Goldman Sachs maintains a Sell rating on Otsuka despite a target price raise to ¥2,650, citing a slowdown in earnings momentum as the PC upgrade cycle peaks. While security product sales remain strong, falling PC volume and rising logistics costs are expected to weigh on 2H results.
Key Takeaways
- 1.PC upgrade demand related to the end of Windows 10 support is peaking out, leading to a projected decline in sales volume.
- 2.Strong demand for security products (OSM) is partially offsetting the SI business decline, with sales forecast at ¥200 bn for FY12/26.
- 3.The SS business is facing margin pressure due to increased logistics costs for office supplies and a deteriorating project mix in maintenance.
Table of Contents
- Our estimates
- Quarterly earnings outlook
- PC sales volume
- Otsuka: Earnings by business
- Investment thesis, price target risks and methodology: Otsuka
- Disclosure Appendix
- Price target and rating history chart(s)
- Target price history table(s)
- Regulatory disclosures
- Global product; distributing entities
- General disclosures
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Authors
Chikai TanakaYuki Sato
Securities
4768
Themes
PC Replacement CycleCorporate Cyber Security Demand
Regions
Asia PacificJapan