Breaking Down Nomura Holdings, Inc. (NMR) Financial Health: Key Insights for Investors

Are you keeping a close watch on your investments? Have you ever wondered about the financial stability of major players like Nomura Holdings, Inc. (NMR)? With a market cap of $19.16B as of February 2025, understanding Nomura's financial health is crucial for making informed investment decisions. Did you know that for the nine months ended December 31, 2024, Nomura reported net revenue of 1,439.8 billion yen, a 28.9% increase from the previous year? But what does this mean for investors like you? Let's delve into the key insights that can help you assess Nomura's financial standing and its potential impact on your portfolio.

Nomura Holdings, Inc. (NMR) Revenue Analysis

Understanding Nomura Holdings, Inc.'s revenue streams is crucial for investors seeking to assess the company's financial health and future prospects. Nomura operates as a global financial services group, offering a range of services through its various business segments. A closer look at the sources of revenue, growth rates, and segment contributions provides valuable insights.

For the nine months ended December 31, 2024, Nomura Holdings reported net revenue of 1,439.8 billion yen, which is a 28.9% increase from the same period in the prior year.

Nomura Holdings reported a significant 30.9% increase in net revenue for the first half of 2024, reaching 937.8 billion yen, driven by strong performance across its business segments.

For the fiscal year ended March 31, 2024, Nomura Holdings reported net revenue of 1,562.0 billion yen, a 17.0% increase from the previous year.

Nomura's revenue streams can be broken down into several key business segments:

• Wealth Management Division: Formerly known as the Retail Division, this segment saw net revenue increase by 18.2% to 346.9 billion yen for the nine months ended December 31, 2024.
• Investment Management Division: This segment experienced a 35.2% increase in net revenue, reaching 149.5 billion yen for the same period. Assets under management were reported at 93.5 trillion yen as of December 31, 2024.
• Wholesale Division: This division, which includes global markets and investment banking, reported a 30.5% increase in net revenue, reaching 798.8 billion yen for the nine months ended December 31, 2024.

Here's a table summarizing Nomura's financial figures for the year ended March 31, 2024:

Nomura's business segments have shown varied contributions to the overall revenue. The Wealth Management and Investment Management divisions have demonstrated solid growth, while the Wholesale division has also seen significant improvements.

For deeper insights into Nomura Holdings, Inc.'s mission, vision, and core values, you can explore: Mission Statement, Vision, & Core Values of Nomura Holdings, Inc. (NMR).

Nomura Holdings, Inc. (NMR) Profitability Metrics

Analyzing the profitability of Nomura Holdings, Inc. (NMR) involves looking at several key metrics that provide insights into the company's financial health and operational efficiency. These include gross profit, operating profit, and net profit margins, as well as trends in these metrics over time.

For the fiscal year ended March 31, 2024:

• Net Revenue: Nomura Holdings, Inc. reported net revenue of 1,562.0 billion yen, a 17.0% increase from the previous year.
• Income Before Income Taxes: The income before income taxes was 273.9 billion yen, which is an impressive 83.2% increase from the previous year.
• Net Income Attributable to NHI shareholders: 165.9 billion yen for the fiscal year ended March 31, 2024, up 78.8% from the previous year.

A look at Nomura Holdings Inc. ADR annual gross profit:

• For 2024 was $27.738B, a 58.33% increase from 2023.
• For 2023 was $17.519B, a 32.22% increase from 2022.

Nomura Holdings Inc. ADR net income:

• Annual net income for 2024 was $1.144B, a 66.68% increase.
• Net income for the twelve months ending September 30, 2024 was $1.633B, a 93.55% increase year-over-year.

Nomura Holdings' profitability is also reflected in its Return on Equity (ROE), which is a measure of how efficiently a company is using its equity to generate profits. For the nine months ended December 31, 2024:

• Return on shareholders' equity: Annualized at 10.4%, compared to 4.5% in the same period the previous year.

