'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)

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<p style="text-align: center;"><strong>• BEST &amp; WORST •</strong></p>
<p>The best and worst pair from yesterday's announcements is call centre <a href="https://www.smartkarma.com/entities/bell-system24-holdings-inc" target="_blank" data-smartkarma-citation="entities:27224:1" rel="noopener">Bell System24 (6183 JP)</a> and the very Overbought <a href="https://www.smartkarma.com/entities/jcr-pharmaceuticals-co-ltd" target="_blank" data-smartkarma-citation="entities:20126:1" rel="noopener">JCR Pharmaceuticals (4552 JP)</a>.</p>
<figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/163/985/original/2020-10-08_05-56-30.png?1602104205" class="editor-image img-responsive" data-smartkarma-image-id="163985"></figure><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/163/986/original/2020-10-08_05-55-56.png?1602104228" class="editor-image img-responsive" data-smartkarma-image-id="163986"></figure><div class="content-caption">Source for all charts &amp; tables: Japan Analytics</div>
<strong>AEON GROUP</strong> - Wednesday was 'Aeonday' as the majority of group companies reported, and a majority are still showing trailing losses. Parent Aeon's revenues were stable but trailing operating income is still declining at a double-digit rate, something the market is content to 'look through'. At 2.33 Aeon's Relative Price Score is close to a fifteen-year high; its PBR is twice that of <a href="https://www.smartkarma.com/entities/seven-i-holdings-co-ltd" target="_blank" data-smartkarma-citation="entities:1041:1" rel="noopener">Seven &amp; I (3382 JP)</a> whose Residual Core Return is six times Aeon's. We would trade the 'pair'.</div><div></div><div>
<figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/163/987/original/2020-10-08_06-17-52.png?1602105492" class="editor-image img-responsive" data-smartkarma-image-id="163987"></figure><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/163/988/original/2020-10-08_06-22-24.png?1602105757" class="editor-image img-responsive" data-smartkarma-image-id="163988"></figure><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/163/989/original/2020-10-08_06-25-33.png?1602105947" class="editor-image img-responsive" data-smartkarma-image-id="163989"></figure><p></p>
</div><div>
<hr>
<p style="text-align: center;"><strong>DAILY STATS</strong></p>
</div><hr><div><p style="text-align: center;"><strong>21 Quarterly Results</strong></p></div><div><ul style="list-style-type: disc;">
<li><p><strong>Results Score:</strong> 62% Positive / 10% Neutral / 28% Negative</p></li>
<li><p><strong>Average Results Score Change:</strong> +1.5 points</p></li>
<li><p><strong>Average % Change in Revenue:</strong> +8.2% Quarter YoY / +9.1% Rolling TTM YoY </p></li>
<li><p><strong>Average Operating Profit Margin Change:</strong> -3.0ppt</p></li>
<li><p><strong>Percentage Making Quarterly Losses:</strong> 33%</p></li>
</ul></div><hr><div><p style="text-align: center;"><strong>15 Annual • 3 Interim Forecasts/Revisions</strong></p></div><div><ul style="list-style-type: disc;">
<li><p><strong>Annual Forecast/Revision Score:</strong> 47% Positive / 6% Neutral / 47% Negative</p></li>
<li><p><strong>Interim Forecast/Revision Score Change:</strong> 0% Positive / 0% Neutral / 100% Negative</p></li>
<li><p><strong>Average Forecast/Revision Score Change:</strong> -6.8 point</p></li>
</ul></div>


• BEST &amp; WORST •
The best and worst pair from yesterday's announcements is call centre Bell System24 (6183 JP) and the very Overbought JCR Pharmaceuticals (4552 JP).
Source for all charts &amp; tables: Japan Analytics
AEON GROUP - Wednesday was 'Aeonday' as the majority of group companies reported, and a majority are still showing trailing losses. Parent Aeon's revenues were stable but trailing operating income is still declining at a double-digit rate, something the market is content to 'look through'. At 2.33 Aeon's Relative Price Score is close to a fifteen-year high; its PBR is twice that of Seven &amp; I (3382 JP) whose Residual Core Return is six times Aeon's. We would trade the 'pair'.



