While "the trend is your friend" when it comes to short-term investing or trading, timing entries into the trend is a key determinant of success. And increasing the odds of success by making sure the sustainability of a trend isn't easy.The trend often reverses before exiting the trade, leading to a short-term capital loss for investors. So, for a profitable trade, one should confirm factors such as sound fundamentals, positive earnings estimate revisions, etc. that could keep the momentum in the stock aliv ...

Core Viewpoint - Mitsubishi Electric Corporation (MIELY) has experienced a bearish trend, losing 11.5% in the past week, but the formation of a hammer chart pattern suggests a potential trend reversal as buying interest may be increasing [1][2]. Technical Analysis - The hammer chart pattern indicates a possible bottoming out, with reduced selling pressure, suggesting that bulls may be gaining control [2][4]. - A hammer pattern forms when there is a small candle body with a long lower wick, typically occurring during a downtrend, signaling a potential reversal if it appears at the bottom of the trend [3][4]. Fundamental Analysis - There is a strong consensus among Wall Street analysts to raise earnings estimates for MIELY, which supports the bullish outlook for the stock [2][6]. - The consensus EPS estimate for the current year has increased by 6.8% over the last 30 days, indicating analysts' agreement on the company's improved earnings potential [7]. Zacks Rank - MIELY holds a Zacks Rank 1 (Strong Buy), placing it in the top 5% of over 4,000 ranked stocks, which typically outperform the market [8]. - The Zacks Rank serves as a timing indicator, suggesting that the company's prospects are beginning to improve, further supporting the case for a trend reversal [8].

Core Viewpoint - The article emphasizes the importance of confirming the sustainability of stock trends for successful short-term investing, highlighting that price movements should be supported by strong fundamentals and positive earnings estimates. Group 1: Stock Performance - Mitsubishi Electric Corporation (MIELY) has shown a solid price increase of 16.4% over the past 12 weeks, indicating investor confidence in its potential upside [4] - The stock has experienced a price increase of 26.1% over the past four weeks, suggesting that the upward trend is still intact [5] - MIELY is currently trading at 85.5% of its 52-week high-low range, indicating a potential breakout [5] Group 2: Fundamental Strength - MIELY holds a Zacks Rank 1 (Strong Buy), placing it in the top 5% of over 4,000 ranked stocks based on earnings estimate revisions and EPS surprises [6] - The stock has an Average Broker Recommendation of 1 (Strong Buy), reflecting high optimism from the brokerage community regarding its near-term price performance [7] Group 3: Investment Strategy - The "Recent Price Strength" screen is a useful tool for investors to identify stocks like MIELY that are on an uptrend supported by strong fundamentals [3] - The Zacks Rank stock-rating system has a proven track record, with Zacks Rank 1 stocks generating an average annual return of +25% since 1988 [7] - Investors are encouraged to explore over 45 Zacks Premium Screens tailored to different investing styles to find potential winning stocks [8]

Financial Data and Key Metrics Changes - Revenue for Q3 FY '25 reached JPY 1,356.7 billion, a record high, with an operating profit of JPY 126.8 billion, also a record high for the quarter [3][5] - For the first nine months, revenue was JPY 4.3 trillion and operating profit was JPY 303.5 billion, both record highs [7] - The operating profit margin improved by 2.4 percentage points to 9.4% in Q3 [5][10] - The full-year revenue forecast was revised to JPY 5.4 trillion, an increase of JPY 10 billion from the previous forecast, while operating income remains unchanged at JPY 400 billion [4][29] Business Segment Data and Key Metrics Changes - The Infrastructure segment saw year-on-year increases in revenue and operating profit, driven by strong performance in the Public Utility Systems and Defense & Space Systems businesses [19][20] - The Industry & Mobility segment experienced declines in both revenue and operating profit, particularly in the FA Systems and Automotive Equipment businesses [22][24] - The Life segment reported higher orders, revenue, and operating profit year-on-year, particularly in the Building Systems and Air Conditioning Systems businesses [25][26] - The Semiconductor & Device segment saw a decrease in revenue but an increase in operating profit due to changes in product mix [27] Market Data and Key Metrics Changes - Overseas revenue increased by JPY 55.1 billion or 109% year-on-year to JPY 680.7 billion, attributed to the weaker yen [28] - Revenue from Japan also increased by JPY 57.6 billion or 109% year-on-year, with the ratio of overseas revenue to consolidated revenue decreasing to 50.2% [28] Company Strategy and Development Direction - The company aims to continue improving profitability and efficiency across all business segments [4][5] - There is an expectation for steady growth in revenue and operating profit in the Defense & Space Systems and Semiconductor & Device segments [20][29] Management's Comments on Operating Environment and Future Outlook - Management noted the impact of a weaker yen and ongoing efforts to improve profitability and efficiency [3][4] - The company anticipates challenges in the FA Systems business but expects demand for medium- to large-sized controllers and servers to remain weak for the rest of the fiscal year [29][30] Other Important Information - The increase in SG&A expenses was attributed to currency translation effects, personnel expenses, and R&D investments [11] - Total equity increased by JPY 177.1 billion from the end of the previous fiscal year, largely due to a JPY 248 billion increase in net profit [15] Q&A Session Summary Question: What are the expectations for the Defense & Space Systems segment? - Management expects orders, revenue, and operating profit to exceed the previous year's levels, with a steady increase anticipated going forward [20] Question: How is the company addressing the challenges in the FA Systems business? - The company is focusing on price and cost improvements to support performance in the FA Systems business [23] Question: What is the outlook for the Semiconductor & Device segment? - While demand in major markets is stagnating, the company sees solid demand for optical devices for communication, which is expected to support operating profit despite a revenue decline [27]