Here’s a summary of Nomura Real Estate Group’s performance for the fiscal year ended March 31, 2024:

• Operating Revenue: ¥734,715 million, up 12.2% year-on-year.
• Operating Profit: ¥112,114 million, up 12.6% year-on-year.
• Business Profit: ¥113,665 million, up 8.1% year-on-year.
• Ordinary Profit: ¥98,248 million, up 4.4% year-on-year.
• Profit Attributable to Owners of Parent: ¥68,164 million, up 5.6% year-on-year.

Nomura is also actively managing its costs to improve profitability. CEO Kentaro Okuda is seeking an additional $186 million in cost reductions through measures such as rebuilding IT architecture, promoting digitalization and automation, and reviewing office locations.

Here is a table summarizing Nomura's Financial Highlights:

To gain more insight into the investors of Nomura Holdings, Inc., check out this resource: Exploring Nomura Holdings, Inc. (NMR) Investor Profile: Who’s Buying and Why?

Nomura Holdings, Inc. (NMR) Debt vs. Equity Structure

Understanding how Nomura Holdings, Inc. (NMR) finances its operations and growth involves analyzing its debt and equity structure. This provides insights into the company's financial leverage, risk profile, and overall financial health.

Nomura’s financial strategy includes a mix of debt and equity to fund its operations. Examining the specifics of their debt levels helps in understanding the company's financial commitments. As of the third quarter of the fiscal year 2024, Nomura reported total assets of ¥68.94 trillion and total liabilities of ¥63.14 trillion.

Key observations regarding Nomura's debt levels:

• Overview of Debt Levels: Nomura's financial statements provide details on both short-term and long-term debt. Short-term debt includes obligations due within a year, while long-term debt consists of liabilities extending beyond a year.
• Specific Debt Figures: While precise figures for short-term and long-term debt can fluctuate, analyzing the balance sheet provides a clearer picture. For instance, the third quarter of the fiscal year 2024 showed significant liabilities, reflecting the scale of Nomura's operations.
• Recent Debt Activities: Recent activities such as debt issuances, credit ratings, or refinancing can significantly impact Nomura's debt structure. Monitoring these events helps in assessing the company's strategies for managing its debt.

The debt-to-equity ratio is a critical metric for evaluating Nomura's financial leverage. It indicates the proportion of debt and equity used to finance the company’s assets. A higher ratio suggests greater financial risk, while a lower ratio indicates a more conservative approach.

Relevant points on Nomura's debt-to-equity ratio:

• Calculation and Interpretation: The debt-to-equity ratio is calculated by dividing total liabilities by total shareholders' equity. As of the third quarter of the fiscal year 2024, Nomura's total equity was ¥5.80 trillion. Using the reported liabilities of ¥63.14 trillion, the debt-to-equity ratio can be calculated.
• Industry Comparison: Comparing Nomura's debt-to-equity ratio with industry standards provides context. Different segments within the financial services industry may have varying norms, so it's crucial to benchmark against similar companies.
• Implications of the Ratio: A high debt-to-equity ratio may concern investors, signaling higher financial risk. Conversely, a very low ratio might indicate that Nomura is not fully leveraging debt to enhance returns.

Nomura strategically balances debt financing and equity funding to optimize its capital structure. This involves making decisions about when to issue debt, raise equity, or refinance existing debt.

Factors influencing Nomura's financing decisions:

• Market Conditions: Favorable interest rates and market conditions may prompt Nomura to issue debt. Conversely, strong equity markets might favor equity offerings.
• Strategic Objectives: Nomura's strategic goals, such as expansion or restructuring, influence its financing choices. Debt might fund acquisitions, while equity could support long-term growth initiatives.
• Risk Management: Balancing debt and equity is essential for managing financial risk. Nomura aims to maintain a capital structure that supports its operations while mitigating potential vulnerabilities.

Here’s a snapshot of key financial figures for Nomura Holdings, Inc. (NMR) based on the third quarter of fiscal year 2024:

For further insights into Nomura's strategic vision, refer to Mission Statement, Vision, & Core Values of Nomura Holdings, Inc. (NMR).

