Japan Specialist

Mark Chadwick

Thematic (Sector/Industry)

<ul>
<li>The Corona virus was an effective muzzle on activist demands this year. It also gave companies a convenient excuse to curtail investor participation. </li>
<li>Virtually all shareholder proposals were rejected. It could be written off as "when disaster strikes people come together". </li>
<li>This should not detract from the significant improvements in corporate governance to date nor the less visible wins that take place behind closed doors. </li>
<li>Japanese cash-rich companies look even more attractive relative to global peers. Activism is not going away. Perhaps, the approach may change. </li>
</ul>


The Corona virus was an effective muzzle on activist demands this year. It also gave companies a convenient excuse to curtail investor participation. 
Virtually all shareholder proposals were rejected. It could be written off as "when disaster strikes people come together". 
This should not detract from the significant improvements in corporate governance to date nor the less visible wins that take place behind closed doors. 
Japanese cash-rich companies look even more attractive relative to global peers. Activism is not going away. Perhaps, the approach may change. 


Japanese Activism: Playing Behind Closed Doors

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

The probability for a breakout for global equities (MSCI ACWI) has increased in the past week based on several positive technical developments which we highlight below. Still, there are several indicators that continue to tell us we are not yet out of the woods. In this report we outline key technical levels and drivers across major markets, and highlight attractive set ups in the following areas: European &amp; UK Banks, Exchanges/Markets, Asset Managers, and Insurance, Major Autos and Communications.

The probability for a breakout for global equities (MSCI ACWI) has increased in the past week based on several positive technical developments which we highlight below. Still, there are several indicators that continue to tell us we are not yet out of the woods. In this report we outline key technical levels and drivers across major markets, and highlight attractive set ups in the following areas: European &amp; UK Banks, Exchanges/Markets, Asset Managers, and Insurance, Major Autos and Communications.

Global Equity Strategy: Bullish Breakout Probability on the Rise

After failing to break above resistance, global equities (MSCI ACWI) have had a rough start to the third quarter. Continued weakness in global manufacturing and the U.S.-EU tariff escalation raises the potential for a breakdown in global equities, however our outlook remains neutral as long as the MSCI ACWI remains confined to its horizontal range. In today's report we highlight attractive and actionable set-ups within technology, construction and engineering, and real estate.

After failing to break above resistance, global equities (MSCI ACWI) have had a rough start to the third quarter. Continued weakness in global manufacturing and the U.S.-EU tariff escalation raises the potential for a breakdown in global equities, however our outlook remains neutral as long as the MSCI ACWI remains confined to its horizontal range. In today's report we highlight attractive and actionable set-ups within technology, construction and engineering, and real estate.

Global Equity Strategy: Prevailing Trends Persist

Doing bespoke work since 2002....., Custom Products Group

Patrick Hansen

Doing bespoke work since 2002.....

Custom Products Group

Custom Products was started 14 years ago at Lehman Brothers by current co-founder Patrick Hansen, CFA. After 3 years at Lehman, Patrick moved the team to Macquarie Securities where Simon Rigney (co-founder) joined. 3 years ago we took Custom Products independent. 

Our core strength can be summed up three words. 1- Customization - we have very little off the shelf products and most work is done on a one on one bespoke basis. 2- Speed - We pride ourselves in our ability to get requests back to the client very quickly. 3- Confidentiality - We do not redistribute. There is no grace period where we wait a week and then mass blast. Any request stops with that client.

I was screening for names yesterday and started by limited the universe to names above ¥50bn mkt-cap. This parameter reduced the universe to 1,121 names in Japan. I then limited the screen to companies with 5 or more analysts with coverage. This brought my universe down to 428 names. It was crazy that 693 names were immediately eliminated from the screen. So we decided to screen for names that have very little coverage on the Street. Instead of consensus we used company guidance for FY1 PE and…

I was screening for names yesterday and started by limited the universe to names above ¥50bn mkt-cap. This parameter reduced the universe to 1,121 names in Japan. I then limited the screen to companies with 5 or more analysts with coverage. This brought my universe down to 428 names. It was crazy that 693 names were immediately eliminated from the screen. So we decided to screen for names that have very little coverage on the Street. Instead of consensus we used company guidance for FY1 PE and…

Good Stocks You Don't Hear About. Mainly Because There Is Very Little to No Coverage....

Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<ul>
<li>Hazama Ando spent a long time coming out of its doldrums. In February 2020, it started to improve. It started a buyback, scarfing up 22% of volume in 6 weeks.</li>
<li>Later in 2020, another, and in 2021, another still, now with the last one finished in a hurry, they announced another. They've bought back stock 17 months in a row.</li>
<li>It's not clear the master rules of the buyback, but historically they have been reasonably aggressive. I expect that continues.</li>
</ul>


Hazama Ando spent a long time coming out of its doldrums. In February 2020, it started to improve. It started a buyback, scarfing up 22% of volume in 6 weeks.
Later in 2020, another, and in 2021, another still, now with the last one finished in a hurry, they announced another. They've bought back stock 17 months in a row.
It's not clear the master rules of the buyback, but historically they have been reasonably aggressive. I expect that continues.


Hazama Ando (1719 JP) - Big Buyback Is Set & Forget

Japan

Hazama Ando Corp is established through the reorganization of Hazama. The Company performs civil engineering works such as dam, highway, and underground power line projects.  Hazama also constructs commercial, institutional, and industrial buildings including skyscrapers, museums, theaters, and convention centers.

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Hazama Ando (1719 JP)

Japanese Activism: Playing Behind Closed Doors

The Corona virus was an effective muzzle on activist demands this year. It also gave companies a convenient excuse to curtail investor...

Mark Chadwick

Global Equity Strategy: Bullish Breakout Probability on the Rise

The probability for a breakout for global equities (MSCI ACWI) has increased in the past week based on several positive technical developments...

Vermilion Research

Global Equity Strategy: Prevailing Trends Persist

After failing to break above resistance, global equities (MSCI ACWI) have had a rough start to the third quarter. Continued weakness in global...

Vermilion Research

Good Stocks You Don't Hear About. Mainly Because There Is Very Little to No Coverage....

I was screening for names yesterday and started by limited the universe to names above ¥50bn mkt-cap. This parameter reduced the universe to 1,121...

Custom Products Group

Hazama Ando (1719 JP) - Big Buyback Is Set & Forget

Hazama Ando announced another buyback. Their 4th in 2 years, in the last three bought back nearly 15% of the company. This one is ~6-6.5%. Already...

Travis Lundy

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