Hokkaido Gas Co., Ltd. (9534) AI Stock Analysis

• Market Cap: ¥81.03B
• Dividend Yield: 2.88%
• Average Volume (3M): 96.14K
• Price to Earnings (P/E): 6.5
• Beta (1Y): 0.68
• Revenue Growth: 2.77%
• EPS Growth: 10.64%
• Country: JP
• Employees: 1,536
• Sector: Utilities
• Sector Strength: 65
• Industry: Regulated Gas
• EPS (TTM): 9.98
• Shares Outstanding: 88,689,030
• 10 Day Avg. Volume: 73,430
• 30 Day Avg. Volume: 96,140
• PEG Ratio: -0.41
• Price to Book (P/B): 0.52
• Price to Sales (P/S): 0.26
• P/FCF Ratio: 3.03
• 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: 74 Outperform
• Price Target: ¥1,019.00 ▲(49.41% Upside)
• Action: Reiterated Date: 01/31/26
• Date: Action: Reiterated 01/31/26

The score is driven primarily by solid financial performance (improving profitability and reduced leverage, offset by volatile and weakening free-cash-flow trends), supported by strong technical uptrend signals and an attractive valuation (low P/E with a moderate dividend yield).

Positive Factors

Regulated utility model

As a regulated city-gas provider with tariffs and diversified end customers (residential, commercial, industrial), the company benefits from structural demand stability and predictable cash flows. Tariff mechanisms allow cost pass-through over time, supporting durable revenue and margin baselines.

Improving profitability and margins

Recent TTM margin expansion and a 17% revenue uplift reflect stronger operating performance and pricing recovery. Healthy sector margins and improving top-line momentum indicate sustainable earnings power, supporting long-term cash generation if volatility in volumes and costs remains managed.

Balance-sheet deleveraging

Meaningful reduction in debt-to-equity enhances financial flexibility and lowers refinancing and interest-rate vulnerability. Improved leverage supports capacity for necessary capex, regulatory obligations and steadier dividend policy, strengthening the firm's resilience over the medium term.

Negative Factors

Free cash flow volatility

Volatile and recently weakening free cash flow undermines the predictability of internal funding for capex, dividends and debt servicing. Even with positive operating cash flow, inconsistent FCF reduces confidence in sustainable shareholder returns and raises dependence on external financing.

Inconsistent revenue trajectory

Episodic top-line performance indicates sensitivity to demand drivers (weather, industrial activity) and tariff timing. This inconsistency makes medium-term earnings forecast less reliable and could amplify the impact of adverse shocks on profitability and cash generation.

Upstream fuel cost exposure

Dependence on LNG and other feedstock procurement exposes margins to global fuel-price swings. When cost pass-through via tariffs is delayed or incomplete, input-price volatility can compress margins and impair free cash flow, posing a structural performance risk over the next several months.

Hokkaido Gas Co., Ltd. Business Overview & Revenue Model

Company Description

Hokkaido Gas Co., Ltd. engages in gas, and heat and power supply businesses in Japan. The company is also involved in the purification and sale of gas by-products; production and sale of gas appliances, as well as related construction works; and other related works. It offers its services in Sapporo, Otaru, Hakodate, Chitose, Ishikari, Kitahiroshima, Eniwa, Hokuto, and Kitami. Hokkaido Gas Co., Ltd. was founded in 1911 and is headquartered in Sapporo, Japan.

How the Company Makes Money

Hokkaido Gas Co., Ltd. generates revenue primarily through the sale and distribution of natural gas to residential, commercial, and industrial customers. The company charges customers for the volume of gas consumed, which is measured in cubic meters. In addition to gas sales, Hokkaido Gas also earns income from related services, such as installation and maintenance of gas appliances and infrastructure. Strategic partnerships with local governments and businesses enhance their market reach and customer base. The company's revenue is influenced by factors such as natural gas prices, regulatory changes, and demand fluctuations in the energy market.

Hokkaido Gas Co., Ltd. Financial Statement Overview

Summary

Fundamentals are solid for a regulated utility: improving profitability and strong recent revenue growth (~17% TTM) support the score, and leverage has improved (debt-to-equity ~0.64 TTM vs ~1.0x in prior years). The main constraint is cash-flow quality and consistency—free cash flow has been volatile (including a negative year historically) and recently decelerated, with only moderate cash conversion.

