Equity Analyst, LightStream Research

Shifara Samsudeen, ACMA, CGMA

Equity Analyst

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>
<a href="https://www.smartkarma.com/entities/nihon-m-a-center-inc" target="_blank" data-smartkarma-citation="entities:17616:1" rel="noopener">Nihon M&amp;A Center (2127 JP)</a> reported 3QFY03/2024 results yesterday. Both revenue and OP increased 22.5% and 64.6% YoY respectively and were above consensus estimates.</li>
<li>M&amp;A revenues for the quarter saw significant growth after seeing two consecutive quarters of YoY decline driven by growth in the no. of deals and revenue per transaction.</li>
<li>The company’s share price has moved up by around 15% following the earnings announcement, however, share price has been down by more than 30% over the last 12-months.  </li>
</ul>



Nihon M&amp;A Center (2127 JP) reported 3QFY03/2024 results yesterday. Both revenue and OP increased 22.5% and 64.6% YoY respectively and were above consensus estimates.
M&amp;A revenues for the quarter saw significant growth after seeing two consecutive quarters of YoY decline driven by growth in the no. of deals and revenue per transaction.
The company’s share price has moved up by around 15% following the earnings announcement, however, share price has been down by more than 30% over the last 12-months.  


<ul>
<li>
<a href="https://www.smartkarma.com/entities/nihon-m-a-center-inc" target="_blank" data-smartkarma-citation="entities:17616:1" rel="noopener">Nihon M&amp;A Center (2127 JP)</a> ’s 2Q revenues decreased YoY while OP remained flat. However, both revenue and OP beat consensus estimates driven by improvement in revenue per M&amp;A transaction.</li>
<li>There was strong improvement in revenue per transaction driven by enhanced efforts and growth in no. of large deals, however, M&amp;A revenues declined due to drop in no. of deals.</li>
<li>Nihon has so far achieved only 36% of its OP target and it seems unlikely for the company to reach its full-year OP guidance, suggesting there is further downside.  </li>
</ul>



Nihon M&amp;A Center (2127 JP) ’s 2Q revenues decreased YoY while OP remained flat. However, both revenue and OP beat consensus estimates driven by improvement in revenue per M&amp;A transaction.
There was strong improvement in revenue per transaction driven by enhanced efforts and growth in no. of large deals, however, M&amp;A revenues declined due to drop in no. of deals.
Nihon has so far achieved only 36% of its OP target and it seems unlikely for the company to reach its full-year OP guidance, suggesting there is further downside.  


Nihon M&A: Earnings Show Some Recovery; but Could Miss Full-Year OP Guidance

<ul>
<li>
<a href="https://www.smartkarma.com/entities/nihon-m-a-center-inc" target="_blank" data-smartkarma-citation="entities:17616:1" rel="noopener">Nihon M&amp;A Center's</a> share price has dropped more than 50% YTD despite several news media outlets reporting that there has been a surge in M&amp;A activity among Japanese companies.</li>
<li>At the same time, the Japanese government also issued new guidelines to promote more M&amp;A activities in the nation to boost competitiveness.</li>
<li>The no. of M&amp;A transactions for the company has continued to grow however, value per transaction has been on a declining trend suggesting these deals are smaller in size.</li>
</ul>



Nihon M&amp;A Center's share price has dropped more than 50% YTD despite several news media outlets reporting that there has been a surge in M&amp;A activity among Japanese companies.
At the same time, the Japanese government also issued new guidelines to promote more M&amp;A activities in the nation to boost competitiveness.
The no. of M&amp;A transactions for the company has continued to grow however, value per transaction has been on a declining trend suggesting these deals are smaller in size.


Nihon M&A: Not Many Catalysts to Move the Stock Price Up

<ul>
<li>Nihon M&amp;A reported 1QFY03/2024 results on Friday. Both revenue and OP decreased 9.1% and 52.5% YoY to ¥8.2bn (vs consensus ¥9.8bn) and ¥1.7bn (vs consensus ¥3.6bn) respectively.</li>
<li>M&amp;A sales decreased yet again in 1Q as the company is struggling to improve revenue per transaction despite there being an increase in the no. of transactions.</li>
<li>We think the company may not be able to achieve full-year target given declining per transaction revenues and falling other businesses.</li>
</ul>


Nihon M&amp;A reported 1QFY03/2024 results on Friday. Both revenue and OP decreased 9.1% and 52.5% YoY to ¥8.2bn (vs consensus ¥9.8bn) and ¥1.7bn (vs consensus ¥3.6bn) respectively.
M&amp;A sales decreased yet again in 1Q as the company is struggling to improve revenue per transaction despite there being an increase in the no. of transactions.
We think the company may not be able to achieve full-year target given declining per transaction revenues and falling other businesses.


