1016 GMT - Nomura Research Institute's planned divestiture of its overseas industrial IT business is a reasonable move, as the losses in that unit appear largely structural, Morningstar analyst Makoto Naito says in a note. Following the restructuring, he expects the low-margin overseas revenue mix to shrink, allowing total operating margin to trend higher. Naito remains confident in the company's long-term margin expansion, citing resilience in its domestic financial IT segment. He trims his fiscal-year estimates to reflect an overseas slump, but raises his projection for FY 2029 operating profit margin, given management's willingness to exit unprofitable businesses. Morningstar maintains its fair value estimate at Y6,200, but adds that shares are undervalued as the market is underappreciating the recovery runway. The stock closed at Y4,287.00. (jason.chau@wsj.com)

(END) Dow Jones Newswires

February 04, 2026 05:16 ET (10:16 GMT)

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