Conditions for Targeting Undervalued High Dividend Yield Stocks with NISA Growth Investment Limits
Additionally, the Bank of Japan’s monetary tightening, which is often raised as a concern, is expected to end up being unfounded. The persistent yen depreciation and rising prices, attributed to the Bank of Japan’s monetary policy, have led to frequent criticism of the central bank. As a result, there is a view that the Bank of Japan might implement rate hikes significantly earlier than the financial markets anticipate.
Indeed, media reports may give the impression that Bank of Japan Governor Kazuo Ueda is somewhat wavering, as his remarks seem to be influenced by the yen’s weakness. However, this is a problem with the reporting itself. A close examination of his press conferences and speeches shows no signs of inconsistency from Governor Ueda. He is known for being the sole dissenting vote against the ‘Zero Interest Rate Policy Removal’ in August 2000 while serving as a member of the Bank of Japan’s Policy Board. It is unlikely that hasty monetary tightening will revert the Japanese economy back into deflation.
Target Undervalued Stocks Not Yet Reflecting Japan’s ‘Escape from Deflation’
So, what kinds of stocks should be selected for equity investment at present? Although it is said that ‘this is not a bubble,’ it is difficult to handle stocks that have already risen significantly. Therefore, I would like to introduce stocks that are considered undervalued compared to the actual performance of the companies. These are the so-called ‘undervalued stocks.’
In the stock market, ‘undervalued stocks’ refer to stocks that are left at a low price compared to the company’s value, which is calculated from profits generated by the company and its assets. These are often referred to as ‘value stocks.’ Even among Japan’s leading large companies, there are still many stocks that have not yet incorporated the significant structural change of escaping deflation in the Japanese economy into their stock prices.
[Key Points of ‘Undervalued High Dividend Yield Stocks’ Currently Focused on by Hideki Wajima]
- Strong, high-quality companies with solid management foundations, but with high dividend yields during stock price adjustment phases
- Concrete plans or shareholder returns aimed at achieving ‘PBR of 1’
- High likelihood of upward revisions in performance due to yen depreciation corrections
This time, we will pick three stocks from that list.
■ [Real Names Revealed] The real names of the three ‘target’ stocks identified by Hideki Wajima, along with the reasons for their selection, the latest information on each company, and stock price data can be read in the paid version of [FRIDAY Subscription].
Interview and text： Kenji Matsuoka
After working as a money writer, financial planner, and market analyst for a securities company, Wajima became independent in 1996. He writes articles on finance and asset management mainly for business and economic magazines. Author of "A Textbook for the First Year of Robo-Advisor Investing" and "A Book You Can Understand with Rich Illustrations! Cashless Payments for the Absolute Benefit of Cashless Payments".
