Morningstar

Morningstar, Inc.

Equity Bottom-Up

We cut Panasonic’s fair value estimate to JPY 1,300 from JPY 1,500 as we revise our long-term forecast. While Panasonic has been focusing its resources to benefit from the growth opportunity on automotive industry over the past few years, its profitability did not improve as projected. Consequently, Panasonic was not able to source enough money to support its consumer electronics business, and as a result, operating income of all segments declined from the previous year in fiscal 2019. Owing to…

We are cutting Panasonic’s fair value estimate from JPY 2,000 to JPY 1,850 after revising our outlook for the appliance segment. Because of the global economic slowdown and the domestic consumption tax increase in October 2019, we think that revenue growth for the segment will stagnate over the next few years. Moreover, we are concerned about the intense competition of major appliances, because we believe it is difficult for most consumer electronic companies to establish an economic moat, which…

While Panasonic retained its operating income guidance for this fiscal year of JPY 425 billion, it materially lowered its profit guidance from four major business segments by JPY 49 billion, which is below our forecast. The appliances segment cut down its revenue and profit guidance because of the intense competition of air conditioners and flat panel televisions, and the eco solutions segment dropped numbers owing to the slowdown on the domestic housing market, which were both in line with our…

We have a mixed impression of Panasonic’s June quarter earnings. On the positive side, its revenue grew 7.7% from the previous year, which is the highest growth rate over the past decade, if excluding the impact of mergers and acquisitions, or M&amp;A, and currencies. Panasonic has been working for years to expand its overseas business and B2B business, as it had been struggling from the lower growth and intense competition of the domestic consumer electronics market, and so we are encouraged by the…

Japan

Panasonic Corporation manufactures electric and electronic products. The Company produces home appliances, car navigation systems, digital devices, computer peripherals, telecommunications, industrial equipment, and electronic parts. Panasonic has associated companies around the world.

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