Panasonic shares are down over 22% over the past year and shareholders who attended the Companies AGM this week are not happy.

The fall follows despite record consolidated net profit, with miscalculations involving electric vehicle batteries and heat pumps to blame.

At Panasonic’s annual general meeting in Osaka Japan this week shareholders got vocal this week and analysts are mystified as to why the stock is falling.

“The stock price is low, and I’m angry,” a woman said.

“The stock price and earnings are both lousy,” a man said.

“This company used to be great, but now its value has plummeted.”

One of the reason that the stock has a problem is their relationship with Tesla claim analysts.

Image courtesy of Nikkei Asia

According to Nikki Asia, in 2023, Panasonic set EV batteries as a top priority and designated energy-saving heat pumps and management software for supply chains as secondary priorities.

But since then the company has seen disruptions to its EV battery shipment forecast.

After Panasonic indicated plans to reduce EV battery production at domestic factories by 60% at the end of October, the company’s stock price fell to its recent lows.

President and CEO Yuki Kusumi bowed his head and said, “a PBR [price-to-book ratio] of less than 1 does not meet shareholders’ expectations. I’m truly sorry. We will increase profits and produce results.”

In June, Panasonic was overtaken in market capitalization by NEC, whose stock has risen about 80% in a year. Of Japans seven major electronics companies — excluding Toshiba, which was delisted — only Sharp currently has a lower market cap than Panasonic.

As of March 2024 the business delivered net profits of US$2.8 billion for the past year.

In Australia Panasonic is seen as a “solid” consumer electronics Company who also does well in health care and in the B2B market.

Yasuo Nakane, senior analyst at Mizuho Securities, argues that “it is important to create a system where a rise in Panasonic’s stock price serves as an incentive for employees and to create synergies between operating companies.”

Within Panasonic, Kusumi has indicated an intention to manage the group’s business with a focus on return on invested capital and give top-down directions if necessary.

In the end, the stock slump is largely due to a “lack of track record and failure to win market trust,” Nakane said.