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Yakult Honsha Co Ltd 2267

Morningstar Rating
JPY 2,978.50 −22.50 (0.75%)
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Company Report

Yakult 1000 Remains the Growth Engine Despite Deceleration; Persistent Asia Weakness a Concern

Research and development in probiotics has laid the foundation for Yakult’s business, primarily comprising beverage products and pharmaceuticals. The flagship products are probiotics drinks marketed under the namesake brand in 40 countries across four continents, making up an estimated 80% of group sales and 90% of profits. Expanding the international footprint and enhancing domestic profitability through premiumization are the two pillars of Yakult’s growth strategy. Domestic growth lifted by the premium Yakult 1000/ Y1000 success has taken up the baton from overseas volume expansion, becoming a key profit driver.

Price vs Fair Value

2267 is trading at a 21% discount.
Price
JPY 3,001.00
Fair Value
JPY 6,434.00
Uncertainty
Medium
1-Star Price
JPY 1,518.00
5-Star Price
JPY 2,339.00
Economic Moat
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Capital Allocation
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Bulls Say, Bears Say

Bulls

Yakult’s category exposure to probiotics will continue to benefit from the demographic trends in Asia, where an aging population raises health awareness.

Bears

Yakult’s profit growth may stall after the boom of Yakult 1000/Y1000, a key growth engine of the group’s profits, dissipates while higher living costs and price hikes resulting from inflation continue to depress sales volume in overseas markets.

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Trading Information

Previous Close Price
JPY 3,001.00
Day Range
JPY 2,954.003,004.00
52-Week Range
JPY 2,920.505,215.00
Bid/Ask
JPY 2,978.00 / JPY 2,983.50
Market Cap
JPY 902.91 Bil
Volume/Avg
1.7 Mil / 1.8 Mil

Key Statistics

Price/Earnings (Normalized)
18.56
Price/Sales
1.86
Dividend Yield (Trailing)
1.84%
Dividend Yield (Forward)
1.86%
Total Yield
1.85%

Company Profile

Yakult is a pioneer in probiotics, which launched the probiotic drinks Yakult in 1935 after Minoru Shirota’s discovery of Lactobacillus casei strain Shirota, a strain of lactic acid bacteria proved to be able to live in intestines, in 1930. It operates in 40 countries across four continents selling mainly the Yakult probiotic drinks. Apart from the retail outlets, the home delivery channel, served by a team of 83,000 Yakult Ladies globally, contributes about 45% of its probiotic drink volume. Overseas markets comprise 40% of group sales and profits. Yakult has built a meaningful presence in populated emerging markets including China, Indonesia, Mexico, and Brazil. It plans to step up expansion in the U.S. It also operates a pharmaceutical business with an emphasis on oncology drugs.
Sector
Consumer Defensive
Industry
Beverages - Non-Alcoholic
Stock Style Box
Mid Growth
Total Number of Employees
29,880

Competitors

Valuation

Metric
2267
02319
600887
Price/Earnings (Normalized)
18.5610.2617.83
Price/Book Value
1.661.253.38
Price/Sales
1.860.561.39
Price/Cash Flow
11.195.4610.84
Price/Earnings
2267
02319
600887

Financial Strength

Metric
2267
02319
600887
Quick Ratio
2.310.990.70
Current Ratio
2.691.200.99
Interest Coverage
103.374.346.62
Quick Ratio
2267
02319
600887

Profitability

Metric
2267
02319
600887
Return on Assets (Normalized)
9.99%5.00%6.81%
Return on Equity (Normalized)
14.84%14.46%18.67%
Return on Invested Capital (Normalized)
10.80%6.28%9.64%
Return on Assets
2267
02319
600887
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