Hiroshima Gas Co., Ltd. (9535) AI Stock Analysis

• Market Cap: ¥26.39B
• Dividend Yield: 3.13%
• Average Volume (3M): 105.86K
• Price to Earnings (P/E): 16.7
• Beta (1Y): 0.44
• Revenue Growth: 2.11%
• EPS Growth: -9.10%
• Country: JP
• Employees: 1,667
• Sector: Energy
• Sector Strength: 63
• Industry: Oil & Gas Integrated
• EPS (TTM): 8.34
• Shares Outstanding: 68,737,430
• 10 Day Avg. Volume: 41,980
• 30 Day Avg. Volume: 105,863
• 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: ¥438.00
• Price Target Upside: 14.06% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 0

• Rating: 71 Outperform
• Price Target: ¥438.00 ▲(14.06% Upside)

Hiroshima Gas Co., Ltd. scores 71, primarily driven by positive technical indicators showing strong upward momentum, despite being in an overbought state. Financial performance is stable, with challenges in revenue and cash flow that require strategic focus. Valuation metrics suggest the stock is fairly valued with a good dividend yield.

Positive Factors

Equity Base

A strong equity base provides financial stability and resilience, allowing the company to withstand market fluctuations and invest in growth opportunities.

Operational Efficiency

Sustained operational efficiency, as indicated by a strong EBITDA margin, supports long-term profitability and competitive positioning in the market.

Dividend Commitment

Continued dividend payouts reflect management's confidence in cash flow stability and commitment to delivering value to shareholders, enhancing investor trust.

Negative Factors

Revenue Decline

A decline in revenue indicates potential challenges in market demand or competitive pressures, which could impact long-term growth and market share.

Profitability Challenges

Decreased profitability suggests issues with cost management or pricing power, which could hinder financial performance and strategic initiatives.

Negative Free Cash Flow

Negative free cash flow poses risks to the company's ability to fund operations and growth without external financing, potentially affecting financial flexibility.

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

Company Description

HIROSHIMA GAS Co.,Ltd. engages in the gas business in Japan. The company operates through Gas Business, LPG Business, and Others segments. It engages in the production, supply, and sale of gas; wholesale supply of gas to other gas companies; sale of gas devices; and installation of gas equipment associated with gas devices, as well as safety inspection and gas meter data collection activities. The company is also involved in the sale of LPG and LPG devices; refilling of LPG tanks; installation of LPG pipes; and construction of gas pipes and lines. In addition, it engages in the engineering; machinery installation; fees collection and call center operation; and information distribution activities, as well as provision of services for seniors. The company was formerly known as Hiroshima Gas Electric Railway Co., Ltd. and changed its name to HIROSHIMA GAS Co.,Ltd. in 1942. HIROSHIMA GAS Co.,Ltd. was founded in 1909 and is headquartered in Hiroshima, Japan.

How the Company Makes Money

Hiroshima Gas Co., Ltd. generates revenue primarily through the sale and distribution of natural gas to its customers, which include residential households, commercial businesses, and industrial enterprises. The company charges customers based on their gas consumption, using a tiered pricing model that reflects usage levels and market conditions. Additionally, Hiroshima Gas earns income from the sale and maintenance of gas appliances and equipment, providing installation services and conducting safety inspections. The company may also engage in energy solutions and consulting services aimed at improving energy efficiency for its clients, further diversifying its revenue streams. Significant partnerships with other energy providers and infrastructure investments can enhance its service offerings and expand its market reach, contributing to overall earnings.

Hiroshima Gas Co., Ltd. Financial Statement Overview

Summary

Hiroshima Gas Co., Ltd. faces challenges with declining revenue and profitability margins, though it maintains a solid equity base. The increase in financial leverage is manageable but worth monitoring. Cash flow management requires attention, with free cash flow turning negative.

