Hennessy Japan Small Cap Fund Makes 3 New Buys in 1st Quarter

Hennessy Japan Small Cap Fund (Trades, Portfolio) added three new stakes to its portfolio in the first quarter of 2016, which ended Jan. 31. It was the fewest new buys the fund has made in a quarter since the end of the first quarter of 2015. While they may have been few in number, the buys are the fund’s three most-valuable stakes.

The fund’s most significant transaction was its acquisition of a 53,400-share stake in Bellsystem24 Holdings Inc. (TSE:6183, Financial), a Tokyo-based outsourcing, technology and consulting services company, for an average price of ¥1249.98 ($11.12 in U.S. currency) per share. The purchase had a 2.07% impact on the fund’s portfolio.

With the purchase Bellsystem24 Holdings became the fund’s most valuable stake.

The stake is 2.07% of the fund’s total assets.

The company has a P/E of 0.8.

Bellsystem24 Holdings sold for ¥1,179 ($10.49 in American dollars) per share Friday.

The fund invested in a 32,600-share stake in Tasaki Shinju Co. Ltd. (TSE:7968, Financial), a Japanese company involved in the sale of pearls and import, processing and sale of precious and semiprecious stones, for an average price of ¥1,731.88 ($15.41 in U.S. money) per share. The transaction had a 1.63% impact on the fund’s portfolio.

With the purchase Tasaki Shinju became the fund’s second-most valuable stake.

The stake is 0.24% of Tasaki Shinju’s outstanding shares and 1.63% of the fund’s total assets.

Tasaki Shinju has a P/E of 3.2, a P/B of 3.3 and a P/S of 1. GuruFocus gives Tasaki Shinju a Financial Strength rating of 8/10 and a Profitability and Growth rating of 6/10.

Tasaki Shinju sold for ¥1,657 ($14.74 in American currency) per share Friday.

The fund purchased a 15,200-share stake in Digital Garage Inc. (TSE:4819, Financial), a Japanese company engaged in the settlement platform and information technology solution businesses, for an average price of ¥1,993.69 ($17.74 in U.S. money) per share. The deal had a 0.99% impact on the fund’s portfolio.

With the purchase Digital Garage became the third-most valuable stake in the fund’s portfolio.

The stake is 0.03% of Digital Garage’s outstanding shares and 0.99% of the fund’s total assets.

Digital Garage has a P/E of 28.6, a P/B of 3.3 and a P/S of 2.4. GuruFocus gives Digital Garage a Financial Strength rating of 5/10 and a Profitability and Growth rating of 5/10.

Digital Garage sold for ¥1,972 ($17.54 in American dollars) per share Friday.

The fund raised its stake in Kito Corp. (TSE:6409, Financial), a Japanese manufacturer of hoists and cranes, by nearly 109% with the purchase of 34,300 shares for an average price of ¥1,015.51 ($9.03 in U.S. currency) per share. The transaction had a 1.08% impact on the fund’s portfolio.

The stake, now 65,800 shares, is 0.25% of Kito’s outstanding shares and 2.08% of the fund’s total assets.

Kito has a P/E of 11.4, a P/B of 0.9 and a P/S of 0.4. GuruFocus gives Kito a Financial Strength rating of 6/10 and a Profitability and Growth rating of 6/10.

Kito sold for ¥767 ($6.82 in American dollars) per share Friday.

The fund doubled its stake in Elecom Co. Ltd. (TSE:6750, Financial), a Japanese electronics company, with the purchase of 20,000 shares for an average price of ¥1,540.02 ($13.70 in U.S. money) per share. The deal had a 0.96% impact on the fund’s portfolio.

The 40,000-share stake is 0.1% of Elecom’s outstanding shares and 1.91% of the fund’s total assets.

Elecom has a P/E of 17, a P/B of 3.3 and a P/S of 1.1. GuruFocus gives Elecom a Financial Strength rating of 7/10 and a Profitability and Growth rating of 7/10.

Elecom sold for ¥1,946 ($17.31 in American currency) per share Friday.

The fund more than doubled its stake in Sanko Gosei Ltd. (TSE:7888), a Japanese company involved in the manufacture and sale of plastic molded products and molding dies, with the purchase of 68,000 shares for an average price of ¥396.35 ($3.53 in U.S. dollars) per share. The deal had a 0.88% impact on the fund’s portfolio.

The stake, now 134,000 shares, is 0.53% of Sanko Gosei’s outstanding shares and 1.73% of the fund’s total assets.

Sanko Gosei has a P/E of 7.4, a P/B of 0.7 and a P/S of 0.2. GuruFocus gives the company a Financial Strength rating of 8/10 and a Profitability and Growth rating of 6/10.

Sanko Gosei sold for ¥360 ($3.20 in American money) per share Friday.

