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-- 156.060 Warren Buffett shows interest in Japanese stock investment! The shares of the top 5 trading companies have risen by over 140% since the beginning of 2023.
We have prepared several recommended articles to get you started with investing.
In this article, we will introduce the 'Big Five Trading Companies' beloved by Mr. Buffett. Let's consider the investment attractiveness from Buffett's investment trends, a 'major gainianbankuai.' For more details on other investment themes, please check here!
Three stocks that you may want to consider for investment in the new NISA framework, with outstanding stability and a dividend yield of over 3% are attractive.
Let's find stocks from shareholder benefits!
In this article, we will introduce the 'Big Five Trading Companies' beloved by Mr. Buffett. Let's consider the investment attractiveness from Buffett's investment trends, a 'major gainianbankuai.' For more details on other investment themes, please check here!
Three stocks that you may want to consider for investment in the new NISA framework, with outstanding stability and a dividend yield of over 3% are attractive.
Let's find stocks from shareholder benefits!
Amidst the Nikkei Average reaching its post-bubble high, one particularly eye-catching aspect is"The Big 5 Trading Companies" beloved by Mr. Buffett.In the past year, all five major trading companies have shown an increase in stock prices, but when comparing the rate of increase for each company,Mitsubishi Corporation stands out with an increase of about 146%, demonstrating outstanding performance.Mitsui & Co. has seen an 88% increase, Marubeni 73%, Sumitomo Corporation 69%, and Itochu Corporation 62%, all recording growth rates that significantly surpass the Nikkei Average. Renowned American investor Mr. Buffett started investing in Japanese trading company stocks in 2019, publicly disclosing ownership of over 5% of each company in August 2020. Subsequent purchases have continued, and according to the "Letter to Shareholders" in February 2024, shareholder letters state that Berkshire's holdings of trading company stocks are around 9%, with Mr. Buffett expressing a clear intention to approach the 9.9% limit.
What is noteworthy is that Mr. Buffett clearly stated in the shareholder letter that his investment in these trading company stocks aims for a period of 10 to 20 years.long-term holdingClearly aiming for that goal. In addition, Berkshire led by Mr. Buffett is actively issuing bonds in the yen bond market. It was revealed on the 9th that they are planning to issue the first yen-denominated corporate bonds after the Bank of Japan's policy change. In response to this, there is speculation that Mr. Buffett will enter into a buyout of trading company stocks with the funds he raised.
- A business model that handles a wide range of products, with an equity range much larger than Berkshire's.
As the reason for investing in the five major trading companies, Mr. Buffett statedListing similar business models to Berkshire.The five major trading companies have diversified business fields, and Berkshire itself is also known for engaging in businesses such as insurance and railroads, while also investing in beverage giant $Coca-Cola (KO.US)$Known for its investments in IT giants $Apple (AAPL.US)$It is also known for its investments inDiversificationoperating with diversification.
Trading companies have strong endurance due to the breadth and flexibility of their business.Strong durabilityHaving the vitality to actively respond to business opportunities, There is still potential for further development in the future.In addition, the range of trading house interests is much larger than that of Berkshire, and one of the advantages is the possibility of Berkshire collaborating with the top 5 trading houses around the world through investment.It is possible to collaborate in various businesses around the world.One of the merits is being able to identify possibilities.
・ Active shareholder returns
Mr. Buffett mentioned in a letter that the 5 companies have a more shareholder-friendly policy compared to the customary practices in the USA.Even more shareholder-friendly policies.is appreciated for its efforts. According to five analysts,Share buyback plancompanies, they are also described as 'favorable to shareholders,' share buybackthey are also noted to be making efforts to enhance the value of stocks held by investors.is also cautious about issuing new shares andavoiding dilution of shares through new share issuance.
Profit distribution mainly focuses on dividends, business investment, and share buybacks.
Mr. Buffett mentioned in his letterprofit distributionabout Itochu Corporation, Mitsui & Co., Mitsubishi Corporation, Sumitomo Corporation, and Marubeni, the five general trading companiesallocate approximately one-third of their net profit to dividendsmost of the retained earnings arebusiness investmentsor even smaller onesshare buybackpointed out that it is used. In terms of executive compensation at Japanese trading companies, it was praised as "far more modest" compared to typical executive compensation amounts in the United States.Much more modestpraised as "to be".
