"Time for a Change at Canon?" -Barons

[awinphoto]

In fact it isn't even a case of the company earning less profit. It's a case of increasing profits by less than they had anticipated.

In the world of finance, growing by less than anticipated is still very bad.  Look at Apple - despite selling 28% more iPhones and 84% more iPads (year-over-year) and a 23% increase in revenue which beat Apple's own predictions, those gains still fell short of analysts' expectations of the most recent quarterly report, and their stock has dropped 6.4% over the past week.  That translates to a market cap loss of more than $35 billion dollars (which is nearly equal in size to the entire Canon, Inc. valuation!).

Then the question has to be, if we know or assume it is the office products and P&S that are killing canon and they are making it up and then some with DSLR's, would it be worth while shutting them down or scaling them back and putting more money and resources in the DSLR market since that is their bread and butter... Nikon has been a one trick pony for decades, why cant canon...

[Neeneko]

I find this a nearly startling characterization of the new Canon M. A lackluster clone? I'll bet a 1DX to your little Powershot that Sony, Olympus, Panasonic, Samsung, Fuju and even Nikon are not singing that song. If you want to say it's lackluster, you'd better bring some facts. Also, what's your basis for saying the primary target market is "new customers"?

It is pretty much like every other mirrorless entry right now.  Nothing really differentiates it other then having fewer lenses available for it's new mount and, of course, Canon's name associated with it.. which in the mirrorless space isn't worth much since they are just entering.

Suddenly, there's a simple little camera that is compatible with every EOS lens we already have. That's called a major competitive advantage. How do you get that with Sony? Olympus?

Ahm.  Yes.  Adapters exist for putting EF lenses on those bodies already.

While somehow you see this as "lackluster," competitors see this as Canon leveraging their market dominance, and you better believe they don't see it as lackluster. I also see it as Canon's first step down the road to totally eliminating the mirror-based DSLR. If I were working the camera floor at Best Buy, I'd be overjoyed with the Canon M. What a great alternative to offer buyers!

They might fear Canon's marketing department and resources, so yes, their dominance might play in... but for the moment they are just a late player to an emerging market with a product essentially identical to existing ones.  It could pan out any number of ways, but right now it kinda feels like a 'too little, too late'.

[unfocused]

In fact it isn't even a case of the company earning less profit. It's a case of increasing profits by less than they had anticipated.

In the world of finance, growing by less than anticipated is still very bad.  Look at Apple - despite selling 28% more iPhones and 84% more iPads (year-over-year) and a 23% increase in revenue which beat Apple's own predictions, those gains still fell short of analysts' expectations of the most recent quarterly report, and their stock has dropped 6.4% over the past week.  That translates to a market cap loss of more than $35 billion dollars (which is nearly equal in size to the entire Canon, Inc. valuation!).

Yes, I understand that. But, there is a difference between under-performance due to management weaknesses and under-performance due to external market conditions. The Barron's columnist is trying to make the case that the current management is at fault, while other analysts are looking at Canon's numbers and viewing them as indicative of what is happening in the entire sector. They are basically saying: "if Canon is having problems, it is going to be worse for other companies in the same sector."

The Barron's columnist would replace the top executive at Canon because Americans and Europeans have screwed up their respective economies. That's a non-sequitur.

[Daniel Flather]

...quality product...long-term success.

+1

[mystic_theory]

Yes, I understand that. But, there is a difference between under-performance due to management weaknesses and under-performance due to external market conditions. The Barron's columnist is trying to make the case that the current management is at fault, while other analysts are looking at Canon's numbers and viewing them as indicative of what is happening in the entire sector. They are basically saying: "if Canon is having problems, it is going to be worse for other companies in the same sector."

The Barron's columnist would replace the top executive at Canon because Americans and Europeans have screwed up their respective economies. That's a non-sequitur.

Since I trust the market for financial matters more than bloggers, I went to Google finance and compared the performance of Canon stock (TYO:7751) with Nikon stock (TYO:7731): year to date Canon lost 27.57% while Nikon gained 22.80%. I guess that's enough to judge the respective managements and products. All the rest is bla bla bla...

[paul13walnut5]

Since I trust the market for financial matters more than bloggers, I went to Google finance and compared the performance of Canon stock (TYO:7751) with Nikon stock (TYO:7731): year to date Canon lost 27.57% while Nikon gained 22.80%. I guess that's enough to judge the respective managements and products. All the rest is bla bla bla...

