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Japan Times
3 days ago
- Business
- Japan Times
Japan firms exit Tokyo exchange at record pace in delisting rush
Japanese companies are leaving the Tokyo Stock Exchange at the fastest pace in over a decade, reflecting a surge in deals and management buyouts as they face more pressure to make better use of their capital. The number of firms that delisted their shares from the TSE or announced plans to do so has reached 59 in the first half, rising from 51 a year earlier and marking the most on record for a comparable period, according to exchange data going back to 2014. If firms continue to exit the TSE at this pace, the figure for 2025 will exceed last year's annual record of 94 companies. The trend reflects the Tokyo bourse's broad push to make the Japanese market more appealing for foreign investors by ensuring that listed companies offer high shareholder returns, while firms that aren't meeting their goals face the threat of being taken off the exchange. The TSE has called on companies to pursue goals including improving their valuations and cutting overly close ties with other companies in the form of cross-shareholdings. Those reforms made Japanese shares one of the world's best performers in recent years, while encouraging activist shareholders to demand even more changes from company managers. For investors, increased activism has boosted calls to raise returns with measures such as stock buybacks, while mergers and acquisitions have soared. "The decrease in the number of listed companies as a result of the activation of the capital market is a welcome development,' said Hiroshi Matsumoto, senior client portfolio manager at Pictet Japan. Japan is following in the footsteps of overseas markets like the U.S. and U.K., where more companies have gone private over the last 20 years on stricter rules to stay listed as well as growth in private market financing. The Tokyo exchange has emphasized since last year that its priority for listed firms is quality rather than a big numbers of companies. "The TSE's intentions are going as planned,' said Hajime Nakajima, managing director at Deloitte Tohmatsu Equity Advisory. Companies whose shares are considered cheap will increasingly become targets of M&A and management buyouts, and "more and more of them will exit the market,' he said. The number of listed companies on the Tokyo bourse fell to 3,842 last year, marking the first decrease since the merger of the TSE and the Osaka exchange in 2013, according to TSE data excluding figures from the Tokyo Pro Market. The number will likely fall further to 3,808 by the end of June, based on Bloomberg calculations of data including figures from the exchange. The TSE reorganized in 2022 its equity market into Prime — with the biggest firms, Standard, and Growth — listing the smallest companies. Since then, the TSE has urged listed companies to improve corporate governance and take steps to bolster their value. In addition, the transition period for companies that fail to meet listing standards expired at the end of March, and if they continue to fall short, they're scheduled to be delisted in October 2026 at the earliest. Many companies left the Tokyo exchange after getting bought out by other firms and investment funds. ID&E, a construction consulting firm, became a wholly owned subsidiary of non-life insurer Tokio Marine, who saw business opportunities in its new unit's disaster prevention and mitigation tactics. Guidelines that the Ministry of Economy, Trade and Industry released in 2023 suggesting best practices for corporate takeovers have helped fuel the M&A boom. In cases where both a company and its subsidiary were listed, a not uncommon arrangement in Japan's share market that's been criticized as leading to conflicts of interest, parent firms have bought out units to steer clear of governance concerns. The planned takeover by Japan's biggest telecom firm, Nippon Telegraph & Telephone, of its unit NTT Data Group is one example of that. As the costs of maintaining a public listing rise and activist shareholders push for more payouts and policy changes, takeovers of companies by management are climbing. I'rom Group, a company that supports clinical trials, teamed up with U.S. investment firm Blackstone to take its shares private, in one such instance. Tao Zhiyuan, a portfolio manager at AllianceBernstein Japan, said that Japan's chemical sector has "many interesting niche-top stocks,' but a lot of them are too small for global funds to invest in. If Japan as a whole "sees an increase in the number of large, strong companies through M&A, the number of investment targets from a foreign perspective will increase,' he said.
