The 28 Japanese ADRs that are listed on the NYSE or traded on the Nasdaq posted a combined average 1.9% loss last week. This compares to returns of +0.6%, -3.8%, +0.5% and +4.2% in the four weeks prior.
Nearly 80% (22 of 28) ADRs finished the week lower, compared to 60% posting gains two weeks ago.
See the chart near the bottom for weekly and year-to-date returns.
The five best performing ADRs:
- 1. TDK (TDK) 7.7% -- has received a lot of analyst attention following news it will take over Alps Electric's hard-disk drive business; up another 1% intra-day in Tokyo, possibly on news Goldman will keep TDK on its "strong buy" recommendation list
2. Nidec (NJ) 5.1% -- similar to TDK, has been trading higher following news of M&A activity; up another 2% intra-day
3. Hitachi (HIT) 4.0% -- shares are actually down 1% intra-day after trading off as much as 3.6% on news of a parent-only loss forecast and dividend cut due to loss at hard-disk drive business; Japanese business press notes the stock has support given its low 1.1 to 1.2 price-to-book ratio and possible accelerated restructuring
4. Kyocera (KYO) 2.0% -- trading up 3.2% today on analyst share price hike
5. NIS Group (NIS) 0.4% -- no news in particular
The five worst performing ADRs:
- 1. Kubota (KUB) -8.7% -- shares struggling against U.S. real estate market uncertainty and potential global economic slowdown; losing 2.7% intra-day today in Tokyo on a KBC downgrade to "sell" from "buy", and new target share price of ¥900, from ¥1,400 previously and ¥1,053 on Friday
2. Makita (MKTAY) -7.0% -- seems it could also have been sold last week due to concerns over strength of U.S. and global economy; its shares remain up double-digits on the year, therefore some likely profit taking; trading 1.2% higher intra-day
3. Trend Micro (TMIC) -5.9% -- shares continue to fall; trading up 0.7% intra-day; difficult to call a bottom, but can't expect much more selling due to comparatively attractive dividend yield of 2.9% (for its ordinary shares), esp. for yield hungry Japanese investors
4. Mitsubishi UFJ (MTU) -5.7% -- the mega banks are still hated despite a BoJ rate hike last month; selling pressure persists due to doubt of another near-term hike; down 2.3% intra-day; Japanese business press reported some institutional investors are cutting their losses
5. Mizuho FG (MFG) -4.5% -- see comments for Mitsubishi UFJ above; down 0.7% intra-day
* Note: Intra-day gains/losses are for ordinary shares 3/19/07
Disclosure: The author owns shares of NIS Group and IIJ and also owns IIJ call options.
Click to enlarge chart