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

• Market Cap: ¥285.68B
• Dividend Yield: 3.49%
• Average Volume (3M): 84.03K
• Price to Earnings (P/E): 6.7
• Beta (1Y): 0.86
• Revenue Growth: 3.44%
• EPS Growth: 6.97%
• Country: JP
• Employees: 5,508
• Sector: Industrials
• Sector Strength: 72
• Industry: Conglomerates
• EPS (TTM): 170.00
• 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: Moderate Buy
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 79 Outperform
• Price Target: ¥7,431.00 ▲(5.70% Upside)

Hanwa Co., Ltd. scores well due to its strong financial performance and attractive valuation. The technical indicators suggest a positive market sentiment, supporting the stock's upward trend. However, the need for improved cash flow management and high debt levels are areas to watch.

Positive Factors

Revenue Growth

Consistent revenue growth indicates a strong market position and effective business strategy, supporting long-term financial stability.

Operational Efficiency

Strong profit margins reflect efficient operations and cost management, enhancing the company's ability to sustain profitability.

Equity Position

A strong equity base provides financial stability and flexibility, enabling the company to invest in growth opportunities.

Negative Factors

High Debt Levels

High debt levels can limit financial flexibility and increase risk, potentially impacting long-term financial health.

Cash Flow Management

Inefficient cash flow management can constrain operational flexibility and limit the company's ability to finance growth initiatives.

Free Cash Flow Conversion

Low free cash flow conversion indicates challenges in translating earnings into cash, which can affect liquidity and investment capacity.

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 Co., Ltd. generates revenue through a multi-faceted business model that includes trading activities, distribution, and logistics services. The company's key revenue streams come from the sale of metals and industrial materials, which are sourced from both domestic and international suppliers. Additionally, Hanwa earns income from value-added services such as processing, storage, and transportation of goods. Strategic partnerships with manufacturers and suppliers enhance its supply chain capabilities, allowing for competitive pricing and reliable delivery. Market demand fluctuations, commodity price changes, and global trade dynamics significantly influence its earnings, while its focus on expanding into emerging markets contributes to revenue growth.

Hanwa Co., Ltd. Financial Statement Overview

Summary

Hanwa Co., Ltd. presents a robust financial profile with consistent revenue growth and profitability. The balance sheet is stable with a strong equity position, though the high debt level requires monitoring. Cash flow management needs improvement to enhance liquidity and operational flexibility.

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	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
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	85.04B	84.25B	72.08B	71.67B	73.73B	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	377.64B	362.04B	377.97B	719.87B	299.87B
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	189.21B
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: Positive
• Last Price: 7030.00
• 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:8078, the sentiment is Positive. The current price of 7030 is above the 20-day moving average (MA) of 6927.50, above the 50-day MA of 6676.80, and above the 200-day MA of 5712.49, indicating a bullish trend. The MACD of 128.19 indicates Positive momentum. The RSI at 57.39 is Neutral, neither overbought nor oversold. The STOCH value of 48.45 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive 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	79 Outperform	¥285.68B	6.74	11.34%	3.49%	3.44%	6.97%
8081	78 Outperform	¥43.70B	11.35	―	3.55%	18.42%	51.06%
8070	74 Outperform	¥26.34B	8.82	―	3.76%	-18.88%	42.17%
8020	73 Outperform	¥288.30B	10.10	―	3.19%	1.50%	9.82%
8088	69 Neutral	¥377.56B	8.16	―	3.44%	4.50%	―
8057	68 Neutral	¥99.43B	9.14	―	2.97%	31.48%	83.15%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%

Hanwa Co., Ltd. Corporate Events

Hanwa Co., Ltd. Announces Share Acquisition Progress

Hanwa Co., Ltd. has announced the acquisition of 146,700 of its own common stock shares, valued at 982,383,000 yen, from November 10 to November 30, 2025. This acquisition is part of a larger plan approved by the Board of Directors to purchase up to 1,000,000 shares by September 30, 2026, as part of its strategic financial management efforts.

Hanwa Co., Ltd. Announces Stock Split and Amendment to Articles of Incorporation

Hanwa Co., Ltd. has announced a stock split and a partial amendment to its Articles of Incorporation. The stock split, set at a ratio of five shares for every one share, aims to enhance share liquidity and broaden the investor base by reducing the price per investment unit. This move will increase the total number of outstanding shares from 42,332,640 to 211,663,200, effective April 1, 2026. Additionally, the Articles of Incorporation will be amended to reflect the new total number of shares authorized to be issued, increasing from 114,000,000 to 570,000,000. These changes are intended to support Hanwa’s strategic goals and potentially impact its market positioning positively.

Hanwa Co., Ltd. Announces Share Buyback Plan to Enhance Shareholder Returns

Hanwa Co., Ltd. has announced a resolution by its Board of Directors to acquire up to 1,000,000 of its own shares, equivalent to 2.5% of the total issued shares, with a maximum total acquisition cost of 5.0 billion yen. This move, scheduled between November 10, 2025, and September 30, 2026, aims to enhance shareholder returns and improve capital efficiency by purchasing shares on the Tokyo Stock Exchange.

Hanwa Co., Ltd. Reports Mixed Financial Results for First Half of 2025

Hanwa Co., Ltd. reported its consolidated financial results for the six months ended September 30, 2025, showing a slight increase in net sales by 1.6% to ¥1,279,141 million. However, the company experienced a decline in operating profit by 4.0% and ordinary profit by 15.2%, with profit attributable to owners of the parent dropping by 17.2%. Despite these declines, Hanwa’s equity-to-asset ratio improved to 34.6%, indicating a stronger financial position. The company also announced an increase in annual dividends per share, reflecting a commitment to returning value to shareholders.

Hanwa Co., Ltd. Completes Share Buyback

Hanwa Co., Ltd. has completed the acquisition of its own shares, purchasing 131,800 shares of common stock for a total value of 843,559,000 yen on the Tokyo Stock Exchange. This move is part of a larger plan authorized by the Board of Directors to acquire up to 1,250,000 shares, aiming to enhance shareholder value and optimize capital structure.