The fund doubled its stake in Hito-Communications Inc. (TSE:3654), a Japanese outsourcing and temporary staffing business, with the acquisition of 12,900 shares for an average price of ¥1,323.48 ($11.77 in U.S. currency) per share. The deal had a 0.75% impact on the fund’s portfolio.

The stake, now 25,800 shares, is 0.14% of Hito-Communications’ outstanding shares and 1.5% of the fund’s total assets.

Hito-Communications has a P/E of 25.7, a P/B of 5.5 and a P/S of 1.5. GuruFocus gives Hito-Communications a Financial Strength rating of 9/10 and a Profitability and Growth rating of 5/10.

Hito-Communications sold for ¥2,101 ($18.69 in American dollars) per share Friday.

The fund raised its stake in Fujibo Holdings Inc. (TSE:3104), a Tokyo-based industrial fiber products company, by more than 96%. The fund bought 108,000 shares for an average price of ¥216.32 ($1.92 in U.S. money) per share. The transaction had a 0.72% impact on the fund’s portfolio.

The stake, now 220,000 shares, is 0.19% of Fujibo’s outstanding shares and 1.46% of the fund’s total assets.

Fujibo has a P/E of 10.9, a P/B of 1 and a P/S of 0.7. GuruFocus gives Fujibo a Financial Strength rating of 6/10 and a Profitability and Growth rating of 6/10.

Fujibo sold for ¥216 ($1.92 in American currency) per share Friday.

The fund hiked its stake in Kitz Corp. (TSE:6498), a Japanese manufacturer of valves used in water supply and sewage systems, by almost 46%. The fund acquired 39,700 shares for an average price of ¥544.23 ($4.84 in U.S. dollars) per share. The deal had a 0.69% impact on the fund’s portfolio.

The stake, now 126,500 shares, is 0.12% of Kitz’s outstanding shares and 2.21% of the fund’s total assets.

Kitz has a P/E of 10.2, a P/B of 0.7 and a P/S of 0.4. GuruFocus gives Kitz a Financial Strength rating of 8/10 and a Profitability and Growth rating of 6/10.

Kitz sold for ¥467 ($4.15 in American money) per share Friday.

The fund boosted its stake in Koa Corp. (TSE:6999), a Tokyo-based electronic passive components supplier, by more than 50% with the purchase of 22,500 shares for an average price of ¥1,007.02 ($8.96 in U.S. dollars) per share. The transaction had a 0.68% impact on the fund’s portfolio.

The stake, now 67,200 shares, is 0.18% of Koa’s outstanding shares and 2.04% of the fund’s total assets.

Koa has a P/E of 11.1, a P/B of 0.5 and a P/S of 0.7. GuruFocus gives Koa a Financial Strength rating of 9/10 and a Profitability and Growth rating of 7/10.

Koa sold for ¥811 ($7.21 in American currency) per share Friday.

The fund increased its position in DCM Holdings Co. Ltd. (TSE:3050), a Japanese holding company engaged mostly in home improvement and leisure businesses, by nearly 40%. The fund acquired 22,900 shares for an average price of ¥820.92 ($7.30 in U.S. money) per share. The deal had a 0.64% impact on the fund’s portfolio.

The stake, now 80,500 shares, is 0.06% of DCM Holdings’ outstanding shares and 2.26% of the fund’s total assets.

DCM Holdings has a P/E of 11.7, a P/B of 0.7 and a P/S of 0.3. GuruFocus gives DCM Holdings a Financial Strength rating of 5/10 and a Profitability and Growth rating of 6/10.

DCM Holdings sold for ¥798 ($7.10 in American dollars) per share Friday.

The fund hiked its stake in Takeei Corp. (TSE:2151), a Japanese waste recycling company, by 50% with the purchase of 20,000 shares for an average price of ¥998.63 ($8.88 in U.S. currency) per share. The transaction had a 0.59% impact on the fund’s portfolio.

The stake, now 60,000 shares, is 0.25% of Takeei’s outstanding shares and 1.78% of the fund’s total assets.

Takeei has a P/E of 18.5, a P/B of 0.9 and a P/S of 0.8. GuruFocus gives Takeei a Financial Strength rating of 6/10 and a Profitability and Growth rating of 6/10.

Takeei sold for ¥979 ($8.71 in American money) per share Friday.

The fund trimmed its stake in Mitsui Sugar Co. Ltd. (TSE:2109), a Japanese sugar company, by more than 49%. The fund sold 58,000 shares for an average price of ¥529.97 ($4.71 in U.S. dollars) per share. The deal had a -1.02% on the fund’s portfolio.

The remaining stake of 60,000 shares is 0.04% of Mitsui Sugar’s outstanding shares and 1.07% of the fund’s total assets.

Mitsui Sugar has a P/E of 9.2, a P/B of 1 and a P/S of 0.7. GuruFocus gives Mitsui Sugar a Financial Strength rating of 6/10 and a Profitability and Growth rating of 7/10.

Mitsui Sugar sold for ¥484 ($4.31 in American currency) per share Friday.

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