[Summary]
From among the financial results articles added on May 20, 2026, we will organize three stocks that are attracting a lot of attention.
The three stocks to watch this time are SOMPOHD (8630), MS&AD (8725), and Daido Signal (6743).
The reasons for selection are profit size, year-on-year growth, verifiable profitability such as EPS and ROE, and connection with market themes.
In particular, SOMPOHD and MS&AD are large-scale financial results in the insurance sector, and their profit levels and capital efficiency stand out. On the other hand, Daido Signal's sales and operating income have both increased significantly, making it easy to keep an eye on as a railway infrastructure-related company.
However, because insurance companies have different accounting structures than general business companies, it is important not to make too simple comparisons of sales and operating profit margins.
Stock prices fluctuate not only based on business performance, but also on market expectations and supply and demand. Company forecasts may change depending on the external environment.
Selection policy
This time's Top 3 was confirmed by targeting full-year financial results articles for the fiscal year ending March 2026 that were added on the same day, excluding articles that only disclosed corrections.
The evaluation focused on the following:
*Year-on-year change in sales and profits
- Scale of operating income or ordinary income
- Profitability such as EPS and ROE
- Cash flow and financial verifiability
- Prominence within the sector
- Notes on temporary factors and accounting peculiarities
This is not intended to determine short-term stock price increases, but rather to select stocks that are worth reading additionally based on their financial results.
3 stocks to watch
1. SOMPOHD (8630)
SOMPOHD's full-year financial results for the fiscal year ending March 2026 were sales of 5,372,921 million yen (+6.1%), operating profit of 843,226 million yen (+155.3%), and net income attributable to owners of parent company of 640,086 billion yen (+163.3%).
EPS is 701.03 yen, ROE is 13.7%, and the large profit scale and year-on-year growth are notable. In the insurance sector, multiple factors affect business performance, including natural disasters, insurance premium rates, asset management, and reductions in cross-shareholdings, so it is necessary to check not only the rate of increase in profits but also the quality of profits.
The focus is on the company's capital policy after the increase in profits and whether it will be able to maintain ROE going forward. Insurance stocks are also affected by interest rates and the stock market, so from next time onwards, I would also like to check the company's adjusted net income and shareholder return policy.
2. MS&AD (8725)
MS&AD's full-year financial results for the fiscal year ending March 2026 were sales of 7,653,030 billion yen (+14.9%), operating income of 1,120,230 billion yen (+20.6%), and ordinary income of 787,339 billion yen (+13.8%).
EPS is 528.87 yen and ROE is 18.0%, confirming high profitability. As a large non-life insurance group, improvements in domestic insurance premium rates, overseas insurance business, asset management, and strategic stock sales may have combined to boost performance.
On the other hand, insurance companies are susceptible to natural disasters and financial market fluctuations, and strong performance in the current fiscal year does not necessarily continue the same way in the next fiscal year. The next thing to look at is the company's capital policy, return policy, and consideration of natural disaster risk.
3. Datong Signal (6743)
Daido Signal's full-year financial results for the fiscal year ending March 2026 were sales of 25.695 billion yen (+17.3%), operating income of 2.187 billion yen (+89.8%), and net income attributable to owners of parent company of 1.791 billion yen (+16.1%).
The operating profit margin is 8.5% and the equity ratio is 54.6%, which are well-balanced for a business company. It is easy to evaluate the fact that sales and operating income are increasing at the same time, and the focus will be on whether demand for renewals related to railway signals and infrastructure continues.
However, the next outlook shows sales of 25.7 billion yen and operating profit of 1.8 billion yen, which is expected to be a decrease from the current operating profit. Profits tend to fluctuate depending on the progress of large projects, order profitability, and material costs. This industry is affected by business cycles, so performance is not constant.
How to view top candidates
This year's top candidates were divided into large-scale financial results in the insurance sector and financial results of infrastructure-related business companies.
SOMPOHD and MS&AD have large profits and ROE, and are likely to attract investor interest. On the other hand, because the accounting structure is different from that of ordinary companies, it is easy to misunderstand when comparing operating profit margins and equity ratios side by side with ordinary manufacturing and service industries.
