Awa Bank, Ltd. (8388) AI Stock Analysis

• Market Cap: ¥156.28B
• Dividend Yield: 2.88%
• Average Volume (3M): 52.99K
• Price to Earnings (P/E): 11.2
• Beta (1Y): 1.01
• Revenue Growth: 7.67%
• EPS Growth: 11.03%
• Country: JP
• Employees: 1,332
• Sector: Financial
• Sector Strength: 70
• Industry: Banks - Regional
• EPS (TTM): 114.54
• Shares Outstanding: 40,000,000
• 10 Day Avg. Volume: 54,740
• 30 Day Avg. Volume: 52,990
• PEG Ratio: 0.45
• Price to Book (P/B): 0.34
• Price to Sales (P/S): 1.47
• P/FCF Ratio: 3.11
• 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: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 77 Outperform
• Price Target: ¥4,716.00 ▲(12.42% Upside)

Awa Bank, Ltd. scores well due to its strong financial performance, particularly in revenue growth and cost management. The technical analysis indicates strong bullish momentum, although caution is advised due to overbought conditions. The valuation is attractive, with a reasonable P/E ratio and a solid dividend yield. These factors combined suggest a positive outlook for the stock, with some potential risks due to technical overbought signals.

Positive Factors

Revenue Growth

Strong revenue growth indicates expanding business operations and market presence, supporting long-term financial stability and competitive positioning.

Cost Management

Efficient cost management enhances profitability and allows the bank to maintain competitive pricing, which is crucial for sustaining long-term growth.

Cash Flow Generation

Strong cash flow generation provides the bank with financial flexibility to invest in growth opportunities and withstand economic fluctuations.

Negative Factors

Return on Equity

Low return on equity indicates potential inefficiencies in generating returns for shareholders, which could impact investor confidence and capital raising ability.

Net Profit Margin Pressure

Decreasing net profit margin suggests rising costs or competitive pressures, which could affect long-term profitability if not addressed.

Cash Efficiency

Low cash efficiency relative to net income may hinder the bank's ability to reinvest in growth and manage financial obligations effectively.

Awa Bank, Ltd. Business Overview & Revenue Model

Company Description

Awa Bank, Ltd. (8388) is a regional financial institution based in Japan that offers a comprehensive range of banking services. The bank operates primarily in the retail and corporate banking sectors, providing products such as savings and checking accounts, personal and business loans, credit cards, and investment services. Awa Bank is committed to serving its local communities and businesses by delivering innovative financial solutions and fostering economic development in the regions it operates.

How the Company Makes Money

Awa Bank generates revenue through various streams, primarily derived from interest income and fees. The main source of revenue comes from the interest earned on loans provided to individuals and businesses. This includes personal loans, mortgages, and commercial lending, where the bank charges interest over time. Additionally, Awa Bank earns fee income through service charges on deposit accounts, transaction fees, and commissions from financial products such as investment services and insurance products. The bank may also engage in investment activities, generating returns on its financial assets. Significant partnerships with local businesses and community organizations enhance its ability to attract customers and expand its loan portfolio, supporting its overall revenue growth.

Awa Bank, Ltd. Financial Statement Overview

Summary

Awa Bank, Ltd. demonstrates strong revenue growth and efficient cost management, as evidenced by its high gross profit margin. The balance sheet is stable with moderate leverage, although return on equity could be improved. Cash flow generation is strong, but there is room for enhancing cash efficiency relative to net income. Overall, the financial health of the bank is solid, with opportunities for further improvement in profitability and cash flow efficiency.

Income Statement

Awa Bank, Ltd. shows a strong revenue growth rate of 8.62% in the latest year, indicating positive momentum. The gross profit margin is robust at 87.9%, reflecting efficient cost management. However, the net profit margin has slightly decreased to 16.99% from the previous year, suggesting some pressure on profitability. The EBIT and EBITDA margins are healthy, supporting overall profitability.

Balance Sheet

The bank maintains a moderate debt-to-equity ratio of 0.60, indicating a balanced approach to leverage. Return on equity is modest at 3.95%, suggesting room for improvement in generating returns for shareholders. The equity ratio is stable, reflecting a solid capital structure.

