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>Our outlook remains neutral for global ex-U.S. markets while horizontal consolidation continues on the MSCI ACWI ex-U.S. index.  In today’s report we take a bottoms-up view on developed ex-U.S. equities, highlighting stocks that present attractive buy opportunities <em>within the <strong>Communications, Health Care, Manufacturing, Materials, Technology, Transportation, and Utilities </strong>Sectors</em></p>

Our outlook remains neutral for global ex-U.S. markets while horizontal consolidation continues on the MSCI ACWI ex-U.S. index.  In today’s report we take a bottoms-up view on developed ex-U.S. equities, highlighting stocks that present attractive buy opportunities within the Communications, Health Care, Manufacturing, Materials, Technology, Transportation, and Utilities Sectors

Bottoms-Up View on Developed Markets: Actionable Stocks, Part 2

Asia Healthcare Analyst, Pathology Associates Limited

Dion Stéfan Büchner M.D., FCAP

Asia Healthcare Analyst

Pathology Associates Limited

Equity Bottom-Up

<p>We reiterate our “Equal-weight” rating on the stock post 1H FY18 (YE Dec-18) earnings.</p><ul>
<li>Chugai reported strong 1H FY18 sales (+12.8% to ¥1b) due to an increase in <strong>Actemra</strong> exports to Roche (+44% to ¥44.9b).</li>
<li>Increase in core OP in 1H FY18 (+42.7% to ¥5b) is mainly due to onetime income received (¥22.7b) from transfer of the long-listed drug business in 1Q FY18.</li>
</ul>

We reiterate our “Equal-weight” rating on the stock post 1H FY18 (YE Dec-18) earnings.
Chugai reported strong 1H FY18 sales (+12.8% to ¥1b) due to an increase in Actemra exports to Roche (+44% to ¥44.9b).
Increase in core OP in 1H FY18 (+42.7% to ¥5b) is mainly due to onetime income received (¥22.7b) from transfer of the long-listed drug business in 1Q FY18.


Strong 1H FY18 – Hemlibra Approval for Non-Inhibitors to Boost Sales.

Japan TMT Analyst

Pelham Smithers

Market Intel on Asian Tech with a Japan focus

Pelham Smithers Associates

Founded in 2009, Pelham Smithers Associates (PSA) provides market intelligence on Asian technology, focusing in particular on Japan. The industries covered by our team of specialists are: consumer electronics, telecomms, pharmaceuticals, internet, electronic parts and materials, automotive technology, retail and capital goods. 

Research is provided by the following:
Pelham Smithers: Macro, consumer electronics, telecoms & pharma
Joel Scheiman: Electronics materials / components
Julie Boote: Autos
Will Nestuk: Capital goods, machinery & transportation equipment parts
Thao Nguyen: eCommerce, internet content, marketing & advertising

<p>As a defensive sector, Japan’s pharmaceutical sector has had an up-and-down time of it during the Abe era. In the early days of Abenomics, the sector was a serial underperformer, as there were high hopes that Abenomics would soon pull Japan out of its deflationary slump. However, even as early as 4Q 2013, misgivings were beginning to emerge (primarily then around the forthcoming consumption tax hike) and the sector went into a long period of outperformance, which ended in June 2016 with “Kuroda…</p>

As a defensive sector, Japan’s pharmaceutical sector has had an up-and-down time of it during the Abe era. In the early days of Abenomics, the sector was a serial underperformer, as there were high hopes that Abenomics would soon pull Japan out of its deflationary slump. However, even as early as 4Q 2013, misgivings were beginning to emerge (primarily then around the forthcoming consumption tax hike) and the sector went into a long period of outperformance, which ended in June 2016 with “Kuroda…

Opportunities in The (Overpriced) Japan Pharma Sector

<p>In our April International Strategy, we explore the recent consolidation across global equity markets and examine the following opportunities within:</p><ul><li>Defensive Sectors, including an actionable Group within Health Care: Pharmaceuticals</li><li>Japan and Hong Kong</li><li>Emerging Markets</li></ul><p>Also included are links to in-depth commentary on all 12 sectors</p>

