Shimizu Bank has demonstrated a solid performance in its Q3 2026 results, showcasing growth that defies cautious expectations. The bank reported a total revenue of ¥8.1 billion and a basic earnings per share (EPS) of ¥77.15. These figures mark a significant improvement from Q3 2025, where the revenue was ¥6.4 billion, and EPS was ¥49.74.
Key Financial Highlights
- Q3 2026 Total Revenue: ¥8.1 billion
- Q3 2025 Total Revenue: ¥6.4 billion
- Q3 2026 Basic EPS: ¥77.15
- Q3 2025 Basic EPS: ¥49.74
- Trailing Twelve Month Revenue: ¥27.9 billion
- Trailing Twelve Month EPS: ¥216.42
- Trailing Twelve Month Net Income: ¥2.44 billion, up from ¥1.86 billion in Q3 2025
Profitability and Earnings Quality
The increase in revenue reflects improved profit margins and a healthier earnings profile. The bank experienced a notable transformation from previous net losses of ¥2.38 billion and ¥2.24 billion in Q3 and Q2 2025, respectively. This turnaround is supported by cleaner profit margins rather than mere revenue growth.
The shift in trailing EPS from losses of ¥207.45 in earlier periods to a positive ¥216.42 highlights the quality of earnings. Investors are keen to assess whether this improvement is sustainable or merely a temporary phenomenon.
Valuation Metrics
Shimizu Bank’s stock currently trades at ¥2,912, resulting in a trailing price-to-earnings (P/E) ratio of 13.5 times earnings. This is lower than the overall Japanese market average of 15.3 times and the banking sector’s average of 14.9 times. However, the bank’s share price exceeds its discounted cash flow (DCF) fair value of ¥1,568.70 per share.
Credit Quality Concerns
The bank maintains a 55% allowance for bad loans, which critics argue is relatively low, especially given its non-performing loans ranging between ¥13.5 billion to ¥14.7 billion. This raises questions regarding the durability of its recent profit levels.
Outlook and Long-Term Trends
As Shimizu Bank navigates through these changes, the keen focus remains on its long-term growth trajectory and how it can maintain profitability amidst current challenges. Investors are encouraged to consider not just the quarterly results but also the overarching trends that shape the bank’s financial future.
For those exploring investment opportunities, it might be beneficial to analyze Shimizu Bank alongside companies with stronger balance sheets and risk profiles to ensure a well-rounded portfolio strategy.
