Daito Bank, Ltd. (8563) AI Stock Analysis

• Market Cap: ¥12.91B
• Dividend Yield: 3.74%
• Average Volume (3M): 24.48K
• Price to Earnings (P/E): 7.0
• Beta (1Y): 0.82
• Revenue Growth: 5.91%
• EPS Growth: 5.03%
• Country: JP
• Employees: 428
• Sector: Financial
• Sector Strength: 70
• Industry: Banks - Regional
• EPS (TTM): 32.21
• Shares Outstanding: 12,701,462
• 10 Day Avg. Volume: 30,860
• 30 Day Avg. Volume: 24,476
• PEG Ratio: 1.10
• Price to Book (P/B): 0.28
• Price to Sales (P/S): 0.77
• P/FCF Ratio: 1.67
• 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: 66 Neutral
• Price Target: ¥1,133.00 ▲(19.77% Upside)
• Action: Reiterated Date: 03/05/26
• Date: Action: Reiterated 03/05/26

The score is driven mainly by moderate financial performance—stable margins and reduced leverage offset by weak revenue growth and cash flow volatility. Technical indicators are mixed with neutral momentum and the stock below its 20-day average, while valuation is a notable positive due to the low P/E and solid dividend yield.

Positive Factors

Low leverage / strong equity position

A debt-to-equity ratio of 0.14 provides durable financial flexibility, lowering interest burden and enhancing shock absorption. This stronger capital posture helps support lending capacity, maintain dividends, and fund strategic initiatives over months, reducing refinancing and solvency risk.

Stable net profit margins (~10%)

Consistent net margins near 10% indicate a resilient core banking franchise and recurring profitability. Margin stability supports predictable earnings and internal funding for investments or capital returns, providing a durable earnings base even if top-line growth is uneven.

Diversified revenue mix and digital focus

A mix of interest, fee, and investment income plus partnerships and a push into digital banking reduces dependence on a single income stream and can lower operating costs. That diversification and efficiency focus supports steadier revenue and margin resilience over the medium term.

Negative Factors

Recent negative revenue growth

Persistent negative revenue growth denotes weakening top-line momentum, limiting scale economies and cross-sell opportunities with retail and SME clients. Without revenue recovery, the bank faces tougher choices between cost cuts, reduced investment, or reliance on non-recurring items to sustain earnings.

Declining operating (EBIT/EBITDA) margins

Erosion in EBIT/EBITDA margins signals operational pressure or rising costs relative to income. That reduces the bank's buffer against credit losses, lowers funds available for reinvestment in digital and service upgrades, and can materially constrain profitability if the trend continues.

Volatile operating cash flow

Material volatility and prior negative operating cash flow weaken liquidity predictability, increasing dependence on liability management or external funding. That constrains sustainable loan growth, dividend reliability, and the ability to invest consistently in strategic initiatives over the medium term.

Daito Bank, Ltd. Business Overview & Revenue Model

Company Description

The Daito Bank, Ltd. provides various banking products and services to individual and corporate customers in Japan. The company accepts time, savings, and foreign currency deposits; and offers mutual fund and government bonds. It also provides housing, car, education, card, free, expansion and renovation, and business and institutional loans; and pension and insurance, as well as financial product brokerage, investment trust, web account transfer reception, online payment/electronic money charge, and pay-easy fund transfer reception services. In addition, the company offers credit and debit cards, mail orders, safe-deposit boxes, and credit guarantees, as well as foreign currency exchange, automatic remittance, ATM, and Internet banking services. It operates through 58 branches. The company was formerly known as Daito Mutual Bank and changed its name to The Daito Bank, Ltd. in 1989. The Daito Bank, Ltd. was founded in 1942 and is headquartered in Koriyama, Japan.

