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Meiji Holdings Co Ltd 2269

Morningstar Rating
JPY 3,525.00 −15.00 (0.42%)
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Company Report

Dairy Restructuring and Product Innovations Most Critical to Restoring Meiji’s Food Profitability

Margin expansion through growth in value-added health foods and an enlarged overseas sales scale will serve as a key driving force behind Meiji’s midterm growth. In the near term, restoring margins squeezed by rapid Japanese yen depreciation and cost inflation and minimizing China losses is a priority. Meanwhile, restructuring efforts to enhance pharmaceutical profitability have borne fruit. Pharma profit growth, lifted by new vaccines and overseas expansion, will hold equal importance as food to the fairly challenging growth target of more than 11% CAGR in operating profits for the three-year plan ending March 2027.

Price vs Fair Value

2269 is trading at a 892% premium.
Price
JPY 3,525.00
Fair Value
JPY 4,321.00
Uncertainty
Medium
1-Star Price
JPY 5,182.00
5-Star Price
JPY 1,577.00
Economic Moat
Mclgv
Capital Allocation
Wnhqrfcv

Bulls Say, Bears Say

Bulls

Meiji is poised to ride on the global health trend and capture rising demand for health and functional foods in Asia, particularly China.

Bears

Top-line growth seems capped by limited domestic volume growth as the population shrinks, while overseas development is still in the early stages.

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Trading Information

Previous Close Price
JPY 3,540.00
Day Range
JPY 3,525.003,556.00
52-Week Range
JPY 3,235.003,823.00
Bid/Ask
JPY 3,524.00 / JPY 3,531.00
Market Cap
JPY 973.64 Bil
Volume/Avg
600,700 / 965,540

Key Statistics

Price/Earnings (Normalized)
22.80
Price/Sales
0.89
Dividend Yield (Trailing)
2.70%
Dividend Yield (Forward)
2.84%
Total Yield
2.70%

Company Profile

Meiji Holdings was established in April 2009 as a merged entity of Meiji Dairies, Japan’s largest dairy company, and Meiji Seika, the country’s number-two confectionery maker. The amalgamation was propelled by a surge in commodity prices, Japan’s aging and shrinking population, and fierce competition. The food business, comprising dairy and confectionery operations, represents more than 80% of the group’s sales and 70% of profits. The rest mainly comes from the pharmaceutical business, specializing in antibacterial and generic drugs, as well as vaccines. Overseas food operations, mainly in China, the US, and Southeast Asia, comprise merely 6.5% of the group sales are in red due to a surge in investment in China’s new factories and fierce price competition initiated by Chinese dairy makers.
Sector
Consumer Defensive
Industry
Packaged Foods
Stock Style Box
Mid Value
Total Number of Employees
24,105

Competitors

Valuation

Metric
2269
02319
2267
Price/Earnings (Normalized)
22.809.4517.72
Price/Book Value
1.321.211.58
Price/Sales
0.890.531.78
Price/Cash Flow
8.186.7211.06
Price/Earnings
2269
02319
2267

Financial Strength

Metric
2269
02319
2267
Quick Ratio
0.960.852.17
Current Ratio
1.751.052.56
Interest Coverage
238.113.95105.20
Quick Ratio
2269
02319
2267

Profitability

Metric
2269
02319
2267
Return on Assets (Normalized)
6.38%5.03%9.93%
Return on Equity (Normalized)
10.34%14.54%14.77%
Return on Invested Capital (Normalized)
8.82%6.45%10.53%
Return on Assets
2269
02319
2267
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