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Special Report: 15 Japanese Net-Nets

March 28, 2011

Geoff Gannon


About the author:

Geoff Gannon
GuruFocus - Stock Picks and Market Insight of Gurus

Rating: 4.4/5 (18 votes)


Liarspoker - 3 years ago

Thanks Geoff.

The 15 company's look interesting. However I am having real trouble finding and researching my usual criteria for net net investing. These criteria include director pay/otions/warrants, director holdings, major shareholders etc ( basically reading the Directors Report ) as well as reading the notes to the balance sheet. I am quite prepared to buy Japanese net nets and have enquired if my broker can do it ( which he can, there's a larger commission though ). However I am not sure if I will invest in those shares if I can't find the info listed above.

How do you find that sort of information Geoff ?
Yswolinsky - 3 years ago
Geoff great job, just a quick question, I see you did not assign a liquidation value to either the receivables or the inventory. I presume most of these stocks would be trading above NCAV if a fire sale liquidation value was placed on the inventory. Can you add any color to this?

Yswolinsky - 3 years ago
Or at least, at less of a discount to NCAV
Liarspoker - 3 years ago

I have an order in for shares in two of the companies mentioned for tonights session albeit at prices lower than todays close.. I also have a request in with a Japanese speaking friend to translate some of the accounts and notes of other companies. I'll be looking to add perhaps two more companies if the prices fall more.

It's interesting to note Jacob that many of these companies have very large cash balances as well as marketable securities. Not only that but often marketable securities are held under fixed assets as well ( a different accounting system maybe ) ? The companies would obviously trade at a lower discount to NCAV if you discount inventory and receivables but if you look at the details of share number four then you know that is a company that won't be sold in a fire sale as plenty of suitors should be available. Also notice the cash build up over the last few years. 2007 = 3.6b, 2008 = 4.2bn, 2009 = 5bn & 2010 = 6.4m. Ok so receivables and investments have dropped a little over the period from memory ) but surely a divi paying company with no debt with that sort of cash generation is worth more than NWC ?

I'm looking forward to doing more digging as time permits.
NiallF - 3 years ago
Hi - I read the report on these 15 Japanese net nets. However, can you send through a list of the JPY market prices for each of these 15 stocks when the analysis was done. The prices were not in the report. Knowing that will make it easier to reference how much the market has moved since the analysis was done.


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