Day 2 went with my acquisition of 200 shares of Mitsui & Co.

I had contemplated going for it only if it goes under 1340 per share. However, I decided to ensure I get it and bought it for 1344 per share (0.5 yen under it’s closing value last Friday)—although it did fall to under 1340 and return to close at 1344 today.

Mitsui & Co. actually made news recently for reporting a loss of 70 billion yen for this fiscal year—its first loss ever since establishment in 1947. There are a few reasons why I bought the shares in spite of their loss. First, the company has a good history of profits and there hasn’t been major changes to their management team except for the promotion of Yasunaga Tatsuo to CEO after Iijima Masami became Chairman, so the team should be capable of bringing the company back to profit. Second, due to their 70 billion yen loss resulting in the fall in their share price, the company’s P/B ratio (price-to-book ratio) currently stands at 0.58 (under 1.0). This means that the share price is undervalued. Third, tomorrow is the ex-dividend date, so in order to receive the cash dividend, it is necessary to hold onto the shares today. The company has also released a document on March 23 notifying that there is no change to the 32 yen of dividend per share announced on February 4. So, having 200 shares today entitles me to 6400 yen of dividend (which should be paid out on June 22 after the annual general meeting).

So there’s no result for today since no sale is made.

I’m planning to sell off 100 shares tomorrow at a slightly higher price to offset part of the transaction fees though so that I’m not making a loss on the trade alone (disregarding dividends), and I’ll be keeping a lookout on Sharp the next few days. If the Foxconn deal goes through, their stocks are expected to soar.

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