This flash report on selecting stocks with strong earnings for Japanese equity investment strategies introduces stocks expected to rise after earnings announcements on the TSE Prime Market. It summarizes market trends from 12–13 August and the key earnings points for individual stocks.
The Japanese equity investment strategy sought to identify stocks with strong earnings that are expected to rise in the Tokyo stock market following the earnings announcement season. The screen covered March year-end stocks listed on the TSE Prime Market, selecting stocks with high year-on-year profit growth and continued high-growth potential as supplementary picks. Screening criteria included a market capitalization of at least ¥500 billion and at least 2 analysts publishing forecast EPS. The TOPIX hit a record high on 12 August and continued to rise on 13 August. This suggested that stocks with strong earnings could become targets of buying across a broad range of sectors.
The commentary on the stocks covered sets out the earnings highlights for several names listed in the stock table. Furukawa Electric has a business portfolio covering the full data center value chain from upstream to downstream, with growing demand observed for optical products for data centers. Hitachi Construction Machinery, Mitsubishi Heavy Industries and Honda Motor, among others, raised their operating profit forecasts for the current fiscal year, while the companies' order backlogs and segment-specific growth drivers are also outlined. The new articles include a range of investment information, such as One Pagers on U.S. stocks, bond-related reports and foreign equity strategies.