DAILY STATS
21 Quarterly Results
Results Score: 62% Positive / 10% Neutral / 28% Negative
Average Results Score Change: +1.5 points
Average % Change in Revenue: +8.2% Quarter YoY / +9.1% Rolling TTM YoY 
Average Operating Profit Margin Change: -3.0ppt
Percentage Making Quarterly Losses: 33%
15 Annual • 3 Interim Forecasts/Revisions
Annual Forecast/Revision Score: 47% Positive / 6% Neutral / 47% Negative
Interim Forecast/Revision Score Change: 0% Positive / 0% Neutral / 100% Negative
Average Forecast/Revision Score Change: -6.8 point


🇯🇵 JAPAN • Results & Revisions - 10/​​​​​​​​07 Aeon Group, BS24, Welcia, JCR Pharma

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>Upside momentum continues to wane for global equities. Price action this week has indeed confirmed lower highs for now in the MSCI ACWI, ACWI ex-US, EAFE, and EM indexes. These lower highs increase the probability for breakdowns and a deeper pullback, but we do not want to get ahead of ourselves. Until we see breakdowns we still view global equities as being in a period of consolidation. We outline important technical levels across markets and highlight actionable set ups within Technology, Health care and Staples.</p>

Upside momentum continues to wane for global equities. Price action this week has indeed confirmed lower highs for now in the MSCI ACWI, ACWI ex-US, EAFE, and EM indexes. These lower highs increase the probability for breakdowns and a deeper pullback, but we do not want to get ahead of ourselves. Until we see breakdowns we still view global equities as being in a period of consolidation. We outline important technical levels across markets and highlight actionable set ups within Technology, Health care and Staples.

Global Equity Strategy: Stay Defensive With Technology, Health Care, Staples

<p>Positive news flow surrounding COVID-19 is encouraging on many fronts. Still, despite encouraging news and the relief rally in global equities, history tells us that this is a fairly standard bear market rally in terms of its magnitude, making us believe the global equity market is not yet out of the woods. We are watching for signs of a turn of the tide. There has been significant damage inflicted and that damage is going to take time to repair. Actionable Themes in this report have representation in Staples, Health Care, Technology, and a collection of bottom-up ideas. </p>

Positive news flow surrounding COVID-19 is encouraging on many fronts. Still, despite encouraging news and the relief rally in global equities, history tells us that this is a fairly standard bear market rally in terms of its magnitude, making us believe the global equity market is not yet out of the woods. We are watching for signs of a turn of the tide. There has been significant damage inflicted and that damage is going to take time to repair. Actionable Themes in this report have representation in Staples, Health Care, Technology, and a collection of bottom-up ideas. 

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/000/124/934/original/2020-03-27_06-28-40.png?1585258181" class="editor-image img-responsive" data-smartkarma-image-id="124934"></figure><div class="content-caption">Source • Japan Analytics</div><p><strong>THURSDAY 26th MARCH</strong> - Yesterday saw six companies reporting results, of which only two -<a href="https://www.smartkarma.com/entities/optoelectronics-co-ltd" target="_blank" data-smartkarma-citation="entities:9374:1" rel="noopener">Optoelectronics (6664 JP)</a> and <a href="https://www.smartkarma.com/entities/fukushima-printing-co-ltd" target="_blank" data-smartkarma-citation="entities:3931:1" rel="noopener">Fukushima Printing (7870 JP)</a> - has positive scores. Seventeen companies revised their forecasts, and one made initial forecasts. In terms of our scoring system, the ratio of positive to negative 'scores' was 5:11, with <a href="https://www.smartkarma.com/entities/jxtg-holdings-inc" target="_blank" data-smartkarma-citation="entities:638:1" rel="noopener">JXTG (5020 JP) </a>being the largest negative-scoring company and <a href="https://www.smartkarma.com/entities/maxvalu-nishinihon-co-ltd" target="_blank" data-smartkarma-citation="entities:13743:1" rel="noopener">Maxvalu Nishinihon (8287 JP)</a> being unchanged. Of the six companies announcing results, only two had positive outcomes.</p><div class="content-caption"><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/124/936/original/File%202020-03-27%200%2015%2036.jpeg?1585258841" class="editor-image img-responsive" data-smartkarma-image-id="124936"></figure></div><div class="content-caption">Source • NHK</div><p><strong>GOOD NEWS • BAD NEWS </strong>- The good news is that the increase in disclosed cases of Covid-19 outside Tokyo has not increased significantly; Tokyo, however, has seen an alarming rise. Forty-seven new cases were confirmed yesterday, taking the total in the metropolis to 259. Tokyo will implement a 'stay-at-home-policy' this weekend. Surrounding prefectures have encouraged their residents not to travel into the city over the weekend. Amusement parks that had reopened last weekend will now close their doors.</p><p><strong>ODD NEWS</strong> - In other 'news', the Sapporo Board of Education is debating whether to allow students to wear face masks that are not white. In the past, many schools have mandated that children can only have black hair, forcing some children whose hair is naturally lighter to dye their hair black to conform to the 'norm'.  </p>

