IwaiCosmo Holdings, Inc. (8707) AI Stock Analysis

• Market Cap: ¥81.62B
• Dividend Yield: 5.75%
• Average Volume (3M): 93.04K
• Price to Earnings (P/E): 8.9
• Beta (1Y): 1.13
• Revenue Growth: 10.85%
• EPS Growth: 30.77%
• Country: JP
• Employees: 788
• Sector: Financial
• Sector Strength: 70
• Industry: Financial - Capital Markets
• EPS (TTM): 123.31
• Shares Outstanding: 25,012,800
• 10 Day Avg. Volume: 106,760
• 30 Day Avg. Volume: 93,036
• PEG Ratio: 0.40
• Price to Book (P/B): 0.83
• Price to Sales (P/S): 2.19
• P/FCF Ratio: -8.82
• 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: 81 Outperform
• Price Target: ¥4,014.00 ▲(22.75% Upside)

IwaiCosmo Holdings scores well due to its strong technical momentum and attractive valuation. While financial performance is solid, the negative cash flow trend is a concern. The lack of earnings call data and corporate events did not impact the score.

Positive Factors

High Profitability

Very high gross and healthy net margins indicate a structurally profitable business model with low direct costs. Durable margin strength supports internal funding for growth, cushions cyclical revenue swings in capital markets, and sustains returns to shareholders over the medium term.

Low Leverage and Strong ROE

Extremely low leverage and a near-10% ROE signal conservative financial policy and efficient capital use. This balance sheet strength provides enduring financial flexibility to absorb shocks, pursue selective investments, and maintain operations without over-reliance on external financing.

Consistent Revenue Growth

Sustained top-line growth demonstrates the company’s ability to expand client activity and product distribution over time. Reliable revenue expansion helps scale fixed-cost base, supports margin sustainability, and provides a platform for steady earnings and strategic reinvestment.

Negative Factors

Negative Operating Cash Flow

Operating cash flow turning negative is a persistent structural risk: earnings are not being converted into operating cash. Over months this can erode liquidity, force reliance on external funding, constrain investment, and reduce resilience during market downturns.

Poor Cash Conversion (FCF vs Net Income)

A negative free cash flow to net income ratio implies reported profits are not translating into distributable cash. If this persists, it undermines the quality of earnings, limits capital returns, and restricts the company’s ability to self-fund strategic initiatives and absorb stress.

Limited Equity Cushion

An equity ratio of ~36.5% means a material portion of the balance sheet is funded by liabilities. While leverage is low, the modest equity cushion may limit shock absorption and funding flexibility if cash flows remain weak, increasing the importance of restoring robust operating cash generation.

IwaiCosmo Holdings, Inc. Business Overview & Revenue Model

Company Description

IwaiCosmo Holdings, Inc., together with its subsidiaries, primarily engages in the securities business in Japan. The company sells securities; and offers public stocks and ETFs/REITs, margin, foreign stocks, bonds, FX exchange, CFD exchange, and futures/options trading services, as well as investment trust and asset management services. The company was formerly known as Iwai Securities Co., Ltd. and changed its name to IwaiCosmo Holdings, Inc. in July 2010. IwaiCosmo Holdings, Inc. was founded in 1944 and is headquartered in Osaka, Japan.

How the Company Makes Money

IwaiCosmo Holdings generates revenue through multiple channels, including fees from asset management services, commissions from brokerage activities, and advisory fees from investment consultations. The company charges a percentage of assets under management (AUM) for its investment management services, which constitutes a significant portion of its revenue. Additionally, brokerage commissions earned from facilitating trades for clients add to the revenue stream. The company may also engage in strategic partnerships with financial institutions and technology firms to enhance its service offerings and expand its client base, further contributing to its earnings through collaborative ventures and shared revenue models.

IwaiCosmo Holdings, Inc. Financial Statement Overview

Summary

IwaiCosmo Holdings shows strong profitability with high margins and a solid balance sheet with low leverage. However, the negative trend in operating cash flow raises liquidity concerns that need to be addressed.

Income Statement

IwaiCosmo Holdings has demonstrated robust revenue growth from 2024 to 2025, with a revenue increase of 7.15%. The company maintains a high gross profit margin of 96.36% and a net profit margin of 26.11%, indicating strong profitability and efficient cost management. Additionally, EBIT and EBITDA margins are healthy at 33.62% and 36.34%, respectively, showcasing strong operational efficiency.

Balance Sheet

The company has a solid equity base with a debt-to-equity ratio of 0.11, indicating low leverage and financial stability. The return on equity is impressive at 9.93%, reflecting effective use of shareholders' funds. The equity ratio stands at 36.50%, underscoring a healthy balance between liabilities and equity.

