Gunma Bank (8334) AI Stock Analysis

• Market Cap: ¥738.17B
• Dividend Yield: 3.14%
• Average Volume (3M): 1.14M
• Price to Earnings (P/E): 15.1
• Beta (1Y): 1.12
• Revenue Growth: 15.77%
• EPS Growth: 27.55%
• Country: JP
• Employees: 2,983
• Sector: Financial
• Sector Strength: 70
• Industry: Banks - Regional
• EPS (TTM): 36.21
• Shares Outstanding: 395,888,180
• 10 Day Avg. Volume: 961,470
• 30 Day Avg. Volume: 1,136,676
• PEG Ratio: 0.24
• Price to Book (P/B): 0.84
• Price to Sales (P/S): 2.26
• P/FCF Ratio: -0.79
• 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: ¥2,400.00
• Price Target Upside: 32.49% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 1
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 69 Neutral
• Price Target: ¥2,124.00 ▲(17.25% Upside)

Gunma Bank's strong financial performance, particularly in revenue growth and profitability, is a key strength. The technical analysis indicates bullish momentum, although the stock is in overbought territory. Valuation metrics are favorable, with a reasonable P/E ratio and attractive dividend yield. The main risk is the declining operating cash flow, which needs attention for sustained growth.

Positive Factors

Revenue and Profitability Growth

Consistent strong top-line growth and a ~21% net profit margin indicate durable demand for the bank's loan and fee services. Sustained revenue expansion and healthy net margins support internal capital generation, underwriting capacity, and provide resilience against medium-term economic swings.

Improving ROE and Capital Position

Rising ROE alongside a moderate leverage profile and a stable equity ratio suggests improving capital efficiency while retaining regulatory buffer. This combination enhances the bank's ability to absorb credit losses, support loan growth, and maintain credible capital for strategic investments over the medium term.

Diversified Bank Revenue Model

A three‑pillar earnings mix (net interest, fees/commissions, and securities income) reduces reliance on any single revenue source. Fee income and securities returns help smooth interest-rate cycles and support margin stability, while local deposit funding sustains liquidity for lending over months.

Negative Factors

Weak Operating Cash Flow Conversion

Declining operating cash flow and negative free‑cash‑flow conversion mean reported earnings are not turning into cash. Over the medium term this undermines the bank's ability to self-fund loan growth, dividends, and technology investment, forcing greater reliance on external financing.

Compression in Operating Margins

A pronounced drop in EBIT margin signals rising operating costs or margin pressure that may not be transient. Persistently lower operating profitability reduces capacity for reinvestment and weakens the bank's cushion against higher credit costs or competitive rate pressures over the medium term.

Geographic Concentration Risk

Heavy concentration in Gunma and adjacent areas exposes the loan and deposit base to local economic cycles and limits growth avenues. Limited geographic diversification can amplify the impact of regional downturns and constrain the bank's ability to diversify credit risk and expand fee businesses over time.

Gunma Bank Business Overview & Revenue Model

Company Description

The Gunma Bank, Ltd. provides various banking and financial products and services in Japan. The company engages in the fund management activities, including investment in securities and funding in the call market; and accepting deposits and negotiable certificates of deposit, as well as the provision of loans. It also provides securities investment, leasing, derivative transaction, and proprietary derivative trading services. The Gunma Bank, Ltd. was founded in 1932 and is based in Maebashi, Japan.

How the Company Makes Money

Gunma Bank generates revenue through several key streams. The primary source of income comes from net interest income, which is earned from the difference between the interest rates on loans extended to customers and the interest paid on deposits. The bank provides various loan products, including personal loans, mortgages, and business loans, which contribute significantly to its interest income. Additionally, the bank earns fee-based income from transaction services, asset management, and investment advisory services. The bank may also engage in financial market operations, including trading and investment in securities, which can provide additional revenue. Strategic partnerships with local businesses and government entities further enhance its revenue potential by fostering a stable customer base and promoting lending opportunities. Overall, Gunma Bank's diversified revenue model allows it to adapt to changing market conditions while supporting local economic development.

Gunma Bank Financial Statement Overview

Summary

Gunma Bank shows strong revenue growth and profitability with effective cost management and stable leverage. However, the declining operating cash flow is a concern, despite a robust equity position and improved return on equity.

Income Statement

Gunma Bank has shown a steady increase in total revenue over the years, with a notable revenue growth rate of 38.94% from 2024 to 2025. The gross profit margin is robust, consistently above 76%. However, there is a slight decline in EBIT margin from 30.19% in 2024 to 19.79% in 2025, indicating rising operational costs. The net profit margin improved significantly from 20.55% in 2024 to 20.86% in 2025, highlighting effective cost management.

Balance Sheet

The balance sheet reflects a solid financial position with a debt-to-equity ratio of 2.22 in 2025, indicating moderate leverage for a bank. The return on equity increased to 7.80% in 2025 from 5.43% in 2024, showing improved profitability. The equity ratio remains stable at approximately 5.33%, ensuring adequate equity financing.

Cash Flow

Gunma Bank's cash flow statements show negative free cash flow growth due to significant decreases in operating cash flow. The free cash flow to net income ratio is negative, highlighting challenges in converting income into cash flow. However, the bank has been active in managing its financing activities to maintain liquidity.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	176.13B	210.43B	191.22B	168.23B	141.97B	135.10B
Gross Profit	176.13B	160.15B	151.44B	152.61B	140.10B	132.57B
EBITDA	47.79B	67.70B	49.17B	45.47B	46.65B	26.30B
Net Income	46.80B	43.90B	31.13B	27.93B	26.44B	13.50B
Balance Sheet
Total Assets	10.63T	10.56T	10.82T	10.66T	11.15T	10.62T
Cash, Cash Equivalents and Short-Term Investments	0.00	1.28T	1.84T	1.83T	2.65T	2.33T
Total Debt	1.18T	1.10T	1.65T	1.02T	1.63T	1.39T
Total Liabilities	10.05T	9.99T	10.25T	10.15T	10.62T	10.07T
Stockholders Equity	579.50B	562.94B	573.09B	515.81B	529.25B	548.09B
Cash Flow
Free Cash Flow	-603.17B	-603.17B	22.76B	-661.97B	453.61B	1.98T
Operating Cash Flow	-597.11B	-597.11B	27.10B	-656.17B	459.59B	1.99T
Investing Cash Flow	54.96B	54.96B	411.00B	-153.32B	-127.81B	-498.37B
Financing Cash Flow	-32.30B	-32.30B	-13.53B	-8.07B	-9.28B	-5.16B

Gunma Bank Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 1811.50
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:8334, the sentiment is Positive. The current price of 1811.5 is below the 20-day moving average (MA) of 1876.60, above the 50-day MA of 1784.24, and above the 200-day MA of 1468.66, indicating a bullish trend. The MACD of 45.98 indicates Positive momentum. The RSI at 63.72 is Neutral, neither overbought nor oversold. The STOCH value of 76.97 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:8334.

Gunma Bank Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
8359	76 Outperform	¥881.21B	15.32	5.37%	2.87%	14.57%	100.81%
5830	75 Outperform	¥869.98B	12.73	―	2.10%	1.39%	52.58%
7337	70 Outperform	¥531.41B	13.90	―	3.21%	19.82%	29.59%
8334	69 Neutral	¥738.17B	15.14	8.19%	3.14%	15.77%	27.55%
7167	69 Neutral	¥1.01T	16.01	―	2.00%	18.45%	41.89%
8377	69 Neutral	¥643.39B	12.42	―	1.41%	28.83%	105.24%
Sector *	68 Neutral	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%