Source • Japan AnalyticsTHURSDAY 26th MARCH - Yesterday saw six companies reporting results, of which only two -Optoelectronics (6664 JP) and Fukushima Printing (7870 JP) - has positive scores. Seventeen companies revised their forecasts, and one made initial forecasts. In terms of our scoring system, the ratio of positive to negative 'scores' was 5:11, with JXTG (5020 JP) being the largest negative-scoring company and Maxvalu Nishinihon (8287 JP) being unchanged. Of the six companies announcing results, only two had positive outcomes.Source • NHKGOOD NEWS • BAD NEWS - The good news is that the increase in disclosed cases of Covid-19 outside Tokyo has not increased significantly; Tokyo, however, has seen an alarming rise. Forty-seven new cases were confirmed yesterday, taking the total in the metropolis to 259. Tokyo will implement a 'stay-at-home-policy' this weekend. Surrounding prefectures have encouraged their residents not to travel into the city over the weekend. Amusement parks that had reopened last weekend will now close their doors.ODD NEWS - In other 'news', the Sapporo Board of Education is debating whether to allow students to wear face masks that are not white. In the past, many schools have mandated that children can only have black hair, forcing some children whose hair is naturally lighter to dye their hair black to conform to the 'norm'.  

🇯🇵 JAPAN • Revisions & Results Alert - 26th March

MSCI Emerging Markets Index / Technical Analysis

<p>Supporting our global bull market thesis, uptrends remain intact for the major global indexes (MSCI ACWI, ACWI ex-US, EAFE, and EM). At this point, concerns surrounding the Wuhan coronavirus have led to some market setbacks and deterioration in market indicators, however they have not resulted in breakdowns. This is true even for areas of the market most-directly affected, including China (MSCI China) and emerging markets (MSCI EM). For these reasons and, as long as there is no significant additional damage, we view recent weakness as a buying opportunity - especially within EM. We see coronavirus concerns as helping correct the excess bullish sentiment and optimism in the short-term.</p>

Supporting our global bull market thesis, uptrends remain intact for the major global indexes (MSCI ACWI, ACWI ex-US, EAFE, and EM). At this point, concerns surrounding the Wuhan coronavirus have led to some market setbacks and deterioration in market indicators, however they have not resulted in breakdowns. This is true even for areas of the market most-directly affected, including China (MSCI China) and emerging markets (MSCI EM). For these reasons and, as long as there is no significant additional damage, we view recent weakness as a buying opportunity - especially within EM. We see coronavirus concerns as helping correct the excess bullish sentiment and optimism in the short-term.

Japan

JCR Pharmaceuticals Co., Ltd. develops, produces, and sells pharmaceutical products and raw materials.  The Company also sells equipment for hospital and laboratory use.  JCR Pharmaceuticals' products include drug for leukemic diseases and hormonal agents including genetically engineered human somatotrophic hormone (growth hormone) and gonadotropic hormone.

Price Gauge
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Jcr Pharmaceuticals (4552 JP)

🇯🇵 JAPAN • Results & Revisions - 10/07 Aeon Group, BS24, Welcia, JCR Pharma

• BEST & WORST • The best and worst pair from sday's announcements is consumer electronics retailer Bic Camera (3048 JP) and Japan's largest...

Campbell Gunn

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Upside momentum continues to wane for global equities. Price action this week has indeed confirmed lower highs for now in the MSCI ACWI, ACWI...

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Major Indexes Testing Resistance

Positive news flow surrounding COVID-19 is encouraging on many fronts. Still, despite encouraging news and the relief rally in global equities,...

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🇯🇵 JAPAN • Revisions & Results Alert - 26th March

THURSDAY 26th MARCH - Yesterday saw six companies reporting results, of which only two -Optoelectronics (6664 JP) and Fukushima Printing (7870 JP)...

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EM Pullback Opportunity

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🇯🇵 JAPAN • Results & Revisions - 10/​​​​​​​​07 Aeon Group, BS24, Welcia, JCR Pharma

• BEST & WORST • The best and worst pair from sday's announcements is consumer electronics retailer Bic Camera (3048 JP) and Japan's largest...

Campbell Gunn

Global Equity Strategy: Stay Defensive With Technology, Health Care, Staples

Upside momentum continues to wane for global equities. Price action this week has indeed confirmed lower highs for now in the MSCI ACWI, ACWI...

Vermilion Research

Major Indexes Testing Resistance

Positive news flow surrounding COVID-19 is encouraging on many fronts. Still, despite encouraging news and the relief rally in global equities,...

Vermilion Research

🇯🇵 JAPAN • Revisions & Results Alert - 26th March

THURSDAY 26th MARCH - Yesterday saw six companies reporting results, of which only two -Optoelectronics (6664 JP) and Fukushima Printing (7870 JP)...

Campbell Gunn

EM Pullback Opportunity

Supporting our global bull market thesis, uptrends remain intact for the major global indexes (MSCI ACWI, ACWI ex-US, EAFE, and EM). At this point,...

Vermilion Research

🇯🇵 JAPAN • Results & Revisions - 10/07 Aeon Group, BS24, Welcia, JCR Pharma