Japan Tobacco (JAPAY) fair value: what the stock is really worth
As of Nov 6, 2026: fair value (intrinsic value) of Japan Tobacco stock $15.56, price $16.98, that is 8.4% below the price, quality 59 out of 100. Rating: fairly valued. Calculated from audited financials with 24 of our 26 valuation models and 37 quality factors, updated daily.
69 individual criteria per stock, every one traceableSee the method →
Price vs Fair Value
White line = price, green steps = our fair value per fiscal year. As of Nov 5, 2026.
How to read this chart
60‑month range $5.64 – $24.11 · fair‑value band $10.31 – $22.29 · the $16.98 price screens above the $15.56 fair value. Green steps = our fair value per fiscal year (point-in-time, no hindsight). As of Nov 5, 2026.
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Japan Tobacco Inc., a tobacco company, engages in the manufacture and sale of tobacco products in Japan and internationally. It operates through two segments: Tobacco Business and Processed Food Business.
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It offers tobacco products, such as cigarettes, fine cut tobacco products, cigars, pipes, and hookah products. The company provides reduced-risk products, including heated tobacco, infused tobacco, e-vapor, traditional oral, and modern oral.
Further, the company provides frozen and room-temperature products comprising frozen udon noodles, packed rice, and frozen okonomiyaki; and seasonings, including yeast extracts, assembled, kelp and seaweed, and oyster sauces. It offers its products under the Winston, Camel, Möbius, and LD brands.
Japan Tobacco Inc. was founded in 1898 and is headquartered in Tokyo, Japan.
Stock analysis
Japan Tobacco (JAPAY) currently trades at $16.98, while our model-based Fair Value estimate is $15.56, so the stock looks roughly fairly valued today (gap 9.1%).
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Valuation
Bull case: the Growth Earnings group reads highest at a median of $15.49 per share, and 6 of the 24 models we run sit above the $16.98 price.
Bear case: the Dividend Discount group reads lowest at $9.80, and 18 of the 24 models stay below the price. Data coverage for this calculation is high.
Scenario range: $10.31 (bear) to $22.29 (bull), the price of $16.98 sits inside it. Bear and bull are the same models on cautious and optimistic assumptions, a range, not a price target.
Quality & growth
The Quality Score stands at 59/100 (solid quality), in the Consumer Defensive sector.
Healthy Growth: Revenue growth appears healthy and is supported by profitability and cash-flow quality.
Japan Tobacco ADR reported revenue of ¥3.6T in FY2025 versus ¥2.3T in FY2021, a compound +11.8%/yr. Reported net income was ¥535B in FY2025, compounding +12.1%/yr from FY2021.
Key figures
Market cap $82.6B Large · P/E ratio 15.6 · P/S ratio 2.29 · EPS (TTM) $1.09 · Dividend yield 3.6% · Net margin 14.7% · Return on equity 14.7% · Return on assets (EBIT) 8.3% (5-year average).
Competitive moat
Our AI-assisted moat analysis scores the competitive advantage at 72 out of 100 (medium confidence).
What moves the price
The share trades about 30% below its 52-week high and 3% above its 52-week low, currently below its 200-day average.
For context, the median of 10 Consumer Defensive peers we cover trades at 8% fair-value upside, at −8%, JAPAY screens richer than that median.
Fair Value models
Bear$10.31Fair Value $15.56Bull$22.29
Price $16.98 · Downside -8.4%
Model ⓘEach model values the company its own way (discounted cash flow, earnings, assets, dividends). The fair value above starts from their evidence-weighted blend, not from a single model. In cyclical trough or peak years, after dilution or a stock split it is adjusted afterwards, so it can sit above or below the models. Based on fiscal year 2025 figures (about 10 months old). Earnings retained since then ($0.9347 per share) are deliberately not added.Bear ⓘBear = the cautious scenario: the same model computed with conservative anchors (lower growth, margins and valuation multiples). Together with Bull it frames a plausible valuation range, not a price target.BaseBull ⓘBull = the optimistic scenario: the same model computed with favourable anchors (higher growth, margins and valuation multiples). Together with Bear it frames a plausible valuation range, not a price target. If a model's bull case is above four times its base value, the table shows that limit with a > sign (like the overall Bull above): beyond it no assumption holds.Coverage ⓘCoverage = how well-backed THIS model's estimate is for this stock (0–100): how complete and reliable its input data are, and how well the model fits the company. The final Fair Value is an evidence-weighted blend, so better-evidenced models count more. Green ≥70, amber 50–69, grey below 50.
