Unveiling 3 Japanese Growth Stocks With Insider Ownership Up To 35%

Japan's stock markets have recently shown mixed performance, with the Nikkei 225 Index experiencing a slight decline while the broader TOPIX Index has seen gains. This variable landscape underscores the importance of discerning investment choices, particularly in growth companies with substantial insider ownership which can indicate confidence from those closest to the company's operations and future.

Top 10 Growth Companies With High Insider Ownership In Japan

Name	Insider Ownership	Earnings Growth
SHIFT (TSE:3697)	35.4%	27.2%
Kanamic NetworkLTD (TSE:3939)	25%	28.9%
Hottolink (TSE:3680)	27%	57.3%
Medley (TSE:4480)	34%	28.8%
Micronics Japan (TSE:6871)	15.3%	39.7%
Kasumigaseki CapitalLtd (TSE:3498)	34.8%	44.6%
ExaWizards (TSE:4259)	24.8%	80.2%
Money Forward (TSE:3994)	21.4%	63.5%
Soiken Holdings (TSE:2385)	19.8%	118.4%
freee K.K (TSE:4478)	24%	82.6%

Click here to see the full list of 109 stocks from our Fast Growing Japanese Companies With High Insider Ownership screener.

Let's take a closer look at a couple of our picks from the screened companies.

Mercari

Simply Wall St Growth Rating: ★★★★☆☆

Overview: Mercari, Inc. operates a marketplace application in Japan and the United States, focusing on the buying and selling of goods, with a market capitalization of approximately ¥335.42 billion.

Operations: The company's revenue is generated from its marketplace applications active in Japan and the United States.

Insider Ownership: 36%

Mercari, a prominent Japanese growth company with substantial insider ownership, is set to achieve significant financial milestones by June 2024, forecasting revenues of JPY 190 billion and profits of JPY 12 billion. Recent strategic shifts include eliminating selling fees to enhance competitiveness in the U.S. resale market—a move that contrasts sharply with industry trends towards higher fees. Despite a highly volatile share price, Mercari's revenue and earnings growth are outpacing the Japanese market average, supported by innovative policies like hassle-free returns which could bolster consumer trust and market share.

• Click to explore a detailed breakdown of our findings in Mercari's earnings growth report.

• Insights from our recent valuation report point to the potential overvaluation of Mercari shares in the market.

TSE:4385 Earnings and Revenue Growth as at Jun 2024

Rakuten Group

Simply Wall St Growth Rating: ★★★★☆☆

Overview: Rakuten Group, Inc. operates globally, offering e-commerce, fintech, digital content, and communications services with a market capitalization of approximately ¥1.80 trillion.

Operations: The company generates revenue through its diverse operations in e-commerce, fintech, digital content, and communications.

Insider Ownership: 17.3%

Rakuten Group is poised for notable growth, with earnings expected to surge by 87.6% annually, outpacing broader market trends. Although its revenue growth of 7.4% per year is modest compared to some peers, it exceeds Japan's average market rate of 3.9%. The company's recent strategic financial activities include a substantial $1.99 billion fixed-income offering and double-digit growth projections for the fiscal year 2024, excluding its securities business affected by stock market volatility. However, a projected low return on equity of 8.8% in three years suggests potential challenges in generating shareholder value.

• Delve into the full analysis future growth report here for a deeper understanding of Rakuten Group.

• Our expertly prepared valuation report Rakuten Group implies its share price may be lower than expected.

TSE:4755 Earnings and Revenue Growth as at Jun 2024

Capcom

Simply Wall St Growth Rating: ★★★★☆☆

Overview: Capcom Co., Ltd. is a Japanese company that specializes in the planning, development, manufacturing, sale, and distribution of home video games, online games, mobile games, and arcade games globally with a market capitalization of approximately ¥1.24 trillion.

Operations: The company generates revenue from the global sales of home video games, online games, mobile games, and arcade games.

Insider Ownership: 11.5%

Capcom, a growth-oriented company with high insider ownership in Japan, shows promising financial dynamics. Its earnings have grown by 18.1% over the past year and are projected to increase at an annual rate of 8.75%. While this growth rate is modest, it still surpasses the Japanese market's average. Capcom's revenue is also expected to outpace the market with a forecasted growth of 5.8% per year compared to the market's 3.9%. The company recently announced a significant stock dividend and has maintained robust engagement through various industry conferences, underscoring its active role in sector developments.

• Take a closer look at Capcom's potential here in our earnings growth report.

• Our valuation report here indicates Capcom may be overvalued.

TSE:9697 Earnings and Revenue Growth as at Jun 2024

Turning Ideas Into Actions

• Investigate our full lineup of 109 Fast Growing Japanese Companies With High Insider Ownership right here.

• Already own these companies? Bring clarity to your investment decisions by linking up your portfolio with Simply Wall St, where you can monitor all the vital signs of your stocks effortlessly.

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Contemplating Other Strategies?

• Explore high-performing small cap companies that haven't yet garnered significant analyst attention.

• Diversify your portfolio with solid dividend payers offering reliable income streams to weather potential market turbulence.

• Find companies with promising cash flow potential yet trading below their fair value.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.The analysis only considers stock directly held by insiders. It does not include indirectly owned stock through other vehicles such as corporate and/or trust entities. All forecast revenue and earnings growth rates quoted are in terms of annualised (per annum) growth rates over 1-3 years.

Companies discussed in this article include TSE:4385 TSE:4755 and TSE:9697.

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