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

<p>While a more cautious outlook is appropriate, as long as $77 holds (the September lows) we are constructive and would be buyers on a pullback. A move below $77 would start to get very concerning, and would leave $75 and the 200-day MA as last-ditch support. Considering the recent pullback we want to be sticking with areas that have continued to outperform in spite of recent broad market weakness. For that we look to the following leadership Sectors: <strong>Technology, Consumer Discretionary, Manufacturing, Materials, and Transportation</strong></p>

While a more cautious outlook is appropriate, as long as $77 holds (the September lows) we are constructive and would be buyers on a pullback. A move below $77 would start to get very concerning, and would leave $75 and the 200-day MA as last-ditch support. Considering the recent pullback we want to be sticking with areas that have continued to outperform in spite of recent broad market weakness. For that we look to the following leadership Sectors: Technology, Consumer Discretionary, Manufacturing, Materials, and Transportation

'Quantamental' Japan Specialist, LightStream Research

Campbell Gunn

'Quantamental' Japan Specialist

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.

Thematic (Sector/Industry)

<p style="text-align: center;"><strong>• BEST &amp; WORST •</strong></p><p>Our best and worst pairing from Monday's announcements is <a href="https://www.smartkarma.com/entities/nidec-corp" target="_blank" data-smartkarma-citation="entities:7245:1" rel="noopener">Nidec (6594 JP)</a> and <a href="https://www.smartkarma.com/entities/koei-tecmo-holdings-co-ltd" target="_blank" data-smartkarma-citation="entities:20277:1" rel="noopener">Koei Tecmo (3635 JP)</a>. </p><section class="figure"><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/167/689/original/2020-10-27_05-41-07.png?1603744887" class="editor-image img-responsive" data-smartkarma-image-id="167689"></figure></section><section class="figure"><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/167/690/original/2020-10-27_05-42-32.png?1603744992" class="editor-image img-responsive" data-smartkarma-image-id="167690"></figure><div class="content-caption">Source for all charts &amp; tables: Japan Analytics</div></section><hr><div><p style="text-align: center;"><strong>DAILY STATS</strong></p></div><hr><div><p style="text-align: center;"><strong>232Quarterly Results</strong></p></div><div><ul style="list-style-type: disc;">
<li><p><strong>Results Score:</strong> 31% Positive / 9% Neutral / 59% Negative</p></li>
<li><p><strong>Average Results Score Change:</strong> -1.9 points</p></li>
<li><p><strong>Average % Change in Revenue:</strong> -10.0% Quarter YoY / -4.8% Rolling TTM YoY </p></li>
<li><p><strong>Average Operating Profit Margin Change:</strong> -0.8ppt</p></li>
<li><p><strong>Percentage Making Quarterly Losses:</strong> 6%</p></li>
</ul></div><hr><div><p style="text-align: center;"><strong>33 Annual • 29 Interim Forecasts/Revisions</strong></p></div><div><ul style="list-style-type: disc;">
<li><p><strong>Annual Forecast/Revision Score:</strong> 39% Positive / 12% Neutral / 49% Negative</p></li>
<li><p><strong>Interim Forecast/Revision Score Change:</strong> 59% Positive / 0% Neutral / 41% Negative</p></li>
<li><p><strong>Average Forecast/Revision Score Change:</strong> +1.1 points</p></li>
</ul></div>

• BEST &amp; WORST •Our best and worst pairing from Monday's announcements is Nidec (6594 JP) and Koei Tecmo (3635 JP). Source for all charts &amp; tables: Japan AnalyticsDAILY STATS232Quarterly Results
Results Score: 31% Positive / 9% Neutral / 59% Negative
Average Results Score Change: -1.9 points
Average % Change in Revenue: -10.0% Quarter YoY / -4.8% Rolling TTM YoY 
Average Operating Profit Margin Change: -0.8ppt
Percentage Making Quarterly Losses: 6%
33 Annual • 29 Interim Forecasts/Revisions
Annual Forecast/Revision Score: 39% Positive / 12% Neutral / 49% Negative
Interim Forecast/Revision Score Change: 59% Positive / 0% Neutral / 41% Negative
Average Forecast/Revision Score Change: +1.1 points


