In today’s briefing:
- BIG Nikon (7731) Buyback – OK But Should Do Better
- WISE Tour Leisure Rebalancing (TIGER ETF): Long/Short Tradable Names
- JD.com (JD): Layoff Plan Covers Only Minor Businesses, Still a Buy
- Seven & I: A Lot Left in Speedway Synergies
- Nikon (7731) | Focusing on the 4 Year View
- Merger of Dongwon Industries & Dongwon Enterprise
- Torikizoku Holdings (3193): Healthy Performance in March Despite Difficult Environment
BIG Nikon (7731) Buyback – OK But Should Do Better
- Nikon Corp (7731 JP) today announced a Very Large Buyback. This is the third buyback it has announced since spring 2019. The first was short. The next two big.
- The company also announced a new Medium-Term Management Plan for FY2022-2025 today in which they reiterated their existing Shareholder Return Policy of 40+% payout of stable dividends and opportunistic buybacks.
- It’s a decent div, and the buyback is for 6-7% of shares out, but it could do better. The company is hugely cash- and securities holdings-rich. It should do better.
WISE Tour Leisure Rebalancing (TIGER ETF): Long/Short Tradable Names
- Next Thursday, the rebalancing trading of the WISE Secondary Cell Index will occur. The current AUM is ₩0.24T, and the AUM has slightly increased in the last two weeks.
- Five names (2 Longs & 3 Shorts) are screened: Hana Tour Service, Lotte Tour Development, Asiana Airlines, Paradise Co Ltd, & Hanjin KAL Corp.
- All the short targets are available for short-selling. The Long targets have also not seen much volatility recently, so it looks fine to put them all in a Long/Short basket.
JD.com (JD): Layoff Plan Covers Only Minor Businesses, Still a Buy
- JD dismissed employees in many businesses, such as Retail, International, and Jingxi.
- However, we believe the layoff only covers minor businesses and functions.
- We believe the stock still has a upside of 48%.
Seven & I: A Lot Left in Speedway Synergies
- Even though the results weren’t a blowout as we expected, today’s price performance suggests that Seven & I Holdings (3382 JP) has not disappointed the market.
- We think Seven & I could be playing safe by holding back Speedway synergies.
- After a short breather, share price momentum has shifted positive and we expect this to continue alongside upgrades to Speedway synergy estimates.
Nikon (7731) | Focusing on the 4 Year View
- The new four-year medium-term strategy that lays out a realistic route to greater profitability and growth.
- The stock has been trading below book value for years
- Buying back 10% of outstanding shares will give investors confidence
Merger of Dongwon Industries & Dongwon Enterprise
- Dongwon Industries (006040 KS) plans to merge with Dongwon Enterprise, paving the way for the latter company to complete a back door public listing.
- We believe this merger between Dongwon Industries and Dongwon Enterprise will have a positive impact on Dongwon Industries.
- Once the merger is completed, there could be less pressure “to keep the share price of Dongwon Industries intentionally low” in order have more beneficial merger ratio with Dongwon Enteprise.
Torikizoku Holdings (3193): Healthy Performance in March Despite Difficult Environment
- Same-store sales were 126.7% vs. March 2021 (112.8% for February), 70.2% vs. March 2020 (36.9% for February), and 58.9% vs. March 2019 (39.1% for February)
- The number of stores at the end of March was 615 (unchanged MoM). The number of directly owned stores was 384 (unchanged MoM).
- The company plans to open Torikizoku Hibiya Store in Yurakucho, Chiyoda-ku, Tokyo, on April 11.
Before it’s here, it’s on Smartkarma
