Morgan Stanley analyst Lisa Jiang has maintained their neutral stance on HSYDF stock, giving a Hold rating yesterday.
Lisa Jiang has given her Hold rating due to a combination of factors impacting Harmonic Drive Systems. The company is set to recognize an impairment loss at its subsidiary, Harmonic Precision, which is expected to result in an extraordinary loss. This development has led to a slight downward revision of the company’s net profit guidance for the fiscal year ending March 2025, despite an upward adjustment in sales and operating profit forecasts.
While the increase in sales guidance from ¥54 billion to ¥55.5 billion and the shift from an operating loss to a modest profit are positive indicators, the lack of significant improvement in quarterly operating profit targets tempers the outlook. The fourth-quarter operating profit target remains similar to the third quarter’s, suggesting limited progress. Therefore, the overall impression remains neutral, justifying the Hold rating.
In another report released yesterday, Jefferies also upgraded the stock to a Hold with a Yen2,800.00 price target.