Taiko Bank, Ltd. (8537) AI Stock Analysis

• Market Cap: ¥22.38B
• Dividend Yield: 3.5%
• Average Volume (3M): 29.90K
• Price to Earnings (P/E): 8.9
• Beta (1Y): 0.98
• Revenue Growth: 16.60%
• EPS Growth: -5.51%
• Country: JP
• Employees: 793
• Sector: Financial
• Sector Strength: 70
• Industry: Banks - Regional
• EPS (TTM): 72.98
• Shares Outstanding: 9,671,400
• 10 Day Avg. Volume: 33,270
• 30 Day Avg. Volume: 29,900
• PEG Ratio: 0.12
• Price to Book (P/B): 0.18
• Price to Sales (P/S): 0.68
• P/FCF Ratio: 1.01
• 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: 72 Outperform
• Price Target: ¥2,766.00 ▲(33.69% Upside)

Overall score reflects solid financial performance and cash generation, supported by reasonable valuation (P/E 10.54 and 2.88% dividend yield). Technicals are strong but momentum indicators (RSI 74.54, Stoch 78.85) suggest the stock may be extended in the near term. Key risk from the fundamentals is the relatively low equity ratio (4.47%) alongside inconsistent historical revenue growth.

Positive Factors

Profitability & margins

High and improving margins indicate durable operational efficiency in core banking activities. Strong gross and operating margins suggest the bank retains a large share of revenue after costs, supporting sustainable earnings generation and resilience through economic cycles.

Revenue & cash generation

Simultaneous revenue growth and robust free cash flow expansion point to strengthening core loan and fee businesses and effective cash conversion. Elevated FCF supports reinvestment in lending, branch/digital capabilities, and provides flexibility for capital allocation decisions over the medium term.

Moderate leverage

A moderate debt-to-equity ratio signals prudent use of leverage for a regional bank, enabling credit extension while limiting excessive funding risk. This balance supports sustainable growth in lending volumes without overburdening the capital structure.

Negative Factors

Low equity ratio

A very low equity ratio reduces the bank's capital buffer against asset shocks and credit losses. Structurally, this weakens loss-absorbing capacity, may constrain lending during stress, and increases reliance on stable earnings or external capital to meet regulatory or growth needs.

Inconsistent revenue growth

Irregular top-line growth undermines predictability of interest and fee income, complicating credit provisioning and long-term planning. For a regional bank, uneven revenue can reflect concentration risk or sensitivity to market/loan-cycle swings, limiting strategic consistency.

Low return on equity

A low ROE implies limited profitability per unit of shareholder capital, reducing capacity to organically build buffers or fund expansion. Over the medium term this can pressure dividend policy and make it harder to attract equity without improving margins or lowering capital intensity.

Taiko Bank, Ltd. Business Overview & Revenue Model

Company Description

The Taiko Bank,Ltd. provides various banking products and services in Japan. The company offers loans, credit card and guarantee, general leasing, foreign exchange, and Internet banking services. It operates through a network of 71 branches. The company was founded in 1942 and is headquartered in Nagaoka, Japan.

How the Company Makes Money

Taiko Bank generates revenue primarily through interest income from loans and mortgages, which is a significant portion of its earnings. The bank charges interest on various loan products, including personal loans, business loans, and home mortgages, while also providing credit card services that contribute to interest income and fees. Additionally, Taiko Bank earns fee-based income from services such as account maintenance, transaction fees, and investment advisory services. The bank may also engage in wealth management and asset management services, generating revenue through management fees and commissions. Strategic partnerships with local businesses and government entities may enhance its loan portfolio and increase customer deposits, further contributing to its overall financial performance.

Taiko Bank, Ltd. Financial Statement Overview

Summary

Financials are solid overall: strong profitability metrics (gross margin 94.24%, net margin 12.51%, EBIT/EBITDA margin 22.89%) and improving revenue (+10.21% from 2024 to 2025). Cash generation is strong (FCF growth 24.26% and high operating cash flow to net income of 5.68). Offsetting this, revenue growth has been inconsistent and the equity ratio is low (4.47%), which adds balance-sheet risk despite moderate leverage (debt-to-equity 1.56).

Income Statement

The income statement shows a solid gross profit margin of 94.24%, indicating strong revenue retention. The net profit margin improved significantly to 12.51%, reflecting enhanced profitability. Although the revenue grew by 10.21% from 2024 to 2025, this growth has been inconsistent over the years. The EBIT and EBITDA margins are healthy at 22.89%, showing effective operational management.

Balance Sheet

The balance sheet is stable with a moderate debt-to-equity ratio of 1.56, suggesting prudent financial leverage. However, the equity ratio is relatively low at 4.47%, which may indicate potential risks in asset financing. Return on equity is commendable at 3.33%, showing decent returns for shareholders.

Cash Flow

Cash flow analysis reveals strong free cash flow growth of 24.26%, indicating improved cash generation. The operating cash flow to net income ratio is robust at 5.68, reflecting efficient cash operations. However, the free cash flow to net income ratio is significantly higher at 5.43, highlighting a potential emphasis on cash over profit.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	18.83B	19.95B	19.82B	19.64B	19.06B	19.87B
Gross Profit	20.32B	18.80B	19.58B	19.42B	18.81B	19.54B
EBITDA	17.35B	4.62B	3.26B	2.53B	3.57B	3.12B
Net Income	2.47B	2.50B	1.72B	1.28B	2.04B	1.57B
Balance Sheet
Total Assets	1.70T	1.68T	1.63T	1.61T	1.70T	1.71T
Cash, Cash Equivalents and Short-Term Investments	0.00	127.11B	85.98B	104.37B	237.74B	231.90B
Total Debt	112.83B	88.10B	70.20B	52.10B	138.00B	117.34B
Total Liabilities	1.62T	1.60T	1.55T	1.53T	1.62T	1.63T
Stockholders Equity	78.15B	74.98B	77.65B	73.11B	76.98B	79.23B
Cash Flow
Free Cash Flow	0.00	13.54B	11.56B	-139.63B	-4.52B	142.68B
Operating Cash Flow	0.00	14.19B	1.60B	-139.40B	-4.19B	143.44B
Investing Cash Flow	0.00	846.00M	-19.40B	6.62B	10.63B	-1.67B
Financing Cash Flow	0.00	-649.00M	-592.00M	-589.00M	-592.00M	-736.00M

Taiko Bank, Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 2069.00
• 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:8537, the sentiment is Positive. The current price of 2069 is below the 20-day moving average (MA) of 2350.35, below the 50-day MA of 2102.38, and above the 200-day MA of 1696.30, indicating a bullish trend. The MACD of 87.93 indicates Positive momentum. The RSI at 58.93 is Neutral, neither overbought nor oversold. The STOCH value of 22.33 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:8537.

Taiko Bank, Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
8537	72 Outperform	¥22.38B	8.87	―	3.50%	16.60%	-5.51%
8349	72 Outperform	¥14.47B	9.19	―	3.58%	13.77%	19.08%
8383	70 Outperform	¥16.02B	9.10	―	3.30%	11.93%	36.32%
Sector *	68 Neutral	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%
8364	64 Neutral	¥29.08B	13.29	―	2.59%	4.90%	―
8542	64 Neutral	¥18.50B	10.87	―	3.37%	3.70%	24.98%
8563	63 Neutral	¥12.67B	9.17	―	3.74%	5.91%	5.03%