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Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: Spekulatius who wrote (47827)	5/6/2012 11:33:13 AM
From: E_K_S	Respond to of 78683

Sony Corporation (SNE) -NYSE Last $15.30/share (TBV = $18.29 EV/EBITDA= $7.02) It may be early but as I research more about the company and their massive turnaround project, the value proposition is definitely there. I suspect the bottom will be in later than sooner so (for me) no rush to buy. Here is a very good article outlining a few of the main areas that will reduce costs and increase growth. Can Kazuo Hirai save Sony? April 13, 2012 digitaltrends.com Highlights from the article: 1) Sony is looking to spin its expensive small- and mid-sized LCD production off into joint ventures, letting partners shoulder some of the costs for producing the flat screens that are part-and-parcel of almost every electronic device today. LCDs are now a commodity item, and Sony needs to reduce the amount of money it puts into manufacturing them. A good portion of the savings will come from backing out of its joint venture with Samsung to make LCD flat panels 2) Sony will be selling off it's Chemical divisions and looking to form some type of JV (and/or industry alliance) for electric vehicle batteries and other forms of energy storage. Sony is one of the biggest battery-makers on the planet. 3) Sony is looking to increase sales in China, Mexico and India. In fact Sony India will be their biggest growth market in 2015. Sony India will focus on developing new devises that use new OLED displays that deliver the convergence from their networks, mobile and digital content into one end user package. India to be in the league of top five markets for Sony by 2015 articles.economictimes.indiatimes.com From the article"..."India is becoming one of the most important market for Sony globally, is highly profitable and has potential to figure amongst the largest markets in three years," says Tamagawa who has helped the brand triple its Indian revenues since he took charge as the managing director five years back...." 4) Sony looks to expand their professional imaging technologies, specifically developing their Medical peripherals business. Sony bought Micronics last September and just closed a deal for iCyt, makers of diagnostic equipement and cellular analysis systems, respectively. This is a huge growth market that is very profitable. 5) Sony's Financial Service Group is their most profitable division. Sony’s Most Profitable Business Is Not Related To Gadgets pulse2.com From the article"...Sony Financial is a holding company for Sony’s financial services. It owns and oversees businesses like Sony Life Insurance, Sony Bank, Sony Assurance, and Sony Bank Securities. The market cap of Sony Financial Holdings Inc (TYO:8729) is $568.98 billion and they are headquartered in Tokyo, Japan...." This link shows just how profitable this division is: sonyfh.co.jp What if Sony decides to expand their Financial Services into India and China, two markets where their brand is rated very high for "quality". This is the hidden gem for me. I do not think the company has planned this far down the road for their financial services division. If Sony India delivers the 5% growth, bringing their Finance Services into the fold could be very profitable for the company. ---------------------------------------------------- Therefore, it's a developing transformation that is worth watching. It's the two growth markets in China and India that attract my attention. I also believe finding their way into the medical imaging market could prove a good move. For example. dentists across the world are installing new imaging equipment, their single largest capital investment for new equipment. Maybe there will be further acquisitions by SNE to enter this part of the medical imaging market. With the company now selling 20% below Tangible Book Value it's worth looking at SNE (for me) as a value candidate stock. It's still a work in progress. ( financials: advfn.com ). EKS