Goldman Sachs reveals the 'Seven Samurai' — Japan's version of the 'Magnificent Seven' stocks
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Investors have been bullish on Japan stocks since last year, repeatedly driving them to record highs. The latest rally was on Thursday, when the Nikkei 225 hit a record high that surpassed the previous one reached in 1989. Goldman Sachs has named “Seven Samurai” stocks in Japan, which it says could be an equivalent of the United States’ “Magnificent Seven.” The “Magnificent Seven” comprises Apple , Amazon , Alphabet , Meta , Microsoft , Nvidia and Tesla , which were behind much of the gains that drove the S & P 500 up a whopping 24% or so in 2023. In a Feb. 18 report, Goldman answered clients’ requests for the Japanese equivalent of the “Magnificent Seven.” “As a first attempt, we have decided to focus on the most liquid stocks in Japan ([average daily trading volume] of over US$50 million), that have been amongst the best-performing stocks both [year-to-date and over the last 12 months, and which have not posted any operating or net losses since 2020,” Goldman wrote. With that criteria, Goldman has come up with a list of seven stocks, and they are: Screen Holdings, Advantest, Disco, Tokyo Electron, Toyota Motor, Subaru and Mitsubishi. Here’s how they’ve performed year-to-date, their potential upsides according to FactSet, and how to invest. Japanese markets may have jumped a lot, but fund managers and analysts are still bullish on them . Some have given more upside to the Nikkei 225 as well as the Topix, and pointed out that Japanese companies are becoming more shareholder-friendly. The Tokyo Stock Exchange has also launched a corporate governance reform campaign on companies to disclose their plans for improvement, spurred by the fact that many are trading at a price-to-book ratio of below one. That means that many stocks are undervalued. — CNBC’s Ying Shan Lee contributed to this report.
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