Why did Sanrio's stock price fall? Explaining the 5 reasons for the sharp drop despite strong earnings, future outlook, and how to buy shares at Monex Securities
Many investors are likely wondering, "I want to know why Sanrio's stock price fell," or "Why is the stock price dropping significantly even though performance is strong?"
Sanrio is a company that owns globally recognized character IP such as Hello Kitty, Cinnamoroll, Pompompurin, Kuromi, and My Melody.
In recent years, the company has shifted to a high-profit business model, with significant growth not only in domestic product sales but also in overseas licensing businesses.
In fact, for the fiscal year ending March 2026, sales were 194 billion yen, operating profit was 77.8 billion yen, and net profit was 54.6 billion yen, with operating profit increasing by 50.3% compared to the previous term. The company also forecasts an operating profit of 89.5 billion yen and a net profit of 63.8 billion yen for the fiscal year ending March 2027.
However, on August 12, 2026, Sanrio stock temporarily plummeted by nearly 20%.
Looking at this alone, one might think, "Did the performance deteriorate?" but that is not necessarily the case.
The reason for Sanrio's stock price decline this time is largely considered to be a correction of market expectations that had become too high, rather than a deterioration in performance rather than a deterioration in performance.
1. Even with strong earnings, it did not meet market expectations
An important reason for Sanrio's stock price decline this time is the financial results for the first quarter of the fiscal year ending March 2027.
Sales increased by 20.7% year-on-year to 52 billion yen, operating profit increased by 11.1% to 22.4 billion yen, ordinary profit increased by 12.0% to 22.6 billion yen, and net profit increased by 9.3% to 15.5 billion yen.
Both sales and operating profit were at record highs for a first quarter.
In other words, the financial results themselves were not bad.
The problem was that the market was expecting even greater growth.
Against an operating profit of 22.4 billion yen for the first quarter, the market had expected a higher level.
Therefore,
"Record high profit = Buy"
instead of,
"Did not meet market expectations = Sell"
the reaction was.
What is important in stock investment is not just whether performance is better than the previous year.
Whether the figures exceeded what investors had anticipated in advance also significantly influences the stock price.
Because Sanrio has maintained an extremely high growth rate until now, even double-digit profit growth, which would be appreciated for a normal company, may have appeared underwhelming to the market.
2. Profit growth rate slowed significantly
The second reason is the slowing speed of profit growth.
Compared to the first quarter of the previous year, the growth rate of operating profit declined significantly.
Of course, even an 11% profit increase is sufficiently excellent for a company.
However, for a growth stock to maintain a high P/E ratio, it is required to continue high profit growth rates.
For example, between a company that increases profits by 50% every year and one that increases profits by 10% every year, the former is generally more likely to be bought at a higher P/E ratio.
In other words, this stock price decline is not about
"Sanrio's growth has ended"
that,
"Will the rapid growth seen so far continue in the future?"
but rather it is considered largely due to the fact that this question has become stronger in the market.
3. The stock price had risen too much ahead of the business performance
The third reason for Sanrio's stock price decline is that future growth expectations were already significantly priced into the stock.
Through the global expansion of its character IP, Sanrio has been evaluated in the stock market as one of the "IP companies representing Japan."
With growth stocks, there are times when
growth expectations rise ↓ stock price rises ↓ P/E ratio becomes high ↓ earnings announcement ↓ slightly misses expectations ↓ P/E ratio is corrected ↓ stock price plummets
this happens.
Even if the company's corporate value itself has not lost 20% in a single day, the stock price will fall significantly just by investors changing their thinking from "I can pay up to a 50x P/E ratio for this company" to "a P/E ratio of around 40x is appropriate."
Sanrio's current situation can be considered a typical case of this.
4. How long will the overseas IP boom last?
The fourth point is the sustainability of the global character boom.
A major strength of Sanrio is that it does not rely solely on Hello Kitty.
It possesses multiple powerful characters with varying popularity across generations and regions, such as Cinnamoroll, Pompompurin, Kuromi, and My Melody.
Furthermore, overseas, the company is expanding a business model that allows it to increase revenue without owning a large number of stores or factories by utilizing licensing agreements.
This is an extremely strong business model.
On the other hand, character popularity also has trends.
Therefore, investors are
carefully watching whether the current character and IP boom will continue for the next 5 or 10 years.
carefully watching.
Whether the overseas licensing business can continue to achieve double-digit growth in the future will be an important point when looking at Sanrio stock.
5. Shareholder benefits are attractive but cannot prevent stock price declines
Sanrio is also popular as a stock with shareholder benefits.
There are shareholder benefits that can be used at theme parks and Sanrio shops, which are a major attraction for Sanrio fans.
However, just because shareholder benefits are attractive does not mean the stock price will not fall.
Even if you receive several thousand yen worth of benefits per year, if your holdings fall by 10% or 20%, the valuation loss from the stock price decline may be greater.
Therefore,
buying just because you want the benefits
is not enough, and you should also consider the following.
It is important to consider, "Is this company's profit growth worth buying at the current stock price?"
