Aozora Bank (8304) AI Stock Analysis

• Market Cap: $288.75B
• Dividend Yield: 4.21%
• Average Volume (3M): 1.04M
• Price to Earnings (P/E): 13.5
• Beta (1Y): 0.66
• Revenue Growth: 1.12%
• EPS Growth: 6.36%
• Country: JP
• Employees: 2,476
• Sector: Financial
• Sector Strength: 80
• Industry: Banks - Regional
• EPS (TTM): 30.59
• Shares Outstanding: 139,789,410
• 10 Day Avg. Volume: 1,033,240
• 30 Day Avg. Volume: 1,038,639
• PEG Ratio: -0.43
• Price to Book (P/B): 0.64
• Price to Sales (P/S): 0.00
• P/FCF Ratio: -4.16
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $2,038.18
• Price Target Upside: -3.72% Downside
• Rating Consensus: Moderate Sell
• Number of Analyst Covering: 2

• Rating: 42 Neutral
• Price Target: ―

Aozora Bank's overall score reflects significant financial challenges, particularly in generating income and cash flows. The technical indicators signal a bearish trend, while the valuation metrics raise concerns about profitability. Despite a healthy dividend yield, the negative financial performance and technical analysis suggest caution for investors.

Aozora Bank Business Overview & Revenue Model

Company Description

Aozora Bank, Ltd., together with its subsidiaries, provides various banking products and services in Japan and internationally. It operates through Retail Banking Group, Institutional Banking Group, Allied Banking Group, Specialty Finance Group, International Finance Group, and Financial Markets Group segments. The company offers checking accounts, savings accounts, time deposits, deposits-at-notice, non-residents deposits, and negotiable certificates of deposit, as well as deposits in foreign currencies. It also provides loans on deeds and notes, and overdrafts; corporate, M&A, project, equity, sustainable, LBO, structured, real estate, business recovery, and project financing products; syndicated loans; discount on promissory notes; securities investments, including public, local, and corporate bonds, as well as equity and other securities; domestic and foreign exchange services; and consignment of bonds. In addition, the company offers liabilities guarantee, securities lending, public bonds underwriting, agency, custody, financial instruments intermediary, securitization, M&A advisory, business succession consulting, business expansion, equity/debt funding, and consulting services. Further, it is involved in the over-the-counter sale of securities investment trusts and insurance products; and provision of trust services for secured corporate bonds, as well as interest rate, currency, and other derivative transaction services. As of March 31, 2021, it operated 19 branches. The company was formerly known as Nippon Fudosan Bank, Limited and changed its name to Aozora Bank, Ltd. in 2001. Aozora Bank, Ltd. was incorporated in 1957 and is headquartered in Tokyo, Japan.

How the Company Makes Money

Aozora Bank makes money through a variety of revenue streams typical of financial institutions. The primary sources of revenue include interest income from loans and advances provided to individual and corporate clients. The bank also earns from fees and commissions on services such as asset management, advisory, and brokerage activities. Additionally, Aozora Bank generates income from trading activities and investments in financial markets. Strategic partnerships and collaborations with other financial entities might also contribute to its earnings, enhancing its service offerings and market reach. The bank's revenue model is supported by its ability to manage risks and optimize its asset portfolio to ensure sustainable profitability.

Aozora Bank Financial Statement Overview

Summary

Aozora Bank is facing financial challenges across its income, balance sheet, and cash flow statements. Despite a stable equity position, negative income and cash flow metrics highlight operational inefficiencies and sustainability concerns. Declining revenue and negative cash flows need to be addressed to improve financial health.

Income Statement

Aozora Bank's income statement reveals mixed performance. The TTM data shows negative net income, resulting in a negative net profit margin, while the gross profit margin is positive but distorted due to negative revenue. Revenue growth has declined over the years, indicating a downward trend in earnings. EBIT margin is positive in the TTM, suggesting operational efficiency, but EBITDA margin is negative, highlighting issues with earnings before interest, taxes, depreciation, and amortization.

Balance Sheet

The balance sheet of Aozora Bank shows a moderate financial position. The debt-to-equity ratio is relatively high, indicating leverage reliance, but the equity ratio remains stable, reflecting a solid equity base compared to total assets. Return on equity is negative due to the negative net income, suggesting challenges in generating returns for shareholders.

