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Price: $9.82
Discount category: Close to intrinsic value
Next earnings: 2026-11-13
Next earnings is estimate: Yes
Company name: Mizuho Financial Group
Sector: Banking
About: Mizuho Financial Group is one of the largest banking groups in Japan. It owns Mizuho Bank, Mizuho Trust & Banking and Mizuho Securities, and it also has banking and securities businesses in the Americas, Europe and Asia. It serves individuals, small and large Japanese companies, global companies and investors. Total assets were ¥304.3 trillion at June 30, 2026. Its common shares trade on the Tokyo Stock Exchange, and its American depositary shares (ADSs) trade on the New York Stock Exchange. Since October 1, 2020, five ADSs represent one common share. The fiscal year ends on March 31, and Mizuho calls the year to March 31, 2027 fiscal 2026. Amounts are in yen under Japanese GAAP unless the text says otherwise.
Thesis: The market doubts that Mizuho can keep its higher returns. Profit grew mostly because Japanese interest rates rose, fees grew and Mizuho sold shares that it held in client companies. Investors fear that these drivers can slow, and that losses on securities or higher credit costs can cut profit. Profit was ¥1,248.6 billion in fiscal 2025, up 41.0%, and ROE was 11.4%, up from 8.5%. In July 2026, Mizuho raised its profit target for fiscal 2026 to ¥1,400.0 billion. Its new target for fiscal 2028 is ROE above 12% without more rate rises by the Bank of Japan. For the gap to close, three things must be true. Profit must reach the ¥1,400.0 billion target for fiscal 2026. Fee income in Japan and abroad must keep growing, so that returns do not depend only on interest rates. Mizuho must keep a total payout ratio of 50% or more with buybacks, while its CET1 ratio stays in its operational range. The first half results, expected on November 13, 2026, give the next test, and the fiscal 2026 results in May 2027 give the second. If these checks pass, the gap can close over the next four to six quarters. The main reason it may not close is a fall in Japanese interest rates or a credit shock, which can cut profit quickly.
Risks: Profit depends on Japanese interest rates and on markets. The fiscal 2028 target assumes a Bank of Japan policy rate of 0.75%. If rates fall or markets weaken, net interest income, fees and trading income can fall. Credit costs can rise. Mizuho lends to large Japanese and global companies, and trade tariffs or a weaker world economy can hurt these clients. Gains from the sale of shares that Mizuho holds in client companies helped profit in fiscal 2025. These gains can get smaller as fewer such shares remain, and a fall in share prices lowers their value. Mizuho reports in yen, and its ADSs trade in U.S. dollars. A weaker yen lowers the dollar value of the ADSs and of the dividends that ADS holders receive. The 20-F names problems with IT systems, including cyber attacks, as a risk. A system failure can cause losses, regulatory action and harm to Mizuho's reputation.
Balance sheet: Mizuho funds itself mainly with deposits. Total assets were ¥304.3 trillion and total net assets were ¥11.6 trillion at June 30, 2026. Own capital was ¥11,510.8 billion, or about ¥4,730 per share on 2,433.5 million shares outstanding (a calculation from the release figures). The CET1 ratio was 13.51% at June 30, 2026 under the international standard, up from 13.16% at March 31, 2026, and the total capital ratio was 17.74%. Risk-weighted assets were ¥82.2 trillion. Mizuho completed a buyback of 24.35 million shares for ¥200.0 billion on September 18, 2026 and planned to cancel them on October 23, 2026. It plans dividends of ¥150 per share for fiscal 2026, up from ¥145, and it uses a total payout ratio of 50% or more as a guide. For a bank, net debt is not a useful measure, so this profile does not show debt figures. As of 2026-06-30.
Checkpoints: Jul 30, 2026: Q1 fiscal 2026 results. Passed. Watch: Profit on track for the fiscal 2026 target of ¥1,300.0 billion and continued buybacks pass; lower profit or a lower target fail. Outcome: Profit rose 45.5% to ¥422.9 billion, and Mizuho raised its fiscal 2026 target to ¥1,400.0 billion and its buyback to up to ¥200.0 billion. Nov 13, 2026 (estimate): First half fiscal 2026 results. Pending. Watch: First half profit above half of the ¥1,400.0 billion target, a kept or raised target and a new buyback pass; a lower target or a large rise in credit costs fail. May 2027 (estimate): Fiscal 2026 results and shareholder returns. Pending. Watch: Profit of ¥1,400.0 billion or more, ROE on the path to above 12% and a total payout ratio of 50% or more pass; lower profit or smaller returns fail.
Recent events: 2026-09-24: Mizuho said that it completed its share buyback. It bought back 24,352,700 shares for ¥200.0 billion from May 18 to September 18, 2026, and it planned to cancel these shares on October 23, 2026. 2026-08-14: Mizuho reported a CET1 ratio of 13.51% at June 30, 2026 under the international standard, up from 13.16% at March 31, 2026. The total capital ratio was 17.74%. 2026-07-30: Mizuho reported Q1 fiscal 2026 results. Profit attributable to owners of parent rose 45.5% to ¥422.9 billion. Mizuho raised its profit target for fiscal 2026 to ¥1,400.0 billion from ¥1,300.0 billion. It also raised its share buyback to up to ¥200.0 billion and 35 million shares, from ¥100.0 billion and 25 million shares. 2026-05-19: Mizuho set a new target of ROE above 12% for fiscal 2028, without more rate rises by the Bank of Japan, and consolidated net business profits of ¥1.8 trillion to ¥2.0 trillion. It said that it reached its earlier target of ROE above 10% two years early. 2026-05-15: Mizuho reported fiscal 2025 results. Profit attributable to owners of parent rose 41.0% to ¥1,248.6 billion, and EPS was ¥502.92. Ordinary profits rose 34.6%, mainly because fee business grew in and outside Japan and because Mizuho sold shares that it held in client companies. Mizuho planned dividends of ¥150 per share for fiscal 2026, up from ¥145, and a first buyback of up to ¥100.0 billion. 2025-11-14: Mizuho reported first half fiscal 2025 results and raised its profit forecast for fiscal 2025 to ¥1,130.0 billion. Actual profit for the year was ¥1,248.6 billion.