'Quantamental' Japan Specialist, LightStream Research

Campbell Gunn

'Quantamental' Japan Specialist

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.

Thematic (Sector/Industry)

<div>
<figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/147/477/original/2020-07-23_10-42-06.png?1595468537" class="editor-image img-responsive" data-smartkarma-image-id="147477"></figure><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/147/478/original/2020-07-23_10-44-59.png?1595468712" class="editor-image img-responsive" data-smartkarma-image-id="147478"></figure><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/147/483/original/2020-07-23_11-31-51.png?1595471532" class="editor-image img-responsive" data-smartkarma-image-id="147483"></figure><div class="content-caption">Source • Japan Analytics</div>
<a href="https://www.smartkarma.com/entities/obic-co-ltd" target="_blank" data-smartkarma-citation="entities:1273:1" rel="noopener">OBIC (4684 JP)</a>- OBIC was the largest-cap company to report on Wednesday before the four-day holiday break. Despite a deceleration in the rate of revenue growth, the operating profit margin reached a record level of 58% in the first quarter as both COGS and SG&amp;A continue to decline. The other end of the Income Statement is less impressive. The 17 percentage point gap between the operating and CITC margins is also a new record. OBIC's ability to control its securities investment and returns at unconsolidated subsidiaries is much less impressive. OBIC is now the most Overbought IT Sector company in Japan, although the company's peer-relative earnings and forecast momentum has been declining. At an EV/ TTM OP of 34x times, valuations have only been higher during the 1999/2000 tech bubble and will act a constraint to the upside. With little margin for safety, we would not be buyers at this level.
<figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/147/485/original/2020-07-23_11-40-21.png?1595472039" class="editor-image img-responsive" data-smartkarma-image-id="147485"></figure><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/147/480/original/2020-07-23_11-19-55.png?1595470809" class="editor-image img-responsive" data-smartkarma-image-id="147480"></figure><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/147/479/original/2020-07-23_10-46-52.png?1595468831" class="editor-image img-responsive" data-smartkarma-image-id="147479"></figure><div class="content-caption">Source • Japan Analytics<hr>
</div>
DAILY STATS
</div><hr><div>24 Quarterly Results</div><div><ul>
<li>
Results Score: 10 Positive / 1 Neutral / 13 Negative</li>
<li>
Average Results Score Change: -1.3</li>
<li>
Average % Change in Revenue: +1.8% Quarter YoY / +2.9% Rolling TTM YoY (exc. Kosei Secs) 
</li>
<li>
Average Operating Profit Margin Change: -0.3ppt (exc. Kosei Secs)
</li>
<li>
Percentage Making Quarterly Losses: 25%</li>
</ul></div><hr><div> 13 Annual • 11 Interim Forecasts/Revisions</div><div><ul>
<li>Annual Forecast/Revision Score: 3 Positive / 2 Neutral / 8 Negative</li>
<li>Interim Forecast/Revision Score Change: 3 Positive / 1 Neutral / 7 Negative</li>
<li>Average Forecast/Revision Score Change: -7.6</li>
</ul></div>


Source • Japan Analytics
OBIC (4684 JP)- OBIC was the largest-cap company to report on Wednesday before the four-day holiday break. Despite a deceleration in the rate of revenue growth, the operating profit margin reached a record level of 58% in the first quarter as both COGS and SG&amp;A continue to decline. The other end of the Income Statement is less impressive. The 17 percentage point gap between the operating and CITC margins is also a new record. OBIC's ability to control its securities investment and returns at unconsolidated subsidiaries is much less impressive. OBIC is now the most Overbought IT Sector company in Japan, although the company's peer-relative earnings and forecast momentum has been declining. At an EV/ TTM OP of 34x times, valuations have only been higher during the 1999/2000 tech bubble and will act a constraint to the upside. With little margin for safety, we would not be buyers at this level.
Source • Japan Analytics

DAILY STATS
24 Quarterly Results

Results Score: 10 Positive / 1 Neutral / 13 Negative

Average Results Score Change: -1.3

Average % Change in Revenue: +1.8% Quarter YoY / +2.9% Rolling TTM YoY (exc. Kosei Secs) 


Average Operating Profit Margin Change: -0.3ppt (exc. Kosei Secs)


Percentage Making Quarterly Losses: 25%
 13 Annual • 11 Interim Forecasts/Revisions
Annual Forecast/Revision Score: 3 Positive / 2 Neutral / 8 Negative
Interim Forecast/Revision Score Change: 3 Positive / 1 Neutral / 7 Negative
Average Forecast/Revision Score Change: -7.6


