Price Target Changed • Jun 30
Price target increased by 9.3% to JP¥2,358 Up from JP¥2,158, the current price target is an average from 9 analysts. New target price is approximately in line with last closing price of JP¥2,358. Stock is up 59% over the past year. The company is forecast to post earnings per share of JP¥186 for next year compared to JP¥187 last year. Announcement • Jun 19
Zeon Corporation to Report Q1, 2027 Results on Jul 29, 2026 Zeon Corporation announced that they will report Q1, 2027 results on Jul 29, 2026 New Risk • May 31
New minor risk - Dividend sustainability The dividend is not well covered by cash flows. Cash payout ratio: 97% Dividend yield: 3.6% This is considered a minor risk. Dividends are ultimately paid out of the company's available cash reserves. Companies that pay out too much of their cash flow are at risk of having to reduce or cut their dividend in future. If cash flow growth slows or cash flows fall, then there may not be enough cash reserves to maintain the same dividend. Or in extreme cases, companies may opt to take on debt to maintain the dividend. This risk is mitigated by the fact the dividend is covered by earnings, however, cash flows are generally more important. For dividend paying companies, any reduction in the dividend can significantly impact the share price. Currently, the following risks have been identified for the company: Major Risk Earnings are forecast to decline by an average of 4.4% per year for the foreseeable future. Minor Risks Dividend is not well covered by cash flows (97% cash payout ratio). Large one-off items impacting financial results. Reported Earnings • May 14
Full year 2026 earnings: EPS exceeds analyst expectations Full year 2026 results: EPS: JP¥187 (up from JP¥127 in FY 2025). Revenue: JP¥412.0b (down 2.1% from FY 2025). Net income: JP¥36.2b (up 38% from FY 2025). Profit margin: 8.8% (up from 6.2% in FY 2025). Revenue was in line with analyst estimates. Earnings per share (EPS) surpassed analyst estimates by 20%. Revenue is forecast to grow 2.7% p.a. on average during the next 3 years, compared to a 4.7% growth forecast for the Chemicals industry in Japan. Over the last 3 years on average, earnings per share has increased by 42% per year but the company’s share price has only increased by 15% per year, which means it is significantly lagging earnings growth. Announcement • May 14
Zeon Corporation, Annual General Meeting, Jun 26, 2026 Zeon Corporation, Annual General Meeting, Jun 26, 2026. Announcement • May 13
Natoco Co., Ltd. (TSE:4627) signed a letter of intent to acquire Tohpe Corporation from Zeon Corporation (TSE:4205). Natoco Co., Ltd. (TSE:4627) signed a letter of intent to acquire Tohpe Corporation from Zeon Corporation (TSE:4205) on May 11, 2026. A cash consideration of ¥2.19 billion will be paid by Natoco Co., Ltd. As part of consideration, ¥2.19 billion is paid towards common equity of Tohpe Corporation. Natoco Co., Ltd. has resolved to enter into a stock transfer agreement.
The expected completion of the transaction is November 2, 2026. Live News • May 13
Zeon Net Income Surges 38% as Dividend Rises Despite Sales Drop Zeon reported a 38% rise in net income for FY2026, supported by growth in specialty materials and cost reduction efforts, even as sales declined 2%.
Operating cash flow was about 3x higher year over year, supporting a higher dividend payout, with the total annual dividend lifted to 76 yen per share and the year-end dividend raised to 40 yen.
For FY2027, the company is guiding for slightly lower sales and ordinary profit while aiming for continued growth in operating profit and stable earnings per share, backed by a focus on margins and investments in specialty materials and battery technology.
The mix of higher profitability, stronger cash generation and a higher dividend points to a business that is prioritizing return on capital and capital discipline even with softer top-line expectations.
