East Japan Railway Co

9020: XTKS (JPN)

Morningstar Rating for Stocks	Fair Value	Economic Moat	Capital Allocation
	¥‎9,656.00	Vkfld	Jydmlgr

Strong Quarter for JRE but Growth Momentum Expected to Slow; Shares Fully Valued

Lorraine Tan ,

Jul 31, 2019

We maintain our fair value estimate for narrow-moat-rated East Japan Railway, or JRE, at JPY 9,500. We consider shares fully valued at current levels and think investors are better served waiting for a better entry point. Although JRE posted solid results that beat consensus estimates during the quarter, we don’t expect the growth momentum to continue through the coming quarters, given the near-term headwinds such as the impending consumption tax hike in October and negative spillover effects from the United States-China tariff war.

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