Sanrio Co Ltd (8136)

Source: Sanrio Co Ltd website

The allure of Hello Kitty cannot be denied as it captures the hearts of young and old, male and female alike and it transcends across generations. Sanrio doesn't need any introductions and the company is making new changes to its strategies which I believe would be beneficial in the long term. It is changing its business model as it moves away from product licensing to space licensing. Increasingly it is going to manufacture its own products rather than through licensing which is a good move, as we can all remember what happened to Pierre Cardin which ultimately undermined its brand value. 

However the latest earnings release did not hit the mark as sales in North American and Europe were blah, domestic sales went on a plateau and Asian sales while good did not lift the company. That surprised me as Sanrio is celebrating its 40th year anniversary this year and yet it did not do wonders for its sales. Is it because there are so many new characters introduced every year, that we are spoilt for choice and may choose to spend on merchandise based on new characters instead? 

That could be why it has swopped its focus as it licenses its characters to corporations such as Singpost (Hello Kitty stamps), EVA Air (Hello Kitty Jet) and the list goes on. Although Sanrio bought Mr Men and Little Miss characters in 2011, I don't really see much going on and I find it a pity as I remember these characters were all the rage when I was younger. I am glad they didn't change the look of these characters unlike Care Bears and Little Pony which I can't identify as they are so much slimmer now! 

Being vested in this stock for a few months, we are regretting that we didn't sell it off earlier when we were in profit. This is just one of the lessons that we have been learning, which is to trade stocks regardless of how much future potential upside blah blah that you think it has, it's far better to have the moolah in your pocket.

I'm a realist that way and with the turbulent markets, we've bought and sold the same stock twice in a few months and made $$$ both times, which is a far better strategy than just plainly holding on to it! I also wonder at times whether it's because I'm female and late to the investment game so my opinions are discounted when it comes to decision making. However, I've been right on so many counts that it's getting difficult for ACCICB to ignore my views. It's probably time to divest Sanrio now as I think things are likely to only get better next year.


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