You should watch how Zeon executes on its specialty materials and battery-related plans, since any delays or higher investment needs could affect margins, cash flow and the company’s ability to maintain its current dividend stance. Valuation Update With 7 Day Price Move • May 13
Investor sentiment improves as stock rises 19% After last week's 19% share price gain to JP¥2,238, the stock trades at a forward P/E ratio of 14x. Average forward P/E is 14x in the Chemicals industry in Japan. Total returns to shareholders of 66% over the past three years. Announcement • Apr 04
Zeon Corporation to Report Fiscal Year 2026 Results on May 13, 2026 Zeon Corporation announced that they will report fiscal year 2026 results on May 13, 2026 Upcoming Dividend • Mar 23
Upcoming dividend of JP¥36.00 per share Eligible shareholders must have bought the stock before 30 March 2026. Payment date: 30 June 2026. Payout ratio is a comfortable 40% and this is well supported by cash flows. Trailing yield: 4.1%. Within top quartile of Japanese dividend payers (3.6%). Higher than average of industry peers (2.3%). Reported Earnings • Jan 31
Third quarter 2026 earnings: EPS exceeds analyst expectations while revenues lag behind Third quarter 2026 results: EPS: JP¥31.27 (down from JP¥38.48 in 3Q 2025). Revenue: JP¥103.2b (up 1.1% from 3Q 2025). Net income: JP¥6.02b (down 23% from 3Q 2025). Profit margin: 5.8% (down from 7.7% in 3Q 2025). Revenue missed analyst estimates by 1.1%. Earnings per share (EPS) exceeded analyst estimates by 53%. Revenue is forecast to grow 2.1% p.a. on average during the next 3 years, compared to a 4.4% growth forecast for the Chemicals industry in Japan. Over the last 3 years on average, earnings per share has increased by 36% per year but the company’s share price has only increased by 16% per year, which means it is significantly lagging earnings growth. Announcement • Jan 30
Zeon Corporation Revises Consolidated Earnings Guidance for the Fiscal Year Ending March 31, 2026 Zeon Corporation revised consolidated earnings guidance for the Fiscal year ending March 31, 2026. For the year, the company expects net sales to be JPY 407,500 million, Operating profit to be JPY 31,000 million, Profit attributable to owners of the parent to be JPY 31,500 million and basic earnings per share to be JPY 162.32 as compared to net sales to be JPY 415,000 million, Operating profit to be JPY 30,500 million, Profit attributable to owners of the parent to be JPY 28,000 million and basic earnings per share to be JPY 144.17 in the previous guidance. While net sales in the Elastomer Business Segment are expected to decrease due to a decline in selling prices resulting from lower raw material prices, net sales and operating profit in the Specialty Material Business Segment are expected to increase, reflecting steady demand for optical films used in large-screen televisions as well as battery materials. In addition, due to the incorporation of the continued depreciation of the yen against the initially assumed exchange rates, ordinary profit and profit attributable to owners of the parent are expected to exceed the previously announced forecast. Accordingly, the forecast has been revised as described above. Announcement • Dec 16
Zeon Corporation to Report Q3, 2026 Results on Jan 30, 2026 Zeon Corporation announced that they will report Q3, 2026 results on Jan 30, 2026 Declared Dividend • Dec 06
First half dividend of JP¥36.00 announced Shareholders will receive a dividend of JP¥36.00. Ex-date: 30th March 2026 Payment date: 30th June 2026 Dividend yield will be 4.2%, which is higher than the industry average of 2.2%. Sustainability & Growth Dividend is well covered by both earnings (39% earnings payout ratio) and cash flows (46% cash payout ratio). The dividend has increased by an average of 17% per year over the past 10 years and has been stable with no material reductions to payments, indicating a long track record of dividend growth and stability. EPS is expected to remain steady over the next 3 years, which should provide adequate earnings cover for the dividend. New Risk • Oct 31
