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Forums - General Discussion - Sony Seen as Reject as Japan JPX Index Cuts Losing Stocks

Sony Corp. (6758) is poised to be rejected from Japan’s government-backed stock index started in January.

The JPX-Nikkei Index 400 (JPNK400) picks companies with the best operating income, return on equity and market value to shame executives of those it excludes into boosting profit and shareholder returns. Japan’s biggest consumer-electronics maker will be kicked out when the gauge reassesses its constituents next month, according to UBS AG, Goldman Sachs Group Inc. and at least four other brokerages, as losses create negative return on equity that dwindling operating income and market value no longer counter.

Goldman Sachs says Sony, creator of the PlayStation, is surpassed by 959 businesses jostling for the 400 spots. Rejection matters as investors including the $1.2 trillion government pension fund buy and sell shares to emulate the gauge’s movements. Sony has fallen from grace as it struggles to stem losses in its television business.

“If you’re dropped, the impact on your share price could be quite big,” said Tomomi Yamashita, who helps oversee the equivalent of $6.3 billion at Shinkin Asset Management Co. in Tokyo and says he can now list almost all 400 companies on the measure. “It’s also going to hurt your image.”

http://www.bloomberg.com/news/2014-07-28/sony-seen-as-reject-as-japan-jpx-index-cuts-losing-stocks.html

This is quite Grim, No doubt about that for share price! LoL,  but on the same token, it just means that much more cutting and trimming to come, And again that will Also mean no IPO offer on the entertainment arm of Sony.

But the cutting off the TV section and Real Estate Holding's would be pretty Sought after the Sony Stocks takes a Hit So Sony setting up that Real Estate Arm was in a pretty good timing , they will be getting plenty of Bid's on Holding's they have to sell to the highest bidder, some of which they have held onto for over 22 year's.

Sony is getting ready to cut very deep into the size of the company, No doubt but on the same token Kaz is getting to that point anyway.Despite the Grim Outlook, Sony will be much smaller and more Mobile of a company..Kas is sticking to his word.

Three Core pillars: Mobile/Entertainment/Cmos

every thing else is being offered on the chopping block.



I AM BOLO

100% lover "nothing else matter's" after that...

ps:

Proud psOne/2/3/p owner.  I survived Aplcalyps3 and all I got was this lousy Signature.

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need to sell more life insurance ASAP

I do hope Sony turns it around though, we need at least 2 non-Nintendo entities duking it out.



LudicrousSpeed said:
need to sell more life insurance ASAP

I do hope Sony turns it around though, we need at least 2 non-Nintendo entities duking it out.


well with this , the Stock will take a further Down Grade, but that also means Many time's The company itself in japan offer's to buy back its own stock!

That of course does not mean the Investment Group will sell it back. But, also it may depend on what the out look is for said company, thats why if the debt is so High very many do not want to take on such Debt and wait for the company to have a "collapsed lung" if you will where they are more often ready to agree to more shake up on the company, that is if the investment Hedge fund or group can in effect get a change enacted by Vote. which is often many times than not, unless you are japanese a west centric investment hedge fund's have quite the up hill battle to get that to happen.

With Cuts to divest of Old Holding's , like a single Building sold for over 1 billion, there is quite a bit of holding's that Sony is going to be selling off No doubt, the splitting off the TV section also means with this that there is a good chance that Sony may be ready to sell off the TV production of the majority of its holding's into TV's



I AM BOLO

100% lover "nothing else matter's" after that...

ps:

Proud psOne/2/3/p owner.  I survived Aplcalyps3 and all I got was this lousy Signature.

It is kinda funny that Sony's most profitable ventures now are life insurance and real estate.

But ya, this would suck. Guess we have to wait until January to see.



Xbox: Best hardware, Game Pass best value, best BC, more 1st party genres and multiplayer titles. 

 

sales2099 said:
It is kinda funny that Sony's most profitable ventures now are life insurance and real estate.

But ya, this would suck. Guess we have to wait until January to see.

Wait until January?

You do not have to wait, Sony is going to be dropped, unless there is a real upswing which i doubt very much Sony's stock will be taking a further Hit again.

The Stock holder's know this very well already Kaz already stated as much. This is just the rating Agency's catching up to lower the stock further , which they were going to do anyway, this was already known well before the 3rd Quarter results.

