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

We continue to move increasingly toward the bullish camp and we believe equities are poised for higher prices moving forward. In today’s report we outline our bullish case and highlight attractive Groups and stocks within Financials, Services, Technology and Manufacturing: Credit Card Issuers, Education Services, China, Solar Energy, and Industrial Rental Equipment.

We continue to move increasingly toward the bullish camp and we believe equities are poised for higher prices moving forward. In today’s report we outline our bullish case and highlight attractive Groups and stocks within Financials, Services, Technology and Manufacturing: Credit Card Issuers, Education Services, China, Solar Energy, and Industrial Rental Equipment.

U.S. Equity Strategy: Upgrading Cap-Weighted Communications to Overweight

Overseas Chinese Equities, Aequitas Research

Ming Lu

Overseas Chinese Equities

Thematic (Sector/Industry)

<ul><li>Most private school operators are also property developers.</li><li>Schools provide stable cash inflows, so that some developers stopped property investment to focus on schools.</li><li>The 1st risk: Property developers may borrow money from schools. They did that before.</li><li>The 2nd risk: Property developers are schools’ landlords and the lease contracts will be based on re-negotiations between relatives.  This raises corporate governance issues.</li><li>In general, we are still optimistic about private schools.</li></ul>

Most private school operators are also property developers.Schools provide stable cash inflows, so that some developers stopped property investment to focus on schools.The 1st risk: Property developers may borrow money from schools. They did that before.The 2nd risk: Property developers are schools’ landlords and the lease contracts will be based on re-negotiations between relatives.  This raises corporate governance issues.In general, we are still optimistic about private schools.

Key Risk to Private Schools: Property Developers Standing Behind

<ul><li>Shanghai Bureau of Education (SBE) distributes selective high schools’ enrolments to non-selective middle school students.</li><li>We believe the new policy provide opportunities for after-school tutoring and private schools, due to the mismatch between students and schools.</li><li>Listed schools, impacted by cancellation of Mathematical Olympiad tests (See <a href="https://www.smartkarma.com/insights/tal-education-tal-us-chaos-in-junior-high-school-application-in-shanghai" target="_blank" data-smartkarma-citation="insights:17836">TAL Education (TAL US) - Chaos in Junior High School Application in Shanghai</a>), should shift classrooms from elementary school pupils to high school students.</li></ul>

Shanghai Bureau of Education (SBE) distributes selective high schools’ enrolments to non-selective middle school students.We believe the new policy provide opportunities for after-school tutoring and private schools, due to the mismatch between students and schools.Listed schools, impacted by cancellation of Mathematical Olympiad tests (See TAL Education (TAL US) - Chaos in Junior High School Application in Shanghai), should shift classrooms from elementary school pupils to high school students.

High School Enrolment Reform at Shanghai Pushing Students to Tutoring and Private Schools

Summary<ul>
<li>There is a long list of Chinese listed schools.</li>
<li>Chinese parents are anxious.</li>
<li>The government tries to relieve the competition among students, but the effect of the policies go opposite ---- pushing students to private and part-time schools.</li>
</ul>Schools Went Public and Went Private. In 2017, four Chinese schools went public in the US. They are <a href="https://www.smartkarma.com/entities/24126" target="_blank" data-smartkarma-citation="entities:24126:1">Bright Scholar Education (BEDU US)</a>, <a href="https://www.smartkarma.com/entities/25898" target="_blank" data-smartkarma-citation="entities:25898:1">RYB Education Inc (RYB US)</a>, <a href="https://www.smartkarma.com/entities/25945" target="_blank" data-smartkarma-citation="entities:25945:1">RISE Education Cayman Ltd (REDU US)</a>, and <a href="https://www.smartkarma.com/entities/25978" target="_blank" data-smartkarma-citation="entities:25978:1">Four Seasons Education (FEDU US)</a>.  But we do not…

Summary
There is a long list of Chinese listed schools.
Chinese parents are anxious.
The government tries to relieve the competition among students, but the effect of the policies go opposite ---- pushing students to private and part-time schools.
Schools Went Public and Went Private. In 2017, four Chinese schools went public in the US. They are Bright Scholar Education (BEDU US), RYB Education Inc (RYB US), RISE Education Cayman Ltd (REDU US), and Four Seasons Education (FEDU US).  But we do not…

Schools Come and Go, But Parents Stay Anxious – Promising Education Industry in China

Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

China Traditional Chinese Medicine / Event-Driven

China Traditional Chinese Medicine (570 HK)

<ul>
<li>There are 45 - mostly firm, mostly Asia-Pac - transactions currently being discussed and analysed on Smartkarma. Inside is a timetable of upcoming key events for each deal.</li>
<li>One new deal was discussed on Smartkarma: <a href="https://www.smartkarma.com/entities/xingda-international-holdings" target="_blank" data-smartkarma-citation="entities:17836:1" rel="noopener">Xingda International (1899 HK)</a>'s partial MBO.</li>
<li>Key updates took place for: <a href="https://www.smartkarma.com/entities/nitro-software-ltd" target="_blank" data-smartkarma-citation="entities:30943:1" rel="noopener">Nitro Software Ltd (NTO AU)</a> , <a href="https://www.smartkarma.com/entities/chip-eng-seng-corp-ltd" target="_blank" data-smartkarma-citation="entities:6441:1" rel="noopener">Chip Eng Seng Corp (CHIP SP)</a> and <a href="https://www.smartkarma.com/entities/china-traditional-chinese-medicine" target="_blank" data-smartkarma-citation="entities:351:1" rel="noopener">China Traditional Chinese Medicine (570 HK)</a>.</li>
</ul>


There are 45 - mostly firm, mostly Asia-Pac - transactions currently being discussed and analysed on Smartkarma. Inside is a timetable of upcoming key events for each deal.
One new deal was discussed on Smartkarma: Xingda International (1899 HK)'s partial MBO.
Key updates took place for: Nitro Software Ltd (NTO AU) , Chip Eng Seng Corp (CHIP SP) and China Traditional Chinese Medicine (570 HK).


(Mostly) Asia-Pac Weekly Risk Arb Wrap: Xingda, Nitro, Chip Eng Seng, Traditional Chinese Medicine

China

Bright Scholar Education Holdings Limited operates as a holding company. The Company, through its subsidiaries, provides bilingual, kindergarten, training, and other educational programs and services. Bright Scholar Education Holdings serves students in China.

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

Bright Scholar Education Holdi (BEDU US)

U.S. Equity Strategy: Upgrading Cap-Weighted Communications to Overweight

We continue to move increasingly toward the bullish camp and we believe equities are poised for higher prices moving forward. In today’s report we...

Vermilion Research

Key Risk to Private Schools: Property Developers Standing Behind

Most private school operators are also property developers. Schools provide stable cash inflows, so that some developers stopped property...

Ming Lu

High School Enrolment Reform at Shanghai Pushing Students to Tutoring and Private Schools

Shanghai Bureau of Education (SBE) distributes selective high schools’ enrolments to non-selective middle school students. We believe the new...

Ming Lu

Schools Come and Go, But Parents Stay Anxious – Promising Education Industry in China

Summary There is a long list of Chinese listed schools. Chinese parents are anxious. The government tries to relieve the competition among...

Ming Lu

(Mostly) Asia-Pac Weekly Risk Arb Wrap: Xingda, Nitro, Chip Eng Seng, Traditional Chinese Medicine

This insight provides a summary of gross/annualised spreads (on deals discussed on Smartkarma) across Asia-Pacific as at the last trading date, and...

David Blennerhassett

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)