| Valuation method | Value, ¥ | Upside, % |
|---|---|---|
| Artificial intelligence (AI) | 3169.12 | 3 |
| Intrinsic value (DCF) | 1995.32 | -35 |
| Graham-Dodd Method | 1647.62 | -46 |
| Graham Formula | 4276.20 | 39 |
ZENKOKU HOSHO Co., Ltd. is a leading Japanese financial services company specializing in credit guarantees, mortgage loans, and insurance agency services. Founded in 1981 and headquartered in Tokyo, the company plays a critical role in Japan's financial ecosystem by providing credit guarantees for individuals and businesses, facilitating access to loans and financial stability. Its diversified portfolio includes mortgage guarantees, card loans, apartment loans, and education loans, alongside non-life insurance agency services and credit research. With a market capitalization of approximately ¥425 billion, ZENKOKU HOSHO operates in a highly regulated industry, ensuring trust and reliability for its clients. The company's strong financial performance, reflected in its ¥51.6 billion revenue and ¥28.8 billion net income for FY 2024, underscores its stability in Japan's credit services sector. As a key player in financial intermediation, ZENKOKU HOSHO contributes to economic growth by mitigating credit risks and supporting lending activities.
ZENKOKU HOSHO presents a stable investment opportunity with low volatility (beta of 0.342), making it attractive for conservative investors seeking exposure to Japan's financial sector. The company's strong profitability (net income of ¥28.8 billion) and consistent cash flow (¥31.3 billion operating cash flow) highlight its operational efficiency. A dividend yield of approximately 2.5% (¥104.5 per share) adds income appeal. However, risks include regulatory changes in Japan's credit guarantee industry and potential economic downturns affecting loan demand. The company's high cash reserves (¥77.6 billion) and manageable debt (¥30 billion) provide financial flexibility, but growth may be constrained by Japan's mature credit market. Investors should weigh its defensive positioning against limited high-growth prospects.
ZENKOKU HOSHO holds a dominant position in Japan's credit guarantee market, benefiting from regulatory expertise and long-standing relationships with financial institutions. Its competitive advantage lies in its comprehensive service offerings, including mortgage, education, and card loan guarantees, which diversify revenue streams. The company's integration of credit research and insurance agency services enhances its value proposition. However, its domestic focus limits exposure to faster-growing international markets. Compared to competitors, ZENKOKU HOSHO's scale and government-backed role in credit intermediation provide stability but may also result in slower innovation. The company's low beta indicates resilience to market fluctuations, appealing to risk-averse investors. Its strong cash position allows for strategic flexibility, though competition from fintech lenders and digital credit platforms could pressure traditional guarantee businesses. Maintaining regulatory compliance and adapting to Japan's aging population's credit needs will be key to sustaining its market position.