On Monday, Jefferies adjusted its outlook on Hamamatsu Photonics KK (6965:JP), reducing the price target to ¥7,000 from the prior ¥8,000. Despite the lower target, the firm maintained its Buy rating on the company's shares. This decision follows the company's recent report of its second-quarter results for the fiscal year ending September 2024, which were disclosed on May 9.
Hamamatsu Photonics' operating profit guidance for the fiscal year ending September 2024 is set at ¥37.5 billion, marking a 34% year-over-year decline. This forecast fell short of market expectations, prompting a downward movement in the company's stock price. The firm's analysis suggests that the current fiscal year's performance is a temporary setback due to a previous surge in demand.
The revised price target from Jefferies reflects updated estimates after considering the company's latest financial report and market performance. Despite the reduction, the firm reaffirms its positive stance on the stock, anticipating a recovery and growth following the current fiscal year's challenges.
Jefferies' position remains optimistic about Hamamatsu Photonics' prospects beyond the current fiscal year. The firm believes that once the effects of the accelerated demand from the previous year have stabilized, the company is expected to resume its growth trajectory. This perspective is underpinned by the maintained Buy rating, despite the adjusted price target.
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