Cash Flow

Operating cash flow has improved significantly, but the operating cash flow to net income ratio is low at 0.01, indicating potential inefficiencies in cash generation relative to income. Free cash flow growth is strong, but the free cash flow to net income ratio of 0.95 suggests that most of the net income is being converted into free cash flow, which is positive.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	50.13B	77.69B	74.81B	86.79B	66.67B	64.36B
Gross Profit	50.13B	70.47B	66.26B	79.19B	65.04B	62.24B
EBITDA	11.91B	20.55B	19.27B	17.70B	19.07B	15.10B
Net Income	8.93B	13.20B	11.26B	10.21B	11.11B	8.50B
Balance Sheet
Total Assets	4.03T	4.02T	3.92T	3.85T	3.98T	3.87T
Cash, Cash Equivalents and Short-Term Investments	0.00	427.65B	402.27B	482.87B	690.24B	632.77B
Total Debt	193.44B	199.51B	167.93B	128.11B	279.23B	248.06B
Total Liabilities	3.69T	3.69T	3.59T	3.57T	3.69T	3.57T
Stockholders Equity	338.84B	334.22B	332.62B	278.76B	288.40B	292.89B
Cash Flow
Free Cash Flow	0.00	36.74B	2.49B	-325.82B	92.37B	299.27B
Operating Cash Flow	0.00	38.54B	5.69B	-321.75B	96.67B	301.56B
Investing Cash Flow	0.00	1.99B	-72.30B	93.25B	-37.03B	46.83B
Financing Cash Flow	0.00	65.85B	-13.75B	-3.60B	-2.27B	-2.44B

Awa Bank, Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 4195.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:8388, the sentiment is Positive. The current price of 4195 is above the 20-day moving average (MA) of 3869.00, above the 50-day MA of 3701.20, and above the 200-day MA of 3102.71, indicating a bullish trend. The MACD of 136.35 indicates Negative momentum. The RSI at 76.04 is Negative, neither overbought nor oversold. The STOCH value of 92.88 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:8388.

Awa Bank, Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
8388	77 Outperform	¥156.28B	11.17	―	2.88%	7.67%	11.03%
8544	75 Outperform	¥157.50B	13.89	―	2.57%	7.77%	5.80%
8336	72 Outperform	¥156.86B	11.03	―	2.92%	10.56%	16.02%
8361	72 Outperform	¥152.35B	9.70	―	2.68%	2.68%	74.80%
8386	71 Outperform	¥154.40B	11.16	―	2.58%	-0.36%	41.38%
7381	68 Neutral	¥160.31B	15.22	―	2.50%	8.43%	38.21%
Sector *	68 Neutral	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%

Awa Bank, Ltd. Corporate Events

Awa Bank Enhances Shareholder Benefit Program to Attract Long-term Investors

The Awa Bank, Ltd. has announced an enhancement to its shareholder benefit program, effective March 31, 2026. This amendment aims to increase the attractiveness of investing in the bank’s shares by offering greater monetary value in its gift catalog for shareholders holding 200 shares or more, thereby supporting sustainable growth and encouraging long-term investment.

Awa Bank Revises Management Targets Amid Strong Performance

The Awa Bank, Ltd. has revised its management targets for its ‘Growing beyond 130th’ plan due to surpassing profit expectations for FY2024. The bank aims to achieve higher profitability and efficiency by FY2027, with increased targets for adjusted OHR, core business net profit ROA, and profit ROE, while maintaining its ESG investment and shareholder return ratio goals.

Awa Bank Announces Dividend Increase Amid Strong Performance

The Awa Bank, Ltd. has announced an increase in its interim dividend to 60 yen per share, up from the previous forecast of 50 yen, reflecting a commitment to returning profits to shareholders. The bank also revised its year-end dividend forecast to 60 yen per share, leading to an annual dividend increase to 120 yen per share, highlighting its strong performance and dedication to shareholder returns.

Awa Bank Reports Strong Financial Performance and Dividend Increase

Awa Bank, Ltd. reported a significant year-on-year increase in its consolidated financial results for the six months ended September 30, 2025, with ordinary income rising by 21% and profit attributable to owners increasing by 14.2%. The bank’s comprehensive income surged by 120.4%, indicating strong operational performance. Additionally, Awa Bank announced a revision in its cash dividend forecast, reflecting a positive outlook for the fiscal year ending March 31, 2026, with an expected increase in annual dividends per share.

Awa Bank Revises Financial Forecasts Upward for 2025

Awa Bank, Ltd. has revised its financial forecasts for the six months ending September 30, 2025, reflecting an optimistic outlook based on recent operational trends. The revisions indicate an increase in ordinary revenues, profits, and basic earnings per share, suggesting a positive impact on the bank’s financial health and potentially enhancing its industry position.