Nomura Holdings, Inc. (NMR) Liquidity and Solvency

Liquidity and solvency are critical indicators of a financial institution's ability to meet its short-term and long-term obligations. For Nomura Holdings, Inc. (NMR), assessing these metrics provides insights into its financial stability and operational efficiency. Below is an analysis based on available financial data.

Current and Quick Ratios:

These ratios measure Nomura Holdings, Inc.'s (NMR) ability to cover its short-term liabilities with its short-term assets. A higher ratio generally indicates better liquidity.

• Current Ratio: This ratio is calculated by dividing current assets by current liabilities.
• Quick Ratio: This ratio excludes inventories from current assets to provide a more conservative measure of liquidity.

As of the fiscal year 2024, Nomura Holdings, Inc.'s (NMR) current ratio and quick ratio provide a snapshot of its ability to meet short-term obligations. For example, if the current ratio is 1.2, it means the company has $1.20 of current assets for every $1.00 of current liabilities. The quick ratio, being more conservative, might be slightly lower, reflecting the ease with which Nomura Holdings, Inc. (NMR) can liquidate its most liquid assets to cover its immediate liabilities.

Analysis of Working Capital Trends:

Working capital, which is the difference between current assets and current liabilities, is a key measure of a company's operational liquidity. Monitoring the trends in working capital helps to understand whether Nomura Holdings, Inc. (NMR) is efficiently managing its short-term resources.

An increasing working capital balance generally suggests improved liquidity, while a decreasing balance might indicate potential challenges in meeting short-term obligations. For the fiscal year 2024, analyzing Nomura Holdings, Inc.'s (NMR) working capital trend involves looking at the changes in its current assets and liabilities over the year. If current assets increased by 10% and current liabilities increased by only 5%, this would signal a positive trend in working capital.

Cash Flow Statements Overview:

The cash flow statement provides a detailed look at all the cash inflows and outflows that occur at Nomura Holdings, Inc. (NMR). It is broken down into three main sections:

• Operating Activities: Cash flow from the normal day-to-day running of the business.
• Investing Activities: Cash flow from purchasing and selling long-term assets.
• Financing Activities: Cash flow from debt, equity, and dividends.

Analyzing these cash flow trends is crucial for understanding Nomura Holdings, Inc.'s (NMR) liquidity position. For the fiscal year 2024:

• Operating Cash Flow: A positive operating cash flow indicates that Nomura Holdings, Inc. (NMR) is generating enough cash from its core business operations to cover its expenses and invest in future growth.
• Investing Cash Flow: Significant cash outflows in this section might indicate substantial investments in long-term assets, while inflows could be from the sale of assets.
• Financing Cash Flow: This section shows how Nomura Holdings, Inc. (NMR) is raising capital, whether through debt or equity, and how it is managing its capital structure.

For instance, if Nomura Holdings, Inc. (NMR) reported $500 million in operating cash flow, -$200 million in investing cash flow (due to asset purchases), and $100 million in financing cash flow (from new debt), this provides a comprehensive view of its cash management strategies.

Potential Liquidity Concerns or Strengths:

Based on the analysis of the current and quick ratios, working capital trends, and cash flow statements, potential liquidity concerns or strengths can be identified.

If Nomura Holdings, Inc. (NMR) has a high current ratio and positive operating cash flow, it indicates strong liquidity. However, a declining working capital or negative trends in cash flow from operations might raise concerns. Monitoring these metrics is essential for investors to assess the financial health and stability of Nomura Holdings, Inc. (NMR).

More information about Nomura Holdings, Inc. (NMR) can be found here: Exploring Nomura Holdings, Inc. (NMR) Investor Profile: Who’s Buying and Why?

Nomura Holdings, Inc. (NMR) Valuation Analysis

Determining whether Nomura Holdings, Inc. (NMR) is overvalued or undervalued requires examining several key financial metrics and market indicators. These include price-to-earnings (P/E), price-to-book (P/B), and enterprise value-to-EBITDA (EV/EBITDA) ratios, as well as stock price trends, dividend yield, payout ratios, and analyst consensus.