Income Statement

Hiroshima Gas Co., Ltd. has shown a decline in revenue from the previous year, with the latest annual revenue at ¥91.595 billion, down from ¥95.219 billion the prior year. Gross profit margin is 28.64%, and the net profit margin stands at 1.84%, both reflecting some compression over the year. Despite these challenges, the EBITDA margin remains robust at 10.93%, indicating decent operational efficiency.

Balance Sheet

The company maintains a healthy equity base with an equity ratio of 52.68%. However, the debt-to-equity ratio has increased slightly to 0.65, indicating a moderate level of financial leverage. Return on equity is relatively low at 2.47%, suggesting room for improvement in profitability relative to shareholder equity.

Cash Flow

Operating cash flow decreased considerably, leading to a negative free cash flow of ¥-3.517 billion. The operating cash flow to net income ratio of 3.48 indicates strong cash generation relative to profits, but the free cash flow to net income ratio is negative, highlighting issues with cash flow management.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	91.59B	91.59B	90.67B	95.22B	76.80B	73.25B
Gross Profit	26.23B	26.23B	28.81B	32.52B	28.21B	28.25B
EBITDA	10.01B	10.01B	10.97B	14.98B	10.63B	15.31B
Net Income	1.69B	1.69B	2.33B	5.22B	3.66B	5.27B
Balance Sheet
Total Assets	129.59B	129.59B	137.63B	142.00B	123.80B	115.48B
Cash, Cash Equivalents and Short-Term Investments	20.61B	20.61B	27.71B	35.64B	20.20B	15.58B
Total Debt	44.10B	44.10B	47.63B	56.12B	38.62B	33.88B
Total Liabilities	58.00B	58.00B	67.12B	74.14B	58.74B	55.67B
Stockholders Equity	68.26B	68.26B	67.13B	64.54B	61.87B	56.77B
Cash Flow
Free Cash Flow	0.00	-3.52B	5.37B	405.00M	743.00M	6.81B
Operating Cash Flow	0.00	5.87B	14.83B	8.95B	7.91B	13.97B
Investing Cash Flow	0.00	-9.26B	-9.68B	-7.06B	-7.14B	-13.32B
Financing Cash Flow	0.00	-3.65B	-13.17B	13.61B	3.80B	715.00M

Hiroshima Gas Co., Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 384.00
• 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:9535, the sentiment is Positive. The current price of 384 is above the 20-day moving average (MA) of 382.30, above the 50-day MA of 372.70, and above the 200-day MA of 358.28, indicating a bullish trend. The MACD of 2.58 indicates Positive momentum. The RSI at 56.33 is Neutral, neither overbought nor oversold. The STOCH value of 70.83 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:9535.

Hiroshima Gas Co., Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
9535	71 Outperform	¥26.39B	16.68		3.13%	2.11%	-9.10%
Sector *	66 Neutral	$15.27B	7.59	4.09%	5.23%	3.88%	-62.31%
NG0	―	€1.83B	23.24	20.08%	―	―	―
8131	78 Outperform	¥126.68B	10.43		2.54%	9.10%	92.69%
8133	70 Outperform	¥222.60B	13.03		3.17%	-4.47%	37.38%
6239	68 Neutral	¥10.33B	10.55		2.36%	-6.19%	-17.05%
8132	67 Neutral	¥71.91B	21.65		1.38%	-6.97%	―

Hiroshima Gas Co., Ltd. Corporate Events

Hiroshima Gas Reports Decline in Profits Amid Slight Sales Growth

Hiroshima Gas Co., Ltd. reported its consolidated financial results for the fiscal year ended March 31, 2025, showing a slight increase in net sales by 1% to ¥91,595 million. However, the company experienced a significant decline in operating profit by 60.7% and ordinary profit by 43.4%, reflecting challenges in maintaining profitability. The financial results indicate a cautious outlook for the upcoming fiscal year with a forecasted decrease in net sales and profit attributable to owners of the parent. The company maintains its dividend payout, signaling a commitment to shareholder returns despite the financial downturn.