Cash Flow

IwaiCosmo Holdings experienced a significant decline in operating cash flow in 2025, turning negative, which is a concern. The free cash flow to net income ratio is negative, indicating cash flow challenges. However, the company is managing capital expenditures efficiently, which could help alleviate cash flow pressures in the future.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	26.36B	25.75B	24.04B	19.69B	20.71B	22.99B
Gross Profit	25.25B	25.52B	23.78B	19.43B	20.51B	23.07B
EBITDA	9.92B	9.36B	8.32B	5.46B	6.10B	7.94B
Net Income	7.08B	6.72B	5.55B	3.56B	3.76B	5.36B
Balance Sheet
Total Assets	192.50B	185.45B	208.11B	183.51B	182.48B	193.03B
Cash, Cash Equivalents and Short-Term Investments	6.96B	10.23B	10.17B	10.27B	16.58B	13.18B
Total Debt	2.00B	26.01B	30.40B	33.40B	29.04B	30.12B
Total Liabilities	126.19B	117.75B	141.77B	125.95B	125.98B	136.83B
Stockholders Equity	66.31B	67.70B	66.34B	57.56B	56.50B	56.20B
Cash Flow
Free Cash Flow	0.00	-6.41B	1.05B	-5.89B	5.93B	3.13B
Operating Cash Flow	0.00	3.13B	1.58B	-5.80B	6.36B	3.96B
Investing Cash Flow	0.00	-666.00M	3.02B	-2.39B	-1.14B	-1.02B
Financing Cash Flow	0.00	-2.82B	-1.89B	-1.73B	-2.75B	-2.47B

IwaiCosmo Holdings, Inc. Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 3270.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:8707, the sentiment is Neutral. The current price of 3270 is below the 20-day moving average (MA) of 3535.75, below the 50-day MA of 3305.28, and above the 200-day MA of 2632.42, indicating a neutral trend. The MACD of 66.00 indicates Positive momentum. The RSI at 52.21 is Neutral, neither overbought nor oversold. The STOCH value of 16.86 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for JP:8707.

IwaiCosmo Holdings, Inc. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
8707	81 Outperform	¥81.62B	8.87	―	5.75%	10.85%	30.77%
8699	75 Outperform	¥51.70B	2.82	―	0.83%	24.64%	33.45%
8622	71 Outperform	¥35.37B	11.83	5.54%	5.47%	-1.80%	-1.02%
8613	71 Outperform	¥70.31B	13.48	9.22%	6.15%	7.45%	45.25%
8614	68 Neutral	¥53.06B	13.66	―	4.86%	6.40%	41.18%
Sector *	68 Neutral	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%
8708	64 Neutral	¥44.02B	17.72	―	4.36%	1.14%	-16.88%

IwaiCosmo Holdings, Inc. Corporate Events

IwaiCosmo Holdings Delivers Strong Nine-Month Profit Surge and Hikes Interim Dividend

IwaiCosmo Holdings reported strong results for the nine months ended December 31, 2025, with operating revenues rising 16.2% year on year to ¥22.88 billion and net operating revenues up 15.8%. Operating profit increased 32.2% to ¥8.99 billion, ordinary profit climbed 30.7% to ¥9.51 billion, and profit attributable to owners of parent surged 49.3% to ¥7.52 billion, lifting basic earnings per share to ¥319.98. Total assets expanded to ¥226.83 billion from ¥185.45 billion at the prior fiscal year-end, while net assets edged up to ¥70.85 billion, resulting in a lower equity-to-asset ratio of 31.2% versus 36.5%, reflecting balance-sheet growth. The company maintained a conservative stance on full-year guidance due to the high sensitivity of its business to market conditions and reiterated that it will disclose quarterly earnings and dividend forecasts only when reasonable estimates are available; it has already raised its interim dividend to ¥60 per share for the year ending March 31, 2026, signaling management’s confidence in current earnings momentum despite wider market uncertainty.

The most recent analyst rating on (JP:8707) stock is a Buy with a Yen3944.00 price target. To see the full list of analyst forecasts on IwaiCosmo Holdings, Inc. stock, see the JP:8707 Stock Forecast page.

IwaiCosmo’s Q3 Preliminary Results Surpass Prior Full-Year Record Profits

IwaiCosmo Holdings announced preliminary consolidated results for the third quarter of the fiscal year ending March 31, 2026, reporting strong year-on-year growth driven mainly by higher revenue from U.S. equity business. Operating revenue rose 16.2% to ¥22.9 billion, while operating profit and ordinary profit increased 32.2% and 30.7% respectively, and profit attributable to owners of parent jumped 49.3% to ¥7.5 billion, lifting earnings per share to ¥319.98. The company noted that, as of the end of the third quarter, both operating profit and ordinary profit have already exceeded the full-year record highs achieved in the previous fiscal year, and ordinary profit has now remained positive for 53 consecutive quarters, underscoring the resilience of its earnings despite market volatility and reinforcing its robust operational and profitability trend.

The most recent analyst rating on (JP:8707) stock is a Buy with a Yen4031.00 price target. To see the full list of analyst forecasts on IwaiCosmo Holdings, Inc. stock, see the JP:8707 Stock Forecast page.