Senior Technology Analyst, Japanese Equities, LightStream Research

Scott Foster

Senior Technology Analyst, Japanese Equities

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

<ul>
<li>Nidec has become an auto parts and factory automation company and should be valued as such. At 24x EPS guidance for FY Mar-23, the shares do not look particularly cheap.</li>
<li>1H results were good, but heavy up-front investment in e-axle traction motor systems for electric vehicles points to deferred gratification for shareholders. </li>
<li>Recession is starting to bite, the Yen is up and Japanese interest rates have only started to rise. Be careful when buying for long-term growth.</li>
</ul>


Nidec has become an auto parts and factory automation company and should be valued as such. At 24x EPS guidance for FY Mar-23, the shares do not look particularly cheap.
1H results were good, but heavy up-front investment in e-axle traction motor systems for electric vehicles points to deferred gratification for shareholders. 
Recession is starting to bite, the Yen is up and Japanese interest rates have only started to rise. Be careful when buying for long-term growth.


Japan Specialist

Mark Chadwick

<ul>
<li>Machine Tool Orders in Japan decreased to 141 billion yen in October from 149 billion yen a year ago.</li>
<li>The 5.4% decline marks the start of the third downturn in Machine Tool Orders over the past decade. </li>
<li>We analyse those downturns and believe that Fanuc’s stock price has probably hit bottom, but THIS TIME IS DIFFERENT</li>
</ul>


Machine Tool Orders in Japan decreased to 141 billion yen in October from 149 billion yen a year ago.
The 5.4% decline marks the start of the third downturn in Machine Tool Orders over the past decade. 
We analyse those downturns and believe that Fanuc’s stock price has probably hit bottom, but THIS TIME IS DIFFERENT


Thematic (Sector/Industry)

<ul>
<li>
<strong>Good Morning Japan:</strong> We strive to provide the best macro, stock and thematic overnight news that will impact the trading day in Japan. Like this ?  Feedback appreciated !</li>
<li>BUY EVERY RALLY:  Equities, USD, Yen - market now priced in peak CPI and Fed Pivot. Still, we have a ways to go.</li>
<li>NKY to up 1.8% vs cash; Yen now 141 handle - not positive for all companies; Buybacks continue at a torried pace; Machine Tools -YoY. Negative Fanuc</li>
</ul>



Good Morning Japan: We strive to provide the best macro, stock and thematic overnight news that will impact the trading day in Japan. Like this ?  Feedback appreciated !
BUY EVERY RALLY:  Equities, USD, Yen - market now priced in peak CPI and Fed Pivot. Still, we have a ways to go.
NKY to up 1.8% vs cash; Yen now 141 handle - not positive for all companies; Buybacks continue at a torried pace; Machine Tools -YoY. Negative Fanuc


Good Morning Japan | Inflation Slain? = Buy Everything Rally

Covering IPOs, Healthcare and Technology Stocks

Andrei Zakharov

Algosun Global

Private Capital Markets

<ul>
<li>ROKAE Robotics is a Beijing-based supplier of next-generation flexible cobots and lightweight industrial robots backed by Chinese conglomerate New Hope Group and VC investors. </li>
<li>ROKAE Robotics has raised a total of ~CN¥900M in funding over 5 rounds. The last round was a CN¥400M private equity in May-21 that was led by New Hope Group. </li>
<li>The company operates a manufacturing industrial park in Shandong province with an annual output of 50,000+ robots. </li>
</ul>


ROKAE Robotics is a Beijing-based supplier of next-generation flexible cobots and lightweight industrial robots backed by Chinese conglomerate New Hope Group and VC investors. 
ROKAE Robotics has raised a total of ~CN¥900M in funding over 5 rounds. The last round was a CN¥400M private equity in May-21 that was led by New Hope Group. 
The company operates a manufacturing industrial park in Shandong province with an annual output of 50,000+ robots. 


ROKAE Robotics: Founder-Led Supplier of Flexible Cobots and Lightweight Industrial Robots

<ul>
<li>Keyence reported record 2Q Sales and OP, thoroughly beating street expectations. The company recorded high double-digit growth in all regions - even in Europe.  </li>
<li>Pricing power is on display 10-35% price hikes to shore up the dip in GPM to 81.3%, depressed on higher raw material costs.  Sets up for future earnings growth. </li>
<li>The share price has underperformed the TOPIX -26%YTD. Valuations at the bottom of the recent range. We expect a share price recovery and are bullish. </li>
</ul>


Keyence reported record 2Q Sales and OP, thoroughly beating street expectations. The company recorded high double-digit growth in all regions - even in Europe.  
Pricing power is on display 10-35% price hikes to shore up the dip in GPM to 81.3%, depressed on higher raw material costs.  Sets up for future earnings growth. 
The share price has underperformed the TOPIX -26%YTD. Valuations at the bottom of the recent range. We expect a share price recovery and are bullish. 


Keyence(6861 JP) | The Rise of the Phoenix – A Company like No Other

Japan

FANUC CORPORATION manufactures factory automation (FA) systems and equipments, and robots. The Company's products include computerized numerically-controlled (CNC) equipment, servo motors, laser systems, industrial robots, wire-cut electric discharge machines, and CNC drill.  Fanuc participates in a joint venture with General Electric in the FA field.

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Fanuc Corp (6954 JP)

Nidec (6594 JP): New Valuation Benchmark

It is fashionable to criticize Nidec's business model, but valuation compression is the greater risk. Japanese interest rates have started to rise...

Scott Foster

Fanuc (6954) | This Time Is Different

Japan Machine Tool Orders have entered the third downturn since GFC. Fanuc's valuation has already sunk to downturn levels, but we fear this...

Mark Chadwick

Good Morning Japan | Inflation Slain? = Buy Everything Rally

Good Morning Japan: We strive to provide the best macro, stock and thematic overnight news that will impact the trading day in Japan. Like this ? ...

Mark Chadwick

ROKAE Robotics: Founder-Led Supplier of Flexible Cobots and Lightweight Industrial Robots

ROKAE Robotics is one of our top picks in China's industrial robotics segment. Beijing-based robotics firm focuses on flexible cobots, lightweight...

Andrei Zakharov

Keyence(6861 JP) | The Rise of the Phoenix – A Company like No Other

2Q record earnings confirms why Keyence will continue to grow for years to come. The price hikes sets the company up for strong earnings growth. ...

Mark Chadwick

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