Leading Independent Investment Research, Morningstar, Inc.

Morningstar

Leading Independent Investment Research

Morningstar, Inc.

Morningstar, Inc. is a leading provider of independent investment research in North America, Europe, Australia, and Asia. We offer an extensive line of products and services for individual investors, financial advisors, asset managers, and retirement plan providers and sponsors. 

Morningstar provides data on more than 500,000 investment offerings, including stocks, mutual funds, and similar vehicles, along with real-time global market data on more than 16 million equities, indexes, futures, options, commodities, and precious metals, in addition to foreign exchange and Treasury markets. Morningstar also offers investment management services through its investment advisory subsidiaries, with more than $180 billion in assets under advisement or management as of June 30, 2015. We have operations in 27 countries.

Download the Morningstar Fact Sheet : http://corporate.morningstar.com/US/documents/MarketingFactSheets/AboutMorningstarFactsheet.pdf

Thematic (Sector/Industry)

After an average 82% run-up in share price since the fourth quarter of 2016 for the six narrow-moat Macau gaming names we cover, we think the Macau gaming sector is no longer undervalued from a long-term investment perspective. After a review of prospective gross gaming revenue growth and margins over the next decade, we find the shares of <a href="https://www.smartkarma.com/entities/806" target="_blank" data-smartkarma-citation="entities:806:1">Galaxy Entertainment Group Limited (27 HK)</a>, <a href="https://www.smartkarma.com/entities/473" target="_blank" data-smartkarma-citation="entities:473:1">Wynn Macau Ltd (1128 HK)</a>, <a href="https://www.smartkarma.com/entities/606" target="_blank" data-smartkarma-citation="entities:606:1">Wynn Resorts Ltd (WYNN US)</a> (70% of EBITDA from Macau), <a href="https://www.smartkarma.com/entities/810" target="_blank" data-smartkarma-citation="entities:810:1">Melco Resorts &amp; Entertainment</a>…

After an average 82% run-up in share price since the fourth quarter of 2016 for the six narrow-moat Macau gaming names we cover, we think the Macau gaming sector is no longer undervalued from a long-term investment perspective. After a review of prospective gross gaming revenue growth and margins over the next decade, we find the shares of Galaxy Entertainment Group Limited (27 HK), Wynn Macau Ltd (1128 HK), Wynn Resorts Ltd (WYNN US) (70% of EBITDA from Macau), Melco Resorts &amp; Entertainment…

Macau Gaming Stocks Not Incorporating Cyclicality and Policy Risks; Shares Overvalued

Investment Advisors, JL Warren Capital

Junheng Li

Investment Advisors

JL Warren Capital

JL Warren Capital LLC is a leading independent equity research firm focused on Chinese companies and listed multinationals in China. We employ a bottom-up research approach that takes great care to avoid the acquisition of material non-public information. Through investigative due diligence including channel surveys and interviews, our research helps clients to pinpoint the dislocations in the market.

Macau gaming benefits from robust Chinese consumer and business sentiment, and wealth accumulation especially among the rich and beyond.  Using the street consensus of high-double-digit year-over-year growth rate for 2018 (17-20%), GGR is likely to bounce back to the peak historical level of ~360 billion MOP in 2013.  We believe that Macau will deliver growth beyond recovery for years to come, weathering volatilities along the way.During 2013-2017, in RMB term, China’s GDP grew 41% from 59…

Macau gaming benefits from robust Chinese consumer and business sentiment, and wealth accumulation especially among the rich and beyond.  Using the street consensus of high-double-digit year-over-year growth rate for 2018 (17-20%), GGR is likely to bounce back to the peak historical level of ~360 billion MOP in 2013.  We believe that Macau will deliver growth beyond recovery for years to come, weathering volatilities along the way.During 2013-2017, in RMB term, China’s GDP grew 41% from 59…

Macau Update: Strong Mass Visitations During Holiday; VIP Rolling Re-Accelerated Post CNY

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

MSCI Emerging Markets Index / Technical Analysis

Big-picture technicals offer a compelling outlook for equities -- in the long-run. Despite arguably stretched trends, especially in the U.S. and EM, one indicator in particular keeps us optimistic: monthly charts.  What is clear right now is: (1) Europe is on the doorstep of breaking above secular resistance; (2) Japan is breaking out above secular resistance; (3) and EM already has. Speaking of EM, we view this as the place to be, or overweight, in 2018. The EM/EAFE’s 20-year chart (below) reveals an in-progress trend reversal (which developed at a secular trendline) in favor of EM.In today’s report we review every global sector, highlighting actionable stocks within each.