Expectations for rising commodity prices
Looking at the earnings of the five major trading companies, thethe majority of their earningsBuffett's investment is in the field where trading companies are extensively involved.Expectations for the rise in energy and commodity prices.There is a possibility that Warren Buffett's investments during the decline in oil and gas prices due to COVID-19, were influenced by factors such as the Russia-Ukraine conflict and economic recovery.Brought significant profits due to the soaring commodity prices.。
Amid the continued profit growth from new investments by trading companies and expansion of shareholder returns, Nomura Securities Analyst Yasuhiro Narita is expecting additional shareholder returns leading up to the earnings announcement for the fiscal year ending March 2024.Expectations for additional shareholder returns.supported andsupport trading company stockspointed out. In addition, Masayuki Ohtani, head of the Securities Japan Research Department, stated that Berkshire buys with the assumption of long-term ownership, aiming to improve shareholder value.The company's efforts will continue in the future.So much is expected for trading company stocks because of this.There is no significant overvaluation.and there is still room for increased attention and expectations towards the full-year earnings announcement. It is believed that the minimum dividend level will be maintained regardless of fluctuations in performance, potentially providing investors with a sense of buying security. However, while the evaluation from Mr. Buffett, who adheres to long-term ownership, can be considered an international "seal of approval" for the stability of the five companies, fluctuations in exchange rates and resource prices indicate that the five major trading companies may not be free from the risk of price movements in the future.
$Mitsubishi (8058.JP)$is a leading "general trading company" in Japan. As a core company of the Mitsubishi Group, it has a solid business foundation in resources, machinery, and chemicals, while also expanding consumer business through convenience stores such as Lawson. Mitsubishi Corporation announced a 500 billion yen share buyback in February, leading to a large-scale return that exceeds a total return ratio of over 90% for the fiscal year ending March 2024, surprising the market and causing a sharp increase in stock prices. Jeffrey's Securities analyst Mr. Fam Taaihna and others stated in a report,was well-received.Evaluation is that the impact of the Reed's Inc is larger than expected. Mitsubishi Corporation has an additional 500 billion yen surplus fund, and it is pointed out that "if attractive acquisition targets are not found,Shareholder returnsit will be used".
$Mitsui (8031.JP)$is positioned as being on a par with Mitsubishi Corporation. Relatively,資源関連ビジネスへの傾斜が強い。鉄鉱石や液化天然ガスなどのコモディティに重点を置き、資源・エネルギーセクターで力を発揮している。特に鉄鉱石に強く重きを置いており、資源が豊かなオーストラリアに多額の投資を行っている。また、三井物産はこうした伝統的としていた領域を越えて、ヘルスケアなどExpansion outside the resources sectorSteering in a different direction.
$ITOCHU (8001.JP)$Unlike other trading companies,the weight of the resource-related business is relatively low,instead, features a high proportion of life consumer-related businesses like the fully consolidated 'FamilyMart'.This is a characteristic of having a high proportion of life consumer-related businesses.is a characteristic feature. Also, among major trading companies,the risk capital invested in China is the largest.The strength of the company's pipes related to China is also noteworthy. Furthermore, the company clearly stated its intention to enhance shareholder returns early in the new fiscal year. On April 3, they announced the management plan for the fiscal year ending March 2025. The amount obtained by dividing the sum of dividends and share buybacks by net profit.The policy is to increase the total return ratio to about 50%.They set the lower limit of annual dividend per share at 200 yen, which is 40 yen higher than the previous fiscal year, and also announced a record-breaking share buyback of up to 150 billion yen.The management of continuously returning stable earnings to shareholders is being recognized in the market.Is valued by the market.
$Sumitomo (8053.JP)$Reed's Inc is well-known in the fields of real estate, media, leasing, and steel products, but they focus on nonferrous metals in the resources industry.Expanding business globallySumitomo Corporation accounts for about 40% of total sales in Japan, with the USA being one of the main markets representing over 15% of sales, and Asian countries around 20%. European, Middle Eastern, and other regions make up just over 15%, with the remaining portion in Central and South America. This distribution showcases Sumitomo Corporation's global presence.It has established a solid position internationally.are indicating.
$Marubeni (8002.JP)$Resource investmentDiversificationand avoiding excessive dependence on specific commodities, the company's exposure to resources is relatively balanced compared to others. In recent years, the company has reduced asset impairment risks through proactive measures. The company's strategic focus areas include North American farm products (especially beef and grains) and aerospace leasing.
Source: MOOMOO, The Nikkei, Bloomberg
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moomoo News: Sherry
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exera : Buffett is amazing after all![[undefined]](https://static.moomoo.com/nnq/emoji/static/image/default/default-black.png?imageMogr2/thumbnail/36x36 "undefined")
183976241 : Just by holding Marubeni, it's multiplied by 5!
スマイリー山川 : This guy is the trigger for the crash
兆り人 : Can Buffett survive that long with a long-term tenure of 10 to 20 years?
Please stop inciting
182526358 : Thank you so much for the great information.
I also hold shares of the five major trading companies
I realized it again and again.
182544341 : Ok
Takeyou reza Goo job : Thank you Marubeni
esuteru101 : Although Japanese companies are also selling cutting-edge technology, there are places where they underestimated AI technology. Even if you notice how amazing ChatGPT is, it's Japan. It's a strange way of saying it, but they're very good at imitating. It's bad at building from scratch, but other countries can't further refine what has been made. You'll be able to make something even better by diving in to the smallest details. If you do that, stocks will go up a bit, and now I think they're being licked off a bit. IMHO.
ヨシ : After all, trading companies are solid and realistic
メグムカネダ : nice
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