In today’s briefing:
- Improved Profitability to Attract Overseas Investors Key to Raise Valuation Even After TSE’s Request
Improved Profitability to Attract Overseas Investors Key to Raise Valuation Even After TSE’s Request
- Companies that increased Tobin’sQ have further increased Tobin’sQ due to continued growth in ROE and ROA. They have room to further improve return on capital by reducing cash on hand.
- Companies with lower Tobin’s Q may include small-cap stocks that are increasingly undervalued because they have relatively high ROE and ROA but are not covered by overseas investors.
- Over the past year, few companies raised their valuations based solely on expectations of P/B bottoming-out without improving profitability, and IR activities alone have had limited effect in boosting valuations.
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