Daiwa Securities Living Investment (8986) AI Stock Analysis

• Market Cap: $240.93B
• Dividend Yield: 5%
• Average Volume (3M): 3.79K
• Price to Earnings (P/E): 18.0
• Beta (1Y): 0.23
• Revenue Growth: -5.13%
• EPS Growth: 14.49%
• Country: JP
• Employees: N/A
• Sector: Real Estate
• Sector Strength: 57
• Industry: REIT - Residential
• EPS (TTM): N/A
• Shares Outstanding: 2,406,890
• 10 Day Avg. Volume: 3,286
• 30 Day Avg. Volume: 3,793
• PEG Ratio: 1.55
• Price to Book (P/B): 1.25
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 17.23
• 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

• Rating: 73 Outperform
• Price Target: ¥111,612 ▲(11.50%Upside)

The strong financial performance with effective equity utilization and stable operations is the primary driver of the score, despite high leverage and negative free cash flow risks. The technical analysis suggests bullish momentum, tempered by overbought signals. The valuation indicates moderate pricing with a solid dividend yield, enhancing the stock's attractiveness.

Daiwa Securities Living Investment Business Overview & Revenue Model

Company Description

Daiwa Securities Living Investment Corporation (8986) is a Japan-based real estate investment trust (REIT) that primarily invests in residential properties. The company focuses on acquiring, managing, and leasing a diversified portfolio of residential assets, including apartments and other living accommodations, to generate stable rental income and capital appreciation for its investors. It operates within the real estate sector, providing opportunities for investors to participate in the residential property market in Japan.

How the Company Makes Money

Daiwa Securities Living Investment Corporation generates revenue primarily through rental income derived from its portfolio of residential properties. The company leases these properties to tenants, ensuring a steady stream of income. Additionally, the REIT may engage in strategic property acquisitions and sales to optimize its portfolio and capture capital gains. Partnerships with property management firms and real estate developers can enhance its operational efficiency and market reach, contributing to its overall earnings. Key factors influencing its revenue include occupancy rates, rental market conditions, and property management effectiveness.

Daiwa Securities Living Investment Financial Statement Overview

Summary

Daiwa Securities Living Investment shows strong financial performance with solid revenue growth and profitability. The income statement highlights impressive margins, but high leverage and negative free cash flow due to capital expenditures pose risks.

Income Statement

Daiwa Securities Living Investment has shown consistent revenue growth over the years, with a revenue growth rate of 11.24% between 2023 and 2024. The company maintains a solid gross profit margin of 61.03% and a strong net profit margin of 43.80%, indicating efficient cost management. The EBIT margin is impressive at 49.91%, and the EBITDA margin stands at 68.08%, highlighting robust operational efficiency. These metrics reflect a strong and profitable income statement with positive growth trends.

Balance Sheet

The company's balance sheet reveals a high debt-to-equity ratio of 1.09, indicating significant leverage, which poses a potential risk. However, the return on equity is strong at 6.40%, showcasing effective utilization of equity. The equity ratio is 46.95%, suggesting a balanced capital structure. While the leverage is notably high, the company manages to maintain a stable equity base, reflecting financial stability with some emphasis on debt financing.

Cash Flow

Cash flow analysis shows a significant decline in free cash flow, with a negative free cash flow of -30.47 billion JPY in 2024, down from 1.32 billion JPY in 2023, indicating aggressive capital expenditures. The operating cash flow to net income ratio is healthy at 2.21, suggesting strong cash generation relative to net income. However, the free cash flow to net income ratio is negative, highlighting cash flow challenges primarily due to high capital expenditures and investment activities.

Breakdown	Sep 2024	Sep 2023	Sep 2022	Sep 2021	Sep 2020
Income Statement
Total Revenue	27.44B	24.67B	22.70B	21.30B	19.91B
Gross Profit	16.74B	14.54B	13.20B	12.55B	11.10B
EBITDA	18.68B	17.14B	15.67B	14.66B	14.36B
Net Income	12.02B	10.35B	9.27B	8.89B	9.39B
Balance Sheet
Total Assets	400.09B	367.53B	353.68B	336.30B	310.21B
Cash, Cash Equivalents and Short-Term Investments	8.17B	18.70B	14.77B	11.04B	9.66B
Total Debt	204.74B	188.14B	181.69B	172.69B	152.69B
Total Liabilities	212.26B	195.54B	188.46B	179.01B	159.09B
Stockholders Equity	187.82B	172.00B	165.22B	157.30B	151.12B
Cash Flow
Free Cash Flow	-30.47B	1.32B	-3.85B	-15.88B	-46.90B
Operating Cash Flow	26.53B	24.57B	14.40B	13.12B	25.43B
Investing Cash Flow	-56.87B	-23.32B	-18.09B	-28.68B	-70.78B
Financing Cash Flow	20.34B	2.84B	7.60B	17.19B	46.63B

Daiwa Securities Living Investment Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 100100.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:8986, the sentiment is Positive. The current price of 100100 is above the 20-day moving average (MA) of 98090.00, above the 50-day MA of 95996.00, and above the 200-day MA of 90268.15, indicating a bullish trend. The MACD of 1159.56 indicates Negative momentum. The RSI at 73.70 is Negative, neither overbought nor oversold. The STOCH value of 77.95 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:8986.

