North Pacific Bank, Ltd. (8524) AI Stock Analysis

• Market Cap: ¥338.54B
• Dividend Yield: 3.01%
• Average Volume (3M): 2.56M
• Price to Earnings (P/E): 14.1
• Beta (1Y): 1.42
• Revenue Growth: 19.69%
• EPS Growth: 70.91%
• Country: JP
• Employees: 2,799
• Sector: Financial
• Sector Strength: 70
• Industry: Banks - Regional
• EPS (TTM): 17.70
• Shares Outstanding: 378,060,180
• 10 Day Avg. Volume: 2,725,260
• 30 Day Avg. Volume: 2,556,740
• PEG Ratio: 0.16
• Price to Book (P/B): 0.52
• Price to Sales (P/S): 1.43
• P/FCF Ratio: 5.87
• 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: 76 Outperform
• Price Target: ¥1,040.00 ▲(45.05% Upside)

The overall stock score of 75.9 reflects strong technical momentum and solid financial performance. The stock's valuation is reasonable, supported by a healthy dividend yield. While financial performance is stable, improvements in cash flow management could enhance the bank's financial health further.

Positive Factors

Revenue Growth

Consistent double-digit top-line growth reflects expanding lending and fee businesses, indicating successful customer acquisition and product demand. Durable revenue expansion supports scale in the loan book, underwriting experience and reinvestment capacity, improving medium-term earnings resilience.

High Gross Margin

Exceptionally high gross margin points to efficient core spread management and low direct cost of revenue, which is structurally important for a regional bank. Sustained margin strength provides a buffer against rate volatility and supports capacity to absorb higher operating costs or loan-loss provisions over time.

Operating Cash Generation

Operating cash generation materially exceeds accounting earnings, indicating solid cash conversion from core banking activities. Strong cash flow underpins dividend funding, reserve building, and loan growth without immediate reliance on market funding, enhancing financial flexibility over the medium term.

Negative Factors

Free Cash Flow Collapse

A near-total decline in free cash flow dramatically reduces available internal funding for strategic investments, balance sheet strengthening or higher dividends. If persistent, this erosion constrains flexibility, may force reliance on wholesale funding or asset sales, and can pressure long-term growth execution.

Low Equity Ratio / Liability Reliance

A very low equity ratio indicates the bank is highly funded by liabilities, amplifying sensitivity to deposit runs, funding cost shocks and asset-quality deterioration. Structurally this narrows the capital buffer, raising regulatory and solvency risk and limiting room for aggressive balance-sheet expansion or loss absorption.

Moderate Net Profit Margin

Despite high gross margins, a mid-teens net margin suggests meaningful non‑interest expenses, provisioning or other deductions that limit retained earnings. Structurally, this constrains return on equity and internal capital generation, potentially capping dividend growth and reinvestment over the medium term.

North Pacific Bank, Ltd. Business Overview & Revenue Model

Company Description

North Pacific Bank, Ltd. (8524) is a financial institution based in Japan that offers a wide range of banking services, including personal banking, commercial banking, and investment services. The bank primarily serves individuals, small to medium-sized enterprises (SMEs), and corporate clients, providing products such as savings and checking accounts, loans, mortgages, and wealth management services. North Pacific Bank is committed to fostering economic growth in its local communities by offering tailored financial solutions to meet the diverse needs of its customers.

How the Company Makes Money

North Pacific Bank generates revenue primarily through the interest spread between the rates it pays on deposits and the rates it earns on loans and other financial products. Key revenue streams include interest income from personal and commercial loans, fees from account services, transaction fees, and investment income from its portfolio of securities. Additionally, the bank may engage in wealth management and advisory services for high-net-worth individuals and businesses, generating management fees and commissions. Strategic partnerships with local businesses and community organizations further enhance its customer base and service offerings, contributing to its overall earnings.

North Pacific Bank, Ltd. Financial Statement Overview

Summary

North Pacific Bank, Ltd. demonstrates solid financial performance with strong revenue growth and efficient cost management, as evidenced by high gross profit margins. However, the decline in free cash flow and reliance on liabilities suggest areas for improvement in cash flow management and operational efficiency.