An well you also have to remember that , its less overhead! for insurance and real Estate vs physical hardware production components and work force requirements not just that but power requirement's and Resources. Software and Admin. Services like Insurance and real estate  are way lower in opperation cost's. Example in case of TV production expenses of that much production vs what korea can get for a wage by wage process is much cheaper than the costs in japan that are needed, and that much more problematic for anyone to really to compete with the likes of samsung and LG on not just the low cost entry point but for also higher end units also. In Korea and china the production is way more cost effective than in japan on wage requirements alone for not only in component cost builds but also production and wage earning's low cost working cost's vs Much need Higher cost working cost's.

think about how much market erosion that has taken on japanese companies , and not just Sony! pretty much many electronic manuf. Companies out of japan, none just the size of Sony! it takes quite a bit to turn that around since Sony has in its employ over 130,000+ people, and many are japanese! Cutting out parts of your company is costly and time consuming if you want to make sure the  employed workers you are trying to save as many jobs as you can for those that work for yor company in japan.

IE: Samsung can under cut every freaking japanese electronic company in cost's for production of electronics and they do just that!

That's Exactly why Sony is cutting most of the Electronic sections off for selling off Assets, but as for the Entertainment Arm No because 

A) its already a LLC which mean's its already a subsidiary that its stock is not a IPO along with the entertainment Arm

And B) Kaz already stated what the three Core Pillars are (Mobile/Software ,services,Entertainment/cmos)

Tv's are no longer a core Pillar over at Sony, thus you have to have a Real Estate Company to set up to offer Those production plants for sale, some of which has been held by Sony for over 22 + years, when you can sell a single building for over 1 billion you best be darn tootin there will be offer's for such Physical Assets. the benefits is Down sized more smaller leaner company, increased market cap after lower over head cost's pay back debt, and narrow the companies focus.

the Bad: Lower income stream, also the Loss of Job's unless you can divest with job retention by new holding company, the cost's involved are expensive, so already Sony has spent more in restructuring cost's for no short term benefits, but long term should net a +



I AM BOLO

100% lover "nothing else matter's" after that...

ps:

Proud psOne/2/3/p owner.  I survived Aplcalyps3 and all I got was this lousy Signature.

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LudicrousSpeed said:
need to sell more life insurance ASAP

I do hope Sony turns it around though, we need at least 2 non-Nintendo entities duking it out.


Playstation Is a LLC its not for public offering, it already runs in of itself by it's own, so why do you think Sony has not put more money into sections of first Party AAA cost's? its because they are not using Sony's Money they are Using Sony Computer Entertainments Money!

"Sony computer entertainment already operates independently of the main body of Sony"

because its already a subsidiary even if Sony the parent folds in a year or two the Playstation will still be Sony! because its already a subsidiary by itself, some may ask can anyone just outright buy SCE? No! they cannot and as for a Vote by the board its not going to happen because of 1st right stock purchase option on the books!

If anything It will just mean it will go on as it is right now lower number of AAA production more 3rd party Production software and a hell of a lot of Indie development's by many  3rd part PC development publisher's and development studios.

Right now the its more cost effective to lower the number of AAA investments and go with 2nd tier lower cost investment into something like Freedom wars, than keep investing into high budget loss leading projects.

That is exactly why Sony's main Target is lower cost higher return on software for the majority, there will be AAA but less this generation from 1st party and more from 2nd Tier this generation.

IE: They cannot do very many AAA production's quick in a row until the profit generation increases, thus just like last cycle more of the AAA games will come much later than early cycle, due to the fact they are running SCE. LLC mainly on its own as its a subsidiary, its already spun off because its a subsidiary, but you cannot buy any stock of its company.



I AM BOLO

100% lover "nothing else matter's" after that...

ps:

Proud psOne/2/3/p owner.  I survived Aplcalyps3 and all I got was this lousy Signature.

Ka-pi96 said:
eh, I'm sure Sony will be fine. These things take time but they seem to be going in the right direction now.

well the Main part of Sony, or i should say many parts that they have had for well before Playstation was established may be under going some big Cuts, as Kaz is setting the company to Focus on the Three Pillars, and it does indeed show that direction, it is taking some time, but for the parts that have such large restructure its not going to be quick and its not going to be easy cuts. the fact back when i first joined this site i stated, that Sony would indeed looking to cut about 70,000 people from its work force before every thing is all said and done looks to be well on its way. expect further 30,000 man power being cut from Sony by the next 4 to 5 years!

At least, Due to the Divestment of quite a large number of physical Assets that are quite frankly too much over head and not enough ability to recover those costs for operation Costs in over head are far more than they can recover due to low cost competition being well able to undercut operation expenses vs than what many japanese companies can operate at for the expense they would need.



I AM BOLO

100% lover "nothing else matter's" after that...

ps:

Proud psOne/2/3/p owner.  I survived Aplcalyps3 and all I got was this lousy Signature.