent profitability signal durable demand for its trading and distribution services. Stable margins and large TTM revenue provide scale advantages, enabling continued investment in operations and resilience to modest volume or price fluctuations over the next several months.

Solid Capital Efficiency and Equity Base

A near-1x debt-to-equity and double-digit ROE reflect efficient use of capital and a meaningful equity cushion. This balance supports funding trading inventories and working-capital needs while preserving flexibility for strategic spending, helping the company absorb shocks and maintain operations over a multi-month horizon.

Diversified trading and supply-chain business model

Hanwa's sogo shosha model—trading, logistics, processing coordination and risk-management—creates multiple revenue streams and deep customer ties. This structural mix reduces single-market dependence, supports repeat business, and secures steady gross-margin capture through services that remain relevant over the coming months.

Negative Factors

Weak Cash Conversion

Very low free cash flow conversion indicates earnings are not translating into liquid resources, likely due to working-capital intensity in trading. Over 2-6 months this constrains capacity to self-fund growth, raises sensitivity to inventory swings, and may pressure dividend or capex plans if conditions tighten.

Significant Total Debt Exposure

Although leverage appears balanced, the company's material absolute debt raises interest-rate and refinancing risk. In a prolonged downturn or rising-rate environment, debt servicing could compress margins and reduce strategic flexibility, making the firm more vulnerable across the medium term.

Thin Trading Margins

Low absolute margins are typical for commodity and trading businesses but leave limited buffer against adverse price moves or competitive pressure. Sustaining profitability depends on volume and spread management; margin compression would materially reduce net income and raise reliance on higher turnover to meet targets over coming months.

Hanwa Co., Ltd. Business Overview & Revenue Model

Company Description

Hanwa Co., Ltd. trades in steel, metals and alloys, nonferrous metals, food products, petroleum and chemicals, lumber, machinery, and other products in Japan and internationally. The company's Steel Division sells steel bars, shapes, sheets, pipes, tubes, wires, plates, building materials, and ferrous raw materials; aluminum sheets, extrusion molding materials, and processed aluminum products; and automotive steel parts. Its Metal Recycling and Primary Metal Division offers aluminum, copper, zinc, lead, stainless steel, and nickel ingots, as well as ferroalloys of chromium, silicon ore, and manganese; and recycles copper, aluminum, zinc, lead, tin, and stainless steel scraps. The company's Food Products Division provides seafood products, such as salmon, prawns and shrimp, octopus, mackerel, horse mackerel, herring roe, capelin, crab, chicken, and others. Its Energy and Living Materials Division offers heavy oil, kerosene, LPG, LNG, industrial gas, bunker oil, gasoline, diesel, lubricating oil, biomass energy, PKS, wood pellets, recycled heavy oil, RPF, discarded tires, discarded building-material chips, raw materials for lubricating oil additives, and chemicals, as well as paper and used paper products to steel, chemicals, and paper and pulp sectors. This division also provides synthetic resin raw materials and plastic products that include polyethylene, polypropylene, and polystyrene. The company's Lumber & Plywood Division imports and sells lumber, plywood, and other wood products that include coniferous plywood, laminar and genban, precut, and CAD drawing products, as well as structural and non-structural materials, steel ceiling joists, plaster boards and insulating materials, interior and exterior building materials, and unit reinforcing bars to building material trading companies, building material manufacturers, sales agents, wholesalers, home builders, and other companies. Hanwa Co., Ltd. was incorporated in 1947 and is headquartered in Osaka, Japan.

How the Company Makes Money

Hanwa primarily makes money by acting as an intermediary and solution provider in physical supply chains—buying materials and products from upstream producers and selling them to downstream manufacturers, processors, and end users—earning gross profit on the spread between procurement and sales prices. Key revenue streams typically include: (1) Trading and distribution margins from steel products (e.g., sourcing steel from mills and supplying processors, fabricators, and manufacturers), where earnings depend on sales volume, product mix, and market price spreads; (2) Trading of metals and mineral resources, where the company sources non-ferrous metals and raw materials from domestic and overseas suppliers and sells to industrial customers, generating profit from price spreads and transaction volumes; (3) Supply-chain services such as inventory holding, logistics coordination, processing coordination, and just-in-time delivery, which support margin capture and can also generate service-related fees where applicable; and (4) Financing and risk-management functions commonly embedded in trading operations (e.g., providing credit terms to customers, coordinating letters of credit, and managing price/FX exposure), which can contribute to earnings through improved transaction capability and, where disclosed, finance-related income. The company’s profitability is influenced by commodity price movements (which affect inventory valuation and trading spreads), demand conditions in manufacturing and construction end markets, global supply availability, foreign exchange rates, and the effectiveness of risk controls and working-capital management. Specific segment-level revenue splits, named partnerships, and contract structures are null.