🇯🇵 JAPAN • Results & Revisions 22nd July - OBIC, CyberAgent, Tokyo Steel & The Deep Freeze

<figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/129/213/original/File%202020-04-23%205%2019%2052.jpeg?1587587091" class="editor-image img-responsive" data-smartkarma-image-id="129213"></figure><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/129/215/original/File%202020-04-23%205%2019%2008.jpeg?1587587183" class="editor-image img-responsive" data-smartkarma-image-id="129215"></figure><div class="content-caption">Source • Marco Piani</div>TIMELINES - The excellent timelines prepared by @Marco_Piani provide a novel interpretation of Japan's 'rank' in the progression of COVID-19 on terms of both cases and deaths. The data confirms that Japan is 'lagging' the World in both respects. Also of note are the 'second waves' that are appearing in several countries, including South Africa, Argentina, Poland and the Philippines. <figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/129/216/original/2020-04-23_05-29-31.png?1587587408" class="editor-image img-responsive" data-smartkarma-image-id="129216"></figure><div class="content-caption">Source • Arbor Data Science</div>GOING-OUT RELATED - As the hospital system overflows, the government is becoming more strident in its attempts to have greater compliance with the current 'suggestions' on social distancing and working from home diverting attention from their failure to anticipate the breakdown of the medical system.  PM Abe has resorted to pleading with citizens not to make their traditional home-town visits over Golden Week, while the still-crowded supermarkets may be required to limit the number of shoppers at any one time. As is evident from the Google search data above, Japan (and Singapore and latterly Indonesia) are on diverging 'paths' from most European countries, and it is premature to consider any exit strategies. We conclude that the current states of emergency across all Japanese prefectures will be extended beyond the end of Golden Week on 6th May, probably to the end of next month.<figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/129/259/original/2020-04-23_07-06-14.png?1587593194" class="editor-image img-responsive" data-smartkarma-image-id="129259"></figure><div class="content-caption">Source • Japan Analytics</div>IMPENDING PEAK - The first of the March year-end company results were announced yesterday and will become a deluge over the eight trading days either side of the Golden Week holidays. As many companies are now avoiding interim and annual forecasts, the absolute number of data points will be reduced. In the DETAIL below, we shall review the results, revisions and initial forecast announcements made yesterday.  The positive/neutral/negative balance for the nine results was 5:0:4; and for the 23 revisions/forecasts, the split was 10:1:12. Of the six companies reporting annual results, only one made a forecast for the current year. Dry cleaner <a href="https://www.smartkarma.com/entities/hakuyosha-company-ltd" target="_blank" data-smartkarma-citation="entities:4492:1" rel="noopener">Hakuyosha (9731 JP)</a> withdrew its December year-end forecasts. Three companies cut their dividends; two increased. <blockquote>Everybody talks as if they know what is going to happen - nobody knows what is going to happen - Charlie Munger</blockquote>

Source • Marco PianiTIMELINES - The excellent timelines prepared by @Marco_Piani provide a novel interpretation of Japan's 'rank' in the progression of COVID-19 on terms of both cases and deaths. The data confirms that Japan is 'lagging' the World in both respects. Also of note are the 'second waves' that are appearing in several countries, including South Africa, Argentina, Poland and the Philippines. Source • Arbor Data ScienceGOING-OUT RELATED - As the hospital system overflows, the government is becoming more strident in its attempts to have greater compliance with the current 'suggestions' on social distancing and working from home diverting attention from their failure to anticipate the breakdown of the medical system.  PM Abe has resorted to pleading with citizens not to make their traditional home-town visits over Golden Week, while the still-crowded supermarkets may be required to limit the number of shoppers at any one time. As is evident from the Google search data above, Japan (and Singapore and latterly Indonesia) are on diverging 'paths' from most European countries, and it is premature to consider any exit strategies. We conclude that the current states of emergency across all Japanese prefectures will be extended beyond the end of Golden Week on 6th May, probably to the end of next month.Source • Japan AnalyticsIMPENDING PEAK - The first of the March year-end company results were announced yesterday and will become a deluge over the eight trading days either side of the Golden Week holidays. As many companies are now avoiding interim and annual forecasts, the absolute number of data points will be reduced. In the DETAIL below, we shall review the results, revisions and initial forecast announcements made yesterday.  The positive/neutral/negative balance for the nine results was 5:0:4; and for the 23 revisions/forecasts, the split was 10:1:12. Of the six companies reporting annual results, only one made a forecast for the current year. Dry cleaner Hakuyosha (9731 JP) withdrew its December year-end forecasts. Three companies cut their dividends; two increased. Everybody talks as if they know what is going to happen - nobody knows what is going to happen - Charlie Munger