Income Statement

North Pacific Bank, Ltd. shows robust revenue growth, with the latest annual revenue increasing by 15.9% compared to the previous year. The gross profit margin remains high at 93.71%, reflecting efficient cost management. However, the net profit margin of 14.87% suggests room for improvement in operational efficiency and cost control.

Balance Sheet

The bank maintains a stable equity position with a debt-to-equity ratio of 4.47, indicating manageable leverage. The equity ratio is 2.83%, suggesting a heavy reliance on liabilities, which is typical for banks but could pose risks if not managed carefully. The return on equity is solid at 5.42%, though there is potential for higher returns.

Cash Flow

Operating cash flow remains strong, but there was a significant decline in free cash flow compared to the previous year, with a decrease of 96.58%. The operating cash flow to net income ratio is 1.89, showing sufficient cash generation relative to earnings. Nevertheless, the sharp drop in free cash flow growth raises concerns about cash allocation and capital expenditures.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	143.40B	138.57B	120.67B	115.38B	112.98B	116.99B
Gross Profit	143.40B	129.87B	119.60B	113.76B	112.10B	115.08B
EBITDA	26.30B	37.59B	28.03B	23.25B	25.20B	22.03B
Net Income	21.28B	20.61B	12.83B	9.65B	11.76B	9.42B
Balance Sheet
Total Assets	13.28T	13.45T	13.24T	12.52T	13.54T	11.86T
Cash, Cash Equivalents and Short-Term Investments	0.00	2.65T	3.06T	2.80T	4.34T	2.63T
Total Debt	1.69T	1.70T	1.53T	941.78B	2.00T	1.30T
Total Liabilities	12.88T	13.06T	12.80T	12.11T	13.12T	11.42T
Stockholders Equity	393.16B	380.48B	442.68B	403.35B	416.81B	436.05B
Cash Flow
Free Cash Flow	33.66B	33.66B	983.81B	-1.37T	1.73T	1.16T
Operating Cash Flow	39.05B	39.05B	988.14B	-1.36T	1.74T	1.17T
Investing Cash Flow	-328.51B	-328.51B	-703.01B	-172.00B	-16.14B	-171.64B
Financing Cash Flow	-9.05B	-9.05B	-19.16B	-4.82B	-4.03B	-32.28B

North Pacific Bank, Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 717.00
• 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:8524, the sentiment is Positive. The current price of 717 is below the 20-day moving average (MA) of 925.85, below the 50-day MA of 862.95, and above the 200-day MA of 682.91, indicating a neutral trend. The MACD of 17.63 indicates Positive momentum. The RSI at 56.01 is Neutral, neither overbought nor oversold. The STOCH value of 38.61 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:8524.

North Pacific Bank, Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
8370	77 Outperform	¥241.40B	12.75	7.61%	3.81%	17.68%	20.15%
7173	76 Outperform	¥305.45B	8.03	―	1.95%	19.69%	50.61%
8524	76 Outperform	¥338.54B	14.13	―	3.01%	19.69%	70.91%
8358	76 Outperform	¥373.35B	14.11	8.13%	2.12%	22.44%	59.32%
Sector *	68 Neutral	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%
7380	67 Neutral	¥306.52B	12.56	―	2.94%	1.91%	9.73%
8368	64 Neutral	¥355.78B	18.04	3.95%	2.19%	9.29%	28.34%

North Pacific Bank, Ltd. Corporate Events

North Pacific Bank Expands Shareholder Benefits to Boost Investment

North Pacific Bank, Ltd. has announced an expansion of its shareholder benefit program to make investing in its shares more attractive. The changes include lowering the threshold for the number of shares required to receive benefits and adding accommodation vouchers to the rewards for larger shareholders. This move is in response to increased interest in asset building among individual investors, driven by the expansion of the Nippon Individual Savings Account program. The changes aim to encourage long-term investment in the bank and support its sustainable growth.

The most recent analyst rating on (JP:8524) stock is a Hold with a Yen785.00 price target. To see the full list of analyst forecasts on North Pacific Bank, Ltd. stock, see the JP:8524 Stock Forecast page.