[gazonk]

- who else has the necessary expertise in manufacturing multi-colored products?

[Aristophanes]

- who else has the necessary expertise in manufacturing multi-colored products?

MAMIYA

[Kunzite]

'blad, also, with their yellow/red/blue cameras...

[monochrome]

Aren't these two statements at odds with each other, rather than the second being a "furthermore"?

Compliance officers review reports to ensure proper use of qualifying language, so that nothing is stated as a certainty. The legal definition of improper language is "puffery," i.e. using overly optimistic projections or positively emottional adjectives and adverbs.

Quality of writing refers to insightful, rationally-supported points and conclusions. Referring to an "Exit Strategy" for Pentax, without referencing either prior work or supporting the reason an exit strategy is needed or assumed is, in this reader's opinion, "poor" research writing - not up to the London standard.

[monochrome]

Havng read the "Note" (this is a brief note, not a 70-page Research Report) with some care I make the following observations regarding the Pentax digital camera entries.

1. Context
   1. These are the analyst "takeaways," not the spoken policy of Hoya revealed at the Q1 results briefing.
2. Business Conditions: Digital Cameras
   1. Hoya is concerned about a compact digital inventory adjustment, although it seems to expect that demand for interchangeable lens to expand. . . . inventory build in distribution channels in Europe and North America . . . mid-tier makers have revised downward production plans . . . Pentax plans to release a mirrorless camera under the Pentax brand that is distinct . . . "
      1. My Comment: Digital Camera is a fragmented product and manufacturer market, with some lines growing and others declining. The developed-markets recession plays a significant part in Hoya's plans for Pentax - they will make business decisions based on current and expected future conditions and may not yet have firm plans for Pentax.
3. Investment Strategy
   1. Analyst characterises Hoya's business model thus: "Hoya's main products command impressive shares of global markets and margins are high," then lists non-camera share ranges as 10% - 90%, depending on product, implying those are acceptable. "Management policy is consistent in its pursuit of high market share and high margins, and the company is highly regarded by the equity market
      1. My comment: The analyst does not define what Hoya considers high market share nor high margins, but Canon and Nikon would seem to look more like a digital camera division that would fit Hoya's business model. Hoya COULD "pursue high market share and high margins" as an outcome for Pentax if it values the brand enough!!
4. Risks
   1. The analyst seems to assume that Hoya plans to exit the digital camera business; the analyst refers to upside and downside risks realted to the timing and value of the {apparently certain} sale of Pentax.
      1. My Comment: If the analyst has correctly characterized Hoya's business model, the current market conditions and the future developed-markets economies, I believe the analyst MUST conclude Hoya should either actively increase Pentax market share and profit margin or sell Pentax and redeploy the capital elsewhere. That doesn't mean the analyst knows Hoya WILL sell Pentax, but (he) beleives they SHOULD so do. However, the analyst does not KNOW Hoya's plans for Pentax (see above).

This is what analysts do - they tell their readers what they think a company will/should do, what they think the results of such an action could be, and what would happen to the stock price if/when the action occurs.

I'll leave it to you to draw your conclusions.

[glanglois]

monochrome: Thanks. That's how I read it but apparently did not convey those thoughts well enough.

In particular, I failed to take into account the possibility of a very big shift for Pentax, into a unit with high margins and much higher (than current) market share. The analyst does not mention that possibility although it cannot be entirely discounted.

I dimly recall some company, perhaps Hoya, describing a goal of 10% market share in a few years. Whether that's large enough for them in the long term is not clear.

I still think that the Pentax division in the immediate future (next few years) is:

Low margin
Low market share
Consumer-oriented (those fickle consumers!)
In a very fast paced, competitive market (lots of work and investment to keep up).

If Hoya are convinced that they can change the first the first two, anything can happen. But they certainly cannot change the market as a whole.

Thanks again.

[Kunzite]

monochrome, good analysis
I can't help but think the author doesn't believe that Pentax cannot "succeed" if they're not playing Canikon's game, so Hoya must sell them. I bet, though, that Hoya would be satisfied by a nice profit margin... and so it seems, as they're integrating the now profitable Pentax tighter and tighter in their structures.
I'm also sceptical about Hoya keeping the secret about their (supposed) EVIL plans, but he knows for sure they will release such a camera... how?

IMHO, those two points are just opinions, far from facts. But we'll still discuss to whom Pentax will be sold, and we'll be terrible disappointed if we won't see any EVIL at Photokina

[Nass]

"better than expected terms for the sale of the Pentax camera operations"

I think Nikon

[Quicksand]

Hoya does not like low margins, small market share, and small profits for a lot of work.

Yeah, me neither.

[Angevinn]

Hey Uccemebug,

I don't believe Hoya went to Citi, but somebody did (probably the company involved in negotiations to purchase the Pentax Digital Imaging Division, that is one of my reasons for suspecting Kodak. Kodak and Citi are both stateside. Kodak is a shrewd company with its business proceedings, not so much on execution and follow through. What I have seen of Kodak is that it survives a lot on litgation and intellectual properties.

Kodak has had successful lawsuits against Sony, Samsung, Sun Micro Systems and I believe Nikon and Canon as well. Kodak's Porta film was great. It's a T-Grain based color negative formulation. I used Porta a lot in 35mm and 120 when I shot portraits. That's awhile back; I used to develop my own film and print also.