Income Statement

TTM (Trailing-Twelve-Months) results show solid profitability for a regulated utility profile, with gross margin ~31%, EBIT margin ~10%, and net margin ~7%. Revenue growth accelerated to ~17% in TTM after slightly negative growth in FY2025 and FY2024, indicating improving top-line momentum. The main weakness is that revenue growth has been inconsistent over the last several years, which can make earnings momentum less predictable even though margins have been trending better recently.

Balance Sheet

Leverage has improved meaningfully: debt-to-equity is ~0.64 in TTM versus ~0.98–1.03 in FY2024–FY2023, reflecting better balance-sheet flexibility. Return on equity is healthy for the sector at ~13.9% TTM. The key risk is that absolute debt remains sizable, and the company has a history of running near-1.0x debt-to-equity in prior years, so balance-sheet strength is improved but not structurally low-leverage.

Cash Flow

Cash generation is positive, with TTM operating cash flow of ~¥29.9B and free cash flow of ~¥16.1B, and free cash flow covering ~54% of net income. However, free cash flow growth is negative in TTM, and cash conversion is only moderate (operating cash flow is well below the level that would fully cover reported earnings on a one-for-one basis). Historical volatility is also notable, including a year with negative free cash flow (FY2023), which lowers confidence in consistency.

Breakdown	TTM	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	173.93B	170.29B	173.88B	174.84B	126.96B	118.16B
Gross Profit	54.64B	50.37B	49.09B	44.94B	37.00B	34.29B
EBITDA	33.31B	29.81B	30.28B	27.77B	21.25B	19.97B
Net Income	12.46B	10.40B	11.63B	9.96B	5.24B	4.29B
Balance Sheet
Total Assets	195.22B	195.43B	186.37B	183.80B	160.43B	151.22B
Cash, Cash Equivalents and Short-Term Investments	8.79B	11.32B	9.47B	2.72B	9.57B	6.14B
Total Debt	58.36B	62.60B	75.16B	67.78B	58.51B	73.66B
Total Liabilities	101.57B	106.94B	107.37B	115.80B	101.24B	96.99B
Stockholders Equity	91.39B	86.35B	76.89B	65.89B	57.12B	52.19B
Cash Flow
Free Cash Flow	16.09B	14.73B	15.86B	-14.60B	8.22B	11.66B
Operating Cash Flow	29.91B	29.83B	31.68B	6.70B	19.71B	22.40B
Investing Cash Flow	-15.93B	-20.06B	-16.75B	-22.56B	-11.11B	-10.25B
Financing Cash Flow	-8.13B	-7.92B	-8.17B	9.03B	-5.18B	-7.55B

Hokkaido Gas Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 682.00
• 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:9534, the sentiment is Positive. The current price of 682 is below the 20-day moving average (MA) of 882.75, below the 50-day MA of 826.60, and below the 200-day MA of 686.97, indicating a bullish trend. The MACD of 21.84 indicates Positive momentum. The RSI at 64.69 is Neutral, neither overbought nor oversold. The STOCH value of 79.03 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:9534.

Hokkaido Gas Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
9536	76 Outperform	¥96.23B	9.60	9.07%	3.61%	9.39%	77.24%
9543	75 Outperform	¥112.86B	11.41	8.29%	3.89%	1.08%	37.11%
9534	74 Outperform	¥81.03B	6.47	―	2.88%	2.77%	10.64%
9533	73 Outperform	¥552.76B	19.60	6.03%	1.81%	7.08%	43.50%
9537	69 Neutral	¥21.64B	6.96	―	2.18%	6.66%	―
Sector *	66 Neutral	$17.65B	18.10	5.60%	3.62%	6.62%	11.55%
9539	62 Neutral	¥45.31B	13.92	―	1.81%	0.93%	1212.45%

Hokkaido Gas Co., Ltd. Corporate Events

Hokkaido Gas Lifts Profits and Full-Year Outlook on Strong Nine-Month Results

Hokkaido Gas Co., Ltd. reported consolidated net sales of ¥114.8 billion for the nine months ended December 31, 2025, up 3.3% year on year, with operating profit surging 56.0% to ¥8.1 billion and profit attributable to owners of parent climbing 55.2% to ¥5.8 billion, reflecting improved profitability and higher comprehensive income. The company’s financial position also strengthened, as equity increased and the equity-to-asset ratio rose to 46.8%, while it maintained its dividend forecast of ¥23.00 per share for the fiscal year ending March 31, 2026 and revised its full-year earnings outlook upward, signaling confidence in continued earnings growth and offering increased visibility for shareholders and other stakeholders.