Growth Quality ⓘGrowth is valuable only when reinvestment earns attractive returns (Aswath Damodaran): sustainable growth depends on return on capital, reinvestment and efficiency. Basis: total company revenue over the periods shown on the cards (3Y/5Y/all years), not per share, so a merger can show up as a growth jump; per-share earnings growth is in the value-creation card.95/100
Revenue growth appears healthy and is supported by profitability and cash-flow quality.
Revenue growth 1 year
+15.4%
Revenue growth 3 years ⓘMeasures the company's TOTAL revenue from reported annual statements: compound average growth per year (CAGR) from the fiscal year 3, 5 or N years back to the most recent comparable fiscal year. Not per share: buybacks do not change this number, and a merger can appear as a growth jump. Per-share growth (which does include buybacks) is in the value-creation card.
+11.0%
Revenue growth 5 years ⓘMeasures the company's TOTAL revenue from reported annual statements: compound average growth per year (CAGR) from the fiscal year 3, 5 or N years back to the most recent comparable fiscal year. Not per share: buybacks do not change this number, and a merger can appear as a growth jump. Per-share growth (which does include buybacks) is in the value-creation card.
+11.7%
Start year 2020 (pandemic). Over 10 years: +4.9% a year
Revenue growth 24 years ⓘMeasures the company's TOTAL revenue from reported annual statements: compound average growth per year (CAGR) from the fiscal year 3, 5 or N years back to the most recent comparable fiscal year. Not per share: buybacks do not change this number, and a merger can appear as a growth jump. Per-share growth (which does include buybacks) is in the value-creation card.
−0.9%
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What shareholders gained per year (last 5 years), in JPY ⓘWhat the business itself delivers per year: earnings growth per share plus the dividend yield. This is what you get IF the market keeps valuing the stock the same way: it contains no assumption about the market changing its mind. Computed per share, so buybacks count and a merger does not pass as growth. For a company that pays no dividend it is pure earnings growth per share. Period: earnings growth per share as CAGR over the last 5 reported fiscal years (annual statements), plus the current dividend yield. The start value is the median of the three years around the start, so a single crisis year (a pandemic or a write-down) does not distort the rate. Measured in JPY: this currency has depreciated against the euro and dollar over the long run, so part of the nominal rate is currency erosion that never reaches a EUR/USD investor.
+13.2%
Earnings growth per share plus dividend.
Earnings per share, growth per year+9.6%
Dividend (yield on the price)3.6%
Pace: 5 vs 10 years ⓘTwo data points, not a trend model: earnings growth per share over the last 5 fiscal years against the last 10. Labelled "steady" when both rates are within 3 percentage points of each other, otherwise picking up or flattening. Shown only when ten years of history exist.9.6% vs 2.5%, picking up
Profit margin 2020 to 2025 ⓘOperating margin then vs now, from reported annual statements. A falling margin after a boom year is the classic peak-earnings signal: the growth rate then leans on an inflated base.22% → 22%
Pace: the 5-year rate starts in 2020 (pandemic)
Growth Forecast
A lot of optimism in the price
The price assumes about as much growth as the company has delivered so far and more than analysts expect.
What the price assumes ⓘThis turns our valuation around: instead of asking what the share is worth, it asks what growth the current price requires. It uses the cash the company keeps after all spending (free cash flow), the same discount rate as our models, five years of growth, then slowing evenly to 2 % a year by year ten. Compared with the analysts' sales forecasts extended to the same five years (at least three analysts, for context only, it does not enter the Fair Value): within 3 percentage points counts as "in line" (amber), below that little optimism (green), above that a lot of optimism (red).
+9.8%
Yearly growth needed for the next five years to justify today's price.
What forecasts expect ⓘAnalysts publish sales forecasts for the next two fiscal years. For the years after that, growth slows evenly to 2 % a year by year ten (2 % is the long-run rate our models use). Projected years are marked as such.
+4.8%
Yearly sales growth analysts expect, extended to five years.
After inflation (figures in JPY, Japan: IMF forecast 2.1% a year to 2030, 1.3% from 2016 to 2025) that is about +7.5% a year for the price and +2.6% for the forecasts.
News mood ⓘNews mood, the average tone of recent news (80 articles), rated against how stocks are usually covered. 🚀 Hype = unusually upbeat · 🙂 Positive = above average · 😐 Neutral = typical · 🙁 Negative = below average · 😨 Very negative = unusually downbeat. It reflects the tone of coverage, not our valuation.Neutral
Recent news coverage is roughly neutral, about typical for how stocks are covered.
