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Shiseido Company (SSDOY)
OTHER OTC:SSDOY
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Shiseido Company
(OTC:SSDOY)
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Rating:51Neutral
Price Target:
$16.50
▼(-1.73% Downside)
Shiseido's overall stock score reflects a balance of strengths and weaknesses. The most significant factor is the mixed financial performance, with strong cash flow improvements but ongoing profitability challenges. Technical analysis suggests a neutral market sentiment, while valuation concerns persist due to a negative P/E ratio. The earnings call provided some positive insights into cost management but highlighted significant sales and market challenges.
Shiseido Company (SSDOY) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$6.75B
Dividend Yield1.14%
Average Volume (3M)1.03K
Price to Earnings (P/E)527.8
Beta (1Y)0.21
Revenue Growth-3.83%
EPS Growth-109.28%
CountryUS
Employees27,908
SectorConsumer Defensive
Sector Strength42
IndustryHousehold & Personal Products
Share Statistics
EPS (TTM)0.10
Shares Outstanding400,000,000
10 Day Avg. Volume3,091
30 Day Avg. Volume1,030
Financial Highlights & Ratios
PEG Ratio0.69
Price to Book (P/B)1.76
Price to Sales (P/S)1.12
P/FCF Ratio-482.68
Enterprise Value/Market Cap1.34
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit0.01
Enterprise Value/Ebitda0.11
Forecast
1Y Price Target
$16.50Price Target Upside-1.73% Downside
Rating ConsensusHold
Number of Analyst Covering1
Shiseido Company Business Overview & Revenue Model
Company DescriptionShiseido Company, Limited engages in the production and sale of cosmetics in Japan and internationally. The company offers fragrances; makeup products; skincare and body care products; and hair care and styling products, as well as hair color and perm solutions for hair salons. It also engages in the restaurant and food, and retail businesses; and operates beauty salons. In addition, the company operates and supports SABFA, a professional hair makeup training school. It sells its products through department stores, specialty stores, and drug stores. The company was founded in 1872 and is headquartered in Tokyo, Japan.
How the Company Makes MoneyShiseido generates revenue primarily through the sale of its cosmetics and skincare products across various channels, including retail, e-commerce, and professional salons. Its revenue model is diversified into several key segments: skincare, makeup, fragrance, and hair care. The company also benefits from significant partnerships with retailers and distributors globally, enhancing its market reach. Additionally, Shiseido invests in research and development to innovate and improve its product offerings, which helps maintain brand loyalty and attract new customers. Seasonal promotions, collaborations with influencers, and limited edition launches also contribute to driving sales and boosting revenues.
Shiseido Company Earnings Call Summary
Earnings Call Date:Aug 06, 2025
(Q2-2025)
| % Change Since: |
Next Earnings Date:Nov 10, 2025
Earnings Call Sentiment Neutral
The earnings call presented a mixed outlook with significant achievements in cost management and structural reforms leading to improved profitability. However, these were countered by notable challenges such as declining net sales, underperformance in key markets like the Americas, and increased risks associated with Drunk Elephant. While the company is making strides in market share expansion and cost reductions, the sales decline and regional challenges present substantial hurdles.Q2-2025 Updates
Positive Updates
Core Operating Profit Exceeds Expectations
For H1, core operating profit was JPY23.4 billion, an increase of JPY4.1 billion YoY, exceeding expectations and achieving over 60% of the full-year guidance of JPY36.5 billion.
Structural Reforms Yield Positive Results
The company implemented structural reforms and cost management strategies that resulted in improved profitability despite declining net sales, including a JPY13.2 billion increase in core operating profit in Japan.
Successful Cost Reductions
Realized JPY13.5 billion in cost reduction benefits in H1, with a full-year target increased to JPY25 billion, and a two-year target increased to JPY50 billion.
Market Share Expansion
The company expanded its market share in fragrances in Japan, Asia Pacific, and Europe, and achieved growth in China and Travel Retail in Q2 despite prior challenges.
Positive Free Cash Flow
Free cash flow turned positive at JPY17.5 billion, improving from a negative figure in Q1 due to higher profit before tax and other factors.
Negative Updates
Net Sales Decline
Net sales for H1 were JPY469.8 billion, with an underlying growth rate of minus 6%, primarily due to weakness in China Travel Retail and Drunk Elephant.
Challenges with Drunk Elephant
Drunk Elephant's performance fell far short of expectations, contributing to underperformance in the Americas, with risk of impairment losses increasing.
Americas Underperformance
The Americas market maintained YoY growth but fell short of expectations in Q2, with core operating profit dropping JPY3.3 billion due to sales decline.
Inbound Market Slowdown in Japan
The inbound market in Japan slowed down, with consumer purchases turning negative in Q2, impacting sales despite profitability improvements.
Sales Risks in H2
There are risks to achieving sales targets in H2, particularly in Japan and the Americas, with the potential for flat sales growth instead of the originally planned 4% growth.