New major risk - Revenue and earnings growth Earnings are forecast to decline by an average of 2.9% per year for the foreseeable future. This is considered a major risk. Ultimately, shareholders want to see a good return on their investment and that generally comes from sharing in the company's profits. If profits are expected to decline, then in most cases the share price will decline over time as well. In addition, if the company pays dividends it will also likely need to reduce or cut them, striking a dual blow to total shareholder returns. Currently, the following risks have been identified for the company: Major Risk Earnings are forecast to decline by an average of 2.9% per year for the foreseeable future. Minor Risks Paying a dividend despite having no free cash flows. Large one-off items impacting financial results. Upcoming Dividend • Sep 22
Upcoming dividend of JP¥36.00 per share Eligible shareholders must have bought the stock before 29 September 2025. Payment date: 03 December 2025. Payout ratio is a comfortable 55% but the company is not cash flow positive. Trailing yield: 4.2%. Within top quartile of Japanese dividend payers (3.6%). Higher than average of industry peers (2.6%). Announcement • Sep 17
Zeon Corporation to Report Q2, 2026 Results on Oct 30, 2025 Zeon Corporation announced that they will report Q2, 2026 results on Oct 30, 2025 Major Estimate Revision • Aug 06
Consensus EPS estimates increase by 10% The consensus outlook for fiscal year 2026 has been updated. 2026 EPS estimate increased from JP¥131 to JP¥144. Revenue forecast steady at JP¥413.3b. Net income forecast to grow 8.5% next year vs 8.9% growth forecast for Chemicals industry in Japan. Consensus price target up from JP¥1,661 to JP¥1,730. Share price rose 3.1% to JP¥1,654 over the past week. Reported Earnings • Jul 31
First quarter 2026 earnings released: EPS: JP¥38.07 (vs JP¥38.77 in 1Q 2025) First quarter 2026 results: EPS: JP¥38.07 (down from JP¥38.77 in 1Q 2025). Revenue: JP¥103.1b (down 2.8% from 1Q 2025). Net income: JP¥7.51b (down 8.4% from 1Q 2025). Profit margin: 7.3% (down from 7.7% in 1Q 2025). The decrease in margin was driven by lower revenue. Revenue is forecast to grow 1.6% p.a. on average during the next 3 years, compared to a 4.0% growth forecast for the Chemicals industry in Japan. Over the last 3 years on average, earnings per share has increased by 11% per year whereas the company’s share price has increased by 6% per year. Board Change • Jul 21
High number of new directors There are 5 new directors who have joined the board in the last 3 years. Member of Audit & Supervisory Board Hiroyuki Hirakawa was the last director to join the board, commencing their role in 2025. The company’s lack of board continuity is considered a risk according to the Simply Wall St Risk Model. Declared Dividend • Jul 09
Final dividend of JP¥36.00 announced Shareholders will receive a dividend of JP¥36.00. Ex-date: 29th September 2025 Payment date: 3rd December 2025 Dividend yield will be 4.6%, which is higher than the industry average of 2.2%. Sustainability & Growth Dividend is covered by earnings (41% earnings payout ratio) but the company has no free cash flows available, indicating it may be using cash reserves or debt to pay the dividend. The dividend has increased by an average of 18% per year over the past 10 years and has been stable with no material reductions to payments, indicating a long track record of dividend growth and stability. EPS is expected to grow by 21% over the next 3 years, which should provide support to the dividend and adequate earnings cover. Announcement • Jun 06
Zeon Corporation to Report Q1, 2026 Results on Jul 30, 2025 Zeon Corporation announced that they will report Q1, 2026 results on Jul 30, 2025 Reported Earnings • Apr 26
Full year 2025 earnings: EPS exceeds analyst expectations Full year 2025 results: EPS: JP¥133 (down from JP¥147 in FY 2024). Revenue: JP¥420.6b (up 10.0% from FY 2024). Net income: JP¥26.2b (down 16% from FY 2024). Profit margin: 6.2% (down from 8.1% in FY 2024). The decrease in margin was driven by higher expenses. Revenue was in line with analyst estimates. Earnings per share (EPS) surpassed analyst estimates by 2.6%. Revenue is forecast to grow 4.0% p.a. on average during the next 3 years, compared to a 4.7% growth forecast for the Chemicals industry in Japan. Over the last 3 years on average, earnings per share has increased by 5% per year whereas the company’s share price has increased by 1% per year. Buy Or Sell Opportunity • Apr 03
