Bank of Saga Ltd. (8395) AI Stock Analysis

• Market Cap: ¥82.13B
• Dividend Yield: 2.29%
• Average Volume (3M): 54.99K
• Price to Earnings (P/E): 10.1
• Beta (1Y): 1.09
• Revenue Growth: 7.97%
• EPS Growth: 20.44%
• Country: JP
• Employees: 1,294
• Sector: Financial
• Sector Strength: 70
• Industry: Banks - Regional
• EPS (TTM): 127.48
• Shares Outstanding: 16,935,910
• 10 Day Avg. Volume: 40,980
• 30 Day Avg. Volume: 54,986
• PEG Ratio: 0.26
• Price to Book (P/B): 0.33
• Price to Sales (P/S): 0.75
• P/FCF Ratio: 1.91
• 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: 74 Outperform
• Price Target: ¥5,286.00 ▲(22.93% Upside)
• Action: Reiterated Date: 02/04/26
• Date: Action: Reiterated 02/04/26

The score is driven primarily by solid financial performance (strong margins and improving leverage) and strong technical trend/momentum. Valuation is supportive with a low P/E and a moderate dividend yield, while the main offsetting risks are negative revenue growth in 2025 and historical cash-flow volatility.

Positive Factors

Stable Retail Lending Model

A clear, deposit-funded retail lending model focused on mortgages, personal and SME loans provides durable, interest-margin driven earnings. This business mix tends to produce predictable net interest income over economic cycles, supporting long-term cash generation and core profitability.

Improving Capital Structure

A materially lower debt-to-equity ratio and a stable equity ratio strengthen solvency and financial flexibility, allowing the bank to absorb shocks, fund lending and meet regulatory capital demands without aggressive external financing, supporting multi-quarter resilience.

Healthy Profit Margins

Sustained double-digit net margins and efficient operating margins indicate disciplined cost management and profitable lending spreads. Margin durability supports reinvestment, dividend capacity, and EPS resilience even if top-line growth moderates over several quarters.

Negative Factors

Recent Revenue Weakness

A downturn in top-line growth signals risks to long-term earnings power if it persists. For a regional retail bank, sustained revenue contraction can compress interest income and fee pools, limiting the ability to scale costs and maintain investment in digital services and branch networks.

Cash Flow Volatility

Fluctuating operating and free cash flows reduce predictability of internal funding for loans, reserves and dividends. Persistent volatility forces either heavier liquidity buffers or external borrowing, raising funding costs and constraining strategic investment over the medium term.

Moderate ROE and Past Leverage Risk

A middling ROE limits capital-generation efficiency versus peers, slowing organic equity growth. Coupled with a history of high leverage, this raises concern that future downturns could pressure capital ratios or force more conservative lending, constraining long-term growth potential.

Bank of Saga Ltd. Business Overview & Revenue Model

Company Description

The Bank of Saga Ltd. provides various banking products and services in Japan. The company offers checking accounts, savings accounts, ordinary deposits, notification deposits, time deposits, separate deposits, tax reserve deposits, non-resident yen deposits, foreign currency deposits, etc.; and mortgage, auto, education, and card loans, as well as discount bolls. It also invests in government bonds, municipal bonds, corporate bonds, stocks, and other securities to prepare and fund deposits; offers remittances, transfers, and collections; and provides export, import, and other foreign exchange services, as well as engages in bond contracting and registration, and financial futures trading businesses. In addition, the company is involved in protection and safe deposit box, securities lending, debt guarantee, public bonds underwriting, public bonds sales, card, commercial paper, defined contribution pension, and life insurance agency businesses. As of March 31, 2021, it operated through a network of 103 branches and 78 out-of-brach ATMs. The company was founded in 1882 and is headquartered in Saga, Japan.

How the Company Makes Money

Bank of Saga Ltd. generates revenue primarily through the interest income earned from lending activities, which includes personal loans, mortgages, and business loans. The bank charges interest on these loans, which constitutes a significant portion of its income. Additionally, the bank earns fee-based income from various services such as account maintenance fees, transaction fees, and advisory services. Investment income from securities and other financial instruments also contributes to its revenue. The bank may also engage in partnerships with local businesses and financial institutions to expand its service offerings and customer base, thereby enhancing its overall earnings potential.

Bank of Saga Ltd. Financial Statement Overview

Summary

Solid profitability and capital structure: ~13.8% net margin (2025), healthy EBIT/EBITDA margins, and improved leverage (debt-to-equity ~0.39). Offsetting this are negative revenue growth in 2025 and historically volatile cash flows (notably 2023), which temper the overall financial strength.

