MS&AD Holdings (8725): Likely to achieve FY3/31 target adj profit ex equity gains, but DPS growth lags peers

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MS&AD Holdings (8725): Likely to achieve FY3/31 target adj profit ex equity gains, but DPS growth lags peers

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MS&AD Holdings (8725)

Likely to achieve FY3/31 target adj profit

ex equity gains, but DPS growth lags peers

Reiterate Rating: BUY | PO: 5,180 JPY | Price: 4,247 JPY

04 June 2026

Reiterate Buy; valuation remains relatively attractive Equity

If ¥800bn adj profit ex equity gains is achieved in FY3/31, this implies an 11% 4-yr

CAGR from FY3/27 company guidance. We view the ¥420bn overseas profit target as

achievable, supported by recent growth in Europe and the US and collaboration with Key Changes

WRB. Management indicated visibility on the sale of Toyota-held shares during FY3/27. (¥) Previous Current

However, near-term DPS growth remains lower than peers; we estimate annual Price Obj. 4,640.00 5,180.00

increases of ¥10–15. Based on a DDM assuming ¥15 DPS growth, our price objective is 2027E EPS 490.12 549.03

¥5,180, implying upside of 22%. Given competitive upside, we reiterate a Buy rating. 2028E EPS 490.83 627.82

Clear path to FY3/31 targets supports confidence 2029E EPS 506.57 596.86

Key actions required to achieve ¥800bn adjusted profit (ex gains on sales of strategic Natsumu Tsujino, CFA >>

equities) are well defined across domestic and overseas operations, with necessary Research Analyst

BofAS Japan

investments and partnerships already in place. We also think management has not fully +81 3 6225-8720

included the target impact of increase in investment income through collaboration with natsumu.tsujino@bofa.com

Barings in the ¥800bn target. We see a high probability of achievement, though

achieving target for life and other service segments may be rather difficult, thus our

forecast lag slightly versus plan. Stock Data