Big-picture technicals offer a compelling outlook for equities -- in the long-run. Despite arguably stretched trends, especially in the U.S. and EM, one indicator in particular keeps us optimistic: monthly charts.  What is clear right now is: (1) Europe is on the doorstep of breaking above secular resistance; (2) Japan is breaking out above secular resistance; (3) and EM already has. Speaking of EM, we view this as the place to be, or overweight, in 2018. The EM/EAFE’s 20-year chart (below) reveals an in-progress trend reversal (which developed at a secular trendline) in favor of EM.In today’s report we review every global sector, highlighting actionable stocks within each.

During the 3rd week in January, the estimated average daily GGR soared to ~857 mm MOP, up 5% week-over-week and 62% year-on-year.  The jump in the year-over-year growth rate is partially driven by the timing of Chinese New Year each year. According to our conversations with the local junket operators, Macau gaming rally continues to be driven by an extremely robust VIP rolling demand.  Despite multiple headline reports regarding China’s capital outflow controls, Macau enjoys an abundant…

During the 3rd week in January, the estimated average daily GGR soared to ~857 mm MOP, up 5% week-over-week and 62% year-on-year.  The jump in the year-over-year growth rate is partially driven by the timing of Chinese New Year each year. According to our conversations with the local junket operators, Macau gaming rally continues to be driven by an extremely robust VIP rolling demand.  Despite multiple headline reports regarding China’s capital outflow controls, Macau enjoys an abundant…

Macau Gaming: Soaring GGR Driven by Inflow of Junket Liquidity

Macro & Asian equity Technical Strategies, BBSP Asia

Federico D'Inca

Macro & Asian equity Technical Strategies

BBSP Asia

Sony Financial Group / Technical Analysis

Mid Term Country Allocation (Tactical view) in terms of Relative Value vs MXAP • HSCEI/MXAP ratio is moving in a range pattern. Therefore downgrade HSCEI from increase exposure to hold. While HSI/MXAP ratio remains above a trend line support (preference for a tactical HSI outperformance over HSCEI). • Keep “overweight” position on HSI, Nikkei, ASX and TWSE. • Maintain “Hold for KOSPI and Nifty vs MXAPShould you have any questions and wish to speak with one of our analysts, please don’t hesitate to…

Mid Term Country Allocation (Tactical view) in terms of Relative Value vs MXAP • HSCEI/MXAP ratio is moving in a range pattern. Therefore downgrade HSCEI from increase exposure to hold. While HSI/MXAP ratio remains above a trend line support (preference for a tactical HSI outperformance over HSCEI). • Keep “overweight” position on HSI, Nikkei, ASX and TWSE. • Maintain “Hold for KOSPI and Nifty vs MXAPShould you have any questions and wish to speak with one of our analysts, please don’t hesitate to…

BBSP Equity Asia Weekly Research 10th January 2018

Hong Kong

Galaxy Entertainment Group is a leading hospitality and gaming company that develops and operates integrated resorts, hotels, and casinos in Macau. Its key properties include Galaxy Macau, Broadway Macau, and StarWorld Macau, offering casino games, entertainment, and related hospitality services. The company is headquartered in Hong Kong and was established in 2002.

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Galaxy Entertainment Group (27 HK)

Macau Gaming Stocks Not Incorporating Cyclicality and Policy Risks; Shares Overvalued

After an average 82% run-up in share price since the fourth quarter of 2016 for the six narrow-moat Macau gaming names we cover, we think the Macau...

Morningstar, Inc.

Macau Update: Strong Mass Visitations During Holiday; VIP Rolling Re-Accelerated Post CNY

Macau gaming benefits from robust Chinese consumer and business sentiment, and wealth accumulation especially among the rich and beyond. Using the...

JL Warren Capital

Global Equity Strategy: Overweight EM

Big-picture technicals offer a compelling outlook for equities -- in the long-run. Despite arguably stretched trends, especially in the U.S. and...

Vermilion Research

Macau Gaming: Soaring GGR Driven by Inflow of Junket Liquidity

During the 3rd week in January, the estimated average daily GGR soared to ~857 mm MOP, up 5% week-over-week and 62% year-on-year. The jump in the...

JL Warren Capital

BBSP Equity Asia Weekly Research 10th January 2018

Mid Term Country Allocation (Tactical view) in terms of Relative Value vs MXAP• HSCEI/MXAP ratio is moving in a range pattern. Therefore downgrade...

BBSP Asia

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