Income Statement

The income statement shows a stable net profit margin of around 13.8% in 2025, with a slight decline in revenue growth rate compared to previous years. EBIT and EBITDA margins are healthy, indicating efficient operations. However, the negative revenue growth rate in 2025 suggests potential challenges in revenue generation.

Balance Sheet

The balance sheet reflects a strong equity position with a debt-to-equity ratio improving to 0.39 in 2025 from higher levels in previous years. Return on equity is moderate at 6.44%, indicating decent profitability. The equity ratio is stable, suggesting a solid capital structure, but the historical high leverage in 2022 poses a risk.

Cash Flow

Cash flow analysis shows a positive trend in free cash flow growth, with a significant improvement in 2025. The operating cash flow to net income ratio is stable, but historical volatility in cash flows, particularly in 2023, indicates potential liquidity management challenges.

Breakdown	TTM	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	48.58B	51.67B	47.57B	44.47B	40.69B	37.78B
Gross Profit	48.58B	47.91B	44.30B	42.01B	40.30B	37.34B
EBITDA	7.80B	11.71B	8.70B	8.41B	7.66B	4.93B
Net Income	6.26B	7.50B	6.22B	5.49B	4.08B	2.46B
Balance Sheet
Total Assets	3.26T	3.18T	3.16T	3.01T	3.16T	3.05T
Cash, Cash Equivalents and Short-Term Investments	0.00	270.96B	201.84B	72.97B	301.83B	377.50B
Total Debt	42.38B	45.20B	57.33B	72.13B	208.39B	168.55B
Total Liabilities	3.14T	3.06T	3.04T	2.90T	3.05T	2.92T
Stockholders Equity	119.52B	116.37B	122.56B	108.76B	115.78B	126.41B
Cash Flow
Free Cash Flow	0.00	20.36B	-26.20B	-190.17B	-4.59B	230.85B
Operating Cash Flow	0.00	22.94B	-24.61B	-188.82B	-3.58B	6.54B
Investing Cash Flow	0.00	95.41B	14.54B	-43.72B	-67.45B	-67.86B
Financing Cash Flow	0.00	18.00B	143.86B	-1.18B	86.57B	324.17B

Bank of Saga Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 4300.00
• 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:8395, the sentiment is Positive. The current price of 4300 is below the 20-day moving average (MA) of 4914.75, below the 50-day MA of 4498.20, and above the 200-day MA of 3212.51, indicating a bullish trend. The MACD of 163.43 indicates Positive momentum. The RSI at 56.13 is Neutral, neither overbought nor oversold. The STOCH value of 37.59 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:8395.

Bank of Saga Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
8395	74 Outperform	¥82.13B	10.09	―	2.29%	7.97%	20.44%
8387	74 Outperform	¥97.05B	5.89	―	3.05%	8.75%	-12.68%
8541	72 Outperform	¥72.40B	10.54	―	2.34%	-0.97%	27.62%
8362	69 Neutral	¥80.08B	11.69	―	2.49%	7.08%	-46.44%
Sector *	68 Neutral	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%
8344	67 Neutral	¥82.49B	16.67	―	2.89%	-0.24%	95.49%
8550	52 Neutral	¥102.99B	-5.36	―	2.12%	10.91%	-1225.48%

Bank of Saga Ltd. Corporate Events

Bank of Saga Announces Increased Interim Dividend

The Bank of Saga Ltd. announced an interim dividend of 50 yen per share, an increase from the previous year’s 40 yen, with a total dividend payout of 845 million yen. This decision reflects the bank’s strong financial performance and commitment to returning value to shareholders, potentially enhancing its market position.

The most recent analyst rating on (JP:8395) stock is a Buy with a Yen3742.00 price target. To see the full list of analyst forecasts on Bank of Saga Ltd. stock, see the JP:8395 Stock Forecast page.

Bank of Saga Ltd. Reports Positive Financial Growth for H1 2025

The Bank of Saga Ltd. reported its consolidated financial results for the six months ending September 30, 2025, showing a year-on-year increase in ordinary income and profit attributable to owners of the parent. The bank’s total assets and net assets also saw growth, indicating a stable financial position. The dividend forecast remains unchanged, reflecting confidence in future performance.

The most recent analyst rating on (JP:8395) stock is a Buy with a Yen3742.00 price target. To see the full list of analyst forecasts on Bank of Saga Ltd. stock, see the JP:8395 Stock Forecast page.