🇯🇵 JAPAN • Revisions & Results 22nd April - Timelines + JAL/ZOZO/Mizuno/CyberAgent

Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

<div class="content-highlight">
Both Bitcoin and gold prices are rallying this year and this is probably a sign of a HEDGE against political instability in China, in our view. Bitcoin and gold are two of the best-performing assets this year, with many stock markets around the world hammered by the concerns from the Wuhan virus. 
</div>
The following were the main headlines impacting the blockchain and cryptocurrencies sectors in South Korea, Japan, and globally in the past few weeks. 
<ul>
<li>BITCOIN PRICE RALLY IN 2020</li>
<li>SOUTH KOREA (TAXES ON CRYPTOS) </li>
<li>CME GROUP</li>
<li>XRP DELISTED FROM JAPAN'S BITBOX </li>
<li>FIRST SWISS COMPLIANT DIGITAL IPO </li>
<li>SAUDI ARAMCO INVESTS IN VAKT </li>
<li>NOMURA RESEARCH INSTITUTE (NRI) LAUNCHES A NEW CRYPTOCURRENCY INDEX </li>
<li>FORMATION OF NATIONAL DIGITAL CURRENCIES IN 2020</li>
<li>
BITCOIN BLOCK REWARD HALVING
</li>
<li>
EXPERTISE IN BLOCKCHAIN
</li>
</ul>
<ul>
<li>
GMO INTERNET
</li>
<li>
TOYOTA LEASING (THAILAND)
</li>
</ul>
<ul>
<li>SQUARE CRYPTO</li>
</ul>
<ul>
<li>
BITCOIN DOMINANCE
</li>
</ul>


Both Bitcoin and gold prices are rallying this year and this is probably a sign of a HEDGE against political instability in China, in our view. Bitcoin and gold are two of the best-performing assets this year, with many stock markets around the world hammered by the concerns from the Wuhan virus. 

The following were the main headlines impacting the blockchain and cryptocurrencies sectors in South Korea, Japan, and globally in the past few weeks. 

BITCOIN PRICE RALLY IN 2020
SOUTH KOREA (TAXES ON CRYPTOS) 
CME GROUP
XRP DELISTED FROM JAPAN'S BITBOX 
FIRST SWISS COMPLIANT DIGITAL IPO 
SAUDI ARAMCO INVESTS IN VAKT 
NOMURA RESEARCH INSTITUTE (NRI) LAUNCHES A NEW CRYPTOCURRENCY INDEX 
FORMATION OF NATIONAL DIGITAL CURRENCIES IN 2020

BITCOIN BLOCK REWARD HALVING


EXPERTISE IN BLOCKCHAIN




GMO INTERNET


TOYOTA LEASING (THAILAND)



SQUARE CRYPTO



BITCOIN DOMINANCE



This Month in Blockchain & Cryptos: Bitcoin Price Rally in 2020, OverFuture's Digital IPO, & Vakt

ja research

ja research is an independent research platform focused exclusively on Japanese equities. Leveraging data and graphic analysis provided by Japan Analytics, we provide insights on small and medium-sized companies that have been ignored by the sell-side as well as challenging conventional wisdom on larger companies. We also offer analyst and corporate access, the latter with translation if required. 

<figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/115/540/original/2020-01-30_04-53-40.png?1580327644" class="editor-image img-responsive" data-smartkarma-image-id="115540"></figure><div class="content-caption">Source • Japan Analytics</div>29TH JANUARY ROUNDUP - Thre were 74 results and 30 forecasts or revisions announcements yesterday. Of the 32 larger-cap companies reporting results, seven saw year-on-year declines in their quarterly OP of greater than 25%, while three - <a href="https://www.smartkarma.com/entities/nec-corp" target="_blank" data-smartkarma-citation="entities:17084:1" rel="noopener">NEC (6701 JP)</a>, <a href="https://www.smartkarma.com/entities/cyberagent-inc" target="_blank" data-smartkarma-citation="entities:8197:1" rel="noopener">CyberAgent(4751 JP)</a>, and <a href="https://www.smartkarma.com/entities/valuecommerce-co-ltd" target="_blank" data-smartkarma-citation="entities:7970:1" rel="noopener">ValueCommerce (2491 JP)</a> grew profits by more than 25%, with the last of the three showing the strongest revenue growth. <a href="https://www.smartkarma.com/entities/omron-corp" target="_blank" data-smartkarma-citation="entities:15904:1" rel="noopener">Omron (6645 JP)</a> saw sales fall by 23%. Our market composite cap-weighted Results Score declined by 8bps to 0.99FORECASTS - <a href="https://www.smartkarma.com/entities/canon-inc" target="_blank" data-smartkarma-citation="entities:1:1" rel="noopener">Canon (7751 JP)</a> released the most optimistic forecasts and account for the 24bps uptick in our Forecast/Revision Score; however, in terms of OP the FY2020 forecast is the same as the FY2016 actual result which was the second-worst outcome in the last decade after FY2019. The weakest outlook came from <a href="https://www.smartkarma.com/entities/screen-holdings-co-ltd" target="_blank" data-smartkarma-citation="entities:5563:1" rel="noopener">Screen (7735 JP)</a> (-28% v TTM OP), which, when combined with <a href="https://www.smartkarma.com/entities/advantest-corp" target="_blank" data-smartkarma-citation="entities:18107:1" rel="noopener">Advantest (6857 JP)</a>'s third-quarter results, should go some way to puncturing the current fad for owning SPE companies.<figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/115/543/original/2020-01-30_05-28-22.png?1580329720" class="editor-image img-responsive" data-smartkarma-image-id="115543"></figure><div class="content-caption">Source • Japan Analytics</div>POST-RELEASE RPS CHANGES - Of the larger-cap companies announcing the day before yesterday or pre-close yesterday, <a href="https://www.smartkarma.com/entities/obic-co-ltd" target="_blank" data-smartkarma-citation="entities:1273:1" rel="noopener">OBIC (4684 JP)</a>, <a href="https://www.smartkarma.com/entities/obic-business-consultants" target="_blank" data-smartkarma-citation="entities:17383:1" rel="noopener">Obic Business Consultants (4733 JP)</a>, and <a href="https://www.smartkarma.com/entities/sakai-moving-service-co-ltd" target="_blank" data-smartkarma-citation="entities:10020:1" rel="noopener">Sakai Moving Service (9039 JP)</a> saw Relative Price Score declines. In contrast, the two Canon group companies, <a href="https://www.smartkarma.com/entities/m3-inc" target="_blank" data-smartkarma-citation="entities:13316:1" rel="noopener">M3 (2413 JP)</a>, and <a href="https://www.smartkarma.com/entities/sekisui-jushi-corp" target="_blank" data-smartkarma-citation="entities:7654:1" rel="noopener">Sekisui Jushi (4212 JP)</a> rose.  In the DETAIL below, we review our Sector Timelines and the announcements from <a href="https://www.smartkarma.com/entities/fanuc-corp" target="_blank" data-smartkarma-citation="entities:752:1" rel="noopener">Fanuc (6954 JP)</a>, <a href="https://www.smartkarma.com/entities/canon-inc" target="_blank" data-smartkarma-citation="entities:1:1" rel="noopener">Canon (7751 JP)</a>, <a href="https://www.smartkarma.com/entities/nec-corp" target="_blank" data-smartkarma-citation="entities:17084:1" rel="noopener">NEC (6701 JP)</a>, <a href="https://www.smartkarma.com/entities/cyberagent-inc" target="_blank" data-smartkarma-citation="entities:8197:1" rel="noopener">CyberAgent (4751 JP)</a>, <a href="https://www.smartkarma.com/entities/omron-corp" target="_blank" data-smartkarma-citation="entities:15904:1" rel="noopener">Omron (6645 JP)</a>, and <a href="https://www.smartkarma.com/entities/advantest-corp" target="_blank" data-smartkarma-citation="entities:18107:1" rel="noopener">Advantest(6857 JP)</a>.

Source • Japan Analytics29TH JANUARY ROUNDUP - Thre were 74 results and 30 forecasts or revisions announcements yesterday. Of the 32 larger-cap companies reporting results, seven saw year-on-year declines in their quarterly OP of greater than 25%, while three - NEC (6701 JP), CyberAgent(4751 JP), and ValueCommerce (2491 JP) grew profits by more than 25%, with the last of the three showing the strongest revenue growth. Omron (6645 JP) saw sales fall by 23%. Our market composite cap-weighted Results Score declined by 8bps to 0.99FORECASTS - Canon (7751 JP) released the most optimistic forecasts and account for the 24bps uptick in our Forecast/Revision Score; however, in terms of OP the FY2020 forecast is the same as the FY2016 actual result which was the second-worst outcome in the last decade after FY2019. The weakest outlook came from Screen (7735 JP) (-28% v TTM OP), which, when combined with Advantest (6857 JP)'s third-quarter results, should go some way to puncturing the current fad for owning SPE companies.Source • Japan AnalyticsPOST-RELEASE RPS CHANGES - Of the larger-cap companies announcing the day before yesterday or pre-close yesterday, OBIC (4684 JP), Obic Business Consultants (4733 JP), and Sakai Moving Service (9039 JP) saw Relative Price Score declines. In contrast, the two Canon group companies, M3 (2413 JP), and Sekisui Jushi (4212 JP) rose.  In the DETAIL below, we review our Sector Timelines and the announcements from Fanuc (6954 JP), Canon (7751 JP), NEC (6701 JP), CyberAgent (4751 JP), Omron (6645 JP), and Advantest(6857 JP). 

