Stock market today: S&P 500 drops for fifth day as focus shifts to Powell’s speech
Morgan Stanley (NYSE:MS) initiated coverage on Nissui Corp (1332:JP) Tuesday with an overweight rating and a price target of JPY1,020.00, citing the company’s transformation from a seafood company to a global processed food company.
The firm noted Nissui’s shifting revenue structure, with the operating profit weighting for food business increasing to 69% for fiscal year ending March 2025, up from 44% in fiscal year 2020, while marine products declined to approximately 20% from 40% during the same period.
Morgan Stanley attributed the growth in food revenues to expansion in Europe and North America, along with improved ability to pass higher costs to customers, which strengthens Nissui’s resilience against price fluctuations compared to other global seafood producers.
For fiscal year ending March 2026, Morgan Stanley expects Nissui to achieve a third consecutive operating profit high, driven by improved profitability in aquaculture due to lower feed prices and a turnaround in marine products following structural reforms at loss-making subsidiaries in North and South America.
While the firm expects Nissui’s rapidly growing food business to level off amid high raw material prices, US tariff impact, and increased capital investment, it believes the company can sustain approximately 6% profit margin due to price hikes implemented to address high costs.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.