How the Company Makes Money

Daito Bank generates revenue through various streams, with interest income being the primary source. This includes interest earned from loans provided to individuals and businesses, which typically carry higher rates compared to the interest paid on customer deposits. Additionally, the bank earns fee income from services such as account maintenance fees, transaction fees, and advisory services for corporate clients. Investment income from securities and other financial instruments also contributes to its earnings. Strategic partnerships with local businesses and governments enhance its ability to offer competitive loan products and foster community relationships, ultimately driving customer retention and growth. Furthermore, the bank’s focus on digital banking solutions and financial technology partnerships helps to reduce operational costs and improve service efficiency, which positively impacts profitability.

Daito Bank, Ltd. Financial Statement Overview

Summary

Stable profitability (net margin ~10%) and improved leverage (low debt-to-equity of 0.14) support the score, but negative recent revenue growth, declining EBIT/EBITDA margins, and volatile/previously negative operating cash flow temper overall strength.

Income Statement

Daito Bank's income statement shows a mixed performance. The net profit margin is relatively stable at around 10%, indicating consistent profitability. However, the revenue growth rate has been negative in recent years, suggesting challenges in expanding revenue. The EBIT and EBITDA margins have also seen a decline, indicating potential pressure on operational efficiency.

Balance Sheet

The balance sheet reflects a strong equity position with a low debt-to-equity ratio of 0.14 in the latest year, showing improved financial stability. Return on equity has improved slightly, indicating better utilization of equity. However, the equity ratio is low, suggesting a high reliance on liabilities to finance assets.

Cash Flow

Cash flow analysis reveals significant volatility. While the free cash flow to net income ratio is healthy, indicating good cash conversion, the operating cash flow has been negative in previous years, which could pose liquidity challenges. The recent positive free cash flow growth is a positive sign, but sustainability remains a concern.

Breakdown	TTM	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	12.35B	11.72B	11.85B	11.56B	11.61B	12.02B
Gross Profit	12.35B	11.14B	11.82B	11.52B	11.54B	11.92B
EBITDA	2.00B	2.60B	2.31B	2.40B	2.30B	2.43B
Net Income	1.42B	1.33B	1.25B	1.28B	1.20B	990.00M
Balance Sheet
Total Assets	863.68B	851.06B	876.89B	895.00B	970.15B	963.50B
Cash, Cash Equivalents and Short-Term Investments	0.00	35.32B	72.28B	72.49B	135.22B	166.10B
Total Debt	200.00M	4.50B	40.22B	50.65B	114.29B	105.34B
Total Liabilities	830.42B	818.35B	838.38B	858.23B	930.51B	922.75B
Stockholders Equity	32.38B	31.84B	37.64B	35.91B	38.77B	39.91B
Cash Flow
Free Cash Flow	0.00	5.38B	-10.18B	-93.42B	-34.14B	113.18B
Operating Cash Flow	0.00	5.57B	-9.11B	-92.83B	-33.87B	113.44B
Investing Cash Flow	0.00	-18.74B	9.42B	31.35B	4.58B	2.13B
Financing Cash Flow	0.00	-23.73B	-6.89B	-384.00M	-378.00M	-378.00M

Daito Bank, Ltd. Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 946.00
• 50DMA: Negative
• 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:8563, the sentiment is Negative. The current price of 946 is below the 20-day moving average (MA) of 1118.90, below the 50-day MA of 1048.22, and above the 200-day MA of 838.59, indicating a neutral trend. The MACD of -3.53 indicates Positive momentum. The RSI at 42.42 is Neutral, neither overbought nor oversold. The STOCH value of 22.39 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:8563.

Daito Bank, Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
8349	72 Outperform	¥13.94B	9.31	―	3.58%	13.77%	19.08%
Sector *	68 Neutral	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%
8563	66 Neutral	¥12.91B	7.04	―	3.74%	5.91%	5.03%
8365	66 Neutral	¥12.22B	21.28	―	2.68%	5.57%	-23.26%
8416	65 Neutral	¥10.49B	8.64	―	2.74%	7.74%	-92.49%
8383	64 Neutral	¥15.96B	4.33	―	3.30%	11.93%	36.32%
8562	53 Neutral	¥12.66B	8.11	―	1.89%	8.11%	68.98%