Canon, Inc. (ADR) (NYSE:CAJ)

CAPS Rating: 3 out of 5

The Company is a manufacturer of plain paper copying machines, digital multifunction devices, laser beam printers, bubble jet printers, cameras and steppers.


Player Avatar tfcinvest (< 20) Submitted: 11/24/2010 1:35:35 AM : Outperform Start Price: $42.66 CAJ Score: -96.02

Japanese export companies would benefit from the collapse of the Japanese bond bubble and the Yen. CAJ is still a world leader in its industry and very competitive globally. It would certainly benefit from the rise of emerging market consumerism.Zheng Fang

Member Avatar heals07 (41.29) Submitted: 4/28/2011 6:27:53 PM
Recs: 0

I dont understand your analysis because the Yen is in a cyclical strengthening against all currencies. The collapse of a bond bubble would cause massive deleveraging similar to that of the United States in late 2008 to 2009. Deleveraging ads strength to the currency diluting Canon's earnings. Deleveraging causes the supply of cash to shrink as it is used to payoff principal. The economy has already been in a multi decade recession which also puts downward pressure on a currency. We have seen the IMF and the Japanese goverment attempt to stop the appreciation of the Yen. Basically in order for Canon to benefit from movements of the Yen, the Japanese economy would need to add more leverage to the system. But since you believe there will be a collapse then you should take the opposite position on the stock if its your biggest reason for investment.

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