CONSOLIDATED FINANCIAL RESULTS | --- | --- | |-----------------------------------------------|-------| | | | | Consolidated Financial Results Briefing | | | for the First Quarter of Fiscal 2025 | | | | | | MITSUBISHI ELECTRIC CORPORATION July 31, 2024 | | Contents 2. Q1 FY25 Financial Results P4 3. FY25 Forecast P16 4. Supplementary Materials P18 4-1. Revenue and Operating Profit by Segment P19 4-2. Revenue and Operating Profit by Segment (Forecast) 4-3. Order Trends of Mass Production Businesses 1. .. 1 Ke ...

Financial Data and Key Indicator Changes - Revenue for Q1 2025 was ¥1,286.4 billion, an increase of ¥66.1 billion year-on-year, marking the fourth consecutive year of record high revenue for the first quarter, primarily driven by the infrastructure segment and the weaker yen [2][8] - Operating profit decreased by ¥2.3 billion year-on-year to ¥58.6 billion, with the operating profit ratio declining by 0.4 points to 4.6% [8] - The cost ratio improved by 0.1 points year-on-year to 71% due to foreign exchange rate improvements, although this was offset by product mix and rising costs [3] Business Line Data and Key Indicator Changes - In the automotive equipment business, revenue and operating profit increased year-on-year, with strong new car sales in most regions except Japan [5] - The infrastructure segment saw increases in orders, revenue, and operating profit, particularly in public utility systems and energy systems [10] - The life segment experienced increased revenue but a decrease in operating profit, with demand for home air conditioners sluggish in Europe but strong in Japan and Asia [5] - The FA systems business faced a decline in both revenue and profit due to stagnation in demand for lithium-ion batteries and decarbonization-related fuels [18] Market Data and Key Indicator Changes - Revenue in overseas markets increased by ¥45.2 billion year-on-year to ¥730.1 billion, accounting for 56.8% of consolidated revenue, a record high [19] - Revenue in Japan increased to 104% year-on-year, but overseas revenue growth outpaced domestic growth [19] Company Strategy and Development Direction - The company revised its revenue forecast for fiscal 2025 upward by ¥90 billion to ¥5,390 billion, while maintaining the operating profit forecast at ¥400 billion [12][15] - The company plans to strengthen cost control and improve profitability and efficiency across all business segments [8][15] Management Comments on Operating Environment and Future Outlook - Management noted that the market recovery for factory automation systems is now expected to occur in Q4, three months later than previously forecasted [12] - The company anticipates steady increases in orders in the defense and space systems business despite a year-on-year decrease in orders received [18] Other Important Information - Total equity increased by ¥75.4 billion, with stockholders' equity rising to ¥3,807.2 billion, reflecting unrealized gains from currency exchange rates [4] - Cash flow from operating activities increased by ¥92.6 billion year-on-year to ¥183.8 billion, contributing to a free cash flow inflow of ¥128.1 billion [17] Q&A Session Summary Question: What is the outlook for the factory automation systems business? - The company has revised the timing of the market recovery to Q4, indicating a delay in expected demand recovery [12] Question: How is the company addressing rising procurement costs? - The company is implementing initiatives to improve profitability and efficiency, including adjustments in product pricing to reflect rising costs [15]

Bloomberg/Bloomberg via Getty Images Elevator Pitch I have a Buy investment rating for Mitsubishi Electric Corporation (OTCPK:MIELF)(OTCPK:MIELY) [6503:JP]. My earlier September 18, 2023 initiation article was focused on the company's Q1 FY 2024 (YE March 31) EBITDA miss and its mid-term ROE target. In this update, my decision is to upgrade my rating for Mitsubishi Electric from a Hold to a Buy, taking into consideration the stock's multiple positives. These positives included continued share repurchases, a ...