5108:JPN - Embedded Expectations Analysis - 2018 11 02
Bridgestone Corporation (5108:JPN) currently trades below UAFRS-based (Uniform) Asset values, with a 0.7x Uniform P/B, implying bearish expectations for the firm, and management may have concerns about demand in the OE segment of the market, pricing and currency headwinds in Latin America, and their replacement businessSpecifically, management may lack confidence in the sustainability of high demand in Japan, as well as growth in their large-sized ORR tires. Moreover, they may be concerned about the impact of a strong U.S. dollar on their gross profits, and may lack confidence in their ability to maintain growth of consolidated operating income in Japan and EMEA. Furthermore, they may be concerned about continued declines in the replacement business in China, Asia, and the Pacific, and about the factors influencing their operating income results. Finally, they may have concerns about the sustainability of strong OE demand in H2 2018, and in their ability to increase pricing in Latin America
Bridgestone and its affiliates are mainly engaged in the manufacture and sale of tires in the Americas, Europe, Asia and Japan. Co.'s principal business segments are tires and diversified products. Co. is engaged in the manufacture and sale of tires for passenger cars, trucks, buses, construction vehicles, industrial vehicles, agricultural machinery, aircraft, motorcycles, as well as tire-related products; and automotive components, industrial products, polyurethane foam products, construction materials, parts and materials for electronic equipment, bicycles and sporting goods. In addition, Co., through its subsidiaries, is engaged in the provision of financing services.
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