🇯🇵 JAPAN • Results & Revisions 10/​​​​​​​​​​​​​​​​​26 Nidec, Canon, OBIC, Koei Tecmo, Nitto Denko

<p>The MSCI ACWI index (USD) is breaking out to all-time highs while the MSCI EM index (local) is breaking above its prior highs from January. This is bullish and will continue to be as long as there is an absence of breakdowns. On the other hand, Europe’s <strong>EURO STOXX 50</strong> and Japan’s <strong>TOPIX </strong>have struggled to break above resistance and their RS remains near the lows -- be selective. In addition to covering important technical levels across all markets, we highlight additional ideas in the following Sectors: <strong>Services, Communications, Industrials, </strong>and <strong>Transportation.</strong></p>

The MSCI ACWI index (USD) is breaking out to all-time highs while the MSCI EM index (local) is breaking above its prior highs from January. This is bullish and will continue to be as long as there is an absence of breakdowns. On the other hand, Europe’s EURO STOXX 50 and Japan’s TOPIX have struggled to break above resistance and their RS remains near the lows -- be selective. In addition to covering important technical levels across all markets, we highlight additional ideas in the following Sectors: Services, Communications, Industrials, and Transportation.

Global Equity Strategy: Bullish Outlook Intact

<div>
<figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/148/266/original/2020-07-28_06-42-44.png?1595886197" class="editor-image img-responsive" data-smartkarma-image-id="148266"></figure><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/148/267/original/2020-07-28_06-47-55.png?1595886499" class="editor-image img-responsive" data-smartkarma-image-id="148267"></figure><div class="content-caption">Source • Japan Analytics</div>
<p><a href="https://www.smartkarma.com/entities/koei-tecmo-holdings-co-ltd" target="_blank" data-smartkarma-citation="entities:20277:1" rel="noopener">Koei Tecmo (3635 JP)</a> - Koei Tecmo produced the most-improved Results Score among large-cap companies yesterday. Colleague <a href="https://www.smartkarma.com/profiles/mio-kato-cfa" target="_blank" data-smartkarma-citation="accounts:713" rel="noopener">Mio Kato</a>'s April Insight<a href="https://www.smartkarma.com/insights/koei-tecmo-plenty-of-headroom-to-play-with" target="_blank" data-smartkarma-citation="insights:38880" rel="noopener"> Plenty of Headroom to Play With</a> called this correctly - <em>"the strength of Sangokushi Senryaku Ban and a strong game pipeline should help the company continue to outperform significantly."</em> The shares are now Overbought, and the valuation has never been as extreme. A Results Score of 30 is 'perfection'. We would trim into any results-induced move above ¥3,500.</p>
<p style="text-align: center;"><strong>DAILY STATS</strong></p>
</div><hr><div><p style="text-align: center;"><strong>40 Quarterly Results</strong></p></div><div><ul>
<li>
<strong>Results Score:</strong> 14 Positive / 0 Neutral / 26 Negative</li>
<li>
<strong>Average Results Score Change: -</strong>3.3</li>
<li>
<strong>Average % Change in Revenue:</strong> -10.6% Quarter YoY / -3.0% Rolling TTM YoY </li>
<li>
<strong>Average Operating Profit Margin Change:</strong> -1.1ppt</li>
<li>
<strong>Percentage Making Quarterly Losses:</strong> 18%</li>
</ul></div><hr><div><p style="text-align: center;"><br><strong>19 Annual • 12 Interim Forecasts/Revisions</strong></p></div><div><ul>
<li>
<strong>Annual Forecast/Revision Score:</strong> 6 Positive / 0 Neutral / 13 Negative</li>
<li>
<strong>Interim Forecast/Revision Score Change:</strong> 2 Positive / 0 Neutral / 10 Negative</li>
<li>
<strong>Average Forecast/Revision Score Change:</strong> -11.5</li>
</ul></div>


