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Analyst Blog

On Feb 27, 2014, we issued an updated research report on Fujifilm Holdings Corporation (FUJIY - Analyst Report). The company delivered robust net income in the third quarter of fiscal 2014 which increased 68.9% to $309.1 million year over year.  Margins increased year over year, led by an increase in revenues.

The overseas operation of the company accounted for roughly 59.5% of the total revenue for fiscal third quarter. The company has been reaping the benefits of falling yen exchange rate which boosted earnings.

Fujifilm is attempting to gain greater market share through geographical expansion as well as product launches in all the segments. In the third quarter of fiscal 2014, the company launched products ranging from lenses to printers.

Additionally, management provided an encouraging outlook for fiscal 2014. Total revenue is expected to be ¥2,400.0 billion, reflecting a year-over-year increase of 8.4%and above the previous expectation of ¥2,350.0 billion. Fujifilm expects operating income to increase 22.7% year over year to ¥140.0 million. Moreover, the company estimates its net income for the coming fiscal year to be ¥70.0 billion, increasing 29.0% year over year.

The strong results and guidance led to positive estimate revisions for fiscal 2014 over the past 60 days. This led to a significant increase of 6 cents in the Zacks Consensus Estimate for fiscal 2014, which now stands at $1.50 per share.

Key Picks from the Sector

Fujifilm currently carries a Zacks Rank #3 (Hold). Other stocks those are worth considering within this sector include Advanced Energy Industries, Inc. (AEIS - Snapshot Report), KLA-Tencor Corp. (KLAC - Analyst Report) and Ultra Clean Holdings Inc. (UCTT - Snapshot Report). All these stocks carry a Zacks Rank #2 (Buy).

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