Hanwa Co., Ltd. Financial Statement Overview

Summary

Strong income statement quality (revenue growth and consistent profitability) and a stable balance sheet (debt-to-equity ~0.99, ROE ~11.9%), but cash conversion is weak (very low free cash flow to net income and modest operating cash flow to net income), which tempers the overall financial strength.

Income Statement

Hanwa Co., Ltd. has demonstrated strong revenue growth with a consistent increase in total revenue over the past years, culminating in a TTM revenue of ¥2,554.51 billion. The gross profit margin is solid at 5.50%, and the net profit margin is healthy at 1.78%. The EBIT margin of 2.41% and EBITDA margin of 3.30% indicate efficient operational performance. The company has shown resilience and stability in its income generation, with consistent profitability metrics.

Balance Sheet

The company's balance sheet reflects a stable financial position with a debt-to-equity ratio of 0.99, indicating balanced leverage. The equity ratio stands at 32.86%, showcasing a strong equity base compared to total assets. The return on equity (ROE) is impressive at 11.88%, highlighting efficient utilization of equity capital. However, the total debt level remains significant, which could pose a risk if not managed carefully.

Cash Flow

Hanwa Co., Ltd.'s operating cash flow is positive at ¥10.13 billion, but there is a decline in free cash flow from the previous year, indicating a need for better cash flow management. The free cash flow to net income ratio is 0.04, suggesting that only a small portion of net income is being converted into free cash flow. The operating cash flow to net income ratio of 0.22 indicates less efficient cash generation from operations compared to net income.

Breakdown	TTM	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	2.58T	2.55T	2.43T	2.67T	2.16T	1.75T
Gross Profit	143.33B	140.61B	119.84B	128.54B	119.01B	79.92B
EBITDA	73.14B	71.58B	59.16B	71.67B	68.88B	35.18B
Net Income	46.25B	45.48B	38.42B	51.51B	43.62B	19.62B
Balance Sheet
Total Assets	1.14T	1.17T	1.17T	1.16T	1.72T	824.59B
Cash, Cash Equivalents and Short-Term Investments	74.42B	65.31B	76.53B	84.19B	165.45B	50.91B
Total Debt	377.32B	382.33B	365.45B	380.98B	722.94B	301.65B
Total Liabilities	754.26B	776.33B	810.22B	848.94B	1.47T	632.73B
Stockholders Equity	381.43B	383.06B	351.21B	303.13B	237.12B	189.22B
Cash Flow
Free Cash Flow	0.00	1.64B	8.56B	271.37B	-287.04B	12.67B
Operating Cash Flow	0.00	10.13B	18.19B	284.23B	-280.75B	19.00B
Investing Cash Flow	0.00	-21.84B	1.01B	-6.54B	-14.99B	-4.19B
Financing Cash Flow	0.00	293.00M	-26.32B	-351.83B	406.82B	-34.22B

Hanwa Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 7170.00
• 50DMA: Negative
• 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:8078, the sentiment is Negative. The current price of 7170 is below the 20-day moving average (MA) of 8380.00, below the 50-day MA of 8223.80, and above the 200-day MA of 6755.72, indicating a neutral trend. The MACD of -118.28 indicates Positive momentum. The RSI at 38.52 is Neutral, neither overbought nor oversold. The STOCH value of 44.65 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:8078.

Hanwa Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
8078	78 Outperform	¥316.97B	7.92	11.34%	3.38%	3.44%	6.97%
8002	74 Outperform	¥9.21T	14.11	13.39%	2.29%	9.62%	25.71%
8001	71 Outperform	$15.74T	16.87	15.23%	2.11%	0.93%	15.80%
8015	70 Outperform	¥6.65T	13.91	13.49%	2.10%	5.32%	9.73%
8031	67 Neutral	¥17.84T	17.68	11.47%	2.28%	-1.33%	-7.40%
2768	65 Neutral	¥1.19T	7.20	11.17%	3.24%	2.12%	18.93%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%

Hanwa Co., Ltd. Corporate Events

Hanwa Completes ¥5 Billion Share Buyback Tranche on Tokyo Stock Exchange

Hanwa Co., Ltd., a listed Japanese trading company, continues to use share repurchases as a tool to manage its capital structure and enhance shareholder value, acquiring its own common stock on the Tokyo Stock Exchange under a board-approved program. The company’s reliance on authorized buybacks under Japan’s Corporation Law highlights an ongoing strategy of capital allocation through market-based purchases of its shares.

