Equity Analyst, LightStream Research

Shifara Samsudeen, FCMA, 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/recruit-holdings-co-ltd" target="_blank" data-smartkarma-citation="entities:15070:1" rel="noopener">Recruit Holdings (6098 JP)</a> reported 1Q results on Tuesday after market. As expected, topline declined 2.5% YoY falling below consensus. Productivity enhancements supported EBITDA growth.</li>
<li>With gradual cooling of labour markets, the HR Tech segment’s top line growth has declined and Recruit does not expect the segment to see strong growth in FY03/2026E.</li>
<li>Recruit’s share price dropped 4.4% during today’s trade and with further weakening of job markets, we think there is further opportunity to gain on the Short side.</li>
</ul>



Recruit Holdings (6098 JP) reported 1Q results on Tuesday after market. As expected, topline declined 2.5% YoY falling below consensus. Productivity enhancements supported EBITDA growth.
With gradual cooling of labour markets, the HR Tech segment’s top line growth has declined and Recruit does not expect the segment to see strong growth in FY03/2026E.
Recruit’s share price dropped 4.4% during today’s trade and with further weakening of job markets, we think there is further opportunity to gain on the Short side.


Recruit Holdings: 1Q Earnings Is No Surprise but More Downside Ahead

Derivatives and Quantitative Strategist

Gaudenz Schneider

Equity Derivatives

<ul>
<li>This strategy exploits relative value in implied volatilities and combines it with a long Nifty 50 vs. short Nikkei 225 directional view over a period of two months.</li>
<li>The strategy performs well if the Nifty 50 rises <em>and</em> outperforms the Nikkei 225. If both indices decline, neither profit nor loss is incurred.</li>
<li>Leverage increases both the strategy's payoff and probability of success.</li>
</ul>


This strategy exploits relative value in implied volatilities and combines it with a long Nifty 50 vs. short Nikkei 225 directional view over a period of two months.
The strategy performs well if the Nifty 50 rises and outperforms the Nikkei 225. If both indices decline, neither profit nor loss is incurred.
Leverage increases both the strategy's payoff and probability of success.


EQD | Long Nifty 50 Vs. Short Nikkei 225 - A Relative Value Option Strategy with a Kicker

Japanese Equity Specialist, Ortus Advisors

Andrew Jackson

Japanese Equity Specialist

Ortus Advisors

Kawasaki Heavy Industries / Equity Bottom-Up

<ul>
<li>Expect continued buying in defense related, as well as banks and life insurance, renewable energy, rails, and medical IT plays with Shigeru Ishiba at the helm. </li>
<li>The Market will be quick to rotate out of names which spiked into Friday's close on expectation for a Sanae Takaichi win in the LDP election.  </li>
<li>Ishiba has been a vocal critic of Abenomics, and his potential policies aimed at higher taxes for investment incomes and capital gains are set to weigh on the Japanese market. </li>
</ul>


Expect continued buying in defense related, as well as banks and life insurance, renewable energy, rails, and medical IT plays with Shigeru Ishiba at the helm. 
The Market will be quick to rotate out of names which spiked into Friday's close on expectation for a Sanae Takaichi win in the LDP election.  
Ishiba has been a vocal critic of Abenomics, and his potential policies aimed at higher taxes for investment incomes and capital gains are set to weigh on the Japanese market. 


Best Outright and Pair Trades for an Ishiba-Led LDP

Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<ul>
<li>Last month, Reuters reported that activist-ish investor Value Act Capital Management had bought a stake in <a href="https://www.smartkarma.com/entities/recruit-holdings-co-ltd" target="_blank" data-smartkarma-citation="entities:15070:1" rel="noopener">Recruit Holdings (6098 JP)</a> and separately in <a href="https://www.smartkarma.com/entities/expedia-group-inc" target="_blank" data-smartkarma-citation="entities:6669:1" rel="noopener">Expedia Group, Inc. (EXPE US)</a>). </li>
<li>It was "revealed" in a letter to its clients. And there were reasons stated why Value Act thought Recruit was worth a lot more than it was trading for. </li>
<li>Today, Recruit announced an on-market buyback for ¥200bn. That's nice. But it is not enormous, and it may signal other info, and it is worth understanding details and context.</li>
</ul>


Last month, Reuters reported that activist-ish investor Value Act Capital Management had bought a stake in Recruit Holdings (6098 JP) and separately in Expedia Group, Inc. (EXPE US)). 
It was "revealed" in a letter to its clients. And there were reasons stated why Value Act thought Recruit was worth a lot more than it was trading for. 
Today, Recruit announced an on-market buyback for ¥200bn. That's nice. But it is not enormous, and it may signal other info, and it is worth understanding details and context.