Yahoo
4 days ago
- Business
- Yahoo
Adcorp Holdings' (JSE:ADR) Shareholders Will Receive A Bigger Dividend Than Last Year
Adcorp Holdings Limited (JSE:ADR) will increase its dividend from last year's comparable payment on the 18th of August to ZAR0.5002. This will take the dividend yield to an attractive 9.8%, providing a nice boost to shareholder returns. While the dividend yield is important for income investors, it is also important to consider any large share price moves, as this will generally outweigh any gains from distributions. Investors will be pleased to see that Adcorp Holdings' stock price has increased by 44% in the last 3 months, which is good for shareholders and can also explain a decrease in the dividend yield. Trump has pledged to "unleash" American oil and gas and these 15 US stocks have developments that are poised to benefit. While it is great to have a strong dividend yield, we should also consider whether the payment is sustainable. Based on the last payment, Adcorp Holdings was quite comfortably earning enough to cover the dividend. This means that a large portion of its earnings are being retained to grow the business. Over the next year, EPS could expand by 68.2% if recent trends continue. If the dividend continues along recent trends, we estimate the payout ratio will be 27%, which is in the range that makes us comfortable with the sustainability of the dividend. View our latest analysis for Adcorp Holdings While the company has been paying a dividend for a long time, it has cut the dividend at least once in the last 10 years. Since 2015, the annual payment back then was ZAR1.40, compared to the most recent full-year payment of ZAR0.634. This works out to be a decline of approximately 7.6% per year over that time. A company that decreases its dividend over time generally isn't what we are looking for. Given that the track record hasn't been stellar, we really want to see earnings per share growing over time. Adcorp Holdings has impressed us by growing EPS at 68% per year over the past five years. The company doesn't have any problems growing, despite returning a lot of capital to shareholders, which is a very nice combination for a dividend stock to have. In summary, it is always positive to see the dividend being increased, and we are particularly pleased with its overall sustainability. Earnings are easily covering distributions, and the company is generating plenty of cash. All of these factors considered, we think this has solid potential as a dividend stock. Investors generally tend to favour companies with a consistent, stable dividend policy as opposed to those operating an irregular one. Still, investors need to consider a host of other factors, apart from dividend payments, when analysing a company. Just as an example, we've come across 3 warning signs for Adcorp Holdings you should be aware of, and 1 of them can't be ignored. Is Adcorp Holdings not quite the opportunity you were looking for? Why not check out our selection of top dividend stocks. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Error al recuperar los datos Inicia sesión para acceder a tu cartera de valores Error al recuperar los datos Error al recuperar los datos Error al recuperar los datos Error al recuperar los datos
Yahoo
5 days ago
- Business
- Yahoo
Honeywell's Dividend Appeal Lies in Future Growth, Not Just Today's Yield
Honeywell International Inc. (NASDAQ:HON) is among the . In recent years, the company has faced setbacks, struggling to translate promising opportunities in automation, the industrial Internet of Things, aerospace, and the energy transition into significant revenue or profit growth. However, the outlook appears more encouraging moving forward. A shot of a commercial plane with a blur of color in the background, representing the production of auxiliary power units in the Safety and Productivity Solutions segment. Honeywell International Inc. (NASDAQ:HON)'s largest division is its aerospace segment, which supplies parts, components, control systems, and integrated solutions to both commercial aviation and the defense sector. Notably, the company also operates a $5 billion quantum computing business. One of Honeywell International Inc. (NASDAQ:HON)'s standout strengths is its solid balance sheet. It has increased its dividend 15 times over the past 14 consecutive years. According to its 2025 proxy statement, the company has strategically deployed $14.6 billion across mergers and acquisitions, capital investments, share buybacks, and dividend payments to strengthen its portfolio and enhance shareholder returns. In addition, the company's strong cash flow provides solid backing for its dividend payments. In the first quarter of 2025, it reported operating cash flow of $600 million and free cash flow of $300 million—a 61% increase from the previous year. Its free cash flow margin of 13% further highlights a positive outlook. Looking ahead to full-year 2025, Honeywell International Inc. (NASDAQ:HON) projects operating cash flow between $6.7 billion and $7.1 billion, with free cash flow expected to range from $5.4 billion to $5.8 billion. The company offers a quarterly dividend of $1.13 per share and has a dividend yield of 2.02%, as of June 14. While we acknowledge the potential of HON as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock. READ NEXT: and Disclosure. None.
Yahoo
5 days ago
- Business
- Yahoo
Tractor Supply: Dividend Strength Ahead
Tractor Supply Company (NASDAQ:TSCO) is one of the . The company continued to deliver solid returns to its shareholders, distributing over $1 billion in fiscal year 2024. This included $472.5 million in dividends and $560.8 million spent on share buybacks. With a dividend payout ratio of around 43%, the company maintains a healthy balance between rewarding investors and preserving capital for future growth. An equestrian rider proudly leading a horse around a competition course. In the first quarter of 2025, Tractor Supply Company (NASDAQ:TSCO) returned another $216.4 million to shareholders, $122.4 million through cash dividends and $94 million via the repurchase of approximately 1.7 million shares. These returns were supported by strong cash flow, with the company generating $216.7 million in operating cash during the quarter. On May 15, Tractor Supply Company (NASDAQ:TSCO) announced a quarterly dividend of $0.23 per share, consistent with the previous payout. It has now increased its dividend for 16 straight years. The stock supports a dividend yield of 1.79%, as of June 14. Tractor Supply Company (NASDAQ:TSCO) is one of the largest rural lifestyle retailers in the United States. With a legacy spanning over 85 years, the company has remained committed to meeting the needs of hobby farmers, ranchers, homeowners, gardeners, pet lovers, and anyone who embraces the 'Life Out Here' way of living. While we acknowledge the potential of TSCO as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock. READ NEXT: and Disclosure. None. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
5 days ago
- Business
- Yahoo
Should You Buy This Energy Stock for Its 9.4% Dividend Yield?
