Japan/Asia Long-Short, LightStream Research

Mio Kato

Japan/Asia Long-Short

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

<p>Our sceptical position on the elevated multiples for tech stocks has been relatively consistent over time. As with all bubbles, despite valuations clearly being out of touch with reality, markets have continued to trend upwards, and in many cases the least attractive stocks have done the best. We would argue that signs of liquidity issues at Ark and the rapid implosion of Archegos herald the beginning of the end.</p>

Our sceptical position on the elevated multiples for tech stocks has been relatively consistent over time. As with all bubbles, despite valuations clearly being out of touch with reality, markets have continued to trend upwards, and in many cases the least attractive stocks have done the best. We would argue that signs of liquidity issues at Ark and the rapid implosion of Archegos herald the beginning of the end.

Softbank – Is Archegos the Bear Stearns CDO Funds in the Coalmine?

<p>We have been vocal about expecting some very strong earnings momentum from Capcom over the next two quarters. The stock had been deflating slightly over the last month or so, presumably due to longer-term holders taking some very healthy potential profits. However, it is now up 11.1% since March 18<sup>th</sup> and once again breaking out to new highs. We check in quickly on Monster Hunter Rise below.</p>

We have been vocal about expecting some very strong earnings momentum from Capcom over the next two quarters. The stock had been deflating slightly over the last month or so, presumably due to longer-term holders taking some very healthy potential profits. However, it is now up 11.1% since March 18th and once again breaking out to new highs. We check in quickly on Monster Hunter Rise below.

Capcom – A Quick Update on Our Top Short-Term Pick

<p>After rising almost 18% following its 3Q earnings blowout, Sony stock has meandered a little but been strengthening of late. We remain highly positive on earnings prospects and consider consensus estimates to be far too low. While we expect continued strong momentum from a slew of exclusive games and broad strength across the company’s segments, we believe that its just announced purchase of the Evo Championship Series has some interesting long-term implications that could fly under the radar.</p>

After rising almost 18% following its 3Q earnings blowout, Sony stock has meandered a little but been strengthening of late. We remain highly positive on earnings prospects and consider consensus estimates to be far too low. While we expect continued strong momentum from a slew of exclusive games and broad strength across the company’s segments, we believe that its just announced purchase of the Evo Championship Series has some interesting long-term implications that could fly under the radar.

Sony – Time to Add to Our 2021 Conviction Call as They Acquire Fighting Game Tournament Evo

<p>Nintendo held its first Nintendo Direct in a while today, announcing a number of ported titles, remasters, expansions and providing an updated trailer for Monster Hunter Rise. They also announced a remaster of the Wii’s Legend of Zelda: Skyward Sword for a July release and the next Splatoon title, set to release in 2022.</p>

Nintendo held its first Nintendo Direct in a while today, announcing a number of ported titles, remasters, expansions and providing an updated trailer for Monster Hunter Rise. They also announced a remaster of the Wii’s Legend of Zelda: Skyward Sword for a July release and the next Splatoon title, set to release in 2022.

Nintendo – Direct Points to Improving Third Party Support and Holiday Launch for New Switch

Smartkarma Research Team, Smartkarma

Smartkarma Research

Smartkarma Research Team

Smartkarma

Smartkarma unites the fragmented investment industry, connecting institutional investors, independent research providers, and corporates within a single network.

Research Reinvented

<p>On our next Webinar, we welcome Insight Provider <a href="https://www.smartkarma.com/profiles/mio-kato" target="_blank" data-smartkarma-citation="accounts:713" rel="noopener">Mio Kato</a> to discuss stalwart Japanese video game publishers <a href="https://www.smartkarma.com/entities/koei-tecmo-holdings-co-ltd" target="_blank" data-smartkarma-citation="entities:20277:1" rel="noopener">Koei Tecmo Holdings (3635 JP)</a> and <a href="https://www.smartkarma.com/entities/capcom-co-ltd" target="_blank" data-smartkarma-citation="entities:1459:1" rel="noopener">Capcom Co Ltd (9697 JP)</a> , both positioned for a strong 2021 with strong product line-ups and high demand from their audience.</p>
<h3>The webinar was hosted on Wednesday, 17 February 2021, 17:00 SGT/HKT.<a href="https://share.hsforms.com/1H9pFZOB-RF2J00kbvMmxcw2c5gj?zoom_webinar_id=85686282338" target="_blank" rel="noopener"></a>
</h3>
<p>Watch the session here:</p>
<p><iframe src="https://www.youtube.com/embed/fYxbY5zAYxU" width="560" height="315" title="YouTube video player" frameborder="0" allow="accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture" allowfullscreen="allowfullscreen"></iframe></p>
<p>Or subscribe to the podcast feed and listen on the go:</p>
<p><iframe src="https://open.spotify.com/embed-podcast/episode/5a7l2cL9wvaXrZ09mJQhB3" width="100%" height="232" frameborder="0" allowtransparency="true" allow="encrypted-media"></iframe></p>
<p>Mio Kato has over 15 years of experience looking at Japanese and Asian cyclically driven sectors such as Gaming, Factory Automation and Autos. He was previously with FrontPoint Partners LP, Arrowhawk Capital Partners, and Uzabase before founding LightStream Research.</p>

On our next Webinar, we welcome Insight Provider Mio Kato to discuss stalwart Japanese video game publishers Koei Tecmo Holdings (3635 JP) and Capcom Co Ltd (9697 JP) , both positioned for a strong 2021 with strong product line-ups and high demand from their audience.
The webinar was hosted on Wednesday, 17 February 2021, 17:00 SGT/HKT.

Watch the session here:

Or subscribe to the podcast feed and listen on the go:

Mio Kato has over 15 years of experience looking at Japanese and Asian cyclically driven sectors such as Gaming, Factory Automation and Autos. He was previously with FrontPoint Partners LP, Arrowhawk Capital Partners, and Uzabase before founding LightStream Research.

Smartkarma Webinar | Koei Tecmo - Capcom: Warriors and Monster Hunters on the Rise

Japan

CAPCOM CO., LTD. develops consumer video game software.  The Company also develops, manufactures, markets, and leases arcade game machines.  Capcom also operates amusement facilities.

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Capcom Co Ltd (9697 JP)

Softbank – Is Archegos the Bear Stearns CDO Funds in the Coalmine?

With a lot of signs of market stress emerging following a truly bubbly run up in 2020 we examine the prospects for a stock that has traditionally...

Mio Kato

Capcom – A Quick Update on Our Top Short-Term Pick

Monster Hunter Rise looks set to put up some very nice numbers at release and beyond. It is one reason why Capcom is out top short-term pick, but...

Mio Kato

Sony – Time to Add to Our 2021 Conviction Call as They Acquire Fighting Game Tournament Evo

We believe that Sony's just announced purchase of the Evo Championship Series has some interesting long-term implications that could fly under the...

Mio Kato

Nintendo – Direct Points to Improving Third Party Support and Holiday Launch for New Switch

The Nintendo Direct today showcased titles from Square Enix, Capcom, Koei Tecmo and Nintendo itself, pointing to a moderately strong pipeline...

Mio Kato

Smartkarma Webinar | Koei Tecmo - Capcom: Warriors and Monster Hunters on the Rise

On 17 Feb, 5pm SGT, join us and Mio Kato to discuss stalwart Japanese video game publishers Koei Tecmo and Capcom , both positioned for a strong...

Smartkarma Research

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