Takeda Pharmaceutical Co Ltd (TAK)

Price$18.45Cached quoteAs of 2026-09-05 20:22 UTC

AI: Fair-priced

Price checkThe shares look fairly priced because strong cash generation offsets weak reported earnings and heavy debt.

The market values Takeda at roughly ¥9.2 trillion using the latest Tokyo close and about 1.59 billion shares. FY2026 guidance calls for ¥650-750 billion of adjusted free cash flow, meaning cash left after running and investing in the business, equal to roughly a 7-8% cash yield. The price is also about 12 times management's ¥472 core earnings-per-share forecast, but roughly 55 times reported earnings. That gap, plus substantial debt, keeps the valuation from looking clearly cheap.

Big pictureTakeda generates durable cash, but patent losses make near-term growth depend on new medicines.

The supplied SEC-derived history shows revenue rising from ¥3.29 trillion in March 2020 to ¥4.58 trillion in March 2025. Operating cash flow exceeded ¥1 trillion in three of the last five reported years, while cash after capital spending averaged roughly ¥780 billion over six years. Earnings were much less steady. Net income fell from ¥317 billion in March 2023 to ¥108 billion in March 2025. Current guidance also expects core revenue to decline slightly as VYVANSE loses exclusivity, making new launches increasingly important.

Business strengthDiversified medicines fund research and dividends, while debt and goodwill still limit downside protection.

Takeda spent ¥730 billion on research in the March 2025 year while producing about ¥856 billion of operating cash after capital spending, evidence that the existing portfolio can fund substantial reinvestment. It also paid ¥303 billion of dividends. However, supplied balance-sheet data show ¥4.52 trillion of debt against only ¥385 billion of cash, while goodwill was ¥5.32 trillion, about three-quarters of book equity. Shares outstanding rose only about 0.9% from March 2020, so dilution has been modest, although stock compensation exceeded buybacks in the latest supplied year.

What could change the storySuccessful new launches could unlock upside, while legal costs or weaker launches would pressure value.

The bullish case is that ORZEYFUL and other late-stage medicines replace revenue lost to older products while Takeda's cost program lifts profitability. At today's valuation, sustained adjusted free cash flow near or above ¥750 billion would make the shares increasingly attractive. The bear case is more concrete than ordinary drug-development risk: first-quarter adjusted free cash flow fell to ¥68.6 billion, VYVANSE is already losing exclusivity, and the AMITIZA case created a ¥402.5 billion legal provision. If launches disappoint while debt reduction stalls, the present valuation would offer limited protection.

AI: News

ORZEYFUL wins U.S. approvalU.S. approval removes a major development risk and gives Takeda an important new growth product.

On August 5, the U.S. Food and Drug Administration approved ORZEYFUL, or oveporexton, for adults with narcolepsy type 1. It is the first approved medicine designed to restore the missing orexin signaling underlying the disease rather than treating individual symptoms. Takeda is preparing the U.S. launch, subject to completion of Drug Enforcement Administration scheduling. The approval matters because Takeda needs new products to offset mature medicines losing exclusivity, although commercial uptake and pricing remain unproven.

ORZEYFUL expands globallyApprovals in China and Japan broaden ORZEYFUL's commercial opportunity beyond the United States.

China approved ORZEYFUL on July 22, followed by Japan on August 24, giving the medicine three major regulatory approvals within weeks. China cleared it for patients aged 16 and older, while Japan approved it for adults. This geographic expansion strengthens the case that ORZEYFUL can become a meaningful global franchise rather than a single-market product. Revenue impact will depend on launch timing, reimbursement and patient adoption, so the approvals improve probability of success without yet proving blockbuster-level sales.

First-quarter guidance holdsTakeda kept its yearly outlook despite softer underlying growth and sharply lower first-quarter cash generation.

Takeda reported first-quarter results on July 30. Revenue reached ¥1.22 trillion, up 10.2% with currency movements but down 0.5% when exchange-rate effects were removed. Reported operating profit rose 9.1%, while adjusted free cash flow fell 63.9% to ¥68.6 billion. Management nevertheless retained its full-year forecast, including ¥650-750 billion of adjusted free cash flow. The results show established brands largely absorbing VYVANSE's patent-loss pressure, but the weak early cash conversion leaves less room for execution errors.

AMITIZA legal setbackA large U.S. antitrust verdict added a real cash risk despite leaving operating guidance unchanged.