Daiwa Securities Living Investment Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
8979	78 Outperform	¥49.96B	18.76		5.66%	4.22%	5.08%
3282	75 Outperform	¥231.76B	25.16		3.90%	14.22%	5.98%
3295	74 Outperform	¥232.70B	20.80		4.74%	-29.52%	9.41%
8986	73 Outperform	$240.93B	17.96	7.03%	5.00%	-5.13%	14.49%
Sector *	71 Outperform	¥235.50B	14.58	10.69%	3.74%	18.48%	21.05%
3269	68 Neutral	$444.80B	29.37	6.09%	3.78%	-0.71%	-7.24%

Daiwa Securities Living Investment Corporate Events

Daiwa Securities Completes Strategic Acquisition of Investment Units

Daiwa Securities Living Investment Corporation announced the completion of its acquisition of own investment units, totaling 20,848 units at a price of approximately 1.999 billion yen. This strategic move, executed through market purchases on the Tokyo Stock Exchange, is aimed at optimizing the company’s capital structure by canceling the acquired units, thereby reducing the total number of outstanding units to 2,386,042. This action reflects the company’s ongoing efforts to enhance shareholder value and strengthen its market position.

Daiwa Securities Living Investment Corporation Announces Property Disposition in Nagoya

Daiwa Securities Living Investment Corporation has announced the disposition of two rental housing properties located in Nagoya, Aichi. The decision to sell these properties, Stagea Kogane and willDo Takabata, was made after evaluating their future profitability and market trends, with the sale price exceeding both book and appraisal values. This move is expected to enhance investor value and align with the company’s asset management objectives.

Daiwa Securities Living Investment Corporation Acquires Own Investment Units

Daiwa Securities Living Investment Corporation announced the acquisition of its own investment units, purchasing a total of 13,816 units for approximately 1.31 billion yen between May 23 and June 30, 2025. This strategic move, executed via market purchases at the Tokyo Stock Exchange, aims to optimize the company’s capital structure and potentially enhance shareholder value.

Daiwa Securities Living Investment Secures 1,000 Million Yen Commitment Line

Daiwa Securities Living Investment Corporation has entered into a commitment line agreement with Daiwa Next Bank, Ltd. for 1,000 million yen to enhance its financial flexibility and stability. This agreement, which is unsecured and unguaranteed, will support the company’s property acquisition and debt repayment efforts, reflecting a strategic move to strengthen its balance sheet without altering existing investment risks.

Daiwa Securities Living Investment Acquires New Residential Property

Daiwa Securities Living Investment Corporation announced the acquisition of a residential property, Splendid TAKAIDA, located in Higashiosaka, Osaka. The acquisition is part of the company’s strategy to diversify and enhance its portfolio, aiming for stable revenue growth. The property will be renamed Gran Casa Takaida upon acquisition completion on July 3, 2025. This move aligns with the company’s asset management objectives, ensuring that the tenant selection criteria are met to maintain stable earnings.

Daiwa Securities Living Investment Corporation Acquires Own Investment Units

Daiwa Securities Living Investment Corporation announced the acquisition of 2,858 of its own investment units at a total price of 267,957,900 yen through market purchases on the Tokyo Stock Exchange. This move is part of a broader strategy approved by the board to acquire up to 26,000 units by September 2025, reflecting the company’s commitment to enhancing shareholder value and optimizing its capital structure.

Daiwa Securities Living Investment Corporation Announces Debt Refinancing Plan

Daiwa Securities Living Investment Corporation has announced a refinancing initiative to address existing borrowings totaling 8,260 million yen, with repayment due in late May and June 2025. This strategic move involves securing new loans from established financial partners, ensuring continued financial stability and operational efficiency. The refinancing effort underscores the company’s proactive approach to managing its financial obligations and maintaining its market position in the REIT sector.

Daiwa Securities Living Investment Corporation Revises Financial Forecasts Following Strong Performance

Daiwa Securities Living Investment Corporation announced a revision in its financial forecasts for the fiscal period ending September 2025, following a better-than-expected performance in the fiscal period ended March 2025. The company reported higher operating revenue and income than previously forecasted, leading to an increase in distribution per unit. This adjustment reflects the finalized impact of asset dispositions, indicating a positive outlook for stakeholders and reinforcing the company’s strategic positioning in the real estate market.

Daiwa Securities Living Investment Corporation Announces Strategic Acquisition of Own Units

Daiwa Securities Living Investment Corporation has announced its decision to acquire and subsequently cancel its own investment units, aiming to enhance capital efficiency and return profits to unitholders. This strategic move is expected to improve unitholder value over the medium to long term by optimizing the company’s financial condition and market positioning.

Daiwa Securities Living Investment Corporation Reports Strong Fiscal Performance Amid Future Challenges

Daiwa Securities Living Investment Corporation reported a significant increase in its financial performance for the 38th fiscal period, with operating revenue rising by 7.3% and profit by 16.2% compared to the previous period. However, the earnings forecast for the upcoming fiscal periods indicates a decline in operating revenue and profit, suggesting potential challenges ahead for the company and its stakeholders.

Daiwa Securities Living Investment Corporation Announces Sale of Healthcare Facilities

Daiwa Securities Living Investment Corporation has announced the disposition of three healthcare facilities, with the transaction scheduled to complete by May 30, 2025. The decision to sell these properties was driven by the favorable offer exceeding their book and appraisal values, aiming to enhance investor value and align with the company’s asset management objectives.