Internet Initiative Japan (Buy) Well-Positioned for Corporate IT Spend, Raising Forecasts/Valuation

IIJ (Buy) - Q1 21 Results Reaction: Margin Expansion Accelerates

IIJ Q2 21 Results Reaction: Setting the Pace for Industry to Follow

Internet Initiative Japan Q3 20 Results: A Second FY20 Guidance Upgrade Highlights Margin Confidence

Internet Initiative Japan - Potential Growth Remains Under-Appreciated (Initiation of Coverage)

Internet Initiative Japan - New Pricing Plans Are Competitive and Impact Is Manageable

Telco/Internet specialist

Kirk Boodry

Redex Research

Equity Bottom-Up

Internet Initiative Japan / Equity Bottom-Up

<p>The IIJ story is better than we expected. The company again posted sector-leading growth in profitability with a direct reward to shareholders through a 42% dividend hike for <em>this year</em> (¥21 to ¥29.75) and a further 24% for FY21 (to ¥37). Guidance for FY21 is ahead of consensus and Redex expectations as are the company’s FY23 (Mar-24) mid-term financial targets for revenue and operating income. This growth trajectory is rare in the Japanese telecoms industry and is supported by exposure to growth areas (cloud, security and IoT) with less offset from weaker segments like consumer mobile. We consider IIJ a core telecom holding and the financial report today demonstrates why. Shares are up 9% in the afternoon session and we think the mid-term forecasts and a higher dividend can sustain further upside. We reiterate our Buy rating.</p>

The IIJ story is better than we expected. The company again posted sector-leading growth in profitability with a direct reward to shareholders through a 42% dividend hike for this year (¥21 to ¥29.75) and a further 24% for FY21 (to ¥37). Guidance for FY21 is ahead of consensus and Redex expectations as are the company’s FY23 (Mar-24) mid-term financial targets for revenue and operating income. This growth trajectory is rare in the Japanese telecoms industry and is supported by exposure to growth areas (cloud, security and IoT) with less offset from weaker segments like consumer mobile. We consider IIJ a core telecom holding and the financial report today demonstrates why. Shares are up 9% in the afternoon session and we think the mid-term forecasts and a higher dividend can sustain further upside. We reiterate our Buy rating.

Internet Initiative Japan Q4 20 Results – Blowout Quarter / Guidance and Massive Dividend Hike