Now 22% undervalued after recent price drop Over the last 90 days, the stock has fallen 4.8% to JP¥1,427. The fair value is estimated to be JP¥1,825, however this is not to be taken as a buy recommendation but rather should be used as a guide only. Revenue has grown by 3.9% over the last 3 years. Earnings per share has declined by 4.7%. For the next 3 years, revenue is forecast to grow by 4.2% per annum. Earnings are also forecast to grow by 2.4% per annum over the same time period. Upcoming Dividend • Mar 21
Upcoming dividend of JP¥35.00 per share Eligible shareholders must have bought the stock before 28 March 2025. Payment date: 30 June 2025. Payout ratio is a comfortable 41% but the company is not cash flow positive. Trailing yield: 4.4%. Within top quartile of Japanese dividend payers (3.7%). Higher than average of industry peers (2.6%). Buy Or Sell Opportunity • Mar 11
Now 21% undervalued Over the last 90 days, the stock has risen 6.4% to JP¥1,496. The fair value is estimated to be JP¥1,895, however this is not to be taken as a buy recommendation but rather should be used as a guide only. Revenue has grown by 3.9% over the last 3 years. Earnings per share has declined by 4.7%. For the next 3 years, revenue is forecast to grow by 4.1% per annum. Earnings are also forecast to grow by 2.2% per annum over the same time period. Announcement • Mar 04
Zeon Corporation to Report Fiscal Year 2025 Results on Apr 25, 2025 Zeon Corporation announced that they will report fiscal year 2025 results on Apr 25, 2025 Reported Earnings • Feb 01
Third quarter 2025 earnings: EPS exceeds analyst expectations while revenues lag behind Third quarter 2025 results: EPS: JP¥38.48 (down from JP¥49.92 in 3Q 2024). Revenue: JP¥102.1b (up 3.8% from 3Q 2024). Net income: JP¥7.83b (down 26% from 3Q 2024). Profit margin: 7.7% (down from 11% in 3Q 2024). Revenue missed analyst estimates by 2.1%. Earnings per share (EPS) exceeded analyst estimates by 75%. Revenue is forecast to grow 4.0% p.a. on average during the next 3 years, compared to a 5.0% growth forecast for the Chemicals industry in Japan. Over the last 3 years on average, earnings per share has fallen by 5% per year but the company’s share price has increased by 2% per year, which means it is well ahead of earnings. Announcement • Dec 12
Zeon Corporation to Report Q3, 2025 Results on Jan 31, 2025 Zeon Corporation announced that they will report Q3, 2025 results on Jan 31, 2025 Declared Dividend • Dec 04
First half dividend of JP¥35.00 announced Shareholders will receive a dividend of JP¥35.00. Ex-date: 28th March 2025 Payment date: 30th June 2025 Dividend yield will be 5.0%, which is higher than the industry average of 2.2%. Sustainability & Growth Dividend is covered by earnings (38% earnings payout ratio) but the company has no free cash flows available, indicating it may be using cash reserves or debt to pay the dividend. The dividend has increased by an average of 18% per year over the past 10 years and has been stable with no material reductions to payments, indicating a long track record of dividend growth and stability. EPS is expected to grow by 9.2% over the next 3 years, which should provide support to the dividend and adequate earnings cover. New Risk • Dec 03
New major risk - Revenue and earnings growth Earnings are forecast to decline by an average of 2.1% per year for the foreseeable future. This is considered a major risk. Ultimately, shareholders want to see a good return on their investment and that generally comes from sharing in the company's profits. If profits are expected to decline, then in most cases the share price will decline over time as well. In addition, if the company pays dividends it will also likely need to reduce or cut them, striking a dual blow to total shareholder returns. Currently, the following risks have been identified for the company: Major Risk Earnings are forecast to decline by an average of 2.1% per year for the foreseeable future. Minor Risks Paying a dividend despite having no free cash flows. Large one-off items impacting financial results. Buy Or Sell Opportunity • Nov 15