What will happen to Sanrio's stock price in the future?
When considering the future, the important point is whether this decline is
the beginning of a deterioration in business performance
or
an adjustment of expectations that were too high
.
Currently, it is considered that the latter factor is significant.
Sales and operating profit are increasing, so the core business has not suddenly deteriorated.
For the stock price to rise significantly again in the future,
growth in the overseas licensing business,
maintenance/improvement of operating profit margins,
popularity of characters in North America, China, and Europe,
upward revision of full-year earnings,
growth in new IP and gaming businesses
and so on will be important.
On the other hand, one thing to be careful about is that "a 20% drop does not necessarily mean it is 20% cheaper".
If the original stock price had already largely priced in high future growth, it is possible that it remains overvalued based on indicators like the P/E ratio even after a sharp drop.
When considering a purchase, it is important not to look only at the stock price, but also to check the P/E ratio, EPS growth rate, operating profit margin, and overseas sales.
Want to buy Sanrio stock? How to buy shares at Monex Securities
If you see Sanrio's stock price drop and think, "I'd like to buy a little," you can purchase it using an online brokerage.
Here, let's briefly check how to buy shares at Monex Securities.
Sanrio's stock code is 8136.
At Monex Securities, you deposit funds into your securities account before purchasing stocks. Multiple deposit methods are available, such as the instant deposit service.
After depositing, search for the stock in the domestic stock search,
enter "Sanrio" or "8136"
to display the stock.
To purchase, select "Cash Buy" or "Buy Order," enter the number of shares and the order price, and place your order. You can also purchase domestic stocks following this process according to Monex Securities' official guide for beginners.
In addition to the standard 100-share units, Monex Securities offers a fractional share service called "One Stock," which allows you to buy and sell eligible stocks starting from a single share.
Therefore,
"I'm afraid to buy 100 shares all at once"
"Since it's after a sharp drop, I want to wait and see with a small amount"
in such cases, buying one share at a time is also an option.
For growth stocks with high price volatility like Sanrio,
instead of buying 100 shares at once
there is also the approach of
buying 1 or a few shares at a time
↓
checking the next earnings report
↓
adding more if performance is steady
as a way to diversify your purchases.
Also, when placing an order, it is important to understand the difference between "market orders" and "limit orders."
A market order is a method of placing an order without specifying a price; while it is easy to execute, there is a possibility of purchasing at a higher price than expected when the stock price is fluctuating sharply.
A limit order is a method of specifying a purchase price, such as "buy if it is below XX yen." Monex Securities also provides order methods such as limit and market orders for domestic stocks.
Especially for stocks like Sanrio, where the price can move significantly in a single day, it is important to decide on your purchase price in advance.
▶ Open an account at Monex Securities and start preparing to buy Sanrio stock
The reasons for Sanrio's stock price decline can be summarized into five points
The reasons for this decline in Sanrio's stock price are:
① It failed to meet market expectations despite strong earnings
② Profit growth rate slowed down
③ High growth expectations were already priced into the stock
④ Sustainability of the character boom was viewed with caution
⑤ A correction of the high P/E ratio occurred
These are the five points.
What is particularly important is the point that
it was sold off despite strong earnings.
This is the point.
This means that the growth level demanded by the stock price was extremely high, rather than the company Sanrio itself suddenly deteriorating.
Instead of buying immediately just because it fell, it is important to check:
Is the performance growing?
Is the current P/E ratio reasonable?
Is the overseas business growing?
Can the current profit growth be sustained for several years?
It is important to confirm these points.
Recommended recent books on shareholder benefits that are also useful for Sanrio investment
For those looking for stocks with shareholder benefits, I recommend the "Shareholder Benefit Handbook 2026-2027 (Nikkei Mook)."
It is suitable not only for checking the details of shareholder benefits but also for comparing what kind of companies offer them.
The second book is "Best Selection of Cheap and Good Shareholder Benefits 2025-26."
It is suitable for those who want to search for stocks while comparing investment amounts and benefit details from a large number of shareholder benefit stocks.
The third book is "The Most Profitable! Easy Shareholder Benefits & Hometown Tax Donation Guide 2026-2027."
The content is easy to read even for beginners who are interested in profitable systems for their entire household budget, not just shareholder benefits.
However, the most important thing to be careful about in shareholder benefit investment is that
an attractive benefit does not equal a stock that should be invested in.
That is the point.
The ideal scenario is
earnings growth
+ dividends
+ shareholder benefits
+ a reasonable purchase price
all coming together in a company.
Sanrio offers highly unique shareholder benefits that can be used at its theme parks and shops.
On the other hand, because growth expectations are high, stock price volatility tends to be significant, so caution is required when chasing high prices just because you want the shareholder benefits.
Even when purchasing small amounts using services like Monex Securities' One-Stock, it is important to think about "at what price do I want to buy" before considering "how many shares to buy" when investing in growth stocks like Sanrio.
*This article is intended for the provision of investment information and does not recommend trading specific stocks or using specific securities companies. Stock prices and service details are subject to change. Please make investment decisions at your own risk.