Currently, comprehensive real-time data for 2024 specific to these valuation metrics is not fully available. However, we can analyze historical data and trends to provide a general assessment. Please note that the latest available data should always be consulted for making investment decisions.

Valuation Ratios:

• Price-to-Earnings (P/E): The P/E ratio indicates how much investors are willing to pay for each dollar of earnings. A lower P/E ratio might suggest undervaluation, while a higher ratio could indicate overvaluation.
• Price-to-Book (P/B): This ratio compares a company's market capitalization to its book value of equity. A P/B ratio below 1.0 could imply the stock is undervalued.
• Enterprise Value-to-EBITDA (EV/EBITDA): This ratio is often used to value companies with significant debt. A lower EV/EBITDA ratio compared to industry peers might suggest undervaluation.

Stock Price Trends:

Analyzing Nomura Holdings, Inc. (NMR)'s stock price trends over the past 12 months (or longer) can provide insights into market sentiment and investor confidence. Recent stock performance, considering broader market conditions and specific company news, helps assess whether the stock is trading at a premium or discount.

Dividend Yield and Payout Ratios:

For investors seeking income, dividend yield and payout ratios are crucial. The dividend yield indicates the annual dividend income relative to the stock price. The payout ratio shows the proportion of earnings paid out as dividends. A sustainable and attractive dividend yield can be a sign of a stable and undervalued company, provided the payout ratio is reasonable.

Analyst Consensus:

Major investment firms' analysts regularly provide ratings (buy, hold, or sell) and price targets for stocks. The consensus rating reflects the overall sentiment of these analysts. It is important to consider the range of opinions and the rationale behind them.

Additional Considerations:

It’s important to consider both quantitative factors (financial ratios) and qualitative aspects (company strategy, competitive positioning, and macroeconomic factors) to determine if Nomura Holdings, Inc. (NMR) is fairly valued, overvalued, or undervalued. Always refer to the most recent financial data and analyst reports for an up-to-date assessment.

Nomura Holdings, Inc. (NMR) Risk Factors

Nomura Holdings, Inc. (NMR) faces a complex array of risks that can significantly impact its financial health. These risks span internal operational challenges, external market pressures, and regulatory changes.

Here's an overview of key risks:

• Market and Economic Risks: Fluctuations in global financial markets, economic downturns, and changes in interest rates can adversely affect Nomura's trading revenues, investment valuations, and overall profitability.
• Credit Risk: The potential for counterparties to default on their obligations poses a significant risk, particularly in Nomura's lending and trading activities.
• Operational Risk: Disruptions to Nomura's operations, whether due to technological failures, human error, or external events such as cyberattacks, can lead to financial losses and reputational damage.
• Regulatory and Legal Risk: Increased regulatory scrutiny, changes in laws and regulations, and potential legal proceedings can result in higher compliance costs, fines, and restrictions on business activities.
• Strategic Risk: Poor strategic decisions, failure to adapt to changing market conditions, and unsuccessful implementation of business plans can negatively impact Nomura's competitive position and financial performance.

Nomura's financial results are susceptible to volatility due to various market-related factors. These include fluctuations in interest rates, especially in Japan where the company maintains a substantial presence. Changes in Japanese interest rates can affect the profitability of Nomura's domestic operations and the value of its investment portfolio. Furthermore, shifts in foreign exchange rates, particularly the Yen, Euro, and US dollar, can impact the reported value of Nomura's international assets and earnings.

Recent events, such as global economic uncertainties and geopolitical tensions, have amplified these market risks. For example, the COVID-19 pandemic and subsequent economic recovery have caused significant market volatility, affecting trading volumes and asset valuations across various sectors. Additionally, ongoing trade disputes and political instability in key regions can create uncertainty and negatively impact investor sentiment, leading to reduced trading activity and investment flows.

Nomura's exposure to credit risk is another critical area of concern. The company engages in various lending and trading activities that involve the potential for counterparties to default on their obligations. Factors such as economic downturns, industry-specific challenges, and regulatory changes can increase the likelihood of defaults, leading to financial losses for Nomura. Effective credit risk management is therefore essential to mitigate these potential losses and maintain the stability of its balance sheet.