Cash Flow

The cash flow statement indicates significant challenges. Operating cash flow is consistently negative, leading to a negative free cash flow. With the absence of positive operating cash flow, the bank struggles to sustain operations without external financing, as evidenced by negative free cash flow to net income ratio.

Breakdown	TTM	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	136.88B	220.18B	106.52B	105.78B	116.28B	116.26B
Gross Profit	164.28B	0.00	106.52B	105.78B	116.28B	116.26B
EBITDA	-4.53B	23.79B	0.00	14.34B	52.44B	44.81B
Net Income	-18.97B	20.52B	-49.90B	8.72B	35.00B	28.97B
Balance Sheet
Total Assets	7.92T	7.76T	7.60T	7.18T	6.73T	5.92T
Cash, Cash Equivalents and Short-Term Investments	1.42T	0.00	1.58T	1.28T	1.14T	950.11B
Total Debt	831.41B	1.23T	744.70B	683.39B	617.42B	563.67B
Total Liabilities	7.47T	7.30T	7.21T	6.75T	6.24T	5.43T
Stockholders Equity	446.68B	451.42B	384.40B	438.66B	493.49B	494.55B
Cash Flow
Free Cash Flow	0.00	67.28B	-229.93B	-67.37B	248.33B	722.29B
Operating Cash Flow	0.00	68.73B	-222.45B	-61.38B	253.90B	728.73B
Investing Cash Flow	0.00	-362.35B	167.44B	213.94B	-23.83B	-223.53B
Financing Cash Flow	0.00	134.91B	281.15B	-18.07B	-16.06B	-14.88B

Aozora Bank Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 2117.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:8304, the sentiment is Neutral. The current price of 2117 is above the 20-day moving average (MA) of 2104.81, above the 50-day MA of 2061.04, and below the 200-day MA of 2243.46, indicating a neutral trend. The MACD of 11.28 indicates Positive momentum. The RSI at 47.83 is Neutral, neither overbought nor oversold. The STOCH value of 18.80 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for JP:8304.

Aozora Bank Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
7327	78 Outperform	¥313.32B	10.21		4.08%	7.10%	42.22%
8377	71 Outperform	¥344.33B	9.01		1.42%	21.04%	20.47%
8410	69 Neutral	¥311.45B	17.01		4.15%	8.66%	-42.80%
Sector *	67 Neutral	¥713.17B	10.66	7.55%	3.34%	7.97%	15.90%
5832	63 Neutral	¥321.18B	11.47		4.06%	12.82%	13.03%
8304	42 Neutral	$288.75B	13.53	4.83%	4.21%	1.12%	6.36%
YFGSF		$2.09B	9.75	5.46%	4.00%	―	―

Aozora Bank Corporate Events

Aozora Bank Announces Stable Dividend Payments for FY2024

Aozora Bank announced a third quarter dividend payment of 19 yen per share, which aligns with 25% of its unchanged full-year dividend forecast of 76 yen per share. The bank also updated its fourth quarter dividend forecast to 19 yen per share, reflecting stability and planning in its financial strategy, which may affect shareholder expectations and market positioning.

Aozora Bank Reports Financial Improvement in FY2024

Aozora Bank’s financial statement for the first nine months of FY2024 shows a decline in ordinary income by 11% compared to the previous year, with a notable turnaround in profitability from a loss in 2023 to a profit in 2024. The bank’s dividend forecast remains unchanged at 76 yen per common share for FY2024, indicating stability in shareholder returns. The company also reported a significant increase in total assets and net assets ratio, reflecting improved financial health.

Aozora Bank Reports Robust Q3 FY2024 Financial Results

Aozora Bank reported a strong financial performance for the third quarter of FY2024, with notable increases in net revenue and business-related profit year-on-year. The bank’s strategic investment business and GMO Aozora Net Bank achieved significant milestones, contributing to the improved financial results. Aozora’s alliance with Daiwa Securities Group is progressing well, enhancing the bank’s corporate and real estate finance offerings. Additionally, the bank has successfully managed its securities portfolio and reduced risks associated with its U.S. non-recourse office loans.