Nihon M&A: Earnings Miss, No Indication of a Business Turnaround Yet

Asia L/S Equity PM/Macro/Thematic Idea Generation

Rikki Malik

<ul>
<li>The company's management fees now cover the operating costs after many years of losses</li>
<li>Recent fund raising has surpassed expectations for its latest VC fund</li>
<li>The company's steps towards better capital allocation are trending in the right direction</li>
</ul>


The company's management fees now cover the operating costs after many years of losses
Recent fund raising has surpassed expectations for its latest VC fund
The company's steps towards better capital allocation are trending in the right direction


Revisiting Jafco (8595.T) - Company Reaches An Important Milestone

Japan

Nihon M&A Center Inc. provides M&A advisory services to small and medium-sized enterprises. The Company, established by certified public accountants and tax accountants, offers M&A related services such as reorganization and MBO (Management Buy-Out) as well.

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Nihon M&A Center (2127 JP)

Nihon M&A: Earnings Begin to Recover..

Nihon M&A reported strong Q3 results which beat consensus. M&A revenues rebound after two quarters of decline driven by growth in no. of deals and...

Shifara Samsudeen, ACMA, CGMA

Nihon M&A: Earnings Show Some Recovery; but Could Miss Full-Year OP Guidance

Nihon M&A's 2Q earnings beat consensus, however, M&A revenues declined due to fewer deals. Nihon has so far achieved only 36% of OP target and...

Shifara Samsudeen, ACMA, CGMA

Nihon M&A: Not Many Catalysts to Move the Stock Price Up

Despite a surge in M&A activity in Japan, Nihon M&A's shares have dropped over 50% YTD. Though Nihon's no. of M&A transactions have increased, the...

Shifara Samsudeen, ACMA, CGMA

Nihon M&A: Earnings Miss, No Indication of a Business Turnaround Yet

Nihon M&A's earnings missed consensus. The company is struggling to improve its falling per transaction revenue and contain costs, and it seems...

Shifara Samsudeen, ACMA, CGMA

Revisiting Jafco (8595.T) - Company Reaches An Important Milestone

Jafco reaches the holy grail of asset management , while its new fund raising is exceeding expectations. Exit multiples for Japan will likely...

Rikki Malik

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52-week Range

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Nihon M&A: Earnings Begin to Recover..

​Nihon M&A reported strong Q3 results which beat consensus. M&A revenues rebound after two quarters of decline driven by growth in no. of deals and...

Shifara Samsudeen, ACMA, CGMA

Nihon M&A: Earnings Show Some Recovery; but Could Miss Full-Year OP Guidance

​Nihon M&A's 2Q earnings beat consensus, however, M&A revenues declined due to fewer deals. Nihon has so far achieved only 36% of OP target and...

Shifara Samsudeen, ACMA, CGMA

Nihon M&A: Not Many Catalysts to Move the Stock Price Up

​Despite a surge in M&A activity in Japan, Nihon M&A's shares have dropped over 50% YTD. Though Nihon's no. of M&A transactions have increased, the...

Shifara Samsudeen, ACMA, CGMA

Nihon M&A: Earnings Miss, No Indication of a Business Turnaround Yet

Nihon M&A's earnings missed consensus. The company is struggling to improve its falling per transaction revenue and contain costs, and it seems...

Shifara Samsudeen, ACMA, CGMA

Revisiting Jafco (8595.T) - Company Reaches An Important Milestone

Jafco reaches the holy grail of asset management , while its new fund raising is exceeding expectations. Exit multiples for Japan will likely...

Rikki Malik

Nihon M&A reported strong Q3 results which beat consensus. M&A revenues rebound after two quarters of decline driven by growth in no. of deals and...

Nihon M&A's 2Q earnings beat consensus, however, M&A revenues declined due to fewer deals. Nihon has so far achieved only 36% of OP target and...

Despite a surge in M&A activity in Japan, Nihon M&A's shares have dropped over 50% YTD. Though Nihon's no. of M&A transactions have increased, the...