Japan Specialist

Mark Chadwick

Thematic (Sector/Industry)

<ul>
<li>OVERSEAS.  SPX sees Red on Friday to  close -2.9%WoW as PCE Deflator heats up; Reality check for peak inflation camp; US 2Yr Yield highest since 2007</li>
<li>JAPAN. NKY Futs -0.4% vs Cash; USDJPY 136.5 on strong USD;  BOJ Gov designate Ueda to follow Kuroda path - for now; Jan Core infl 4.2%; Fujitec: 3 directors booted </li>
<li>DAILY NUGGET. Tale of two Markets: Bearish US Equities but Constructive Japan Equities.  When the data changes..</li>
</ul>


OVERSEAS.  SPX sees Red on Friday to  close -2.9%WoW as PCE Deflator heats up; Reality check for peak inflation camp; US 2Yr Yield highest since 2007
JAPAN. NKY Futs -0.4% vs Cash; USDJPY 136.5 on strong USD;  BOJ Gov designate Ueda to follow Kuroda path - for now; Jan Core infl 4.2%; Fujitec: 3 directors booted 
DAILY NUGGET. Tale of two Markets: Bearish US Equities but Constructive Japan Equities.  When the data changes..


Good Morning Japan |REALITY CHECK-Sticky Inflation! Bearish US/Bullish Japan; Win for Japan Activism

Senior Technology Analyst, Japanese Equities, LightStream Research

Scott Foster

Senior Technology Analyst, Japanese Equities

Long-Short Analysis on Japan, Asia and the World

LightStream Research

LightStream conducts quantitatively rigorous and data-driven analysis with a focus on Japan and Asia.

We consistently cover the Tech, Consumer and Industrial sectors, and provide ECM and Events coverage more broadly.

We supplement traditional qualitative insights from company relationships with a robust quantitative foundation that examines as much historical data as is available.
We further refine the accuracy of our insights and calls through the use of alternative data to flesh out current trends, and through a valuation framework that emphasises non-superficial peer group selection and a proper attempt to understand the metrics and changes that have driven security valuations in the past.

Equity Bottom-Up

<ul>
<li>Advantest's share price has risen by 21.5% since the beginning of January, but sales and profits are peaking and YoY comparisons are becoming increasingly difficult.</li>
<li>Competitor Teradyne's results and guidance give an indication of potential near-term risk, which could be more than 20%. </li>
<li>Visibility is deteriorating and the longer-term outlook uncertain. We doubt the share price can hold up as profits decline. </li>
</ul>


Advantest's share price has risen by 21.5% since the beginning of January, but sales and profits are peaking and YoY comparisons are becoming increasingly difficult.
Competitor Teradyne's results and guidance give an indication of potential near-term risk, which could be more than 20%. 
Visibility is deteriorating and the longer-term outlook uncertain. We doubt the share price can hold up as profits decline. 


IPOs and Catalysts/Events, Global Equity Research Ltd

Arun George

IPOs and Catalysts/Events

Uncompromised, Independent, Conflict-Free Research

Global Equity Research Ltd

Global Equity Research was started in 2017 by a group of experienced research professionals. It was founded on a passionate belief in the importance and the need for uncompromised, independent, conflict-free research. We aim to provide differentiated and actionable primary and bottom up fundamental research.

<ul>
<li>
<a href="https://www.smartkarma.com/entities/pentamaster-corp-bhd" target="_blank" data-smartkarma-citation="entities:15302:1" rel="noopener">Pentamaster Corp (PENT MK)</a> specialises in the manufacturing of automated testing equipment (ATE segment) and the provision of factory automated solutions (FAS segment). </li>
<li>Pentamaster's solid track record, exposure to structural trends (electric vehicles), profitability, cash generation and healthy balance sheet are attractive. The shares are up 12.9% YTD.</li>
<li>However, the shares reflect this story and the valuation looks full compared to peers and historical multiples. We like the fundamentals and would be buyers of any prolonged weakness.</li>
</ul>



Pentamaster Corp (PENT MK) specialises in the manufacturing of automated testing equipment (ATE segment) and the provision of factory automated solutions (FAS segment). 
Pentamaster's solid track record, exposure to structural trends (electric vehicles), profitability, cash generation and healthy balance sheet are attractive. The shares are up 12.9% YTD.
However, the shares reflect this story and the valuation looks full compared to peers and historical multiples. We like the fundamentals and would be buyers of any prolonged weakness.


Pentamaster Corp (PENT MK): Good Story, at What Price?

Technical Analyst, Vermilion Research

Joe Jasper

Technical Analyst

Technical and Quantitative Research

Vermilion Research

Vermilion’s objective is to deliver timely, actionable, and unique technical research to professional investors through the application of our various technical indicators.

