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>M3’s share price has dropped 18% since its 2Q earnings release. Both revenue and OP fell below consensus and we were surprised by the drop in OPM for 2Q.</li>
<li>Medical Platform’s earnings have continued to decline as a result of spending cuts by pharmaceutical companies while other segments have failed to make up for the decline in Medical Platform.</li>
<li>M3 recently bought a majority stake in ELAN, whose consolidation will dilute m3’s margins. The company’s M&amp;A deals have not brought in any significant contribution to consolidated earnings.</li>
</ul>


M3’s share price has dropped 18% since its 2Q earnings release. Both revenue and OP fell below consensus and we were surprised by the drop in OPM for 2Q.
Medical Platform’s earnings have continued to decline as a result of spending cuts by pharmaceutical companies while other segments have failed to make up for the decline in Medical Platform.
M3 recently bought a majority stake in ELAN, whose consolidation will dilute m3’s margins. The company’s M&amp;A deals have not brought in any significant contribution to consolidated earnings.


M3: Earnings Trend Downward, ELAN Acquisition to Further Dilute Margins

<ul>
<li>
<a href="https://www.smartkarma.com/entities/m3-inc" target="_blank" data-smartkarma-citation="entities:13316:1" rel="noopener">M3 Inc (2413 JP)</a> reported 1QFY03/2025 results on Friday. Both revenue and OP for the quarter beat consensus estimates by 3.5% and 11.0% respectively despite earnings continue to decline.</li>
<li>Medical Platform segment’s earnings have continued to decline as a result of pharma marketing whose revenues are impacted due to spending cuts by pharmaceutical companies.</li>
<li>M3’s share price has declined by more than 35% YTD and we don’t see any tangible recovery in the company’s earnings as overseas and other businesses face challenges.</li>
</ul>



M3 Inc (2413 JP) reported 1QFY03/2025 results on Friday. Both revenue and OP for the quarter beat consensus estimates by 3.5% and 11.0% respectively despite earnings continue to decline.
Medical Platform segment’s earnings have continued to decline as a result of pharma marketing whose revenues are impacted due to spending cuts by pharmaceutical companies.
M3’s share price has declined by more than 35% YTD and we don’t see any tangible recovery in the company’s earnings as overseas and other businesses face challenges.


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

<ul>
<li>
<a href="https://www.smartkarma.com/entities/m3-inc" target="_blank" data-smartkarma-citation="entities:13316:1" rel="noopener">M3 Inc (2413 JP)</a> reported 4Q and Full-year FY03/2024 results. Earnings missed both guidance as well as consensus due to slowdown in Medical Platform and Overseas businesses.</li>
<li>Medical Platform’s earnings declined further in 4Q with spending cuts by pharma companies, and it seems that the segment’s earnings will further decline going forward.</li>
<li>M3’s share price is down 18% YTD, and we do not see many catalysts to drive a rally in the company’s share price.</li>
</ul>



M3 Inc (2413 JP) reported 4Q and Full-year FY03/2024 results. Earnings missed both guidance as well as consensus due to slowdown in Medical Platform and Overseas businesses.
Medical Platform’s earnings declined further in 4Q with spending cuts by pharma companies, and it seems that the segment’s earnings will further decline going forward.
M3’s share price is down 18% YTD, and we do not see many catalysts to drive a rally in the company’s share price.


M3 4Q Results: Earnings Miss and Further Slowdown Seems Unavoidable

<ul>
<li>
<a href="https://www.smartkarma.com/entities/m3-inc" target="_blank" data-smartkarma-citation="entities:13316:1" rel="noopener">M3 Inc (2413 JP)</a> reported 3QFY03/2024 results today. Both revenue and OP decreased 1.6% and 7.5% YoY respectively and fell below consensus estimates.</li>
<li>Medical Platform’s revenues declined YoY while overseas segment’s top line growth has been slowing down raising concerns over m3’s growth prospects.</li>
<li>Given continued decline in earnings, it seems that m3 will struggle to meet its full-year guidance suggesting there is further downside.</li>
</ul>



M3 Inc (2413 JP) reported 3QFY03/2024 results today. Both revenue and OP decreased 1.6% and 7.5% YoY respectively and fell below consensus estimates.
Medical Platform’s revenues declined YoY while overseas segment’s top line growth has been slowing down raising concerns over m3’s growth prospects.
Given continued decline in earnings, it seems that m3 will struggle to meet its full-year guidance suggesting there is further downside.


Japan

M3, Inc. supplies medical information services for doctors through the Internet. The Company also supports marketing of pharmaceutical companies and medical equipment manufacturers.

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M3 Inc (2413 JP)

M3: Earnings Trend Downward, ELAN Acquisition to Further Dilute Margins

• M3’s share price has dropped more than 18% since its 2Q earnings release. Both revenue and OP fell below consensus and we were surprised by the...

Shifara Samsudeen, ACMA, CGMA

M3: No Tangible Recovery in Earnings Yet

M3's 1Q earnings beat revenue and OP estimates, however, earnings continue to decline due to decline in pharma marketing and drop in US clinical...

Shifara Samsudeen, ACMA, CGMA

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

M3 4Q Results: Earnings Miss and Further Slowdown Seems Unavoidable

As we expected, m3 missed its own guidance as well as consensus estimates. Medical Platform's earnings growth has decelerated, and the completion...

Shifara Samsudeen, ACMA, CGMA

M3: Earnings Slowdown Is Inevitable

M3's revenues and OP declined YoY in 3Q falling below consensus estimates. Medical Platform reported YoY decline in revenues while Overseas...

Shifara Samsudeen, ACMA, CGMA

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

M3: Earnings Trend Downward, ELAN Acquisition to Further Dilute Margins

• M3’s share price has dropped more than 18% since its 2Q earnings release. Both revenue and OP fell below consensus and we were surprised by the...

Shifara Samsudeen, ACMA, CGMA

M3: No Tangible Recovery in Earnings Yet

​M3's 1Q earnings beat revenue and OP estimates, however, earnings continue to decline due to decline in pharma marketing and drop in US clinical...

Shifara Samsudeen, ACMA, CGMA

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

M3 4Q Results: Earnings Miss and Further Slowdown Seems Unavoidable

As we expected, m3 missed its own guidance as well as consensus estimates. Medical Platform's earnings growth has decelerated, and the completion...

Shifara Samsudeen, ACMA, CGMA

M3: Earnings Slowdown Is Inevitable

​M3's revenues and OP declined YoY in 3Q falling below consensus estimates. Medical Platform reported YoY decline in revenues while Overseas...

Shifara Samsudeen, ACMA, CGMA

M3's 1Q earnings beat revenue and OP estimates, however, earnings continue to decline due to decline in pharma marketing and drop in US clinical...

M3's revenues and OP declined YoY in 3Q falling below consensus estimates. Medical Platform reported YoY decline in revenues while Overseas...