Source • Japan Analytics
Koei Tecmo (3635 JP) - Koei Tecmo produced the most-improved Results Score among large-cap companies yesterday. Colleague Mio Kato's April Insight Plenty of Headroom to Play With called this correctly - "the strength of Sangokushi Senryaku Ban and a strong game pipeline should help the company continue to outperform significantly." The shares are now Overbought, and the valuation has never been as extreme. A Results Score of 30 is 'perfection'. We would trim into any results-induced move above ¥3,500.
DAILY STATS
40 Quarterly Results

Results Score: 14 Positive / 0 Neutral / 26 Negative

Average Results Score Change: -3.3

Average % Change in Revenue: -10.6% Quarter YoY / -3.0% Rolling TTM YoY 

Average Operating Profit Margin Change: -1.1ppt

Percentage Making Quarterly Losses: 18%
 19 Annual • 12 Interim Forecasts/Revisions

Annual Forecast/Revision Score: 6 Positive / 0 Neutral / 13 Negative

Interim Forecast/Revision Score Change: 2 Positive / 0 Neutral / 10 Negative

Average Forecast/Revision Score Change: -11.5


🇯🇵 JAPAN • Results & Revisions 27th July - Koei Tecmo, Nitto Denko, MMC, Stanley Electric, Exedy

<figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/133/748/original/2020-05-16_08-18-15.png?1589584720" class="editor-image img-responsive" data-smartkarma-image-id="133748"></figure><div class="content-caption">Source • Japan Analytics</div><p><strong>"WORSENING"</strong> - The Cabinet Office updated their Business Condition Leading Indicator for March this week, confirming the trend already apparent from our Results &amp; Revision Score data series. The correlation between the series is 0.80, with the only significant deviation occurring in 2016, Coincident conditions are assessed as "worsening" wording that is unchanged since August 2019. </p><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/133/788/original/2020-05-16_12-10-50.png?1589598664" class="editor-image img-responsive" data-smartkarma-image-id="133788"></figure><div class="content-caption">Source • Japan Analytics</div><p><strong>DECOMPOSED</strong> - Our Score is decomposed into a Results Score, an Annual Forecast/Revision Score and an Interim Forecast Revision Score.  The last two are ten-year lows; the first should join them next week. A notable limiting factor is the shortage of forecasts being made. Without this reticence, both forecast Scores would be considerably lower.</p><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/133/795/original/2020-05-16_12-47-02.png?1589600841" class="editor-image img-responsive" data-smartkarma-image-id="133795"></figure><div class="content-caption">Source • Japan Analytics</div><p><strong>RETICENCE</strong> - 77% by number and 81% by value of companies with year-ends in  March, June, September, or December have already reported. Of these 2,464 companies representing ¥438 trillion of market cap, just 1,119 have issued annual forecasts for the current year, and 583 have made interim forecasts. Of all listed companies, one-third by market value are currently unable to see ahead twelve months and only 16% by value and 23% by number are prepared to look forward four-and-a-half months. This unusual degree of reticence leaves the sell-side without their regular anchoring comfort blanket.</p><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/133/802/original/2020-05-16_13-27-57.png?1589605282" class="editor-image img-responsive" data-smartkarma-image-id="133802"></figure><div class="content-caption">Source • Japan Analytics</div><p><strong>NOT CHEAP</strong> -  Even allowing for the lack of a full complement of forecasts, the market's forward multiple is at a five-year high with Net Income expected to reach levels first seen in 2015, 37% below the December 2018 peak. The ten-year peak trailing multiple was 29 on aggregate Net Income of  ¥14.6 trillion, which was ten times the 2009 trough.</p><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/133/801/original/2020-05-16_14-00-16.png?1589605245" class="editor-image img-responsive" data-smartkarma-image-id="133801"></figure><div class="content-caption">Source • Japan Analytics</div><p><strong>FIDDLING ABOUT</strong> - The Bank of Japan has reduced the amount of its daily ETF program for a second time; however, intervened for the last three days of last week seemingly intent on keeping the <a href="https://www.smartkarma.com/entities/nikkei-225" target="_blank" data-smartkarma-citation="entities:22909:1" rel="noopener">Nikkei 225 (NKY INDEX)</a> above 20,000. The cumulative total of BoJ purchases represents over 5% of the Total Market Value.</p><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/133/884/original/2020-05-17_12-54-22.png?1589687679" class="editor-image img-responsive" data-smartkarma-image-id="133884"></figure><div class="content-caption">Source • Japan Analytics</div><p>In the <strong>DETAIL</strong> below, we review some market data trends, look at the Results &amp; Revision Score trends by Sector (a 15-year timeline is shown above), apply some KPMG 'recovery analysis' to Japan and look at Friday's results and revisions.</p><div><ul>
<li>The balance between positive/neutral/negative of the <strong>490</strong> results announcements was <strong>206:45:239</strong>. The average change in Results Score was <strong>-0.2</strong>.</li>
<li>For the <strong>205</strong> revisions/initial forecasts, the split was <strong>49:10:146</strong>, and the average Revision Score was <strong>-7.5</strong>. Of the <strong>364</strong> companies declaring full-year results, <strong>47%</strong> made forecasts for the current year.</li>
<li>Fifty-one will announce today, the largest of which by market capitalisation will be <a href="https://www.smartkarma.com/entities/softbank-group-corp" target="_blank" data-smartkarma-citation="entities:315:1" rel="noopener">Softbank Group (9984 JP)</a>, <a href="https://www.smartkarma.com/entities/terumo-corp" target="_blank" data-smartkarma-citation="entities:6708:1" rel="noopener">Terumo Corp (4543 JP)</a>, and <a href="https://www.smartkarma.com/entities/komatsu-ltd" target="_blank" data-smartkarma-citation="entities:8416:1" rel="noopener">Komatsu (6301 JP).</a>
</li>
</ul></div>

