In today’s briefing:
- Toshiba (6502) Strong Vs Peers on No News Means Susceptible to Risk On Underperformance
- Shinko Shoji (8141) Buyback – Possibly An Interesting Development
- Sony (6758 JP): Image Sensors Set for Rebound & Long-Term Expansion
- NTT (Buy) – Updated Forecasts and Comments on Telework
Toshiba (6502) Strong Vs Peers on No News Means Susceptible to Risk On Underperformance
- Toshiba Corp (6502 JP) sees its AGM next week with new directors and a possible privatisation process ongoing. But the AGM is a done deal and privatisation is not.
- The event-i-ness of Toshiba keeps it “supported” while its better-valued and higher-growth peers fall harder in the face of recent overall market weakness.
- Toshiba promised transparency on its privatisation process, and so far, it has delivered everything it promised. The next “transparency” likely comes in November.
Shinko Shoji (8141) Buyback – Possibly An Interesting Development
- Smallcap semiconductor/component/design/assembly service trading house Shinko Shoji (8141 JP) has been buying back stock. It cancelled 20% of shares out last year. Today it buys back nearly 7%.
- The question is, who sells. What one might want to do may depend on who sells. And we will know that in 1-5 days.
- The stock itself trades at less than net current assets. The entire market cap and indeed equity is its funding of inventory and net receivables. It’s cheap.
Sony (6758 JP): Image Sensors Set for Rebound & Long-Term Expansion
- Aided by the weak yen, Imaging & Sensing Solutions should return as a major profit driver in FY Mar-23.
- Capacity expansion should help SONY regain image sensor market share over the next 3-4 years.
- Participation in TSMC’s foundry project in Kyushu should add to the division’s long-term potential.
NTT (Buy) – Updated Forecasts and Comments on Telework
- NTT has adopted a progressive telework policy that reportedly allows up to 50% of eligible employees (30,000) to work from anywhere in Japan
- All telcos are likely to go down this path although NTT stands out as a larger and more traditional domestic company than KDDI or Softbank
- We have updated our model for new segment reporting. Our new forecasts support a ¥4,500 target price (March 2023) and we remain at Buy.
Before it’s here, it’s on Smartkarma