Recruit (6098 JP) Buyback - It's Big But Not THAT Big; Value Act Effect Vs Corp Selldown Vs Multiple

<ul>
<li>
<a href="https://www.smartkarma.com/entities/recruit-holdings-co-ltd" target="_blank" data-smartkarma-citation="entities:15070:1" rel="noopener">Recruit Holdings (6098 JP)</a>  reported 4Q and Full-year FY03/2025 results on Friday which fell below consensus estimates. However, earnings were in line with the company’s guidance.</li>
<li>Labour markets have begun to cool off with concerns over potential impact of trade wars and economic uncertainty, and the company expects top line to decline in FY03/2026E.</li>
<li>Though the company’s monetisation efforts have paid off, we expect Recruit’s earnings to remain under pressure and think there’s opportunity to gain on the Short side.</li>
</ul>



Recruit Holdings (6098 JP)  reported 4Q and Full-year FY03/2025 results on Friday which fell below consensus estimates. However, earnings were in line with the company’s guidance.
Labour markets have begun to cool off with concerns over potential impact of trade wars and economic uncertainty, and the company expects top line to decline in FY03/2026E.
Though the company’s monetisation efforts have paid off, we expect Recruit’s earnings to remain under pressure and think there’s opportunity to gain on the Short side.


Recruit: Weakening Labour Markets and More Downside Ahead

Japan

Recruit Holdings Co. Ltd. operates information providing services in human resource, housing, bridal, travel, restaurants, beauty, automobiles, and education and more. The company also operate staffing services and advertising business.

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Recruit Holdings (6098 JP)

Recruit Holdings: 1Q Earnings Is No Surprise but More Downside Ahead

Recruit's 1Q earnings were no surprise to us with decline in top line growth. Cost controls have supported margins. The slowdown in the US labor...

Shifara Samsudeen, FCMA, CGMA

EQD | Long Nifty 50 Vs. Short Nikkei 225 - A Relative Value Option Strategy with a Kicker

Option strategy: exploit relative value in implied volatilities combined with directional positioning for a leveraged payoff in a long Nifty 50 vs....

Gaudenz Schneider

Best Outright and Pair Trades for an Ishiba-Led LDP

How to position in Japanese equities after the surprise win by Shigeru Ishiba over Sanae Takaichi in Friday's LDP election.

Andrew Jackson

Recruit (6098 JP) Buyback - It's Big But Not THAT Big; Value Act Effect Vs Corp Selldown Vs Multiple

Recruit has announced a ¥200bn buyback. Last year's market buyback was ¥150bn. This is NOT "Value Act Effect" but it may be taken as such. That...

Travis Lundy

Recruit: Weakening Labour Markets and More Downside Ahead

Recruit's 4Q earnings missed consensus. The job market in the US is cooling off and the company is expecting earnings to remain under pressure...

Shifara Samsudeen, FCMA, CGMA

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Recruit Holdings: 1Q Earnings Is No Surprise but More Downside Ahead

​Recruit's 1Q earnings were no surprise to us with decline in top line growth. Cost controls have supported margins. The slowdown in the US labor...

Shifara Samsudeen, FCMA, CGMA

EQD | Long Nifty 50 Vs. Short Nikkei 225 - A Relative Value Option Strategy with a Kicker

Option strategy: exploit relative value in implied volatilities combined with directional positioning for a leveraged payoff in a long Nifty 50 vs....

Gaudenz Schneider

Best Outright and Pair Trades for an Ishiba-Led LDP

How to position in Japanese equities after the surprise win by Shigeru Ishiba over Sanae Takaichi in Friday's LDP election.

Andrew Jackson

Recruit (6098 JP) Buyback - It's Big But Not THAT Big; Value Act Effect Vs Corp Selldown Vs Multiple

Recruit has announced a ¥200bn buyback. Last year's market buyback was ¥150bn. This is NOT "Value Act Effect" but it may be taken as such. That...

Travis Lundy

Recruit: Weakening Labour Markets and More Downside Ahead

​Recruit's 4Q earnings missed consensus. The job market in the US is cooling off and the company is expecting earnings to remain under pressure...

Shifara Samsudeen, FCMA, CGMA

Recruit's 1Q earnings were no surprise to us with decline in top line growth. Cost controls have supported margins. The slowdown in the US labor...

Recruit's 4Q earnings missed consensus. The job market in the US is cooling off and the company is expecting earnings to remain under pressure...