Lifenet Insurance (TSE:7157): Assessing Valuation After Annualized Premiums Show Year-Over-Year Growth

Lifenet Insurance (TSE:7157) released its October 2025 premium update, showing steady year-over-year gains in both individual and group credit life insurance policies. These upticks in core metrics are drawing keen attention from investors.

See our latest analysis for Lifenet Insurance.

Lifenet Insurance’s steady climb in annualized premiums appears to have energized the market, with the share price jumping 3.4% in a single day and trimming some of this year’s earlier declines. While short-term share price momentum has built after the latest update, the insurance group has still delivered a slight 1-year total shareholder return loss. Long-term holders have seen a powerful 3-year total return of over 100%.

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With the latest growth in premiums now reflected in its share price, investors are left to ponder if Lifenet Insurance still trades at a bargain or whether the market has already factored in tomorrow’s success.

Price-to-Earnings of 25.2x: Is it justified?

At a price-to-earnings (P/E) ratio of 25.2x, Lifenet Insurance shares trade at a noticeable premium to the industry average. This stands out when compared to its recent close at ¥1,968 per share. This high multiple suggests investors are willing to pay well above peer levels for each unit of Lifenet’s earnings, raising questions about the valuation’s sustainability.

The P/E ratio measures how much investors are paying for a company’s earnings and is a key marker for value, especially in the insurance sector where profits can be relatively stable. A higher ratio could signal strong anticipated future growth, but also runs the risk of pricing in overly optimistic expectations if the company’s performance does not keep pace.

Lifenet Insurance’s P/E ratio does not just outpace the Asian Insurance industry average (11x). It also exceeds the average among its direct peers (11.8x). When stacked against the company’s estimated fair P/E ratio of 12.4x, this premium looks even sharper, implying that the market could eventually correct toward the fairer level if growth fails to impress.

Explore the SWS fair ratio for Lifenet Insurance

Result: Price-to-Earnings of 25.2x (OVERVALUED)

However, if revenue or net income growth slows, or investor sentiment shifts, the share price premium could quickly unwind. This would challenge the current outlook.

Find out about the key risks to this Lifenet Insurance narrative.

Another View: Discounted Cash Flow Perspective

Switching gears from multiples, our SWS DCF model offers a more fundamental lens by estimating Lifenet Insurance’s fair value based on its future cash flows. This model suggests the shares are significantly overvalued, with the current price trading well above the DCF-based fair value estimate.

Look into how the SWS DCF model arrives at its fair value.

Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out Lifenet Insurance for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover 857 undervalued stocks based on their cash flows. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity.

Build Your Own Lifenet Insurance Narrative

Curious to reach your own conclusions? You can dig into the numbers and develop your perspective in just a few minutes. Shape the story for yourself: Do it your way

A good starting point is our analysis highlighting 2 key rewards investors are optimistic about regarding Lifenet Insurance.

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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.

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