Japan’s 5 Most Overvalued Companies - No. 2: An Extraordinary Company with an Ultra-Extraordinary Valuation

Disclaimer: The content below reflects my personal opinions for educational purposes only and is not investment advice. Do your own research and consult a licensed professional before acting on any information here.

---

Despite the US government looking hell-bent on crashing the global economy, Japan’s stock market is still partying like it’s 1989.

Therefore, I welcome you to my countdown of the five most overvalued Japanese stocks—companies whose share prices are far higher than their numbers support.

To separate hype from reality I check:

1. Forward & trailing P/E vs. peers – When a Japanese stock trades at multiples miles above its sector, investors are paying for dreams, not earnings.

2. Debt-to-equity & interest-coverage – A fortress balance sheet is nice, but hidden leverage (or the lack of recession cushions) can still magnify the fall.

3. Buzzwords vs. cash flow – If “AI-powered Industry 4.0!” headlines drown out free cash, you’ve found hype.

4. DCF sanity test – A cold shower: does a 10-year discounted-cash-flow model (3 % terminal growth) come anywhere close to today’s price?

---