Nomura also faces significant operational risks that could disrupt its business activities and harm its financial performance. These risks include:

• System failures
• Cybersecurity breaches
• Human error
• Inadequate internal controls

Any of these events could lead to:

• Financial losses
• Reputational damage
• Regulatory penalties

Nomura's global operations and complex IT infrastructure make it particularly vulnerable to these types of risks. Investing in robust cybersecurity measures, enhancing internal controls, and implementing effective business continuity plans are crucial steps to mitigate operational risks and ensure the smooth functioning of its business.

Regulatory and legal risks are also prominent concerns for Nomura, given the increasing complexity and stringency of financial regulations worldwide. Changes in regulations, such as capital requirements, trading rules, and compliance standards, can significantly impact Nomura's business activities and profitability. Additionally, legal proceedings, investigations, and enforcement actions can result in substantial fines, penalties, and reputational damage. Staying abreast of regulatory developments, maintaining a strong compliance framework, and effectively managing legal risks are essential to protect Nomura's financial health and reputation.

Nomura faces strategic risks related to its ability to adapt to changing market conditions, execute its business plans, and maintain a competitive edge. Factors such as:

• Technological advancements
• Shifting customer preferences
• Emerging competitors

These can challenge Nomura's strategic positioning and growth prospects. Failure to innovate, anticipate market trends, or effectively implement its strategic initiatives can result in:

• Loss of market share
• Reduced profitability
• Diminished shareholder value

Nomura must continuously assess its strategic direction, invest in innovation, and adapt its business model to remain competitive and achieve its long-term goals.

Mitigation strategies often involve:

• Diversifying revenue streams
• Strengthening risk management frameworks
• Enhancing cybersecurity measures
• Improving compliance programs

For instance, Nomura might invest in new technologies to improve operational efficiency and client service, or it might expand its presence in high-growth markets to reduce reliance on mature economies. By proactively addressing these risks, Nomura aims to safeguard its financial stability and create long-term value for its shareholders.

Learn more about Nomura Holdings, Inc. (NMR) investors: Exploring Nomura Holdings, Inc. (NMR) Investor Profile: Who’s Buying and Why?

Nomura Holdings, Inc. (NMR) Growth Opportunities

Nomura Holdings, Inc. (NMR) faces a dynamic landscape of growth opportunities driven by strategic initiatives, market conditions, and evolving client needs. Analyzing these factors provides insights into the firm's potential trajectory.

Key growth drivers for Nomura include:

• Product Innovation: Developing and introducing innovative financial products and services to meet the changing demands of clients.
• Market Expansion: Expanding its presence in high-growth markets, particularly in Asia, to capture new business opportunities.
• Strategic Acquisitions: Pursuing strategic acquisitions to enhance its capabilities and expand its market reach.

Nomura's future revenue growth and earnings estimates are influenced by several factors. While specific projections vary depending on market conditions and internal strategies, the general outlook considers:

• Global Economic Trends: The overall health of the global economy and its impact on financial markets.
• Interest Rate Environment: Changes in interest rates and their effect on Nomura's various business segments.
• Regulatory Landscape: Evolving regulations and their implications for financial institutions.

Strategic initiatives and partnerships are vital for Nomura's future growth:

• Digital Transformation: Investing in technology to enhance operational efficiency and client experience.
• Sustainability Initiatives: Integrating environmental, social, and governance (ESG) factors into its business practices and product offerings.
• Strategic Alliances: Forming alliances with other firms to expand its capabilities and reach new markets.

Nomura possesses several competitive advantages that position it for sustained growth:

• Global Network: A well-established global network providing access to diverse markets and clients.
• Strong Brand Reputation: A reputable brand built on trust and expertise.
• Experienced Management Team: A skilled and experienced management team capable of navigating complex market conditions.

For additional insights into Nomura's investor profile, you can explore: Exploring Nomura Holdings, Inc. (NMR) Investor Profile: Who’s Buying and Why?