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  "documentTitle": "Nidec Corp. (6594 JP)",
  "authorId": "51_Muddy_Waters",
  "authorName": "Carson C. Block",
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  "presentationDate": "2016-12-13 00:00:00",
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      "text": "We value Nidec's shares at less than half of the price – JPY 4,764.",
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      "text": "EV / EBITDA: 21.5x",
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      "text": "Nidec in our view unduly promotes business opportunities with sex appeal, such as haptics (which led to a write-off), robots, drones, and LIDAR. These exciting products account for a tiny sliver of Nidec's overall business, and in our view, have received an inordinately large amount of attention from investors. Nidec's margin on sales of drone motors to Amazon.com (AMZN US) is likely to be significantly compressed once any scale is achieved.",
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      "text": "We value Nidec's shares at less than half of the price – JPY 4,764. At the current price, the implied valuation ascribed to its non-HDD businesses is approximately 21.5x EV / EBITDA. (Facebook trades at 24.9x.) Given Nidec's anemic organic growth, the seeming commoditization of many of its products, and the capital intensity of manufacturing, we can see no reason to justify a share price anywhere close to Nidec's current valuation. Unfortunately, Nidec's transparency has been decreasing over the years, and is poised to take a large step backward as the company plans to no longer file financial statements in the U.S. Unless Nidec resolves the U.S. filing and other transparency issues, we believe investors should exercise extreme caution when considering purchasing Nidec's shares.",
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      "text": "We have real corporate governance concerns about Nidec. There are indications that management is able to override internal controls. Mr. Nagamori's receipt of Nidec shares worth today approximately JPY 29.5 billion for his stakes in subsidiaries raises questions, as does the JPY 14.5 billion loan he received from the company, which was repaid a few months later by mostly selling his Nidec shares to the company. It is disconcerting that Nidec was unable to hold onto Bunsei Kure, while the company's Chief Technology Officer, Mikio Katayama, was instrumental in running Sharp into the ground.",
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