In our April International Strategy, we explore the recent consolidation across global equity markets and examine the following opportunities within:Defensive Sectors, including an actionable Group within Health Care: PharmaceuticalsJapan and Hong KongEmerging MarketsAlso included are links to in-depth commentary on all 12 sectors

Global Equity Strategy: Opportunities in Japan, HK, &  EM

<h2>Core coverage <strong>– relative valuations </strong>
</h2><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/049/367/original/core%20coverage.PNG?1523424273" class="editor-image img-responsive" data-smartkarma-image-id="49367"></figure><div class="content-caption">Price as on March 26, 2018<br>*Financial year of Otsula, Chugai and KHK ends in December</div><h2><strong><a href="https://www.smartkarma.com/entities/11747" target="_blank" data-smartkarma-citation="entities:11747">Takeda Pharmaceutical Co Ltd (4502 JP)</a> </strong></h2><p>(NB: Pre-Shire announcement | Pro-Forma analysis to be published shortly) <br>OW | CMP ¥ 5,550| TP ¥ 6,600</p><table class="table table-striped"><tbody>
<tr>
<td><strong>Key drivers / highlights</strong></td>
<td><ul><li>Currently marketed drugs including <strong>Entyvio </strong>(vedolizumab, in-house), <strong>Ninlaro </strong>(ixazomib,in-house), <strong>Trintellix</strong> (vortioxetine, co-develop with Lundbeck) &amp; <strong>Takecab </strong>(vonoprazan, developed in-house) to drive topline over…</li></ul></td>
</tr>
</tbody></table>

Core coverage – relative valuations 
Price as on March 26, 2018 *Financial year of Otsula, Chugai and KHK ends in DecemberTakeda Pharmaceutical Co Ltd (4502 JP) (NB: Pre-Shire announcement | Pro-Forma analysis to be published shortly)  OW | CMP ¥ 5,550| TP ¥ 6,600

Key drivers / highlights
Currently marketed drugs including Entyvio (vedolizumab, in-house), Ninlaro (ixazomib,in-house), Trintellix (vortioxetine, co-develop with Lundbeck) &amp; Takecab (vonoprazan, developed in-house) to drive topline over…



Japan

Chugai Pharmaceutical Company Ltd., manufactures and sells pharmaceuticals in the domestic and international markets through its subsidiaries. The Company develops drugs in the fields of cancer, infectious diseases, bone, blood, and circulatory systems. Chugai Pharmaceutical also conducts research studies on drugs with private and public medical research institutions.

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Chugai Pharmaceutical (4519 JP)

Bottoms-Up View on Developed Markets: Actionable Stocks, Part 2

Our outlook remains neutral for global ex-U.S. markets while horizontal consolidation continues on the MSCI ACWI ex-U.S. index. In today’s report...

Vermilion Research

Strong 1H FY18 – Hemlibra Approval for Non-Inhibitors to Boost Sales.

We reiterate our “Equal-weight” rating on the stock post 1H FY18 (YE Dec-18) earnings. Chugai reported strong 1H FY18 sales (+12.8% to ¥1b) due to...

Dion Stéfan Büchner M.D., FCAP

Opportunities in The (Overpriced) Japan Pharma Sector

As a defensive sector, Japan’s pharmaceutical sector has had an up-and-down time of it during the Abe era. In the early days of Abenomics, the...

Pelham Smithers Associates

Global Equity Strategy: Opportunities in Japan, HK, & EM

In our April International Strategy, we explore the recent consolidation across global equity markets and examine the following opportunities...

Vermilion Research

Japan Pharmaceutical - Sector Overview

Core coverage – relative valuations Takeda Pharmaceutical Co Ltd (4502 JP) (NB: Pre-Shire announcement | Pro-Forma analysis to be published...

Dion Stéfan Büchner M.D., FCAP

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