For the full year ending March 31, 2026, Hokkaido Gas now forecasts net sales of ¥175.0 billion and operating and ordinary profit of ¥15.5 billion, with profit attributable to owners of parent projected at ¥11.2 billion, all modestly higher than the prior year, underscoring a stable growth trajectory. The sharp year-on-year rebound in profits after a weaker prior period suggests the company is benefiting from better cost control or market conditions in its gas and energy operations, reinforcing its competitive position in the regional utility sector and supporting its ability to sustain dividends.

The most recent analyst rating on (JP:9534) stock is a Buy with a Yen930.00 price target. To see the full list of analyst forecasts on Hokkaido Gas Co., Ltd. stock, see the JP:9534 Stock Forecast page.

Hokkaido Gas Lifts Full-Year Earnings Forecast on Stronger Demand and Efficiency Gains

Hokkaido Gas has raised its full-year consolidated and non-consolidated earnings forecasts for the fiscal year ending March 31, 2026, citing higher-than-expected gas sales volumes driven by temperature-related demand, steady growth in customer numbers, and ongoing efficiency gains. The company now projects consolidated net sales of ¥175.0 billion and profit attributable to owners of parent of ¥11.17 billion, both above prior guidance and last year’s results, signaling stronger profitability and underscoring the benefits of its proactive demand development initiatives for stakeholders, including shareholders and customers.

The most recent analyst rating on (JP:9534) stock is a Buy with a Yen925.00 price target. To see the full list of analyst forecasts on Hokkaido Gas Co., Ltd. stock, see the JP:9534 Stock Forecast page.

Hokkaido Gas Lifts Nine-Month Profit Over 50% and Raises Full-Year Forecast

Hokkaido Gas reported consolidated net sales of ¥114.8 billion for the nine months ended December 31, 2025, up 3.3% year on year, with operating profit surging 56.0% to ¥8.1 billion and profit attributable to owners of parent jumping 55.2% to ¥5.8 billion, reflecting a strong recovery in earnings and improved profitability versus the prior-year period. The company’s equity-to-asset ratio improved to 46.8% from 44.1% as net assets rose to ¥93.6 billion, while it maintained its dividend plan for the fiscal year ending March 31, 2026 at a total of ¥23.00 per share; at the same time, Hokkaido Gas revised its full-year forecast upward to net sales of ¥175.0 billion and profit attributable to owners of parent of ¥11.2 billion, signaling confidence in sustained earnings growth and a stronger financial footing for stakeholders.

The most recent analyst rating on (JP:9534) stock is a Buy with a Yen925.00 price target. To see the full list of analyst forecasts on Hokkaido Gas Co., Ltd. stock, see the JP:9534 Stock Forecast page.

Hokkaido Gas to Consolidate Ishikari Gas-Fired Power Business in Wholly Owned Subsidiary

Hokkaido Gas will transfer the assets, rights and obligations of its natural gas-fired thermal power generation business at the Kitagas Ishikari Power Plant to its wholly owned subsidiary Energy Solution Co., Ltd. via an absorption-type company split effective February 1, 2026. By consolidating gas-fired power generation operations under Energy Solution, which already has experience in power generation and cogeneration, the company aims to strengthen operational and technical know-how in a power source it views as having long-term competitiveness; the internal reorganization involves no change in share capital, no consideration or new securities issued, requires no general meeting approval, and is not expected to impair the financial soundness or obligation-fulfillment capacity of either entity, suggesting limited immediate impact on shareholders but clearer structural positioning for future power business development.

The most recent analyst rating on (JP:9534) stock is a Buy with a Yen823.00 price target. To see the full list of analyst forecasts on Hokkaido Gas Co., Ltd. stock, see the JP:9534 Stock Forecast page.

Hokkaido Gas Completes Adjusted Disposal of Treasury Shares for Employee Share Plan

Hokkaido Gas has completed payment procedures for the disposal of treasury shares under its restricted stock allotment system through the company’s Employee Shareholding Association, as previously approved by its board on July 31, 2025. Due to a partial forfeiture of rights tied to the final number of participating association members, the number of common shares disposed of was reduced from 36,200 to 25,420, lowering the total disposal value from 21,394,200 yen to 15,023,220 yen, while maintaining the disposal price at 591 yen per share; this adjustment fine-tunes the scale of the employee-focused equity incentive without altering its core structure.

The most recent analyst rating on (JP:9534) stock is a Buy with a Yen823.00 price target. To see the full list of analyst forecasts on Hokkaido Gas Co., Ltd. stock, see the JP:9534 Stock Forecast page.