Now 21% overvalued after recent price rise Over the last 90 days, the stock has risen 18% to JP¥1,428. The fair value is estimated to be JP¥1,180, however this is not to be taken as a sell recommendation but rather should be used as a guide only. Revenue has grown by 4.1% over the last 3 years. Earnings per share has declined by 15%. For the next 3 years, revenue is forecast to grow by 3.5% per annum. Earnings are also forecast to grow by 0.06% per annum over the same time period. New Risk • Nov 02
New major risk - Revenue and earnings growth Earnings are forecast to decline by an average of 0.1% per year for the foreseeable future. This is considered a major risk. Ultimately, shareholders want to see a good return on their investment and that generally comes from sharing in the company's profits. If profits are expected to decline, then in most cases the share price will decline over time as well. In addition, if the company pays dividends it will also likely need to reduce or cut them, striking a dual blow to total shareholder returns. Currently, the following risks have been identified for the company: Major Risk Earnings are forecast to decline by an average of 0.1% per year for the foreseeable future. Minor Risks Paying a dividend despite having no free cash flows. Large one-off items impacting financial results. Reported Earnings • Oct 29
Second quarter 2025 earnings: Revenues exceed analysts expectations while EPS lags behind Second quarter 2025 results: EPS: JP¥19.62 (down from JP¥21.41 in 2Q 2024). Revenue: JP¥107.2b (up 15% from 2Q 2024). Net income: JP¥4.11b (down 9.1% from 2Q 2024). Profit margin: 3.8% (down from 4.8% in 2Q 2024). Revenue exceeded analyst estimates by 1.5%. Earnings per share (EPS) missed analyst estimates by 37%. Revenue is forecast to grow 3.5% p.a. on average during the next 3 years, compared to a 5.2% growth forecast for the Chemicals industry in Japan. Over the last 3 years on average, earnings per share has fallen by 15% per year but the company’s share price has increased by 2% per year, which means it is well ahead of earnings. Upcoming Dividend • Sep 20
Upcoming dividend of JP¥23.00 per share Eligible shareholders must have bought the stock before 27 September 2024. Payment date: 02 December 2024. Payout ratio is a comfortable 28% and this is well supported by cash flows. Trailing yield: 3.5%. Lower than top quartile of Japanese dividend payers (3.8%). Higher than average of industry peers (2.4%). Announcement • Sep 13
Zeon Corporation to Report Q2, 2025 Results on Oct 28, 2024 Zeon Corporation announced that they will report Q2, 2025 results on Oct 28, 2024 New Risk • Aug 05
New major risk - Revenue and earnings growth Earnings are forecast to decline by an average of 0.6% per year for the foreseeable future. This is considered a major risk. Ultimately, shareholders want to see a good return on their investment and that generally comes from sharing in the company's profits. If profits are expected to decline, then in most cases the share price will decline over time as well. In addition, if the company pays dividends it will also likely need to reduce or cut them, striking a dual blow to total shareholder returns. Currently, the following risks have been identified for the company: Major Risk Earnings are forecast to decline by an average of 0.6% per year for the foreseeable future. Minor Risks Unstable dividend paying track record with dividend experiencing an annual drop of over 20% in the past. Large one-off items impacting financial results. Valuation Update With 7 Day Price Move • Aug 05
Investor sentiment deteriorates as stock falls 23% After last week's 23% share price decline to JP¥1,080, the stock trades at a forward P/E ratio of 10x. Average forward P/E is 12x in the Chemicals industry in Japan. Total loss to shareholders of 26% over the past three years. Simply Wall St's valuation model estimates the intrinsic value at JP¥1,556 per share. Buy Or Sell Opportunity • Aug 03
Now 20% undervalued after recent price drop Over the last 90 days, the stock has fallen 18% to JP¥1,243. The fair value is estimated to be JP¥1,556, however this is not to be taken as a buy recommendation but rather should be used as a guide only. Revenue has grown by 4.9% over the last 3 years. Earnings per share has declined by 24%. For the next 3 years, revenue is forecast to grow by 4.0% per annum. Earnings are also forecast to grow by 0.9% per annum over the same time period. Reported Earnings • Jul 31
