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>Of the ten items highlighted in last week’s <em>Compass</em> that we would like to see in order to turn more bullish, two have happened -- equal-weighted Energy and UK/European Financials are breaking out. This only serves to add to our already positive outlook as U.S. equities are poised to test all-time highs. We are upgrading <em>equal-weight </em>Energy to market weight. Also in today’s report, we highlight attractive Groups and stocks within Technology: Large-, Mid-, and Small-Cap Semiconductors.</p>

Of the ten items highlighted in last week’s Compass that we would like to see in order to turn more bullish, two have happened -- equal-weighted Energy and UK/European Financials are breaking out. This only serves to add to our already positive outlook as U.S. equities are poised to test all-time highs. We are upgrading equal-weight Energy to market weight. Also in today’s report, we highlight attractive Groups and stocks within Technology: Large-, Mid-, and Small-Cap Semiconductors.

U.S. Equity Strategy: Upgrading Equal-Weight Energy Sector; Semis Are Leading Tech

Asia and Global Semiconductor and Tech Research

Andrew Lu

Equity Bottom-Up

<h2>What's new?</h2><p>Nikkei News reported <a href="https://www.smartkarma.com/entities/666" target="_blank" data-smartkarma-citation="entities:666:1">Apple Inc (AAPL US)</a> is designing its own main power management chips for use in iPhones as early as in 2018, cutting dependence on <a href="https://www.smartkarma.com/entities/21607" target="_blank" data-smartkarma-citation="entities:21607:1">Dialog Semiconductor PLC (DLG GR)</a>, according to industry sources, as shares in the U.K. developer plunged after the news out. The main power management chip controls an iPhone's charging function, battery management, and energy consumption. "Based on Apple's current plan, they are set to replace partially, or around half of its power…</p>

What's new?Nikkei News reported Apple Inc (AAPL US) is designing its own main power management chips for use in iPhones as early as in 2018, cutting dependence on Dialog Semiconductor PLC (DLG GR), according to industry sources, as shares in the U.K. developer plunged after the news out. The main power management chip controls an iPhone's charging function, battery management, and energy consumption. "Based on Apple's current plan, they are set to replace partially, or around half of its power…

Nikkei Said Apple Cuts Dialog on Power ICs Supply; We Highlighted This in May and More to Come

<h2>Summary</h2><ul>
<li><em><strong>Miss on 2Q17 guidance</strong>: Apple guides 2Q17 midpoint sales of US$44.5bn sales (-16% q/q and +5% y/y) which is 3% worse than Bloomberg consensus' US$45.7bn. Also, midpoint op margin guidance of 23% and net margin of 18% each is 0.9 and 0.6ppts lower than Bloomberg consensus, respectively. Thus, Bloomberg consensus should adjust down its 2Q17 EPS forecast by US$11 cents to US$1.52 from US$1.63.</em></li>
<li>
<em><strong>No exciting but not actually miss on iPhone shipment</strong>:  Apple reports 1Q17 iPhone shipment of 50.8mn</em>…</li>
</ul>

Summary
Miss on 2Q17 guidance: Apple guides 2Q17 midpoint sales of US$44.5bn sales (-16% q/q and +5% y/y) which is 3% worse than Bloomberg consensus' US$45.7bn. Also, midpoint op margin guidance of 23% and net margin of 18% each is 0.9 and 0.6ppts lower than Bloomberg consensus, respectively. Thus, Bloomberg consensus should adjust down its 2Q17 EPS forecast by US$11 cents to US$1.52 from US$1.63.

No exciting but not actually miss on iPhone shipment:  Apple reports 1Q17 iPhone shipment of 50.8mn…


Apple Misses on Guidance; Understood Now Why Apple Is Suing Qualcomm and Expanding In-House Design

United States

Cirrus Logic, Inc. is a fabless semiconductor company that develops audio and voice IC and software solutions for mobile communications, automotive entertainment, and consumer audio applications. Cirrus Logic is headquartered in Austin, Texas.

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Cirrus Logic (CRUS US)

U.S. Equity Strategy: Upgrading Equal-Weight Energy Sector; Semis Are Leading Tech

Of the ten items highlighted in last week’s Compass that we would like to see in order to turn more bullish, two have happened -- equal-weighted...

Vermilion Research

Nikkei Said Apple Cuts Dialog on Power ICs Supply; We Highlighted This in May and More to Come

What's new?Nikkei News reported Apple Inc (AAPL US) is designing its own main power management chips for use in iPhones as early as in 2018,...

Andrew Lu

Apple Misses on Guidance; Understood Now Why Apple Is Suing Qualcomm and Expanding In-House Design

Summary Miss on 2Q17 guidance: Apple guides 2Q17 midpoint sales of US$44.5bn sales (-16% q/q and +5% y/y) which is 3% worse than Bloomberg...

Andrew Lu

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