In this quarterly strategy report, we look to evaluate where we are with regards the bull market conditions, and where those indicators might be headed, factoring in the downside risks, from Trump tariffs and the US economy, BoJ actions, Japanese earnings and valuations.
Following the recent results season where several leading semiconductor and SPE companies globally produced either disappointing results or guidance, we look at where the semiconductor industry is at present, where it looks to be headed in 2025 and identify opportunities in the Japanese IC / SPE space.
When the BoJ raised rates in March, it had been 17 years since it had last done so, though the world was very different then. While the July rate hike was unlikely to move the economic needle, the question now is what else might follow the subsequent financial market maelstrom. Pelham Smithers discusses the outlook for Japan’s macro environment, what new fiscal policies the new PM might introduce, how the BoJ might react and the all-important trend in corporate earnings. This then leads us to...
It has been nine years since a downturn generated sizable losses for the semiconductor industry and 12 years since the Lehman Crisis led to major structural changes. The length and size of the upcycle has led to worries that the cycle is about to peak and when it does, the downturn could be brutal for both the industry and investors. The current uncertainty is heightened by shortages in many types of semiconductors, with average delivery times pushed out to 20 weeks. Some customers are having to...
Full Article at IIR has reaffirmed its Recommended rating for PIA after undertaking a review post the appointment of a new Portfolio Manager, Harding Loevner. The full report can be found on the IIR website. On 26 July 2021, Pengana International Equities Limited (PIA) announced a fully franked dividend of 1.35 cents per share for the June quarter. This represents an 8% increase on the March quarter dividend and takes the total dividends declared for FY21 of 5.1 cents per share, fully franked....
Pelham Smithers presents his strategy for Q3 2021 and the changes to PSA's stock Focus List Table of Contents Overview 3 Background 4 Valuations & Value 5 The Case for “Muddle Through” 6 Consumer Spending 7 The Labour Market 7 The Currency and the Carry Trade 8 The BoJ and Policy 9 Japan’s Stuttering Economy 10 Stock Performance and Earnings Expectations 12 Catalysts: Digital Transformation, Semiconductors, Price Hikes ...
CANON (JP), a company active in the Electronic Office Equipment industry, now shows a lower overall rating. The independent financial analyst theScreener just confirmed the fundamental rating of 4 stars out of 4, as well as the stock market behaviour of the title as moderately risky. However, environmental deterioration penalises the general evaluation, which is downgraded to Neutral. As of the analysis date February 23, 2021, the closing price was JPY 2,338.50 and its expected value was estimat...
Over the past 70 years, Canon has established defensible market positions in its core office and consumer segments, but secular headwinds and shifting industry dynamics limit its long-term growth potential. Canon's office segment--which sells multifunctional devices, copiers, and industrial and personal laser printers--accounts for 50% of consolidated sales. The firm benefits from partnerships with the original equipment manufacturer, or OEM, of laser printers Hewlett-Packard, which represented ...
We trim no-moat Canon’s fair value estimate to JPY 3,600 per share from JPY 3,700, and to $33 per U.S. ADR from $34, owing to the weakness on its interchangeable lens camera, or ILC, business. Canon’s March quarter results were below our expectations because of the inventory adjustment and worse-than-expected product mix for ILC. While Canon has been the top player of ILC for decades, two major threats for the business have emerged recently: 1) a contraction of the ILC market, caused by the...
We trim no-moat Canon’s fair value estimate to JPY 3,600 per share from JPY 3,700, and to $33 per U.S. ADR from $34, owing to the weakness on its interchangeable lens camera, or ILC, business. Canon’s March quarter results were below our expectations because of the inventory adjustment and worse-than-expected product mix for ILC. While Canon has been the top player of ILC for decades, two major threats for the business have emerged recently: 1) a contraction of the ILC market, caused by the...
We trim no-moat Canon’s fair value estimate to JPY 3,600 per share from JPY 3,700, and to $33 per U.S. ADR from $34, owing to the weakness on its interchangeable lens camera, or ILC, business. Canon’s March quarter results were below our expectations because of the inventory adjustment and worse-than-expected product mix for ILC. While Canon has been the top player of ILC for decades, two major threats for the business have emerged recently: 1) a contraction of the ILC market, caused by the...
We trim no-moat Canon’s fair value estimate to JPY 3,600 per share from JPY 3,700, and to $33 per U.S. ADR from $34, owing to the weakness on its interchangeable lens camera, or ILC, business. Canon’s March quarter results were below our expectations because of the inventory adjustment and worse-than-expected product mix for ILC. While Canon has been the top player of ILC for decades, two major threats for the business have emerged recently: 1) a contraction of the ILC market, caused by the...
We have fine-tuned our earnings forecast for no-moat Canon and trimmed our fair value estimate to JPY 3,700 per share from JPY 3,900 and to $34 per U.S. ADR from $36. We retain our view that Canon’s profit will remain fairly flat over our five-year forecasting period, as steady growth in network cameras and lithography equipment for semiconductors will be offset by the gradual contraction of the copier and digital camera markets. We think the shares are supported by Canon's rich shareholder r...
We have fine-tuned our earnings forecast for no-moat Canon and trimmed our fair value estimate to JPY 3,700 per share from JPY 3,900 and to $34 per U.S. ADR from $36. We retain our view that Canon’s profit will remain fairly flat over our five-year forecasting period, as steady growth in network cameras and lithography equipment for semiconductors will be offset by the gradual contraction of the copier and digital camera markets. We think the shares are supported by Canon's rich shareholder r...
We have fine-tuned our earnings forecast for no-moat Canon and trimmed our fair value estimate to JPY 3,700 per share from JPY 3,900 and to $34 per U.S. ADR from $36. We retain our view that Canon’s profit will remain fairly flat over our five-year forecasting period, as steady growth in network cameras and lithography equipment for semiconductors will be offset by the gradual contraction of the copier and digital camera markets. We think the shares are supported by Canon's rich shareholder r...
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