AI conclusion: Moderate moat stems from tobacco pricing power and scale, while limited durable signals and regulatory scrutiny form the main weaknesses.
Main risk: Philip Morris International's IQOS with around 70 percent share and British American Tobacco's glo could continue to outpace Japan Tobacco's Ploom in the heated tobacco category in Japan and other markets, limiting gains from the shift away from combustibles.
Bull case: By accelerating Ploom innovation and global expansion while using acquisitions like Vector to diversify, Japan Tobacco could increase its heated tobacco share and offset combustible declines.
Bear case: If rivals maintain dominance in heated tobacco and cash from Russia and Iran stays trapped, the company could struggle to fund growth investments and face tighter margins across its portfolio.
Japan Tobacco raised its full-year earnings outlook after nine-month results showed pricing power and double-digit growth in reduced-risk products offsetting a modest drop in combustible volumes. Ploom heated tobacco volumes rose nearly 40 percent while the traditional business still accounts for the vast majority of revenue. Our models currently see the shares as overvalued. Will the heated segment scale fast enough to lift overall margins, or will ongoing declines in cigarettes limit the upside?
Price, fair value, quality and upside side by side.
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Peer GroupⓘHow this stock ranks against its industry: the green marker is this stock, the band is the typical 25–75% peer range, and the tick is the median.Tobacco · 29 stocks
Beats the industry median on 6/15 measures
A mixed picture versus its industry peers.
Valuation
Quality Score59 · Below median
Fair Value upside−8.4% · Below median
Profitability
Return on equity (12 months)14.7% · Above median
Return on assets6.4% · Below median
Net margin (12 months)16.1% · Above median
Operating margin (12 months)29.8% · Top 25%
Growth and dividend
Revenue growth (quarter YoY)17.0% · Top 25%
Dividend yield (12 months)3.6% · Below median
Balance sheet
Debt / equity0.39× · Above median
Valuation Multiplesvs Tobacco median · lower = cheaper
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Is Japan Tobacco (JAPAY) overvalued or undervalued?
As of Nov 5, 2026, our model estimates a fair value of $15.56 versus a price of $16.98, about 8% lower (fairly valued).
What is the fair value of JAPAY?
Our model-based fair value for Japan Tobacco is $15.56 (as of Nov 5, 2026), built from audited fundamentals. The current price: $16.98.
What is the quality score of JAPAY?
Japan Tobacco has a Quality Score of 59/100. It measures business quality (profitability, growth, cash flow, balance-sheet strength, investment discipline, share issuance). Market factors such as price momentum and volatility do not enter the number; they are shown separately in the detail view.
What is the price target for Japan Tobacco (JAPAY)?
Our model-based price target is the fair value of $15.56 (as of Nov 5, 2026) from 24 valuation models. Cautious scenario $10.31, optimistic scenario $22.29. It is a calculation from audited fundamentals, not an analyst target.
What is the Japan Tobacco ADR stock forecast for 2026?
Our models put fair value at $15.56, about 8% lower versus a price of $16.98 (fairly valued). Cautious scenario $10.31, optimistic scenario $22.29. The calculation is refreshed regularly with new filings.
What is the revenue of Japan Tobacco (JAPAY)?
Japan Tobacco reported trailing-twelve-month revenue of about ¥3.8T (latest available figure, as of Nov 5, 2026).
Does Japan Tobacco ADR pay a dividend?
Japan Tobacco currently shows a dividend yield of 3.57% relative to its recent price (as of Nov 5, 2026).
How much is the dividend of Japan Tobacco (JAPAY) and when is the ex-dividend date?
Japan Tobacco has a dividend yield of 3.6%. The last ex-dividend date was Jun 30, 2026. A dividend has been paid every year since at least 2014. The payout ratio is 63.7% of earnings. Free cash flow covers the dividend 1.14 times. Our assessment: Sustainable. Payout and cash coverage both look sustainable.
What growth is priced into Japan Tobacco (JAPAY)?
For today's price to be fair in a discounted-cash-flow model, Japan Tobacco would have to grow free cash flow by +9.8 % per year for five years (discount rate 8.1 %, then slowing evenly to 2 % perpetual growth by year ten). Over the last 5 years revenue grew +11.7 % per year. As of Nov 5, 2026.
What discount rate (WACC) does the fair value of JAPAY use?
