Mizuho has adjusted its recommendation on Resonac Holdings Corp (4004) from Outperform to Neutral while simultaneously boosting its price target to JPY9,000.00, up from JPY4,800.00. That revised target implies roughly 3% upside from current levels. The move comes as the stock has experienced a recent pullback of 7.89% over the past week, even after delivering a strong 149.65% gain over the last 12 months.
Analysts at Mizuho pointed to Resonac's ongoing corporate reshaping as evidence of progress toward becoming a focused IT materials supplier. The company has executed several strategic moves as part of this transition: it sold its lead acid battery business, restructured its graphite electrode operations, and separated its petrochemical unit into a wholly owned subsidiary named Crasus Chem as a step toward a potential spin-out.
On the earnings front, Mizuho projects operating profit from Resonac’s semiconductor applications to rise from JPY108 billion in 2025 to JPY122 billion in 2026. The firm attributes that increase to growth tied to AI-related demand and to contributions from legacy Hitachi Chemical assets now within Resonac’s scope.
In addition, Mizuho expects a partial spin-out of Crasus could occur as early as the fourth quarter of 2026. The broker models an overall operating profit increase from JPY50 billion in 2025 to JPY131 billion in 2026, reflecting the normalization of extraordinary costs that weighed on prior periods.
Despite the upbeat earnings trajectory, Mizuho expressed reluctance to encourage investors to chase the stock at current multiples. The firm highlighted valuations of 17x price-to-earnings for 2026 and 15.5x for 2027 as reasons for caution. It also signaled specific concern about Resonac’s mobility segment - notably EV battery-related materials - which have seen intensifying competition and greater exposure to Nissan.
Those valuation concerns are consistent with InvestingPro metrics that classify the shares as currently overvalued on an EV/EBITDA basis, with a reported ratio of 18.77x.
Investors will have an opportunity to assess progress on the transformation when Resonac reports results next on February 13, nine days from now, which could shed additional light on execution and cost normalization.
Separately, Goldman Sachs has commenced coverage on Resonac with a Buy rating and a price target of JPY8,050.00. Goldman Sachs emphasized Resonac’s scale in the semiconductor materials market, describing the company as the world’s largest manufacturer of back-end semiconductor materials and noting that its product suite spans a substantial portion of both back-end and front-end semiconductor processes. That endorsement underscores a bullish view of Resonac’s market position and potential growth in semiconductor-related end markets.
For now, market participants face a contrast between strong operational forecasts for semiconductor-related profit and near-term valuation and competitive pressures in mobility materials. The next earnings release is likely to be a key data point for evaluating whether projected profit improvements and the planned corporate actions translate into broader investor confidence.