AllAnalyst Report
logoMorningstarAugust 04, 2022

Nomura Holdings, Inc.: Japanese Brokers Report Weak Quarter on Sluggish Market; Nomura Looks Undervalued

Symbols
NMR
Sector(s)
Financial Services
Rating
Current Price
$3.62
Fair Value
Economic Moat
Stewardship
Summary

Nomura is Japan’s largest broker, about twice the size of rival Daiwa Securities and roughly three times the size of the securities units of the three megabanks. It is also the largest asset-management company in Japan, with a similar size differential compared with its rivals. Despite its topnotch brand name in retail broking and asset management in Japan, Nomura has struggled to compete effectively in the institutional securities business against larger global rivals. In 2008, Nomura bought European and Asian assets of the failed Lehman Brothers, which led to a sharply higher cost base but did not provide commensurate revenue. Nomura has reduced the scale of these businesses but maintains its ambition to compete globally with the top players.

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Analyst Profile

Michael Makdad

Equity Analyst
Michael Makdad is a senior equity analyst for Ibbotson Associates Japan, Inc., a wholly owned subsidiary of Morningstar, Inc. He covers financial and real estate firms.Before joining Morningstar in 2018, Makdad worked in equity and credit research in Tokyo and Hong Kong since 2005 for Lehman Brothers, Nomura, Moody’s, and Haitong Securities. He worked as a sector analyst and in roles where he supervised the research product content and presentation for other analysts across the Asia region.Makdad holds bachelor’s and master’s degrees in business administration from Washington University in St. Louis. He also holds the Chartered Financial Analyst® designation.