Both Canon and Nikon are recovering from the devastating effects of tsunamis in Japan and Indonesia.  It has been a volatile couple of years for both companies and is likely to remain so as the effects of lost production facilites and investment in new ones continues to be felt.   This is the greater context, DXO mark and some bloggers will probably have some effect, but largely against the greater adversities I think it is bla bla bla

[mystic_theory]

Since I trust the market for financial matters more than bloggers, I went to Google finance and compared the performance of Canon stock (TYO:7751) with Nikon stock (TYO:7731): year to date Canon lost 27.57% while Nikon gained 22.80%. I guess that's enough to judge the respective managements and products. All the rest is bla bla bla...

Both Canon and Nikon are recovering from the devastating effects of tsunamis in Japan and Indonesia.  It has been a volatile couple of years for both companies and is likely to remain so as the effects of lost production facilites and investment in new ones continues to be felt.   This is the greater context, DXO mark and some bloggers will probably have some effect, but largely against the greater adversities I think it is bla bla bla

This is the "beauty" of forums and blogs: one doesn't have to be smart or even just to understand what others wrote; it's enough if one writes something, anything, and all will be fine.

Now I elaborate: I know all that you wrote, but did you realize that the performance of Nikon is +22.80% and not -22.80%?
It's not "recovering", it's doing quite well indeed in this adverse market. The opposite is true for Canon.
If you moreover want to see the effect of any event on the stock price further in the past, just again look at both charts (TYO:7751 and TYO:7731) on Google finance: you'd be amazed to see how analysts quantify in terms of price change all the bla bla bla; most of it amounts to zero.

[distant.star]

.
Basing a corporate health assessment on two quarters is like making a judgment on World War II the day after Pearl Harbor.

It may be misleading.

Since I trust the market for financial matters more than bloggers, I went to Google finance and compared the performance of Canon stock (TYO:7751) with Nikon stock (TYO:7731): year to date Canon lost 27.57% while Nikon gained 22.80%. I guess that's enough to judge the respective managements and products. All the rest is bla bla bla...

[paul13walnut5]

did you realize that the performance of Nikon is +22.80% and not -22.80%?
It's not "recovering", it's doing quite well indeed in this adverse market.

Yeah I did.  And thats why I painted you a nice picture of where things had been in the last couple of years.
Things are getting better.  And thats because things were baaaaaad. 

Is it slotting into place at all?

[mystic_theory]

.
Basing a corporate health assessment on two quarters is like making a judgment on World War II the day after Pearl Harbor.

It may be misleading.

I agree that these last two quarters have been like Pearl Harbor for Canon, I just hope that the rest will go like World War II as well (at least in terms of change of course): after D800 vs 5D Mark III and t4i vs 3200D (which in theory should be compared to the t3 or a future t4), I'm afraid to see what D7100 vs 70D will look like (I'm planning to upgrade to the 70D).

[Kit.]

Since I trust the market for financial matters more than bloggers, I went to Google finance and compared the performance of Canon stock (TYO:7751) with Nikon stock (TYO:7731): year to date Canon lost 27.57% while Nikon gained 22.80%. I guess that's enough to judge the respective managements and products. All the rest is bla bla bla...

Does Nikon make office equipment?

[mystic_theory]

Does Nikon make office equipment?

No (as I'm sure you already know since you asked) they don't. Indeed comparing Canon with Nikon stocks is a little like comparing oranges with mandarines, but since Barons article is about the company as a whole and it is difficult to come up with another company more similar to Canon than Nikon to factor out market conditions, the comparison should still give a good indication on the quality of Canon management.

[ScottyP]

In my utterly meaningless capacity of O.P., I hereby declare (without any relevance) that this thread has been hijacked.
My point was about the "bleak" and perhaps not "scathing" portrait painted by the article.
Canon is not CURRENTLY competing by price:  in prices they still exceed even Nikon. 
They are not leading in "meaningless" benchmarks like Megapixels.
Their mirrorless product is what it is.
Canon may have some advantage in high-ISO with lower noise.  (GOOD!)
Canon has a lot of other products besides DSLR's which are REALLY doing poorly, and to which by comparison cameras are an area of healthy business.  Those areas (copiers, etc., ) are doing even worse than their competitors.
UNLESS, of course, they can suddenly transform the playing field with a game-changing new product(camera or otherwise), or if they can regain the jump on NIKON on DSLR tech.

The point of the article seemed to be the lack of recent innovation, the loss of market share and the lack of hope for the future.

[mystic_theory]

Well, I really hope then that at Canon besides trying to improve their copy machines and other office equipment they'll keep an eye also on DSLR cameras.

[paul13walnut5]

you'll hear it here first.

And as the 1DX reviews are saying...  the best DSLR camera in the world isn't purely about resolution.