Hanwa announced that it has completed a new tranche of its share buyback program, purchasing 187,800 common shares for about 1.6 billion yen between February 1 and 24, 2026 via the Tokyo Stock Exchange. Under the broader board resolution effective from November 2025, the company has now acquired a total of 659,500 shares for approximately 5.0 billion yen, effectively reaching the authorized monetary limit and signaling a completed execution phase that could support earnings per share and shareholder returns.

The most recent analyst rating on (JP:8078) stock is a Hold with a Yen9548.00 price target. To see the full list of analyst forecasts on Hanwa Co., Ltd. stock, see the JP:8078 Stock Forecast page.

Hanwa Posts Higher Sales but Lower Profits, Keeps Dividend and Full-Year Outlook Intact

For the nine months ended December 31, 2025, Hanwa Co., Ltd. reported a slight 2.4% increase in consolidated net sales to ¥1,965.5 billion, but operating profit fell 12.5% to ¥41.5 billion and profit attributable to owners of parent declined 19.3% to ¥25.7 billion, reflecting margin pressure despite top-line growth. Total assets stood at ¥1,145.7 billion while net assets rose to ¥405.3 billion, lifting the equity ratio to 34.9% and net assets per share to ¥10,177.82; the company maintained its full-year forecast, targeting modest 1.8% sales growth with double‑digit profit declines and confirmed an annual dividend of ¥250 per share, signaling continued shareholder returns even as earnings soften and the consolidation scope expands with three newly added subsidiaries.

The most recent analyst rating on (JP:8078) stock is a Buy with a Yen8840.00 price target. To see the full list of analyst forecasts on Hanwa Co., Ltd. stock, see the JP:8078 Stock Forecast page.

Hanwa Continues Share Buyback, Repurchasing 187,600 Shares in January

Hanwa Co., Ltd. reported that it repurchased 187,600 shares of its common stock on the Tokyo Stock Exchange between January 1 and January 31, 2026, for a total consideration of approximately 1.45 billion yen, as part of a previously authorized share buyback program. Under the board authorization granted in November 2025 to acquire up to 1,000,000 shares (with a ceiling of 5.0 billion yen) through September 30, 2026, the company has cumulatively bought back 471,700 shares for about 3.40 billion yen by the end of January 2026, signaling continued execution of its capital policy aimed at improving shareholder value and capital efficiency.

The most recent analyst rating on (JP:8078) stock is a Buy with a Yen8685.00 price target. To see the full list of analyst forecasts on Hanwa Co., Ltd. stock, see the JP:8078 Stock Forecast page.

Hanwa Announces Change in Representative Director as Part of Management Restructuring

Hanwa Co., Ltd. has announced a change in its top management structure, with Representative Director and Executive Vice President Hiromasa Yamamoto set to retire from his role as Representative Director. Effective April 1, 2026, Yamamoto will continue at the company as a Director and Executive Vice President without representation rights, with the transition formally scheduled for March 31, 2026, signaling a reorganization of the firm’s leadership framework.

The most recent analyst rating on (JP:8078) stock is a Buy with a Yen8641.00 price target. To see the full list of analyst forecasts on Hanwa Co., Ltd. stock, see the JP:8078 Stock Forecast page.

Hanwa Reports Progress on Ongoing Share Buyback Program

Hanwa Co., Ltd. has disclosed the progress of its share buyback program authorized by its board in November 2025. Between December 1 and December 31, 2025, the company repurchased 137,400 shares of its common stock on the Tokyo Stock Exchange at a total cost of ¥967.8 million, bringing cumulative repurchases under the current authorization to 284,100 shares for ¥1.95 billion by the end of December. The buyback is part of a broader program allowing purchases of up to 1,000,000 shares (2.5% of issued shares) or ¥5.0 billion through September 30, 2026, with the maximum number rising to 5,000,000 shares after an April 2026 stock split, underscoring Hanwa’s ongoing capital management efforts and potential support for shareholder value.

The most recent analyst rating on (JP:8078) stock is a Buy with a Yen7431.00 price target. To see the full list of analyst forecasts on Hanwa Co., Ltd. stock, see the JP:8078 Stock Forecast page.