Jefferies raises target on SoftBank, notes PayPay as key growth driver

February 12, 2025 05:43 AM AEDT | By Investing

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Jefferies raises target on SoftBank, notes PayPay as key growth driver

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Investing.com -- Jefferies raised its price target on SoftBank (TYO:9984) Corp (TYO:9434) to ¥234 per share, following in-line third-quarter results on strong performance in the Finance and Media&E-commerce segments. Brokerage cited solid core operations and the increasing value of SoftBank’s stake in PayPay, as it reiterated its "Buy" rating.

SoftBank reported a third-quarter operating profit of ¥236 billion, up 8.5% year-over-year and slightly above the consensus estimate of ¥230 billion.

The Finance segment, led by PayPay, turned profitable with an operating profit of ¥12.4 billion, reversing a ¥1.6 billion loss from the previous year. Media&E-commerce also posted strong growth, while the Consumer segment continued to expand steadily.

Jefferies highlighted PayPay’s rapid growth, with sales up 20.6% year-over-year and EBITDA soaring 378.8%.

SoftBank is consolidating its financial operations under PayPay, acquiring majority stakes in PayPay Securities and PayPay Bank to strengthen its ecosystem. Management sees room for further expansion, though a potential PayPay IPO remains a long-term consideration.

With the Finance business outperforming expectations and SoftBank’s brand transition progressing positively, Jefferies slightly adjusted its forecasts, citing better growth prospects in financial services.

This article first appeared in Investing.com

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