Our models discount Japan Tobacco at 8.1 %: a base by market capitalisation (large), damped by beta 0.15, country premium for USA. The same rate applies in all 26 models.
What is a reverse DCF?
A reverse DCF turns the usual calculation around. Instead of deriving a value from assumptions, it takes today's price as given and asks: what free-cash-flow growth would a company have to deliver for exactly this price to be fair? The result is not a forecast but the expectation already priced in. For Japan Tobacco that is +9.8 % per year for five years, then slowing evenly to 2 % by year ten, using the same discount rate (8.1 %) and the same formula as our fair value.
How much growth has Japan Tobacco (JAPAY) delivered so far?
Over the past 5 years revenue at Japan Tobacco grew +11.7 % a year. The price currently implies free-cash-flow growth of +9.8 % per year. Comparing the two shows how much confidence is in the price: if it demands more than has been delivered, the business has to accelerate for the maths to work.
How fast is the sector of Japan Tobacco (JAPAY) growing?
The median revenue growth in the sector is +3.6 % a year. That is the yardstick for the growth priced into Japan Tobacco (+9.8 % per year): it shows whether the expectation is within the usual range or beyond it.
What is the free cash flow yield of Japan Tobacco (JAPAY)?
The free-cash-flow yield on the price is 4.08 %: that much free cash flow Japan Tobacco produces per unit of market value. When it exceeds the discount rate of our models (8.1 %), the business already earns more than its cost of capital demands, and the price needs little additional growth.
What is the intrinsic value of Japan Tobacco (JAPAY)?
Intrinsic value and fair value mean the same thing: what the business is worth on its numbers, independent of the share price. For Japan Tobacco it is $15.56 per share (as of Nov 5, 2026), against a price of $16.98. It is the blended result of 24 valuation models in 8 families (DCF Models, Earnings-Based, Dividend Discount, Multiples, Asset-Based, Growth DCF, Economic Profit, Growth Earnings).
Is Japan Tobacco ADR stock overvalued or undervalued in 2026?
As of Nov 5, 2026, JAPAY trades above its calculated fair value: price $16.98, fair value $15.56, a gap of about −8% (fairly valued). The calculation is refreshed with each new quarterly report, so the verdict can change during the year.
Is fair value the same as the market price of JAPAY?
No. The price is what the market pays today ($16.98); the fair value is what the company's own numbers justify ($15.56). For Japan Tobacco the two are $1.42 per share apart. That gap is exactly why we show both numbers side by side.
How much is Japan Tobacco ADR worth?
The market values Japan Tobacco at about $82.6B (market capitalisation, as of Nov 5, 2026). Per share that is $16.98; our models calculate a fair value of $15.56 per share.
What do the bullish and bearish scenarios say about JAPAY?
Our models span a range for Japan Tobacco: cautious scenario $10.31, base $15.56, optimistic $22.29 per share (as of Nov 5, 2026, price $16.98). The range comes from different growth and margin assumptions, not from analyst opinions.
What is the P/E ratio of JAPAY?
Japan Tobacco trades at a price-to-earnings ratio of 15.6 (as of Nov 5, 2026). A P/E on its own says little: it compares the price with ONE year of profit, while our fair value of $15.56 is built from several models across several years. Median P/E at fiscal year-end, 10 fiscal years (2016 to 2025), reported earnings: 12.2. Other multiples: PEG 1.2, P/B 3.2, P/S 3.4, EV/EBITDA 11.5.
What is the PEG ratio of JAPAY?
The PEG ratio of Japan Tobacco is 1.16 (P/E divided by earnings growth, as of Nov 5, 2026). That is above 1, so the growth is already paid for in the price.
How solid is the balance sheet of Japan Tobacco (JAPAY)?
Balance-sheet figures for Japan Tobacco (as of Nov 5, 2026): return on equity 14.7%, debt of 0.39 per unit of equity. They feed the Quality Score of 59/100, which measures business quality independently of the share price.
How far is JAPAY from its 52-week high?
Japan Tobacco trades at $16.98, about 30% below its 52-week high of $24.11 and 3% above the low of $16.47 (as of Nov 6, 2026). Distance from the high says nothing about value: that is what the fair value of $15.56 is for.
Which stocks are comparable to Japan Tobacco ADR?
From the same area (Consumer Defensive) we also value Philip Morris International Inc, Altria Group, British American Tobacco p.l.c., ITC Limited, among others. Each of them has its own fair-value calculation on this site using the same models, so the comparison is like for like.
Is Japan Tobacco ADR stock attractive at the current price?
