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Tokio Marine Holdings Inc 8766

JPY 5,444.00 −28.00 (0.51%)
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Company Report

Tokio Marine Earnings: Strong Guidance on Accelerated Shareholding Reduction

Tokio Marine’s fiscal 2023 (ended March 2024) adjusted net profit of JPY 711.6 billion grew 60% from fiscal 2022, which was hit by losses related to covid-19 and natural catastrophes. This exceeded the company’s JPY 690 billion guidance by 3% on lower winter storm loss at Japan P&C and better-than-expected gains from shareholding reduction. The company introduced a new medium-term plan, targeting a 16% three-year earnings per share compound annual growth rate, driven by 15% and 1%-2% respective growth from adjusted net income and share buybacks, after considering capital gains from shareholding reduction, which is expected to boost growth by 8%. Thanks to strong earnings growth and share buybacks, we believe the company can achieve its adjusted return on equity target of over 20% to get on par with global peers starting in fiscal 2024. We believe the impact of accelerated shareholding reduction is factored in. We suggest investors pay attention to dividend yield, given earnings downside risk in capital gains caused by bond mark-to-market loss on higher domestic interest rates. The company's fair value estimate and ratings are under review pending the transfer of coverage to another analyst.

Bulls Say, Bears Say

Bulls

Tokio Marine has a consistent record of delivering stock outperformance relative to the Japanese market and other insurers.

Bears

Tokio Marine’s superior financial performance relative to Japanese peers is already well recognized by the market, so any future slip-up could be punished.

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News

Trading Information

Previous Close Price
JPY 5,472.00
Day Range
JPY 5,352.005,498.00
52-Week Range
JPY 2,960.505,705.00
Bid/Ask
JPY 5,443.00 / JPY 5,452.00
Market Cap
JPY 10.69 Tril
Volume/Avg
7.2 Mil / 5.6 Mil

Key Statistics

Price/Earnings (Normalized)
17.46
Price/Sales
1.52
Dividend Yield (Trailing)
2.26%
Dividend Yield (Forward)
2.92%
Total Yield
2.74%

Company Profile

Dating back to 1879, Tokio Marine is Japan’s oldest insurance company and was its top property and casualty insurer in terms of market share for many decades. After mergers of its smaller rivals in the past few years, the company is now roughly the same size in the domestic nonlife market as MS&AD and Sompo Holdings, but it remains the most valuable listed Japanese insurer in terms of market capitalization due to its larger overseas business portfolio. The majority of its overseas business is in the U.S., where it has purchased four specialty insurers since 2008: Philadelphia Consolidated, Delphi Financial, HCC, and PURE. It is a member of the Mitsubishi keiretsu group and holds minority stakes in a number of group companies that also rank among its shareholders.
Sector
Financial Services
Industry
Insurance - Property & Casualty
Stock Style Box
Large Growth
Total Number of Employees
44,721

Competitors

Valuation

Metric
8766
8725
8750
Price/Earnings (Normalized)
17.468.2917.45
Price/Book Value
2.071.130.95
Price/Sales
1.520.800.36
Price/Cash Flow
20.19
Price/Earnings
8766
8725
8750

Financial Strength

Metric
8766
8725
8750
Quick Ratio
Current Ratio
Interest Coverage
29.6940.7010.12
Quick Ratio
No chart available

Profitability

Metric
8766
8725
8750
Return on Assets (Normalized)
2.54%1.56%0.74%
Return on Equity (Normalized)
18.24%11.73%16.29%
Return on Invested Capital (Normalized)
17.68%9.76%10.27%
Return on Assets
8766
8725
8750
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