Japan’s Dividend & Buyback Surge

Verdad

Naoki Ito

Research

5 Pages

Verdad Capital reviews Japan’s record surge in dividends and buybacks, driven by Tokyo Stock Exchange reforms aimed at improving capital efficiency. While shareholder payouts are at all-time highs, the report stresses that corporate Japan has yet to show real improvement in profitability or capital productivity.

Key Takeaways

Record payouts: FY2025 buybacks already exceed last year’s, marking a fourth straight year of record shareholder returns.
Valuation impact: Since 2022, firms trading below book value fell by 7%, below half book by 24%.
Reform gap: Median ROE has remained stagnant for over a decade, showing reforms are far from complete.
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