Senior Technology Analyst, Japanese Equities, LightStream Research

Scott Foster

Senior Technology Analyst, Japanese Equities

Long-Short Analysis on Japan, Asia and the World

LightStream Research

LightStream conducts quantitatively rigorous and data-driven analysis with a focus on Japan and Asia.

We consistently cover the Tech, Consumer and Industrial sectors, and provide ECM and Events coverage more broadly.

We supplement traditional qualitative insights from company relationships with a robust quantitative foundation that examines as much historical data as is available.
We further refine the accuracy of our insights and calls through the use of alternative data to flesh out current trends, and through a valuation framework that emphasises non-superficial peer group selection and a proper attempt to understand the metrics and changes that have driven security valuations in the past.

Equity Bottom-Up

<ul>
<li>Contract with Australia to supply sonar, communications and navigation equipment for Mogami frigates points to long-term growth for NEC's defense business.</li>
<li>Three frigates to be built for the Australian Navy by MHI in Nagasaki, followed by eight more to be built in Australia. NEC likely to supply all of them.</li>
<li>Shares rebounding from their February low, but still more than 25% below their 52-week high. Selling at 23 times EPS guidance as of April 21.</li>
</ul>


Contract with Australia to supply sonar, communications and navigation equipment for Mogami frigates points to long-term growth for NEC's defense business.
Three frigates to be built for the Australian Navy by MHI in Nagasaki, followed by eight more to be built in Australia. NEC likely to supply all of them.
Shares rebounding from their February low, but still more than 25% below their 52-week high. Selling at 23 times EPS guidance as of April 21.


NEC (6701 JP): Key Supplier for Mogami Frigates

Equity/Index & Cross Asset Volatility Specialist, Cameron Design

Jay Cameron

Equity/Index & Cross Asset Volatility Specialist

Cameron Design

We specialize in financial products and volatility. Our strategies balance speed, data, and risk control to capture opportunities across global markets. Our research leverages AI and data analytics to continuously refine our algorithms and adapt to evolving market dynamics.

Equity Derivatives

Mitsubishi Heavy Industries / Equity Derivatives

<ul>
<li>MHI's diversified exposure to AI (and recent collaboration with NVIDIA), gas turbines, defense, and potentially space, point to potential for the stock in the long term. </li>
<li>Improvements to ROE, and profit margins alongside good visibility on profits with backlogs in the JPY 14T range indicate limited risks for the company in the near future.</li>
<li>A directional DEC26 option trade may be the right strategy to gain exposure on the stock.  </li>
</ul>


MHI's diversified exposure to AI (and recent collaboration with NVIDIA), gas turbines, defense, and potentially space, point to potential for the stock in the long term. 
Improvements to ROE, and profit margins alongside good visibility on profits with backlogs in the JPY 14T range indicate limited risks for the company in the near future.
A directional DEC26 option trade may be the right strategy to gain exposure on the stock.  


MHI's NVIDIA Liquid Cooling Collaboration and DEC26 Options: Monetizing the AI Power Surge

Japan Specialist

Mark Chadwick

Mitsubishi Heavy Industries / Equity Bottom-Up

<ul>
<li>1Q results comfortably beat expectations, with 65% profit growth and record order intake highlighting sustained momentum across Energy Systems and Defence.</li>
<li>Management raised order guidance but left earnings forecasts unchanged, suggesting meaningful upside as the record backlog converts into revenue.</li>
<li>Despite recent gains, MHI remains attractively valued, supported by the gas turbine supercycle, margin expansion, and accelerating defence spending.</li>
</ul>


1Q results comfortably beat expectations, with 65% profit growth and record order intake highlighting sustained momentum across Energy Systems and Defence.
Management raised order guidance but left earnings forecasts unchanged, suggesting meaningful upside as the record backlog converts into revenue.
Despite recent gains, MHI remains attractively valued, supported by the gas turbine supercycle, margin expansion, and accelerating defence spending.