First quarter 2025 earnings: EPS and revenues exceed analyst expectations First quarter 2025 results: EPS: JP¥38.77 (up from JP¥27.62 in 1Q 2024). Revenue: JP¥106.1b (up 15% from 1Q 2024). Net income: JP¥8.19b (up 40% from 1Q 2024). Profit margin: 7.7% (up from 6.3% in 1Q 2024). Revenue exceeded analyst estimates by 7.7%. Earnings per share (EPS) also surpassed analyst estimates by 64%. Revenue is forecast to grow 4.2% p.a. on average during the next 3 years, compared to a 5.7% growth forecast for the Chemicals industry in Japan. Over the last 3 years on average, earnings per share has fallen by 24% per year but the company’s share price has only fallen by 6% per year, which means it has not declined as severely as earnings. Declared Dividend • Jul 11
Final dividend of JP¥23.00 announced Shareholders will receive a dividend of JP¥23.00. Ex-date: 27th September 2024 Payment date: 2nd December 2024 Dividend yield will be 3.4%, which is higher than the industry average of 2.2%. Sustainability & Growth Dividend is covered by both earnings (61% earnings payout ratio) and cash flows (87% cash payout ratio). The dividend has increased by an average of 14% per year over the past 10 years. However, payments have been volatile during that time. EPS is expected to grow by 14% over the next 3 years, which should provide support to the dividend and adequate earnings cover. Announcement • Jun 15
Zeon Corporation to Report Q1, 2025 Results on Jul 29, 2024 Zeon Corporation announced that they will report Q1, 2025 results on Jul 29, 2024 Announcement • Jun 14
Zeon Corporation (TSE:4205) signed a letter of intent to acquire 40% stake in ZS Elastomers Co., Ltd. from Sumitomo Chemical Company, Limited. Zeon Corporation (TSE:4205) signed a letter of intent to acquire remaining 40% stake in ZS Elastomers Co., Ltd. from Sumitomo Chemical Company, Limited (TSE:4005) on June 12, 2024. Upon completion, Zeon Corporation will own 100% stake in ZS Elastomers Co., Ltd. As of March 31, 2024, ZS Elastomers Co., Ltd. generated total assets of ¥12.4 billion, net assets of ¥1.5 billion, sales of ¥1.4 billion, operating income of ¥411 million and net income of ¥442 million. The expected completion of the transaction is September 30, 2024. Announcement • Apr 28
Zeon Corporation, Annual General Meeting, Jun 27, 2024 Zeon Corporation, Annual General Meeting, Jun 27, 2024. Reported Earnings • Apr 26
Full year 2024 earnings: EPS exceeds analyst expectations Full year 2024 results: EPS: JP¥147 (up from JP¥49.94 in FY 2023). Revenue: JP¥382.3b (down 1.6% from FY 2023). Net income: JP¥31.1b (up 194% from FY 2023). Profit margin: 8.1% (up from 2.7% in FY 2023). Revenue was in line with analyst estimates. Earnings per share (EPS) surpassed analyst estimates by 10%. Revenue is forecast to grow 5.7% p.a. on average during the next 3 years, compared to a 5.5% growth forecast for the Chemicals industry in Japan. Over the last 3 years on average, earnings per share has fallen by 31% per year but the company’s share price has only fallen by 3% per year, which means it has not declined as severely as earnings. Announcement • Apr 26
Zeon Corporation (TSE:4205) announces an Equity Buyback for 10,000,000 shares, representing 4.73% for ¥10,000 million. Zeon Corporation (TSE:4205) announces a share repurchase program. Under the program, the company will repurchase up to 10,000,000 shares, representing 4.73% of its issued share capital, for ¥10,000 million. The purpose of the program is to enhance shareholder returns and improve capital efficiency. The program will be valid till March 21, 2025. As of March 31, 2024, the company has 211,315,491 issued shares (excluding treasury stock) and 18,198,165 treasury shares. Upcoming Dividend • Mar 21
Upcoming dividend of JP¥20.00 per share Eligible shareholders must have bought the stock before 28 March 2024. Payment date: 01 July 2024. Payout ratio is a comfortable 61% but the company is paying out more than the cash it is generating. Trailing yield: 3.0%. Lower than top quartile of Japanese dividend payers (3.2%). Higher than average of industry peers (2.1%). Announcement • Mar 17