Source • Japan Analytics"WORSENING" - The Cabinet Office updated their Business Condition Leading Indicator for March this week, confirming the trend already apparent from our Results &amp; Revision Score data series. The correlation between the series is 0.80, with the only significant deviation occurring in 2016, Coincident conditions are assessed as "worsening" wording that is unchanged since August 2019. Source • Japan AnalyticsDECOMPOSED - Our Score is decomposed into a Results Score, an Annual Forecast/Revision Score and an Interim Forecast Revision Score.  The last two are ten-year lows; the first should join them next week. A notable limiting factor is the shortage of forecasts being made. Without this reticence, both forecast Scores would be considerably lower.Source • Japan AnalyticsRETICENCE - 77% by number and 81% by value of companies with year-ends in  March, June, September, or December have already reported. Of these 2,464 companies representing ¥438 trillion of market cap, just 1,119 have issued annual forecasts for the current year, and 583 have made interim forecasts. Of all listed companies, one-third by market value are currently unable to see ahead twelve months and only 16% by value and 23% by number are prepared to look forward four-and-a-half months. This unusual degree of reticence leaves the sell-side without their regular anchoring comfort blanket.Source • Japan AnalyticsNOT CHEAP -  Even allowing for the lack of a full complement of forecasts, the market's forward multiple is at a five-year high with Net Income expected to reach levels first seen in 2015, 37% below the December 2018 peak. The ten-year peak trailing multiple was 29 on aggregate Net Income of  ¥14.6 trillion, which was ten times the 2009 trough.Source • Japan AnalyticsFIDDLING ABOUT - The Bank of Japan has reduced the amount of its daily ETF program for a second time; however, intervened for the last three days of last week seemingly intent on keeping the Nikkei 225 (NKY INDEX) above 20,000. The cumulative total of BoJ purchases represents over 5% of the Total Market Value.Source • Japan AnalyticsIn the DETAIL below, we review some market data trends, look at the Results &amp; Revision Score trends by Sector (a 15-year timeline is shown above), apply some KPMG 'recovery analysis' to Japan and look at Friday's results and revisions.
The balance between positive/neutral/negative of the 490 results announcements was 206:45:239. The average change in Results Score was -0.2.
For the 205 revisions/initial forecasts, the split was 49:10:146, and the average Revision Score was -7.5. Of the 364 companies declaring full-year results, 47% made forecasts for the current year.
Fifty-one will announce today, the largest of which by market capitalisation will be Softbank Group (9984 JP), Terumo Corp (4543 JP), and Komatsu (6301 JP).