A U.S. jury found against Takeda on May 18 in litigation over delayed generic competition for AMITIZA and awarded about $885 million of single damages, with much of that amount subject to automatic tripling under antitrust law. Takeda later recorded a ¥402.5 billion legal provision while maintaining its FY2026 operating and adjusted cash-flow guidance and pursuing an appeal. The case matters because a large eventual payment could compete directly with debt reduction, dividends and investment in new medicines.

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Financial statements

	2026	2025	2024	2023	2022	2021	2020	2019	2018	2017
Revenue	¥4.51T	¥4.58T	¥4.26T	¥4.03T	¥3.57T	¥3.20T	¥3.29T	¥2.10T	¥1.77T	¥1.73T
Gross profit	¥2.93T	¥3.00T	¥2.84T	¥2.78T	¥2.46T	¥2.20T	¥2.20T	¥1.45T	¥1.27T	¥1.17T
Gross margin	65.12%	65.51%	66.54%	69.11%	68.99%	68.91%	66.89%	68.92%	71.99%	67.74%
Research & development	¥675.92B	¥730.23B	¥729.92B	¥633.33B	¥526.09B	¥455.83B	¥492.38B	¥368.30B	¥325.44B	¥312.30B
Operating expenses	¥2.47T	¥2.66T	¥2.62T	¥2.29T	¥2.00T	¥1.69T	¥2.10T	¥1.21T	¥1.03T	¥1.02T
Operating income	¥464.45B	¥342.59B	¥214.07B	¥490.50B	¥460.84B	¥509.27B	¥100.41B	¥237.69B	¥241.79B	¥155.87B
Operating margin	10.31%	7.48%	5.02%	12.18%	12.91%	15.93%	3.05%	11.33%	13.66%	9.00%
EBITDA	¥726.89B	¥1.10T	¥942.08B	¥1.15T	¥1.04T	¥1.07T	¥684.06B	¥485.38B	¥423.92B	¥327.29B
EBITDA margin	16.13%	24.10%	22.09%	28.68%	29.25%	33.43%	20.78%	23.14%	23.94%	18.90%
Net income	−¥152.39B	¥108.14B	¥144.20B	¥317.04B	¥230.17B	¥376.17B	¥44.29B	¥135.08B	¥186.71B	¥115.51B
Net profit margin	−3.38%	2.36%	3.38%	7.87%	6.45%	11.76%	1.35%	6.44%	10.55%	6.67%
Basic EPSper basic share	¥60.88	¥68.36	¥92.09	¥204.29	¥147.14	¥240.72	¥28.41	¥140.61	¥239.35	¥147.15
Diluted EPSper diluted share	¥59.82	¥67.23	¥91.16	¥201.94	¥145.87	¥238.96	¥28.25	¥139.82	¥237.56	¥146.26

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Owners

Reported shareholders

Reference date Jun 30, 2026

Reported holdings Number of shares

View holders

Top 20 reported holders of TAK
Holder	Shares held
Capital Research Global Investors	19.3M
FMR LLC	9.6M
MORGAN STANLEY	6.99M
ADAGE CAPITAL PARTNERS GP, L.L.C.	6.05M
GOLDMAN SACHS GROUP INC	5.13M
BRANDES INVESTMENT PARTNERS, LP	4.54M
ARROWSTREET CAPITAL, LIMITED PARTNERSHIP	3.73M
BlackRock, Inc.	3.69M
RENAISSANCE TECHNOLOGIES LLC	2.57M
Qube Research & Technologies Ltd	2.21M
FIRST TRUST ADVISORS LP	2.11M
D. E. Shaw & Co., Inc.	2.05M
MANAGED ASSET PORTFOLIOS, LLC	1.82M
NORTHERN TRUST CORP	1.74M
VAN ECK ASSOCIATES CORP	1.67M
ENVESTNET ASSET MANAGEMENT INC	1.6M
AQR CAPITAL MANAGEMENT LLC	1.53M
Quantinno Capital Management LP	1.4M
WELLS FARGO & COMPANY/MN	1.15M
MILLENNIUM MANAGEMENT LLC	1.05M

Bars compare reported share counts. A matching total for this share class and reporting period is unavailable, so percentages are not shown.

Source: SEC Form 13F ↗Updated Sep 29, 2026 · Quarterly data

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Jul 1, 2024–Jun 30, 2026

Buys0$0.00 disclosed value

Sells (SEC code S)0$0.00 disclosed value

No insider transactions transactions were reported in the stored SEC coverage.

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