Our research strategists seek to highlight securities which we believe are at major inflection points, based on our various technical and quantitative indicators, and offer asymmetric risk/return profiles. Our unique research methodology, centered on relative strength, enables our strategists to deliver superior investment recommendations.

Our process begins by organizing the universe of actively traded stocks into discrete sectors, then into industry groups. We then apply our technical and quantitative tools to identify developing price trends. Once attractive trends are identified within a selected sector or group, we screen for individual stocks which we believe offer the best risk/reward profile. We provide a historical perspective that often reveals, through our long-term charts, how price patterns often repeat themselves over time.

Technical Analysis

Taiwan Stock Exchange Weighted Index / Technical Analysis

<ul>
<li>The bear market rally that we have discussed since our Sept. 29 Int'l Compass has managed to surpass our price targets, which were YTD downtrends on the ACWX-US and EFA-US.</li>
<li>As a result of these bullish reversals and breakdowns on the US dollar (DXY) and 10-year Treasury yield, we are upgrading our outlook to neutral.</li>
<li>Buy ideas on a pullback in: Consumer Discretionary, Energy, and Technology/Tech Services</li>
</ul>


The bear market rally that we have discussed since our Sept. 29 Int'l Compass has managed to surpass our price targets, which were YTD downtrends on the ACWX-US and EFA-US.
As a result of these bullish reversals and breakdowns on the US dollar (DXY) and 10-year Treasury yield, we are upgrading our outlook to neutral.
Buy ideas on a pullback in: Consumer Discretionary, Energy, and Technology/Tech Services


Bullish Reversals Continue: TAIEX, KOSPI, AEX, Hang Seng, CSI 300. Buy Cyclicals/Growth on Pullbacks

Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<ul>
<li>Given recent corporate events in S-REIT land, there could be some considerable money to be allocated to the sector near-term</li>
<li>
<a href="https://www.smartkarma.com/entities/alibaba-group-holding-ltd" target="_blank" data-smartkarma-citation="entities:787:1" rel="noopener">Alibaba (ADR) (BABA US)</a> / <a href="https://www.smartkarma.com/entities/alibaba-group" target="_blank" data-smartkarma-citation="entities:28434:1" rel="noopener">Alibaba Group (9988 HK)</a> issued an announcement it would pursue a primary listing on the HKEX. This will make BABA Southbound-eligible</li>
<li>At 0.81x newly-lowered book value, <a href="https://www.smartkarma.com/entities/australian-unity-office-fund" target="_blank" data-smartkarma-citation="entities:24077:1" rel="noopener">Australian Unity Office Fund (AOF AU)</a> is trading at a relatively low multiple. </li>
</ul>


Given recent corporate events in S-REIT land, there could be some considerable money to be allocated to the sector near-term

Alibaba (ADR) (BABA US) / Alibaba Group (9988 HK) issued an announcement it would pursue a primary listing on the HKEX. This will make BABA Southbound-eligible
At 0.81x newly-lowered book value, Australian Unity Office Fund (AOF AU) is trading at a relatively low multiple. 


Last Week in Event SPACE: Mapletree, Alibaba, Australian Unity Office

Japan

ADVANTEST CORPORATION produces semiconductor testing devices and electronic measuring instruments.  The Company's products include large-scale integration (LSI) test systems, memory test systems, dynamic test handlers, network analyzers, electronic meters, optical testing devices, and signal sources.

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Advantest Corp (6857 JP)

Good Morning Japan |REALITY CHECK-Sticky Inflation! Bearish US/Bullish Japan; Win for Japan Activism

US hardlanding narrative strengthening; Kishida approval up; BOJ Gov designate Ueda to follow Kuroda path - for now; Japan Jan Core inflation ...

Mark Chadwick

Advantest (6857): Sell into the Rebound

The share price has risen along with a strong Q3 and firm 4Q guidance, but sales and profits are headed down and the timing and extent of cyclical...

Scott Foster

Pentamaster Corp (PENT MK): Good Story, at What Price?

The shares have had a strong run and the valuation looks full compared to peers and historical multiples. We like the fundamentals and would be...

Arun George

Bullish Reversals Continue: TAIEX, KOSPI, AEX, Hang Seng, CSI 300. Buy Cyclicals/Growth on Pullbacks

Bullish reversals: Taiwan $TAIEX, Korea $KOSPI, Netherlands' $AEX reversing YTD downtrends, while Hang Seng $HSI and China's CSI 300 are reversing...

Vermilion Research

Last Week in Event SPACE: Mapletree, Alibaba, Australian Unity Office

The weekend is here! Pour yourself a coffee, grab a comfortable seat, and sift through a brief summary of insights on various events discussed...

David Blennerhassett

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