Capcom Co., Ltd. (9697.T) fair value

ACCE thesis

Capcom develops and publishes the Resident Evil, Monster Hunter, Street Fighter and Devil May Cry franchises, and it runs its own catalogue of back-catalogue titles that keep selling years after launch. The advantage is the combination of owned IP with a 58.3% operating margin, which suggests the company is keeping most of the economics of each hit rather than sharing them with platform holders or outside developers. The near-term driver is the cadence of major releases across these franchises, and the 54.7% revenue growth figure points to a year in which that cadence has delivered. The stock trades at 28.4 times trailing earnings and 32.5 times forward, so the forward multiple is higher than the trailing one, meaning the market is not pricing in a simple continuation of this year's profit level. That is the question worth examining: whether the growth in the franchises is durable enough to support a multiple already above its trailing level.