West Japan Railway Company Report

Japan’s comprehensive national railway routes are dominated by six former national railway operators of which West Japan Railway, or JRW, ranks as the third largest. JRW provides both conventional and high-speed bullet railway, or Shinkansen, along the routes in and linked to the western section of Japan. As its service area tends to have smaller urban centers relative to the east, JRW has found it more challenging than its larger peers to produce excess returns. Despite decent recurring cash flows, JRW’s inability to consistently outearn its cost of capital leaves us with a no-moat rating on the company.