Nomura (TSE:9716) Stock Faces Margin Slip As Net Income Decline Tests Bullish Narratives

NOMURA (TSE:9716) opened Q1 2027 with revenue of ¥35.7 billion and basic EPS of ¥12.77, setting the tone for a quarter where the top line and earnings metrics will be closely watched against a mixed recent track record. Over the past five reported quarters, revenue has moved between ¥39.7 billion and ¥56.0 billion while basic EPS ranged from ¥12.71 to ¥40.54, giving investors a clear view of how the income statement has shifted through the cycle and what that might mean for margins now. With a current net margin of 4.8% compared with 5.7% a year ago, this set of results puts profitability quality and sustainability front and center for anyone following the stock.

See our full analysis for NOMURA.

With the headline numbers on the table, the next step is to weigh them against the widely held narratives around NOMURA, highlighting where the latest figures support the story and where they start to push back.

Curious how numbers become stories that shape markets? Explore Community Narratives

TTM EPS of ¥67.52 vs mixed recent quarters

• Over the last four quarters, NOMURA has earned basic EPS of ¥67.52 on trailing 12 month revenue of ¥157,598 million, while individual quarters have ranged from ¥12.77 to ¥40.54 per share. This highlights how lumpy project timing can be across reporting periods.
• What stands out for a bullish view is that this trailing EPS comes alongside five year compound earnings growth of 27.4% per year. However, the latest single year showed weaker earnings and a net margin of 4.8% compared with 5.7% a year ago, which raises questions for anyone arguing that past growth alone supports the optimistic case.
  • Bulls pointing to that 27.4% long term earnings growth rate need to reconcile it with the recent margin slip from 5.7% to 4.8% and Q1 2027 net income of ¥1,425 million, which are much closer to the lower end of recent results than the higher Q4 2025 figures.
  • Supporters of the bullish story may focus on the ¥7,535 million of trailing 12 month net income, but they also need to factor in that quarterly EPS has dropped from ¥40.54 in Q4 2025 to ¥12.77 in Q1 2027, showing the earnings path has not been a straight line.

P/E of 17.5x with DCF fair value at ¥2,595.82

• NOMURA trades on a trailing P/E of 17.5x, above the 13.1x average for the JP Professional Services industry and roughly in line with peers at 17.5x. The current share price of ¥1,183 sits well below a DCF fair value estimate of ¥2,595.82 per share.
• Critics arguing a bearish angle often focus on that higher P/E and softer recent earnings. However, the valuation data also shows tension between the multiple and the DCF, which points to the stock trading about 54% below its modelled fair value.
  • Bears highlighting the 17.5x P/E relative to the industry’s 13.1x need to weigh that against the sizeable gap between the ¥1,183 share price and the ¥2,595.82 DCF fair value, which points to a very different message from the cash flow model.
  • For anyone taking the cautious side, the combination of a premium P/E and trailing net margin of 4.8% puts extra focus on whether forecasts of roughly 13% earnings growth per year can justify both the multiple and any move towards that DCF fair value.

Revenue at ¥157.60b TTM with 6% growth forecast

• On a trailing 12 month basis, NOMURA has generated ¥157,598 million in revenue, and forecasts in the dataset point to revenue growth of about 6% per year, slightly below the wider JP market forecast of 6.5% per year.
• What is interesting for readers weighing the bullish angle is that earnings are projected to grow around 13% per year off this revenue base, which outpaces the JP market forecast of 10.2% per year even though the company’s own revenue growth is only in line with, or a touch behind, the broader market.
  • Supporters of the more optimistic story can point to the combination of ¥157,598 million in trailing revenue and a forecast 13% earnings growth rate as evidence that profitability could do more work than top line growth if costs and mix are managed well.
  • At the same time, the move from a 5.7% to 4.8% net margin over the last year means anyone leaning on those earnings forecasts needs to pay close attention to how Q1 2027 net income of ¥1,425 million evolves against the revenue run rate.

For a more rounded view of how these revenue and margin trends fit into the broader story for NOMURA, including different community angles on the stock, it is worth checking how others interpret the same numbers through Curious how numbers become stories that shape markets? Explore Community Narratives

Next Steps

Don't just look at this quarter; the real story is in the long-term trend. We've done an in-depth analysis on NOMURA's growth and its valuation to see if today's price is a bargain. Add the company to your watchlist or portfolio now so you don't miss the next big move.

If this mix of signals around NOMURA leaves you uncertain, take a closer look at the underlying figures now and weigh the trade offs yourself, starting with 2 key rewards and 1 important warning sign.

Explore Alternatives to NOMURA

NOMURA's recent slip in net margin, softer quarterly EPS and premium P/E multiple together suggest profitability quality and valuation support are not entirely convincing right now.

If you want stocks where pricing aligns more clearly with earnings strength, compare this setup with companies screened in the 19 high quality undervalued stocks.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com