Daido Signal's sales and operating income are increasing at the same time, and the numbers are easy to read. Although it is small compared to large-scale insurance stocks, we focused on it because it is easy to follow improvements in the profitability of its core business.
Features by sector
Insurance
In the insurance sector, performance is determined by factors such as underwriting, asset management, interest rates, natural disasters, and the sale of cross-shareholdings.
Therefore, it is necessary to check not only the operating income and net income for a single year, but also the outlook for adjusted profits, ROE, shareholder returns, catastrophe reserves, and natural disaster losses.
Infrastructure/Signal
While renewal demand tends to support demand for railway signals and transportation infrastructure, it is dependent on project progress, raw material costs, and investment plans of public and railway companies.
Daido Signal's operating income increased significantly during the current period, but the next operating income plan is 1.8 billion yen, and the focus will be on how far the company can maintain its current strong performance.
Services/Small Caps
In the same day's financial results, Gokurakuyu HD (2340) also had strong sales of 16.246 billion yen (+7.1%), operating profit of 1.236 billion yen (+8.5%), and net profit of 928 million yen (+20.7%).
However, this time we prioritized profit scale and sector attention, and excluded it from the Top 3. The service industry is easily affected by personnel costs, utility costs, store opening investments, and inbound demand.
Financial statements that you should pay attention to
Tokio Marine (8766) had sales of 8,872.277 billion yen (+5.1%), but operating profit was 1,348.63 billion yen (-7.6%), a decrease in profit, so it was excluded from the top three this time. Although they are important as large-scale insurance stocks, SOMPOHD and MS&AD stood out more in terms of the direction of their profits.
P-Eikosha (6576) saw sales increase to 3.638 billion yen (+17.9%), while operating income was 4.2 billion yen (-65.9%). Even though sales have increased, the profit margin has declined, so we would like to further confirm the quality of sales growth.
Flight (3753) and Ubiquitous AI (3858) continue to have operating deficits, and it is necessary to confirm the factors for re-growth and the timing of profitability.
Y-Shinchukin (8421) has seen a significant increase in sales, but its corporate form and accounting structure are unique, making it difficult to use with the same measuring stick as general company rankings, so we excluded it from this Top 3 list.
Points to check after tomorrow
The first thing I would like to confirm is the insurance sector's shareholder returns and capital efficiency. For SOMPOHD, MS&AD, and Tokio Marine, evaluations are likely to be influenced not only by the profits themselves, but also by reductions in cross-shareholdings, share buybacks, and dividend policies.
Next is the progress of orders and projects for Daido Signal. While the operating income for the current period increased significantly, the next operating income is planned to be 1.8 billion yen, so it will be interesting to see whether the improvement in profitability is temporary or sustainable.
Finally, for companies in the red or companies with sales but declining profits, it is necessary to confirm the timing when sales growth turns into profit. Even if only sales are increasing, if fixed costs and costs are heavy, stock valuation will be difficult to increase.
Summary
The three stocks to watch from the financial results article on May 20, 2026 are SOMPOHD, MS&AD, and Daido Signal.
SOMPOHD and MS&AD were major financial results in the insurance sector, and their profit scale and ROE stood out. Daido Signal's sales and operating income increased at the same time, which was easy to read for an infrastructure-related company.
On the other hand, this time's Top 3 are ``stocks with strong financial results'', not ``stocks whose stock prices will rise quickly''.
When making investment decisions, it is important to check not only the absolute value of financial results, but also market expectations, next-year outlook, return policy, and sector characteristics.
Source
This article refers to individual financial results articles prepared based on the financial results disclosed by the target companies.
- SOMPOHD “Summary of Financial Results for the Year Ending March 2026 [IFRS] (Consolidated)”
- MS&AD “Summary of Financial Results for the Fiscal Year Ending March 2026 [Japanese Standards] (Consolidated)”
- Daido Signal “Summary of Financial Results for the Year Ending March 2026 [Japanese Standards] (Consolidated)”