Japanese Turnaround Situations, Short-Ideas, Azabu Research

Michael Allen

Japanese Turnaround Situations, Short-Ideas

Azabu Research

Azabu Research is a publishing and consulting firm focused on distressed equities in the Japanese market. We specialize in turnaround strategies, corporate combinations, divestitures, and restructuring.

Publisher of the Tokyo Turnaround Letter, which conducts the most thorough research possible of publicly available information, including forensic tests for fraudulent overstatement of assets and understatement of liabilities, as well as rigorous market and industry analysis to assess the underlying strengths of the company’s products or services, the appropriateness of the company’s turnaround strategy, and the skill of its current management team. The average length of a report exceeds 25 pages of text and tables, excluding any disclosures or executive summaries.

We have more than 30 years of experience in applying this process to distressed equities in Japan. Additionally, subscribers have free access to detailed, yet easily navigated earnings models for the target company as well as the top five comparable companies, and unlimited access to the analyst for follow-up questions.

Azabu Research also conducts be-spoke research on a project basis, and provides consulting services to companies looking to restructure, divest, make acquisitions, go public, or improve investor sentiment toward their stock.

Independent Research and Consulting Firm

Equity Bottom-Up

<ul>
<li>Lasertec shares dropped nearly 8% following a scathing 53-page report by Scorpion Capital, accusing management of “colossal fraud.” </li>
<li>The SC report is shrill, in our view, and therefore, we think we add value by contributing a second opinion. </li>
<li>In our view, Lasertec is due for a correction even if SC’s report is inundated by hyperbole.</li>
</ul>


Lasertec shares dropped nearly 8% following a scathing 53-page report by Scorpion Capital, accusing management of “colossal fraud.” 
The SC report is shrill, in our view, and therefore, we think we add value by contributing a second opinion. 
In our view, Lasertec is due for a correction even if SC’s report is inundated by hyperbole.


Lasertec (6920): Some of the Accusations Are Disgraceful, Some Not

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.

<ul>
<li>Lasertec has dropped more than 20% in the past week and a half, but is still selling at more than 60x EPS guidance for FY Jun-24.</li>
<li>Weak orders at ASML, disappointing guidance from TSMC and doubts about Intel's equipment purchases cast doubt on Lasertec's growth potential.</li>
<li>Between December 2021 and June 2022, Lasertec's share price dropped by more than 50%. Wait for Q3 results before reaching for a falling knife. </li>
</ul>


Lasertec has dropped more than 20% in the past week and a half, but is still selling at more than 60x EPS guidance for FY Jun-24.
Weak orders at ASML, disappointing guidance from TSMC and doubts about Intel's equipment purchases cast doubt on Lasertec's growth potential.
Between December 2021 and June 2022, Lasertec's share price dropped by more than 50%. Wait for Q3 results before reaching for a falling knife. 


Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<ul>
<li>Lasertec (6920) is a shoo-in for Nikkei 225 inclusion in September according to the quantitative analysis. The amount to buy is a small multiple of ADV, making the inclusion "unimpressive."</li>
<li>It is probably worth looking at the details of ownership, of volume, and of relationship to other stocks in the same general sector.</li>
<li>It is also worth thinking about flow channels (stock up or down changes flows) and forward fundamental calculations.</li>
</ul>


Lasertec (6920) is a shoo-in for Nikkei 225 inclusion in September according to the quantitative analysis. The amount to buy is a small multiple of ADV, making the inclusion "unimpressive."
It is probably worth looking at the details of ownership, of volume, and of relationship to other stocks in the same general sector.
It is also worth thinking about flow channels (stock up or down changes flows) and forward fundamental calculations.


