5101: Yokohama Rubber Report (Abridged)

Summary

  • New tire manufacturers (mostly from China) have taken significant market share from the low to mid tier tire markets over the past 10 years.
  • Yokohama is expanding into industrial tires, increasing production capacity, and focusing on OE business to fend off the new and strengthening competitors.
  • Overall, Yokohama’s financials are healthy and business performance is decent (10-Year average ROE roughly 9%).
  • However, shares are not particularly cheap or expensive at today’s 1,974 yen per share price.
  • Yokohama will look more interesting at 1,400 yen per share.

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