Mitsubishi Corporation, one of Japan's five largest trading companies, has hit a record high in stock price!
On Wednesday, local time, the stock price of Mitsubishi Corporation, one of Japan's five major trading companies invested by Warren Buffett, rose 97%, another record high. The day before, the company announced that it planned to spend up to 500 billion yen (about 33.).$700 million) to buy back up to 10% of its stake and report better-than-expected quarterly results, with net profit nearly tripling in the fiscal quarter to the end of December.
It is worth mentioning that the five major Japanese trading companies, including Mitsubishi Corporation, have been continuously increased by Warren Buffett's Berkshire Hathaway since August 2020. In August 2020, Berkshire Hathaway announced for the first time that more than 5% of the shares of Japan's five major trading companies (Mitsubishi Corporation, Mitsui & Co., Itochu Corporation, Sumitomo, and Marubeni) were considered to be great companies undervalued by the market; In April 2023, Berkshire Hathaway increased its stake in the five largest trading companies to 7More than 4%, making it the largest investment outside the United States; In June 2023, Berkshire Hathaway said it had increased its average stake in Japan's top five trading companies to 85% or more.
Since Warren Buffett's Berkshire Hathaway began to hold the five major trading companies, the stock prices of Japan's five major trading companies have collectively soared, frequently hitting record highs, wind data shows that since August 2020, Marubeni Corporation has risen nearly 5 times, Mitsubishi Corporation and Mitsui & Co. have risen more than 3 times, and Sumitomo Corporation and Itochu Corporation have risen more than 2 times.
Mega-buybacks boost stock prices**.
On Wednesday, February 7, local time, the share price of Mitsubishi Corporation, one of Japan's five largest trading companies, rose 97%, the largest increase since August 2020. In the past year, Mitsubishi Corporation's stock price has accumulated more than 80%.
Just the day before, Mitsubishi Corporation announced that it would spend 500 billion yen (about 33.).US$700 million) to repurchase up to 10% of the shares. It is reported that this buyback program is the largest of Mitsubishi Corporation since 2016.
Mitsubishi Corporation said in a statement that the buyback will take place between Feb. 7 and Sept. 30, and plans to write off all ** repurchased by Oct. 31. Through the buyback program, MC will effectively increase the company's share price and increase shareholder returns.
Jefferies analyst Thanh Ha Pham wrote in a note that "we don't think market participants anticipated" such a large buyback and called it a 'giant buyback'. He said Mitsubishi still has 500 billion yen of remaining funds available for investment and buybacks. "If the company can't find an attractive acquisition target, we think management will return the excess cash to shareholders. ”
Net profit nearly tripled in the fourth quarter.
Mitsubishi Corporation also disclosed its earnings on Tuesday. According to the financial report, the company's net profit in the fourth quarter of last year nearly tripled compared with the same period last year.
According to the financial report, for the nine months ended December 31, 2023, Mitsubishi Corporation's revenue was 147 trillion yen, down 97%；Net profit attributable to the parent company was 69661.4 billion yen, down 27% year-on-year; Diluted earnings per share were 16470 yen, compared to 216 in the same period of the previous year73 yen. The report said that the profit for the current fiscal year was the second-highest in history, second only to the previous year. The reason for the year-on-year decline is due to the surge in resources** caused by the Russia-Ukraine conflict in the previous year.
In addition, Mitsubishi Corporation also said it has entered into a contract with Japanese telecommunications company KDDI CorpAn agreement was reached to privatize the convenience store chain Lawson. The two companies jointly issued a statement on Tuesday saying they agreed to take Japanese convenience store chain Lawson private to accelerate the pace of digitalization of their businesses. KDDI currently holds about 21% of Rosen's shares, the company will propose to acquire 50% of Rosen's shares for 10,360 yen per share**, with a total value of nearly 496.5 billion yen (about 24.1 billion yuan). Mitsubishi Corporation's shareholding in Lawson has increased from 501% reduced to 50%.
Lyon analyst Edward Bourlet said in a note that Mitsubishi appears to have been looking for ways to increase the value of its assets. In this case, Mitsubishi's approach is to make use of KDDI's "digital technology" through an unexpected acquisition, and this attempt seems to have paid off.
However, after the news of Lawson's privatization was announced, KDDI's share price was **. Some analysts believe that the valuation of the deal is problematic, and KDDI shares at one point **32%。Over the past year, Rosen's share price has doubled, taking its price-to-earnings ratio to around 23 times.
Warren Buffett keeps adding to his position.
It is reported that Mitsubishi Corporation is a comprehensive ** company in Japan, founded in 1950 and headquartered in Tokyo. Mitsubishi Corporation's business covers a wide range of sectors, including energy, metals, machinery, chemicals, food, agriculture, infrastructure, life sciences, logistics, real estate, and finance.
In recent years, Warren Buffett's investments in Japan** and the Big Five trading companies have attracted market attention.
In August 2020, Berkshire Hathaway officially entered the Japanese ** market, revealing that it holds 5% of the shares of five major trading companies: Itochu Corporation, Marubeni Corporation, Mitsubishi Corporation, Mitsui & Co., and Sumitomo Corporation.
On April 11, 2023, Warren Buffett said in an interview that he is optimistic about Japanese stocks and will consider increasing his investment in Japanese stocks. According to Warren Buffett, he has increased his stake in Japan's five largest trading companies to 74%, and said it was Berkshire Hathaway's largest investment outside the United States.
In June 2023, Berkshire Hathaway disclosed data showing that the average shareholding ratio of the five trading companies has reached 85%。Berkshire Hathaway said it intends to "hold its investments in Japan for the long term," but not up to 9 depending on the company9%。"No acquisitions will be made after this unless specifically approved by the investee's board of directors. ”
Recently, Sumitomo Corporation, one of Japan's five major trading companies, revealed to ** that Berkshire Hathaway, led by Warren Buffett, is increasing its holdings in five companies, and Buffett's holdings are increasing every day.
It is worth noting that since Warren Buffett's Berkshire Hathaway began to hold the five major trading companies, the stock prices of the five major Japanese trading companies have collectively soared, frequently hitting record highs, wind data shows that since August 2020, Marubeni Corporation has risen nearly 5 times, Mitsubishi Corporation and Mitsui & Co. have risen more than 3 times, and Sumitomo Corporation and Itochu Corporation have risen more than 2 times.
Editor-in-charge: Tactical Heng.
Proofreading: Su Huanwen.
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