The data as of Nov 5, 2026: price $16.98, calculated fair value $15.56 (−8%), Quality Score 59/100, from 24 models. Whether that fits your horizon and risk tolerance is your call. We provide the calculation, not investment advice.
How is the fair value of JAPAY calculated?
We run Japan Tobacco through 24 models from 8 families: DCF Models, Earnings-Based, Dividend Discount, Multiples, Asset-Based, Growth DCF, Economic Profit, Growth Earnings. Every model gets the same audited fundamentals; the fair value of $15.56 builds on their evidence-weighted average, with the spread shown as a cautious and an optimistic scenario.
Is it still worth investing in stocks now?
The global stock market currently sits 13.3% above its aggregate fair value. Japan Tobacco itself currently trades above fair value. An expensive market is no reason to stay out and no reason to buy everything at once: keep a broad savings plan running, buy single stocks only with money you can do without, and hold part of your money liquid while the market is high. The full picture including sectors is on is it worth investing now.
What is the share price of Japan Tobacco (JAPAY)?
The closing price on Nov 6, 2026 was $16.98. Our model-based fair value is $15.56, about 8% lower (fairly valued). We carry closing prices from our data provider, not a live tick.
What should I pay attention to with Japan Tobacco ADR right now?
The price sits close to our fair value, market and models broadly agree here, little valuation tension. A fairly wide model range ($10.31 to $22.29) leaves room in how you read the outcome.
Where does the earnings growth of Japan Tobacco (JAPAY) come from?
Earnings per share at Japan Tobacco grew +4.1 % a year from 2014 to 2025. Broken into its drivers: revenue per share +9.6 %, EBIT margin −3.3 %, tax rate −0.1 %, residual (interest, one-offs) −1.7 %. The four rates multiply to the earnings growth rate, they do not add up. Start and end are three-year averages so a single exceptional year does not distort the result.
Key figures of Japan Tobacco
How large is the market capitalisation of Japan Tobacco (JAPAY)?
The market capitalisation of Japan Tobacco is $82.6B. The stock-market value of the whole company: share price times number of shares. It is what the market asks for the entire business today.
What is the P/S ratio of Japan Tobacco (JAPAY)?
The price-to-sales ratio of Japan Tobacco is 2.29 (P/E × margin). Price to sales: market value relative to yearly revenue. Useful when profit is thin or distorted.
What are the earnings per share of Japan Tobacco (JAPAY)?
Earnings per share at Japan Tobacco are $1.09 (price ÷ EPS = P/E 15.6). Earnings per share over the last twelve months: total profit spread across every single share.
What is the dividend yield of Japan Tobacco (JAPAY)?
The dividend yield of Japan Tobacco is 3.6% (payout 55.6%). Yearly dividend relative to the share price. 3% pays 3 per 100 invested. Below: how much of profit is used for it.
What is the net margin of Japan Tobacco (JAPAY)?
The net margin of Japan Tobacco is 14.7% (fiscal year 2025). How much of every unit of revenue ends up as profit. 10% means 10 cents of profit per dollar of sales.
What is the return on equity of Japan Tobacco (JAPAY)?
The return on equity (ROE) of Japan Tobacco is 14.7% (last twelve months). Profit relative to shareholders' equity, how efficiently the company works with its owners' money.
What is the EBIT return on assets of Japan Tobacco (JAPAY)?
On an EBIT basis the return on assets of Japan Tobacco is 8.3% (avg 5y). Operating profit (EBIT) relative to everything the company owns, as a multi-year average. It describes the business model rather than one good or bad year.
What is the operating margin of Japan Tobacco (JAPAY)?
The operating margin of Japan Tobacco is 29.8% (last twelve months). Profit from the core business (before interest and taxes) relative to revenue.
How fast is revenue growing at Japan Tobacco (JAPAY)?
Revenue at Japan Tobacco is growing +17.0% versus a year earlier (3y avg +11.0%). How much revenue grew versus a year earlier (YoY). The 3-year average next to it puts the single year in context.
How fast are earnings growing at Japan Tobacco (JAPAY)?
Earnings per share at Japan Tobacco are growing +44.6% versus a year earlier. How much earnings per share grew versus a year earlier.
How much net debt does Japan Tobacco (JAPAY) carry?
The net debt of Japan Tobacco is ¥848B (fiscal year 2025, ≈ 2.2 yrs of FCF). Debt minus cash on hand. The note shows how many years of free cash flow could in theory pay it off.
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Broad data
Nov 5, 2026