Key Performance Indicators
Ichigo aims to maximize shareholder value through a significant increase in EPS. The key performance indicators that guide our efforts are as follows:
EPS is an important metric that reflects corporate profitability for shareholders. It is used in the denominator of the price-earning ratio (PER). When a company's PER reaches a certain level, an increase in EPS becomes a key driver of share prices, thus contributing to improved shareholder value.
Net income ÷ Number of shares outstanding
ROE is a measure of profitability that calculates how effectively a company is able to generate earnings with its shareholders' equity. METI's Ito Review states that as an integral element of shareholder value creation, Japanese companies should commit to achieving an ROE of at least 8% and should strive to achieve higher levels than this minimum.
Earnings per share (EPS) ÷ Book-value per share (BPS)
ROI is a measure of profitability relative to the size of the investment. Often used for evaluating individual investments on a stand-alone basis, ROI reflects the efficiency of an investment.
Earnings attributable to an investment ÷ Amount invested
Jointly developed by the Japan Exchange Group, Tokyo Stock Exchange, and Nikkei Inc., the JPX-Nikkei Index 400 is comprised of companies that meet global standards for various matters of importance to investors, such as efficient use of capital and an investor-focused management approach. The quantitative criteria for becoming a JPX-Nikkei 400 constituent are 3-year average ROE, 3-year cumulative operating profit, and market capitalization.
Inclusion in the JPX-Nikkei 400 is a criteria for inclusion into certain index funds and can be a factor that institutional investors use to determine whether to invest in a company.
By achieving the operating profit and ROE targets, Ichigo has been selected for inclusion, and is seeking continued inclusion in the JPX-Nikkei 400.