Telecom Engineering: P/E Unlikely to Rise Amid Recognition of Lower Mobile Order Momentum Ahead

Research evidence excerpt

Telecom Engineering: P/E Unlikely to Rise Amid Recognition of Lower Mobile Order Momentum Ahead

Idea

June 22, 2026 06:51 AM GMT

Morgan Stanley MUFG Securities Co., Ltd.+MConstruction | Japan Ryo Yagi

Equity Analyst

Telecom Engineering: P/E Ryo.Yagi@morganstanleymufg.com +81 3 6836-8938

Unlikely to Rise Amid

Recognition of Lower Mobile Construction

Japan

Industry View AttractiveOrder Momentum Ahead

What’s Changed

COMSYS and EXEO do not look undervalued based on P/E, COMSYSPrice TargetHoldings (1721.T) From¥4,050 To¥4,100

which we think is unlikely to rise amid lower mobile order

EXEO Group (1951.T) From To

momentum (correlated with P/E). Price Target ¥2,350 ¥2,400

Key Takeaways

Deceleration of mobile order momentum (correlated to P/E) to come into focus

for COMSYS and EXEO.

F3/27 mobile order plans call for slowdown in momentum at both COMSYS and

EXEO (EXEO guides for YoY decline).

Mainstay carrier & IT businesses not seeing supply-demand tightness driven by

capacity constraints, which electrical & air-conditioning fields are experiencing.

As such, amid stronger focus on decelerating mobile order momentum, we think

grounds for P/Es to rise above historical averages are lacking for both firms.

Stock selection: COMSYS UW, EXEO EW. Business conditions are similar for both,

and with firm earnings on solid mobile orders likely priced in we think non-carrier

businesses will be in focus for earnings growth ahead; our respective ratings reflect

gaps in profit growth from F3/27 (we forecast OP CAGR (3yr) from F3/27 of +4.1%

for COMSYS, vs. +5.5% for EXEO).

COMSYS: We see prospects of earnings growth aided by rising sales in IT solutions

and social systems, but the stock is not undervalued. Share price gains since Oct