🇯🇵 JAPAN • Results & Revisions Daily Roundup - 29th January - 6954▲ 7751► 6701▲ 4751▲ 6645▼6857▼

The past few days have been monumental in the short history of blockchain as China's president Xi Jinping stated that the country should<a href="https://www.marketwatch.com/story/bitcoin-surges-to-over-10000-in-biggest-single-day-move-since-april-2019-10-26" target="_blank" rel="noopener"> "seize the opportunity of blockchain technology." </a>This was essentially the first time that Xi has praised the merits of the blockchain technology, which resulted in the Bitcoin price exploding higher.
Although the exact timing of the launch of the China government-backed cryptocurrency is not yet known, it could be launched as soon as this winter. It remains to be seen how the Chinese government will seek to regulate Bitcoin and Ethereum as well as its own Chinese government driven cryptocurrency. However, we believe that one of the ways that the Chinese government could encourage the use of its own cryptocurrency is through various incentives schemes, including through the  "social credit scores."
Bitcoin price surged by 35% from October 24th to 26th and has since retraced slightly. As of October 28th, the Bitcoin price is $9,663 which is nearly 30% higher than October 24th just prior to Xi's embrace of the blockchain technology.

The past few days have been monumental in the short history of blockchain as China's president Xi Jinping stated that the country should "seize the opportunity of blockchain technology." This was essentially the first time that Xi has praised the merits of the blockchain technology, which resulted in the Bitcoin price exploding higher.
Although the exact timing of the launch of the China government-backed cryptocurrency is not yet known, it could be launched as soon as this winter. It remains to be seen how the Chinese government will seek to regulate Bitcoin and Ethereum as well as its own Chinese government driven cryptocurrency. However, we believe that one of the ways that the Chinese government could encourage the use of its own cryptocurrency is through various incentives schemes, including through the  "social credit scores."
Bitcoin price surged by 35% from October 24th to 26th and has since retraced slightly. As of October 28th, the Bitcoin price is $9,663 which is nearly 30% higher than October 24th just prior to Xi's embrace of the blockchain technology.  

This Week in Blockchain & Cryptos: Xi Jinping Embraces Blockchain & Bitcoin Price Surges Higher

Japan

CyberAgent, Inc. operates blog media website, Ameba.  The Company also operates internet advertising agency, foreign exchange trading website, and creates PC and mobile contents such as advertisements and games. CyberAgent invests in companies with internet related business.

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CyberAgent Inc (4751 JP)

🇯🇵 JAPAN • Results & Revisions 22nd July - OBIC, CyberAgent, Tokyo Steel & The Deep Freeze

OBIC (4684 JP)- OBIC was the largest-cap company to report on Wednesday before the four-day holiday break. Despite a deceleration in the rate of...

Campbell Gunn

🇯🇵 JAPAN • Revisions & Results 22nd April - Timelines + JAL/ZOZO/Mizuno/CyberAgent

TIMELINES - The excellent timelines prepared by @Marco_Piani provide a novel interpretation of Japan's 'rank' in the progression of COVID-19 on...

Campbell Gunn

This Month in Blockchain & Cryptos: Bitcoin Price Rally in 2020, OverFuture's Digital IPO, & Vakt

Both Bitcoin and gold prices are rallying this year and this is probably a sign of a HEDGE against political instability in China, in our view....

Douglas Kim

🇯🇵 JAPAN • Results & Revisions Daily Roundup - 29th January - 6954▲ 7751► 6701▲ 4751▲ 6645▼6857▼

29TH JANUARY ROUNDUP - Thre were 74 results and 30 forecasts or revisions announcements yesterday. Of the 32 larger-cap companies reporting...

Campbell Gunn

This Week in Blockchain & Cryptos: Xi Jinping Embraces Blockchain & Bitcoin Price Surges Higher

The past few days have been monumental in the short history of blockchain as China's president Xi Jinping stated that the country should "seize the...

Douglas Kim

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