Considering Investment in Insurance Company Stocks 6

This time, I will examine Japan Post Insurance Co., Ltd. (7181).

This is a continuation from last time.

■ Overview of Business Operations

Japan Post Insurance Co., Ltd. is a major life insurance company belonging to the Japan Post Group, primarily providing life insurance products for individuals. It utilizes the nationwide post office network for its sales structure and relies on insurance premium income and asset management revenue as its main sources of income [1].

[1] https://finance.yahoo.co.jp/quote/7181.T/financials

■ Fundamental Analysis

In the financial results for the second quarter (interim period) of the fiscal year ending March 2026, the following points were observed.

• Ordinary revenue: 2.8797 trillion yen (down 2.2% year-on-year)

• Ordinary profit: 183.8 billion yen (up 10.2% year-on-year)

• Interim net income attributable to owners of the parent: 93.8 billion yen (up 49.3% year-on-year)

The main reasons for the profit increase are a reduction in the burden of standard policy reserves related to new contracts and an expansion of the interest rate spread due to improvements in the investment environment. While insurance premium income decreased significantly by 36.5% year-on-year, other ordinary revenue surged by 156.2% year-on-year, supporting overall revenue. The primary drivers of this increase are an increase in gains on sales of securities and an increase in interest and dividend income due to rising interest rates. In particular, the stable expansion of interest income from held assets due to rising yields on domestic bonds has contributed to the improvement of the profit structure.

In addition, valuation gains on foreign currency-denominated assets due to exchange rate effects also contributed partially, indicating that improvements in the investment environment had a positive impact on profits [2].

Financially, total assets were 58.9883 trillion yen (down 1.0% from the end of the previous fiscal year), and net assets were 3.7999 trillion yen (up 17.2% from the same period), with the capital adequacy ratio improving to 6.4% [2].

[2] https://www.jp-life.japanpost.jp/information/press/2025/abt_prs_id002115.html

■ Technical Analysis

Since November 2025, the stock price has strengthened its upward trend from the low 4,000 yen range, and in December, it temporarily hit a year-to-date high of 4,460 yen. As of the end of December, it is hovering around 4,400 yen, and buying following the positive surprise after the earnings announcement continues.

Trading volume is also on an upward trend, and while there are signs of overheating in the short term, share buybacks and the strengthening of shareholder returns through dividend increases are acting as support factors [3].

※ The following indicators are cited as materials for judging overheating:

• RSI (Relative Strength Index): Recorded 74 as of early December. Generally, exceeding 70 is considered "overbought," a level where the risk of a short-term correction increases.

• Deviation rate from the 25-day moving average: At +6.8% as of December 4, it is significantly higher than the 3-month average (+2.5%), suggesting the possibility of a temporary pullback from a technical perspective.

[3] https://irbank.net/7181/140120251113500720

■ Summary

While Japan Post Insurance faces the structural challenge of declining premium income, it has achieved profit growth through improved investment returns and cost control. The strengthening of its financial base and a clear stance on shareholder returns are also positive points.

In the medium to long term, the diversification of sales channels and a review of product strategy will be key to growth. In addition to its appeal as a stable dividend stock, its future capital policy is also worth watching.

*This text was created using AI.

Please note that there may be errors in the content of this article. It simply presents information researched by the author. Please make investment decisions at your own risk.