2016 All-Japan Research Team: Software, No. 2: Satoru Kikuchi

Down one position to No. 2, Satoru Kikuchi reports on 16 Japanese software names for SMBC Nikko Securities.

2016-04-tom-johnson-all-japan-research-team-satoru-kikuchi-small.jpg

< The 2016 All-Japan Research Team

2016-04-tom-johnson-all-japan-research-team-satoru-kikuchi.jpg

Satoru Kikuchi
SMBC Nikko Securities
First-place appearances: 5

Total appearances: 11

Team debut: 2006

Down one position to No. 2, Satoru Kikuchi reports on 16 Japanese software names for SMBC Nikko Securities. He wins plaudits from one portfolio manager for taking “deep dives in his analysis to mine interesting insights.” Another investor hails his coverage of Tokyo-based networking and systems-integration services provider NTT Data Corp. as “really helpful.” In general, the 46-year-old researcher is upbeat on the prospects for domestic business software providers — and for NTT Data, in particular. To boost productivity and competitiveness this year, Japanese companies and the government are expanding spending on information technology services, he advises, which should propel gains for the group. “I especially focus on NTT Data, which I think is the best performing stock in 2016,” says Kikuchi. “NTT Data’s earnings will improve strongly and continue to grow for at least the next five years, due to strong demand from government and financial institutions in their search for profitability improvement.” He has been a fan of the global enterprise technology concern for more than two years. In October 2014 the analyst restated his bullish stance, forecasting an earnings recovery and structural business improvement. Subsequently, for the fiscal year through March 2015, management reported a 34.2 percent year-over-year increase in operating income, to ¥84 billion ($702 million). That was followed by a 32.3 percent rise for the first three quarters of the next fiscal year, to ¥64.2 billion. By the middle of last month, NTT Data’s stock had climbed 48.1 percent, to ¥5,420, leading the country’s software companies overall by 30.9 percentage points. Although it climbed just 3 percent during the trailing 12-month period, that gain was against a sector loss of 11.7 percent.

Sponsored

Related