Written by Aditya Raghunath at The Motley Fool Canada Valued at a market cap of $222.4 million, Alovopetro Energy (TSXV:ALV) stock is up more than 190% in the last five years. After adjusting for dividends, cumulative returns are closer to 309%. Despite these market-beating gains, the energy stock offers you a tasty dividend yield of over 9% in 2025. Moreover, it also trades 43% below all-time highs, allowing you to buy the dip and gain exposure to a quality energy stock at a lower multiple. Let's see if you should consider owning this high-dividend stock at its current price. Alvopetro Energy has established itself as Brazil's first integrated onshore natural gas producer. It continues to deliver exceptional shareholder returns through disciplined capital allocation and strategic positioning in a growing energy market. The Calgary-based company operates primarily in Brazil's Reconcavo Basin near Salvador, leveraging the country's emerging natural gas market, where 32% of the supply is currently imported. Alvopetro's Q1 production reached 2,446 barrels of oil equivalent per day, with 95% of the output comprising natural gas, demonstrating a focused strategy in this high-demand commodity. Financial performance remains robust, as Alvopetro generated $9.2 million in funds flow from operations in the March quarter. It also maintained an impressive 80% operating netback margin despite temporary elevated royalties from a regulatory dispute. The company's disciplined approach allocates 47% of its funds flow to reinvestment, 48% to stakeholder returns, and 5% to building financial resources. Alvopetro's growth strategy centers on two key assets. The Caburé field, where the company holds a 56.2% working interest, features a unitized development with eight wells and production capacity of 21.2 million cubic feet per day. It also owns 100% of the critical midstream infrastructure, including an 11-kilometre transfer pipeline and a gas processing plant with a capacity of over 18 million cubic feet per day. The Murucututu project represents significant expansion potential, with 2P (sum of proven and probable) reserves of 4.6 million barrels of oil equivalent and additional contingent and prospective resources totalling 14.7 million barrels of oil equivalent. Recent drilling results from the 183-D4 well showed 61 metres of potential natural gas pay, with completion planned for Q3 of 2025. Beyond Brazil, Alvopetro has established a Western Canadian growth platform targeting the Mannville Stack heavy oil fairway, where multilateral drilling technology offers attractive economics. It holds a 50% working interest in 8,800 net acres with potential for over 100 drilling locations. With a current enterprise value of $208 million and an annualized dividend yield of 9.4%, Alvopetro provides investors with exposure to Brazil's expanding natural gas market through a proven management team that delivers strong operational execution and shareholder-focused capital allocation. Analysts expect Alvopetro's revenue to increase from $65.7 million in 2024 to $126 million in 2029. Compared to this, free cash flow is forecast to grow from $28 million to $71 million during this period. If the high dividend stock is priced at 10 times forward free cash flow, it should rise by more than 200% over the next four years. After adjusting for dividend reinvestments, cumulative returns could be closer to 250%. Alovopetro's annual dividend payout in 2025 is expected to total around $20 million, suggesting that investors can anticipate consistent dividend hikes through 2029. Bay Street remains bullish on the dividend stock and expects it to gain over 25%, given consensus price targets. The post Should You Buy This Energy Stock for Its 9.4% Dividend Yield? appeared first on The Motley Fool Canada. More reading Made in Canada: 5 Homegrown Stocks Ready for the 'Buy Local' Revolution [PREMIUM PICKS] Market Volatility Toolkit Best Canadian Stocks to Buy in 2025 Beginner Investors: 4 Top Canadian Stocks to Buy for 2025 5 Years From Now, You'll Probably Wish You Grabbed These Stocks Subscribe to Motley Fool Canada on YouTube Fool contributor Aditya Raghunath has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Alvopetro Energy. The Motley Fool has a disclosure policy. 2025
