The T. Rowe Price Japan Fund (Trades, Portfolio) released its third-quarter portfolio earlier this week, revealing that it entered a small stake in Nippon Sanso Holdings Corp. (TSE:4091, Financial). As of quarter-end, the fund’s top four holdings are Keyence Corp. (TSE:6861, Financial), Hoshizaki Corp. (TSE:6465, Financial), Suzuki Motor Corp. (TSE:7269, Financial) and Daikin Industries Ltd. (TSE:6367, Financial).
Managed by Archibald Ciganer, the Baltimore-based fund seeks long-term capital appreciation by investing more than 80% of its capital in Japanese companies and industries. The fund’s security selection reflects a growth style: T. Rowe Price seeks to purchase stocks that have improving market conditions, attractive business niche, improving franchise position, stable cash flows and financially-sound balance sheets.
As of Sept. 30, the fund’s $1.01 billion equity portfolio contains 65 stocks with a turnover ratio of 1%. The fund’s top four sectors in terms of weight are industrials, technology, health care and communication services, representing 32.53%, 18.13%, 13.45% and 12.09% of the equity portfolio.
Nippon Sanso Holdings
The fund purchased 195,900 shares of Nippon Sanso Holdings (TSE:4091, Financial), giving the position 0.49% weight in the equity portfolio. Shares averaged 2,589.71 yen ($22.83) during the third quarter; the stock is modestly overvalued based on Friday’s price-to-GF Value ratio of 1.16.
GuruFocus ranks the chemical company’s profitability 7 out of 10 on the back of a high Piotroski F-score of 8 and three-year revenue and earnings growth rates that outperform more than 60% of global competitors.
Keyence
The fund owns 93,100 shares of Keyence (TSE:6861, Financial), down 2,400 shares from the second-quarter holding. Shares occupy 5.50% of the equity portfolio.
Shares of the hardware company averaged 63,722.7 yen during the third quarter; the stock is significantly overvalued based on Friday’s price-to-GF Value ratio of 1.57.
GuruFocus ranks Keyence’s financial strength 10 out of 10 on several positive investing signs, which include a triple-digit Altman Z-score and no long-term debt.
Hoshizaki
The fund owns 537,800 shares of Hoshizaki (TSE:6465, Financial), down 13,700 shares from the second-quarter holding. Shares occupy 4.84% of the equity portfolio.
Shares of Hoshizaki averaged 9916.51 yen ($87.39) during the third quarter; the stock is modestly overvalued based on Friday’s price-to-GF Value ratio of 1.16.
GuruFocus ranks the industrial company’s financial strength 9 out of 10 on several positive investing signs, which include a high Altman Z-score of 6.07 and an interest coverage ratio that outperforms more than 91% of global competitors.
Suzuki
The fund owns 1,054,700 shares of Suzuki (TSE:7269, Financial), down 26,900 shares from the second-quarter filing. Shares occupy 4.66% of the equity portfolio.
Shares of the automobile company averaged 4,750.49 yen during the third quarter; the stock is fairly valued based on Friday’s price-to-GF Value ratio of 1.07.
GuruFocus ranks Suzuki’s financial strength 6 out of 10 on the back of interest coverage and debt ratios outperforming more than 70% of global competitors despite a moderately weak Altman Z-score of 2.77.
Daikin
The fund owns 170,100 shares of Daikin (TSE:6367, Financial), down 4,500 shares from the second-quarter holding. Shares occupy 3.67% of the equity portfolio.
Shares of the air conditioning company averaged 25005.8 yen during the third quarter; the stock is significantly overvalued based on Friday’s price-to-GF Value ratio of 1.51.
GuruFocus ranks Daikin’s financial strength 7 out of 10 on several positive investing signs, which include a high Piotroski F-score of 7, a strong Altman Z-score of 4.84 and an interest coverage ratio that outperforms more than 68% of global competitors.
