NINOF - Nikon: Strong Recovery With Reduced Margin Of Safety
- Nikon demonstrated strong recovery in the imaging segment with significantly improved operating margin, but a much lower revenue level due to the shrinking camera market.
- Precision equipment sales rebounded as a result of business travel restrictions being gradually lifted.
- Supply chain shortages with respect to electronic components will likely constrain Nikon’s ability to ramp up its manufacturing in 2022.
- Given input updates to my valuation analysis, Nikon currently has about 30% upside from the current stock price of ¥1,320.
- I strongly encourage investors to start reducing their exposure to Nikon stock as risks to the investment story abound and the margin of safety declined.
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Nikon: Strong Recovery With Reduced Margin Of Safety