Daily Brief Japan: Fanuc Corp, Hogy Medical, Tokyo Stock Exchange Tokyo Price Index Topix and more

In today’s briefing:

Fanuc (6954) | Forget FA, Robots Are the Future
Hogy Medical (3593 JP): Strong Nine-Month Result as COVID Had Minimal Impact on Surgery Volume
Isn’t the Best Catalyst to Facilitate MBOs to Increase Market Metabolism?

Fanuc (6954) | Forget FA, Robots Are the Future

Fanuc’s Q3 sales and earnings beat analyst expectations. Sales rose 17% YoY and profit increased by 14%.
The bears will be able to point to the collapse in FA orders in Q3, but this just confirms what the Japan Machine Tool numbers have been signalling.
Robot orders remain strong as Fanuc continues to benefit from de-globalization and the need to modernize global supply chains.

Hogy Medical (3593 JP) reported 6.2% growth in revenue to ¥29.5B during 9MFY23, driven by healthy sales of Premium Kit and other non-woven products. Sales of Premium Kit climbed 12%.
Rising cost pressure has negatively impacted margins. Gross profit margin contracted 180bps YoY to 40.6% in 9MFY23. Operating profit margin declined 20bps YoY to 17.1%.
Hogy continued to expect revenue to rise 5.3% YoY to ¥38.7B, operating profit to grow 6.1% YoY to ¥6.5B, and net profit to increase 4.6% YoY to ¥4.57B in FY23.

The problem is that many companies have resources but haven’t taken steps to strengthen their profitability, given that multiples have declined due to lower excess earnings than 50 years ago.
What is required of TSE isn’t to keep failing students in prime market and lower the quality of the market, but to promote metabolism and raise the quality of it.
The best catalyst is an MBO. Serious management’s consideration of what it should do for shareholders is to enhance profitability by leveraging resources, while the other is an MBO.

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