🇯🇵 JAPAN MARKET UPDATE 18th May - "Worsening"

Japan

NITTO DENKO CORPORATION manufactures and markets a wide range of chemical products which are used as materials for industrial and electronic components. The Company's products include materials for sealants, semiconductors, and wrappings.  Nitto Denko has a network of sales/manufacturing subsidiaries worldwide.

Price Gauge
52-week Range	0.00 - 0.00
Market Cap (USDm)	0.00
P/E	0.00
Dividend (Yield)	0.00

Nitto Denko (6988 JP)

Cautiously Optimistic on Global Equities

We are constructive on global equities and would be buyers on a pullback. A move below $77 would start to get very concerning, and would leave $75...

Vermilion Research

🇯🇵 JAPAN • Results & Revisions 10/26 Nidec, Canon, OBIC, Koei Tecmo, Nitto Denko

• BEST & WORST • Our best and worst pairing from Monday's announcements is Nidec (6594 JP) and Koei Tecmo (3635...

Campbell Gunn

Global Equity Strategy: Bullish Outlook Intact

The MSCI ACWI index (USD) is breaking out to all-time highs while the MSCI EM index (local) is breaking above its prior highs from January. This is...

Vermilion Research

🇯🇵 JAPAN • Results & Revisions 27th July - Koei Tecmo, Nitto Denko, MMC, Stanley Electric, Exedy

Koei Tecmo (3635 JP) - Koei Tecmo produced the most-improved Results Score among large-cap companies yesterday. Colleague Mio Kato's April...

Campbell Gunn

🇯🇵 JAPAN MARKET UPDATE 18th May - "Worsening"

"WORSENING" - The Cabinet Office updated their Business Condition Leading Indicator for March this week, confirming the trend already apparent from...

Campbell Gunn

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Cautiously Optimistic on Global Equities

We are constructive on global equities and would be buyers on a pullback. A move below $77 would start to get very concerning, and would leave $75...

Vermilion Research

🇯🇵 JAPAN • Results & Revisions 10/​​​​​​​​​​​​​​​​​26 Nidec, Canon, OBIC, Koei Tecmo, Nitto Denko

• BEST & WORST • Our best and worst pairing from Monday's announcements is Nidec (6594 JP) and Koei Tecmo (3635...

Campbell Gunn

Global Equity Strategy: Bullish Outlook Intact

The MSCI ACWI index (USD) is breaking out to all-time highs while the MSCI EM index (local) is breaking above its prior highs from January. This is...

Vermilion Research

🇯🇵 JAPAN • Results & Revisions 27th July - Koei Tecmo, Nitto Denko, MMC, Stanley Electric, Exedy

Koei Tecmo (3635 JP) - Koei Tecmo produced the most-improved Results Score among large-cap companies yesterday. Colleague Mio Kato's April...

Campbell Gunn

🇯🇵 JAPAN MARKET UPDATE 18th May - "Worsening"

"WORSENING" - The Cabinet Office updated their Business Condition Leading Indicator for March this week, confirming the trend already apparent from...

Campbell Gunn

🇯🇵 JAPAN • Results & Revisions 10/26 Nidec, Canon, OBIC, Koei Tecmo, Nitto Denko