MHI (7011) | Record Orders Reinforce Multi-Year Energy and Defence Growth Story

Japanese Equity Specialist, Ortus Advisors

Andrew Jackson

Japanese Equity Specialist

Ortus Advisors

Thematic (Sector/Industry)

<ul>
<li>Memory names surging after bullish broker upgrades as mkt refuses to sell off into the shutdown.</li>
<li>Boeing taking a break but outlook for CF suppliers such as Toray ahead of the announcement for now Chinese orders looks positive.</li>
<li>Oil takes a sizeable hit with OPEC signalling supply increases on the way.</li>
</ul>


Memory names surging after bullish broker upgrades as mkt refuses to sell off into the shutdown.
Boeing taking a break but outlook for CF suppliers such as Toray ahead of the announcement for now Chinese orders looks positive.
Oil takes a sizeable hit with OPEC signalling supply increases on the way.


Japan Morning Connection: Wolfspeed Out of Chapter 11 as Expected and Stock Rallies 1726%

<ul>
<li>MHI reports impressive YoY growth in order intake, revenues, and profits across Energy Systems and Defense Equipment segments in Q2 2023.</li>
<li>Despite a 62% YTD stock price increase, strong order backlog and underlying drivers suggest resilience in a challenging economic climate.</li>
<li>The company benefits from global trends in decarbonization and increased national security spending, positioning itself as a leader in gas turbines and defense technology.</li>
</ul>


MHI reports impressive YoY growth in order intake, revenues, and profits across Energy Systems and Defense Equipment segments in Q2 2023.
Despite a 62% YTD stock price increase, strong order backlog and underlying drivers suggest resilience in a challenging economic climate.
The company benefits from global trends in decarbonization and increased national security spending, positioning itself as a leader in gas turbines and defense technology.


Japan

Mitsubishi Heavy Industries, Ltd. is a comprehensive heavy machinery maker. The Company manufactures machinery, ships, turbines and engines, prime movers, aircrafts, and machine parts for military and commercial use.  Mitsubishi Heavy Industries also researches and develops nuclear power plants.

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Mitsubishi Heavy Industries (7011 JP)

NEC (6701 JP): Key Supplier for Mogami Frigates

Contract to supply sonar, communications and navigation equipment for Mogami frigates ordered by Australia a long-term positive. Aerospace &...

Scott Foster

MHI's NVIDIA Liquid Cooling Collaboration and DEC26 Options: Monetizing the AI Power Surge

MHI has seen some ups and downs recently with the market, but could be at the start of a new trend given its new ventures in AI, and continued...

Jay Cameron

MHI (7011) | Record Orders Reinforce Multi-Year Energy and Defence Growth Story

Record orders, a record backlog and conservative guidance leave Mitsubishi Heavy Industries well positioned. Energy Systems and Defence continue to...

Mark Chadwick

Japan Morning Connection: Wolfspeed Out of Chapter 11 as Expected and Stock Rallies 1726%

Markets largely shake off shutdown concerns with memory exploding higher, watch 285A Kioxia. Toray may get a leg higher when China confirms...

Andrew Jackson

MHI (7011) | Rockets and Renewables

MHI reports strong growth in Q2 2023, benefiting from global trends in decarbonization and defense spending, positioning itself as a leader in gas...

Mark Chadwick

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

NEC (6701 JP): Key Supplier for Mogami Frigates

Contract to supply sonar, communications and navigation equipment for Mogami frigates ordered by Australia a long-term positive. Aerospace &...

Scott Foster

MHI's NVIDIA Liquid Cooling Collaboration and DEC26 Options: Monetizing the AI Power Surge

MHI has seen some ups and downs recently with the market, but could be at the start of a new trend given its new ventures in AI, and continued...

Jay Cameron

MHI (7011) | Record Orders Reinforce Multi-Year Energy and Defence Growth Story

Record orders, a record backlog and conservative guidance leave Mitsubishi Heavy Industries well positioned. Energy Systems and Defence continue to...

Mark Chadwick

Japan Morning Connection: Wolfspeed Out of Chapter 11 as Expected and Stock Rallies 1726%

Markets largely shake off shutdown concerns with memory exploding higher, watch 285A Kioxia. Toray may get a leg higher when China confirms...

Andrew Jackson

MHI (7011) | Rockets and Renewables

​MHI reports strong growth in Q2 2023, benefiting from global trends in decarbonization and defense spending, positioning itself as a leader in gas...

Mark Chadwick

MHI reports strong growth in Q2 2023, benefiting from global trends in decarbonization and defense spending, positioning itself as a leader in gas...