Senior Technology Analyst, Japanese Equities, LightStream Research

Scott Foster

Securities analyst covering electronics, precision equipment & robotics, engineering, construction, transport and other sectors for more than 25 years in Japan and 3 years in Korea. Permanent resident of Japan.

Senior Technology Analyst, Japanese Equities

Hitachi Ltd. (6501 JP): Buys Kyoto Robotics, Plans to Sell Hitachi Metals

Hitachi Ltd. (6501 JP): Results Above Guidance, Growth Ahead

Hitachi Ltd. (6501 JP): Buy into the Pull-Back

Hitachi Ltd. (6501 JP): Positive Trends to Continue

Hitachi to Sell Overseas Home Appliance Business; Attempt to Reach Its Mid-Term Management Targets

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

Hitachi Ltd. dropped 7.3% yesterday, the market taking a dim view of the price management plans to pay for GlobalLogic: 8x revenues and more than 35x EBITDA on what looks like an optimistic forecast for FY Mar-22.But while the price is high, the acquisition should increase Hitachi's profits and profit margins, accelerate the digital transformation of its infrastructure and other businesses, and greatly expand its staff of IT professionals and global client base.The impact on Hitachi's balance sheet is manageable, in our estimation. We recommend buying into the sell-off.

Hitachi Ltd. dropped 7.3% yesterday, the market taking a dim view of the price management plans to pay for GlobalLogic: 8x revenues and more than 35x EBITDA on what looks like an optimistic forecast for FY Mar-22.But while the price is high, the acquisition should increase Hitachi's profits and profit margins, accelerate the digital transformation of its infrastructure and other businesses, and greatly expand its staff of IT professionals and global client base.The impact on Hitachi's balance sheet is manageable, in our estimation. We recommend buying into the sell-off. 

Hitachi Ltd. (6501): GlobalLogic Acquisition Expensive but Accretive