Zeon Corporation to Report Fiscal Year 2024 Results on Apr 25, 2024 Zeon Corporation announced that they will report fiscal year 2024 results on Apr 25, 2024 Reported Earnings • Feb 02
Third quarter 2024 earnings: EPS and revenues exceed analyst expectations Third quarter 2024 results: EPS: JP¥49.92 (up from JP¥4.09 in 3Q 2023). Revenue: JP¥98.4b (up 1.6% from 3Q 2023). Net income: JP¥10.5b (up JP¥9.69b from 3Q 2023). Profit margin: 11% (up from 0.9% in 3Q 2023). The increase in margin was primarily driven by lower expenses. Revenue exceeded analyst estimates by 1.3%. Earnings per share (EPS) also surpassed analyst estimates by 52%. Revenue is forecast to grow 5.8% p.a. on average during the next 3 years, compared to a 5.7% growth forecast for the Chemicals industry in Japan. Over the last 3 years on average, earnings per share has fallen by 34% per year but the company’s share price has only fallen by 8% per year, which means it has not declined as severely as earnings. Announcement • Dec 17
Zeon Corporation to Report Q3, 2024 Results on Jan 31, 2024 Zeon Corporation announced that they will report Q3, 2024 results on Jan 31, 2024 Valuation Update With 7 Day Price Move • Nov 03
Investor sentiment deteriorates as stock falls 18% After last week's 18% share price decline to JP¥1,220, the stock trades at a forward P/E ratio of 9x. Average forward P/E is 12x in the Chemicals industry in Japan. Negligible returns to shareholders over past three years. Simply Wall St's valuation model estimates the intrinsic value at JP¥1,547 per share. Buying Opportunity • Oct 30
Now 24% undervalued after recent price drop Over the last 90 days, the stock is down 15%. The fair value is estimated to be JP¥1,714, however this is not to be taken as a buy recommendation but rather should be used as a guide only. Revenue has grown by 9.8% over the last 3 years. Earnings per share has declined by 23%. For the next 3 years, revenue is forecast to grow by 5.9% per annum. Earnings is also forecast to grow by 30% per annum over the same time period. Reported Earnings • Oct 29
Second quarter 2024 earnings: EPS misses analyst expectations Second quarter 2024 results: EPS: JP¥21.41 (down from JP¥41.21 in 2Q 2023). Revenue: JP¥93.5b (down 6.3% from 2Q 2023). Net income: JP¥4.52b (down 48% from 2Q 2023). Profit margin: 4.8% (down from 8.7% in 2Q 2023). Revenue was in line with analyst estimates. Earnings per share (EPS) missed analyst estimates by 16%. Revenue is forecast to grow 5.9% p.a. on average during the next 3 years, compared to a 4.2% growth forecast for the Chemicals industry in Japan. Over the last 3 years on average, earnings per share has fallen by 23% per year but the company’s share price has increased by 6% per year, which means it is well ahead of earnings. Announcement • Sep 23
Zeon Corporation to Report Q2, 2024 Results on Oct 27, 2023 Zeon Corporation announced that they will report Q2, 2024 results on Oct 27, 2023 Upcoming Dividend • Sep 21
Upcoming dividend of JP¥20.00 per share at 2.4% yield Eligible shareholders must have bought the stock before 28 September 2023. Payment date: 04 December 2023. Payout ratio is on the higher end at 99% but the company is not cash flow positive. Trailing yield: 2.4%. Lower than top quartile of Japanese dividend payers (3.3%). In line with average of industry peers (2.5%). New Risk • Jul 29
New major risk - Dividend sustainability The dividend is not well covered by earnings and cash flows. Payout ratio: 99% The company is paying a dividend despite having no free cash flows. Dividend yield: 2.7% This is considered a major risk. Companies that pay out too much of their earnings and cash flows are at risk of having to reduce or cut their dividend in future. If earnings or cash flows stagnate or fall, then there may not be enough to maintain the same dividend. Or in extreme cases, companies may opt to dig into capital reserves or take on debt to maintain the dividend. For dividend paying companies, any reduction in the dividend can significantly impact the share price. Currently, the following risks have been identified for the company: Major Risk Dividend is not well covered by earnings and cash flows. Payout ratio: 99% Paying a dividend despite having no free cash flows. Minor Risks Large one-off items impacting financial results. Profit margins are more than 30% lower than last year (2.0% net profit margin). Reported Earnings • Jul 28