I see your point and agree with you on Hitachi. Hitachi is the parent company of Epson. Epson did release a Leica M clone, the R-(something) that was really awesome but I believe it was only sold in Japan. It's a shame, it was a great camera. I thought about purchasing one a few years ago but passed on it. Hitachi does manufacture imaging sensors also. The Hitachi-Epson group would be a much better fit than Kodak.

I find Kodak very disappointing. In 2009 Kodak closed its CMOS sensor division to focus soley on CCD sensors.

Image Sensors World: Layoffs, Layoffs

Kodak had only acquired that division in 2004 or 2006 if I remember correctly. Whether we like it or not (I do), video is here to stay in DSLR's. You can see many great examples at Vimeo.com. It's like Flickr for but for short videos instead of photos.

Nikon and Canon are both making video standard on all of their upcoming models. Pentax has it on the K-X and K-7, etc. Video and LiveView are not possible with CCD sensors. The sensor has to be CMOS. With Sony being stubborn about keeping CCD in its FullFrame Cameras (rumors of early 2011 of two new CCD Sony FullFrame DSLRs) and other problems at Sony, no wonder no one wants to buy their cameras.

Leica's own Stefan Daniel is on record as saying he would like the eventual replacement of the FullFrame M9 to have Video or Live View. It read as subtle hint at dropping the Kodak CCD sensor that is currently in the M9 in the next model.

Getting back to Kodak, they are a very badly managed company. 110 film was garbage, Disc Film was garbage, APS-C Advantix = more garbage, plus it was Kodak that was pushing the original 4/3 format. The whole 4/3 format to me is a huge joke and a big waste of money. The only companies that fell for 4/3 were Panasonic and Olympus. Both of whom are rumored to be working on larger format cameras. When Kodak first announced the 4/3 format it trumpeted that a large number of companies were going to join the 4/3 group. No one really did. Kodak wasn't even ready at the retail level with the photo kiosks to print pictures from the 4/3 cameras!

A coworker of mine recently bought a new Kodak point and shoot digital camera. She knows I'm into photography so she brought it to work to show me and get my opinion on it. It looks nice, it has a Schneider lens, but when I saw the pictures she had taken with it I was blown away. The pictures were horrible! The pictures from the Kodak had extremely bad chromatic aberration and the lens was not that sharp. My old Sony DSC-V1 digital point and shoot completely stomps the Kodak into the ground. My old Nikon Coolpix 8400 point and shoot is even better.

I like Pentax, I just want to see Pentax grow and keep delivering great products. I really want a FullFrame K-Mount DSLR from Pentax, but with the rumors lately I don't see that happening. I am most likely heading back to Nikon. Regardless, I don't want to see Pentax become a victim of Kodak's incompetence. The Hitachi/Epson group would be a much better fit. Even Fuji! Fuji is somewhat aligned with Nikon though.

Time will tell, Photokina is next month! I wish Pentax the best and truly believe Hoya would be best served by holding onto Pentax. R&D from the camera group can be shared with the medical group, etc. Selling the Pentax camera group is too short sighted. Rome wasn't built in a day. Pentax was badly managed for a number of years. Hoya has the management skill and resources to breath new life into Pentax and make it successful again.

So you're guessing that Hoya went to Citi directly and bought this analysis? And that it wasn't someone else attempting to .. I dunno, manipulate Hoya's stock price? Discredit the company? Or do any of the countless other things that they use investment bank research for?



It wouldn't be the end of the world. Certainly less ludicrous and disastrous than a near-bankrupt and non-participatory JVC as per last year's commentary.

It seems to me that what Pentax needs in an owner and/or partner is distribution in the consumer electronics field, someone who's interested in cameras. Perhaps Hitachi?



Porta's great, I shoot it all the time.

[falconeye]

Per the purported Citigroup analysis, Hoya will sell Pentax as soon as possible.

That's not in this document.

In the 2011's risk forecast, it says that Hoya may sell Pentax sooner and at a higher price -- or later and at a lower price. Which means that selling Pentax is "an option" and nothing beyond that is known. And this is what we always knew.

[Kunzite]

And that's why I wouldn't trust them too much. Pentax is going upwards, why "later and at a lower price"?

[goubejp]

That's not in this document.

In the 2011's risk forecast, it says that Hoya may sell Pentax sooner and at a higher price -- or later and at a lower price. Which means that selling Pentax is "an option" and nothing beyond that is known. And this is what we always knew.

The new presentation of the document in which Pentax camera division does not appear anymore as a business unit but is merged into a larger "information system division" shows us that there is no plan to sell Pentax in a near future anymore. To sell a division you should make it a business unit so that the buyer has a clear idea of the health and revenues of what he buys. The change of presentation of the document reflects this change is strategy.

[kytra]

I think that maybe Samsung will buy Pentax. They are the biggest consumer electronics maker in the world so the Pentax expertise and brand could give the necessary weight to their camera business. Remains to be seen if they want to develop Pentax into the pro-segment but I think that with the Samsung money and global network that would be possible and Pentax would compete again with the Canikons.

[lurchlarson]

I think that maybe Samsung will buy Pentax. They are the biggest consumer electronics maker in the world so the Pentax expertise and brand could give the necessary weight to their camera business. Remains to be seen if they want to develop Pentax into the pro-segment but I think that with the Samsung money and global network that would be possible and Pentax would compete again with the Canikons.

If anyone does buy Pentax I too would guess samsung. They've already worked with Pentax before, why not own them this time around? The gx20 was essentially a k20d with a different UI.

Plus then Pentax has direct access to samsung sensors.