In today’s briefing:
- Toshiba – Some Thoughts on the Bain Article
- Nidec – Weakness Should Be Understood but Downside Risk at Earnings Remains
- Keyence (6861 JP) | 3 Reasons to Ignore Inflation and Rising Rates
- KRUS: Kura’s Roll Keeps Rolling
Toshiba – Some Thoughts on the Bain Article
- Yesterday the Nikkei published an article featuring Bain MD Yuji Sugimoto who also featured heavily during their bid for Kioxia.
- Sugimoto commented that in the event of a buyout there would be no break-up of Toshiba.
- While plausibly a PR move directed at employees that stance raises the question of exactly how they would unlock value.
Nidec – Weakness Should Be Understood but Downside Risk at Earnings Remains
- Consensus expectations for Nidec have drifted towards more reasonable levels in the last few months and a guidance miss is now baked in.
- However, our data analysis suggests that while revenue may exceed consensus expectations OP could miss.
- Guidance on the other hand could be strong, but with multiples elevated that does not mean there is upside risk here.
Keyence (6861 JP) | 3 Reasons to Ignore Inflation and Rising Rates
- The stock has been hit by rising inflation and interest rates. Now is the time to buy
- Keyence is well placed to weather the storm given it has pricing power, high margins, and low capital intensity
- The P/B valuation of 6x is now back to a normalised range and the stock trades at a discount to global peers.
KRUS: Kura’s Roll Keeps Rolling
- Kura Sushi is a dinky (~$540M market cap) sushi business that I have reported on for a little over one year.
- The US subsidiary is das kind (German for ‘the child’ because, why not) of a well-capitalised parent with over 450 stores in Japan.
- It’s a proof of concept venture in a new market, with a tried-and-tested business model, and a parent that provides ample liquidity to its fledging offspring.
Before it’s here, it’s on Smartkarma