First quarter 2024 earnings: EPS exceeds analyst expectations while revenues lag behind First quarter 2024 results: EPS: JP¥27.62 (down from JP¥40.99 in 1Q 2023). Revenue: JP¥91.9b (down 5.8% from 1Q 2023). Net income: JP¥5.84b (down 33% from 1Q 2023). Profit margin: 6.3% (down from 8.9% in 1Q 2023). Revenue missed analyst estimates by 2.2%. Earnings per share (EPS) exceeded analyst estimates by 121%. Revenue is forecast to grow 5.1% p.a. on average during the next 3 years, compared to a 4.0% growth forecast for the Chemicals industry in Japan. Over the last 3 years on average, earnings per share has fallen by 5% per year but the company’s share price has increased by 14% per year, which means it is well ahead of earnings. Announcement • Jun 23
Zeon Corporation to Report Q1, 2024 Results on Jul 27, 2023 Zeon Corporation announced that they will report Q1, 2024 results on Jul 27, 2023 Reported Earnings • Apr 28
Full year 2023 earnings: Revenues and EPS in line with analyst expectations Full year 2023 results: EPS: JP¥49.94 (down from JP¥153 in FY 2022). Revenue: JP¥388.6b (up 7.4% from FY 2022). Net income: JP¥10.6b (down 68% from FY 2022). Profit margin: 2.7% (down from 9.2% in FY 2022). Revenue was in line with analyst estimates. Earnings per share (EPS) were also in line with analyst expectations. Revenue is forecast to grow 4.7% p.a. on average during the next 3 years, compared to a 3.7% growth forecast for the Chemicals industry in Japan. Over the last 3 years on average, earnings per share has increased by 8% per year but the company’s share price has increased by 14% per year, which means it is tracking significantly ahead of earnings growth. Major Estimate Revision • Apr 25
Consensus EPS estimates fall by 49% The consensus outlook for fiscal year 2023 has been updated. 2023 EPS estimate fell from JP¥98.08 to JP¥49.71. Revenue forecast unchanged from JP¥387.3b at last update. Net income forecast to grow 7.3% next year vs 1.7% decline forecast for Chemicals industry in Japan. Consensus price target of JP¥1,536 unchanged from last update. Share price was steady at JP¥1,425 over the past week. Upcoming Dividend • Mar 23
Upcoming dividend of JP¥18.00 per share at 2.6% yield Eligible shareholders must have bought the stock before 30 March 2023. Payment date: 30 June 2023. Payout ratio is a comfortable 29% but the company is not cash flow positive. Trailing yield: 2.6%. Lower than top quartile of Japanese dividend payers (3.6%). In line with average of industry peers (2.8%). Buying Opportunity • Mar 21
Now 21% undervalued Over the last 90 days, the stock is up 5.0%. The fair value is estimated to be JP¥1,708, however this is not to be taken as a buy recommendation but rather should be used as a guide only. Revenue has grown by 8.3% over the last 3 years. Earnings per share has grown by 18%. For the next 3 years, revenue is forecast to grow by 4.6% per annum. Earnings is also forecast to grow by 14% per annum over the same time period. Major Estimate Revision • Feb 07
Consensus EPS estimates fall by 20% The consensus outlook for earnings per share (EPS) in fiscal year 2023 has deteriorated. 2023 revenue forecast decreased from JP¥402.7b to JP¥391.8b. EPS estimate also fell from JP¥151 per share to JP¥121 per share. Net income forecast to grow 23% next year vs 2.9% growth forecast for Chemicals industry in Japan. Consensus price target down from JP¥1,689 to JP¥1,590. Share price fell 4.7% to JP¥1,211 over the past week. Reported Earnings • Feb 01
Third quarter 2023 earnings: EPS and revenues miss analyst expectations Third quarter 2023 results: EPS: JP¥4.09 (down from JP¥41.00 in 3Q 2022). Revenue: JP¥96.8b (up 7.9% from 3Q 2022). Net income: JP¥864.0m (down 90% from 3Q 2022). Profit margin: 0.9% (down from 10.0% in 3Q 2022). Revenue missed analyst estimates by 6.5%. Earnings per share (EPS) also missed analyst estimates by 88%. Revenue is forecast to grow 5.3% p.a. on average during the next 3 years, compared to a 4.2% growth forecast for the Chemicals industry in Japan. Over the last 3 years on average, earnings per share has increased by 18% per year but the company’s share price has remained flat, which means it is significantly lagging earnings.