Company Guidance
During Shiseido Company Limited's 2025 Q2 earnings call, the company provided comprehensive guidance across various metrics. The half-year results showed net sales amounting to JPY469.8 billion, with a decline of 6% due to challenges in China Travel Retail and Drunk Elephant brands. Despite this, core operating profit reached JPY23.4 billion, exceeding expectations by JPY4.1 billion YoY, and representing over 60% of the full-year guidance of JPY36.5 billion. The company emphasized its focus on structural reforms and financial discipline, achieving a 1.5 percentage point improvement in the cost of goods sold ratio. Marketing investments decreased by JPY2.7 billion, while personnel expenses saw a JPY15 billion reduction. Shiseido also maintained high profitability in challenging regions like Travel Retail, achieving a core operating profit margin of 22.1%. For the full year, the company remains committed to reaching a core operating profit of JPY36.5 billion, despite risks to net sales, by accelerating reforms and cost management. Free cash flow turned positive at JPY17.5 billion, and the company plans to further its global cost structure transformation, aiming for a JPY25 billion reduction in 2025. The guidance also noted potential impairment risks in the Americas, with specific challenges highlighted for the Drunk Elephant brand.Shiseido Company Financial Statement Overview
Summary
Shiseido Company shows strong gross profit margins but faces challenges with profitability due to negative net income and declining EBIT and EBITDA margins. The balance sheet indicates increased leverage, posing financial risk, although the equity ratio remains healthy. Cash flow analysis reveals issues in generating free cash flow, despite strong operating cash flow. The company needs to address profitability and leverage to strengthen its financial position.Income Statement
The gross profit margin is strong at approximately 76% for 2024, indicating efficient cost management. However, net profit margin is negative, signaling challenges in profitability. The revenue growth rate from 2023 to 2024 is modest at 1.8%, which shows limited top-line growth. EBIT and EBITDA margins have declined compared to the previous year, pointing to increased operational costs or reduced operating efficiency.45
Neutral
Balance Sheet
The debt-to-equity ratio has increased to 0.57 in 2024, reflecting rising leverage which could pose higher financial risk. Return on Equity (ROE) is negative, indicating that the company is not generating profits from its equity base. However, the equity ratio stands at around 47.5%, suggesting a balanced asset structure despite the leverage concerns.55
Neutral
Cash Flow
The free cash flow has turned negative in 2024, raising concerns about cash generation capability. Operating cash flow to net income ratio is favorable, indicating strong cash generation relative to accounting profits. However, the free cash flow to net income ratio is negative, highlighting challenges in converting profits to free cash.60
Neutral
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 978.69B | 990.59B | 973.04B | 1.07T | 1.04T | 920.89B |
| Gross Profit | 746.10B | 753.19B | 713.36B | 744.16B | 772.21B | 682.49B |
| EBITDA | 83.87B | 80.80B | 93.41B | 129.77B | 111.44B | 82.41B |
| Net Income | -7.45B | -10.81B | 21.75B | 34.20B | 46.91B | -11.66B |
Balance Sheet | ||||||
| Total Assets | 1.25T | 1.33T | 1.26T | 1.31T | 1.18T | 1.20T |
| Cash, Cash Equivalents and Short-Term Investments | 81.52B | 126.86B | 126.64B | 137.53B | 172.06B | 151.01B |
| Total Debt | 337.95B | 363.16B | 280.98B | 297.19B | 190.98B | 324.30B |
| Total Liabilities | 616.46B | 677.21B | 615.11B | 681.91B | 611.93B | 697.64B |
| Stockholders Equity | 613.94B | 632.47B | 618.75B | 604.26B | 546.09B | 485.69B |
Cash Flow | ||||||
| Free Cash Flow | 26.77B | -2.31B | 33.35B | -19.47B | 30.43B | -9.44B |
| Operating Cash Flow | 51.70B | 48.40B | 89.03B | 46.73B | 122.89B | 64.05B |
| Investing Cash Flow | -44.83B | -83.74B | -35.54B | -41.31B | 63.74B | -70.08B |
| Financing Cash Flow | -7.04B | 23.36B | -75.64B | -52.42B | -176.22B | 46.88B |
Shiseido Company Technical Analysis
Negative
16.79
Price Trends
16.80
Negative
16.80
Negative
17.03
Negative
Market Momentum
0.03
Positive
50.04
Neutral
45.06
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SSDOY, the sentiment is Negative. The current price of 16.79 is below the 20-day moving average (MA) of 16.88, below the 50-day MA of 16.80, and below the 200-day MA of 17.03, indicating a bearish trend. The MACD of 0.03 indicates Positive momentum. The RSI at 50.04 is Neutral, neither overbought nor oversold. The STOCH value of 45.06 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for SSDOY.
Shiseido Company Peers Comparison
UnderperformOutperform
Sector (62)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
77 Outperform | $7.53B | 78.59 | 12.97% | ― | 18.61% | -21.36% | |
65 Neutral | $3.05B | 19.01 | 20.68% | 3.31% | 7.04% | 13.52% | |
62 Neutral | $20.33B | 14.63 | -3.31% | 3.23% | 1.93% | -12.26% | |
58 Neutral | $936.72M | 14.89 | 4.12% | 2.98% | -2.92% | -43.06% | |
52 Neutral | $33.38B | 147.29 | -24.69% | 1.47% | -8.14% | -389.12% | |
52 Neutral | $3.78B | 40.12 | -9.98% | ― | -3.68% | -631.67% | |
51 Neutral | $6.75B | 527.80 | -0.15% | 1.14% | -3.83% | -109.28% |
* Consumer Defensive Sector Average
SSDOY
Shiseido Company
16.79
-6.11
-26.68%
EL
The Estée Lauder Companies
95.27
6.08
6.82%
IPAR
Inter Parfums
95.05
-20.10
-17.46%
COTY
Coty
4.24
-3.75
-46.93%
EPC
Edgewell Personal Care
20.16
-14.91
-42.51%
ELF
e.l.f. Beauty
134.08
27.00
25.21%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.