Lasertec (6920) - The State of Things May Be Different Than You Think

<ul>
<li>The 2023 Version of <strong>JAPAN PASSIVE: Who Owns What?</strong> where we break down the major (and minor) passive tracking indices and which category of investor owns how much of each. </li>
<li>Even if you do not "play" index changes, understanding impact is important. Advantest is up 100% in 3mos. Existing passive ownership and new passive buying were crucial to that performance.</li>
<li>Understanding the nature of the ownership and flows is crucial to understanding how to trade certain stocks in Japan. </li>
</ul>


The 2023 Version of JAPAN PASSIVE: Who Owns What? where we break down the major (and minor) passive tracking indices and which category of investor owns how much of each. 
Even if you do not "play" index changes, understanding impact is important. Advantest is up 100% in 3mos. Existing passive ownership and new passive buying were crucial to that performance.
Understanding the nature of the ownership and flows is crucial to understanding how to trade certain stocks in Japan. 


Equity Long-Short, Semiconductors, Fabricated Knowledge

Douglas O'Laughlin

Equity Long-Short, Semiconductors

Fabricated Knowledge

Learn more about the world's most important manufactured product. Meaningful insight, timely analysis, and an occasional investment idea.

<ul>
<li>
<p>Alphawave reported last week.</p>
</li>
<li>
<p>The results were not good; they were great.</p>
</li>
<li>
<p>I actually am excited to see Tony and the team execute like this. Bookings are growing, and while revenue has not come out yet, it seems very likely they will hit their 2023 revenue estimates.</p>
<div></div>
</li>
</ul>



Alphawave reported last week.


The results were not good; they were great.


I actually am excited to see Tony and the team execute like this. Bookings are growing, and while revenue has not come out yet, it seems very likely they will hit their 2023 revenue estimates.




Alphawave, TSMC and Lam Research Follow-up, DISCO and Lasertec

Japan

Lasertec Corporation develops, designs, manufactures and markets photomask inspection systems to make semiconductor devices, confocal scanning laser microscopes and liquid crystal display (LCD) inspection systems.

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Lasertec Corp (6920 JP)

Lasertec (6920): Some of the Accusations Are Disgraceful, Some Not

Lasertec's shares plummeted 8% after a report accused management of fraud. In our view, the short-seller's report was inundated with inaccuracies...

Michael Allen

Lasertec (6920 JP): Further to Fall

Lasertec is down more than 20% but still looks overvalued as weak orders at ASML, disappointing guidance at TSMC and uncertain equipment demand at...

Scott Foster

Lasertec (6920) - The State of Things May Be Different Than You Think

All the earnings are out. Lasertec had previewed its June 2023 results in a 24 July guidance upgrade, and beat those. It also released June 2024...

Travis Lundy

JAPAN PASSIVE: Who Owns What 2023?

This is the annual JAPAN PASSIVE: Who Owns What report for 2023. It is a comprehensive of the major index exposures in Japan by index tracker type,...

Travis Lundy

Alphawave, TSMC and Lam Research Follow-up, DISCO and Lasertec

Alphawave reported last week. The results were not good; they were great. I actually am excited to see Tony and the team execute like this....

Fabricated Knowledge

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Lasertec (6920): Some of the Accusations Are Disgraceful, Some Not

​Lasertec's shares plummeted 8% after a report accused management of fraud. In our view, the short-seller's report was inundated with inaccuracies...

Michael Allen

Lasertec (6920 JP): Further to Fall

Lasertec is down more than 20% but still looks overvalued as weak orders at ASML, disappointing guidance at TSMC and uncertain equipment demand at...

Scott Foster

Lasertec (6920) - The State of Things May Be Different Than You Think

All the earnings are out. Lasertec had previewed its June 2023 results in a 24 July guidance upgrade, and beat those. It also released June 2024...

Travis Lundy

JAPAN PASSIVE: Who Owns What 2023?

This is the annual JAPAN PASSIVE: Who Owns What report for 2023. It is a comprehensive of the major index exposures in Japan by index tracker type,...

Travis Lundy

Alphawave, TSMC and Lam Research Follow-up, DISCO and Lasertec

Alphawave reported last week. The results were not good; they were great. I actually am excited to see Tony and the team execute like this....

Fabricated Knowledge

Lasertec's shares plummeted 8% after a report accused management of fraud. In our view, the short-seller's report was inundated with inaccuracies...