JAPANESE FOOD, DRUG COS UNDERVALUED DESPITE INVESTMENT RETURNS
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TSUKY | Quote | Chart | News | PowerRating -- Japanese food companies,
restaurant operators and drugmakers dominated a Nikkei ranking
of firms that are undervalued despite their efficiency in
generating profits from investment.
Toyo Suisan Kaisha Ltd. (TSE:2875) topped the list. The
company's pretax profit soared to a record in fiscal 2008, with
return on invested capital (ROIC) coming to 10 per cent. But
its stock price has tumbled 20.1 per cent since March 10.
Mexico decided in March to discontinue some special tariff
arrangements with the U.S. and investors grew wary of higher
taxes on products shipped from Toyo Suisan's U.S. business to
Mexico.
The ranking covers publicly traded nonfinancial companies
with March book-closings that had market capitalizations of at
least 50 billion yen as of Friday, as well as capital ratios of
at least 30 per cent and a ROIC of 7 per cent or greater .
Restaurant operator Watami Co. (TSE:7522) ranks No. 4, and
Starbucks Coffee Japan Ltd. (TSE:2712) came in seventh. The
coffee chain has an 11 per cent ROIC, but its stock price has
dropped 3.3 per cent since March 10.
Mochida Pharmaceutical Co. (TSE:4534) and Kaken
Pharmaceutical Co. (TSE:4521) occupied the fifth and sixth
spots respectively. Six other drugmakers made the top 30.
(Nikkei) lm
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