Diamond Zai selected 2 large-cap stocks listed on the Tokyo Stock Exchange Prime Market, INPEX and Oriental Land, for its autumn feature. With higher crude oil prices and a weaker yen providing tailwinds, Oriental Land is expected to benefit from its 25th-anniversary event.
The article introduces 2 large-cap stocks that analysts identified as buys after reviewing their earnings. It narrows the field to large-cap stocks listed on the Tokyo Stock Exchange Prime Market and Standard Market and explains the rationale behind the investment decisions.
INPEX is viewed as having a solid earnings base, with stable sales volumes of crude oil and natural gas, and its first-half operating profit and net income exceeded plan. Its PER is approximately 9 times and its PBR approximately 0.9 times, suggesting the shares are undervalued. The company is also expected to enhance shareholder returns, backed by substantial cash flow.
Oriental Land’s first-quarter revenue rose 10% and operating profit increased 25%, driven by the strong performance of the Tokyo DisneySea 25th-anniversary event. Higher sales of 25th-anniversary merchandise contributed, and the company plans measures to boost revenue, including adding higher-priced tickets from autumn onward and expanding the attractions covered by Disney Premier Access. However, it expects profit to decline temporarily from the second quarter onward due to major renovation work at some hotels.
The article provides an excerpt from Diamond Zai’s November issue feature and also introduces information on content for digital-edition readers and a separate supplementary booklet.