This is a quick profile of one of the many Japanese stocks that have caught my interest and are in my cheap Japanese basket. I’ll be doing more frequent short write ups on names in this basket over the coming months. Sapporo Clinical Laboratory is a $24m market cap operator of retail pharmacies and clinical testing facilities across Hokkaido, Japan. They’ve been compounding tangible book value at 7% over the last 10 years and have a strong history of profitability. Growth is anemic, but they trade at 0.3 P/TBV and management has aimed to increase return on equity to 8% in the long run, which if successful would triple EPS.
Enjoyed this write-up. Something to add to the JP research list. P/TBV 0.3x and potentially 8% ROE in the future would put this stock in the extremely cheap category for me.
I was reminded of your nice write-up on 9776 when I recently reread The Outsiders -- John Malone's chapter talks about "The Edifice Complex" and claims there is an inverse correlation between building fancy headquarters and investor returns. Very applicable to 9776 it feels like ;-)
Absolutely no one is looking at this nanocap. They announced in late February that one of their largest shareholders (6% holder, one of their contractors/biz partner crossholders), wants to unwind their crossholding and Sapporo Clinical will buy them all at an 11% discount. Buybacks at 0.3x p/tbv. Decent size too. Far from my favorite name in Japan, but market gave zero reaction to this news. I have a tiny tiny position.
As my previous writeup shows, Sapporo Clinical Labs is a tiny position for me. There are a lot of opportunities in Japan and I think this is worth owning as part of a much bigger basket. It's one of the smaller sized positions for me.
Enjoyed this write-up. Something to add to the JP research list. P/TBV 0.3x and potentially 8% ROE in the future would put this stock in the extremely cheap category for me.
Wonderful writeup mate. Thanks for sharing. Keep up the good work.
I was reminded of your nice write-up on 9776 when I recently reread The Outsiders -- John Malone's chapter talks about "The Edifice Complex" and claims there is an inverse correlation between building fancy headquarters and investor returns. Very applicable to 9776 it feels like ;-)
Absolutely no one is looking at this nanocap. They announced in late February that one of their largest shareholders (6% holder, one of their contractors/biz partner crossholders), wants to unwind their crossholding and Sapporo Clinical will buy them all at an 11% discount. Buybacks at 0.3x p/tbv. Decent size too. Far from my favorite name in Japan, but market gave zero reaction to this news. I have a tiny tiny position.
As my previous writeup shows, Sapporo Clinical Labs is a tiny position for me. There are a lot of opportunities in Japan and I think this is worth owning as part of a much bigger basket. It's one of the smaller sized positions for me.