< The 2016 All-Japan Research Team
Yoshinao Ibara
Morgan Stanley MUFG Securities Co.
First-place appearances: 0
Total appearances: 8
Team debut: 2006
“There’s no one quite like” Yoshinao Ibara, declares one money manager. The Morgan Stanley MUFG Securities Co. researcher distinguishes himself by conducting “lots of factory tours” — and not just in Japan, this admirer notes. “He goes abroad to see what’s happening on the shop floors in China and Southeast Asia. When his comparisons are written up in reports, they can be fascinating.” In his eighth appearance on this lineup, Ibara, 41, records his best showing to date, rising from third place to second. He tracks 14 Japanese machinery companies and has a bearish outlook on two sector majors, Fanuc Corp. and Keyence Corp., each of which he assigns an underweight rating. Yamanashi-headquartered Fanuc, a global manufacturer of industrial robots and automation equipment, faces numerous headwinds. For example, with the decline of investment in smartphone metal casings, he points out, its RoboDrill business is encountering “structural weakness.” At the same time, demand for machine tools and computer numeric control systems from China, Japan and the U.S. has “entered a downward trend,” the analysts advises, and shareholders have taken a dislike to the stock, a sentiment that he believes is unlikely to change anytime soon. He lowered his rating on Fanuc from equal weight in May, and by mid-March it had slumped 33 percent, to ¥17,350, lagging its domestic peers by 2.8 percentage points. Ibara projects a further decline to ¥16,000. His negative stance on Osaka’s Keyence, which manufactures sensors and measuring instruments used for factory automation and high-technology products, is based in part on his belief that its return on equity is headed for a fall. The stock is overvalued and trading at a premium to peers, he notes, while its dividend remains low at less than 10 percent. Trading at ¥68,900 in mid-March, the shares hold a price objective of ¥53,000.