TMT & Consumer Independent Equity Research Analyst, Obex Capital Research

Aaron Gabin

TMT & Consumer Independent Equity Research Analyst

TMT & Consumer Independent Equity Research

Obex Capital Research

“Obex” is Latin for Barriers to Entry. Obex Capital Management’s investment philosophy is driven by an intense focus on which business model’s Barriers to Entry are able to withstand the ever increasing competitive disruption in the TMT and Consumer Sectors.

Equity Bottom-Up

Spotify continues to generate mid-teens revenue growth, zero operating leverage, declining pricing power, and decent subscriber growth. We are still waiting for an explanation of why paying out $100s of millions of dollars for minimally profitable (assuming it was disclosed) podcasting content translated to a $25B increase in market cap since April.<div class="content-highlight">Obex’s fundamental research process is focused on secular change in the TMT and Consumer sectors. We seek to differentiate between fundamental business analysis and security analysis. Before deciding if a security’s pricing and positioning merit a long or short position, we analyze the four pillars of business fundamentals (Secular Factors, TAM, Competitive Advantage, Business Model) in order to determine if this is a “good” or “not so good” opportunity.</div>

Spotify continues to generate mid-teens revenue growth, zero operating leverage, declining pricing power, and decent subscriber growth. We are still waiting for an explanation of why paying out $100s of millions of dollars for minimally profitable (assuming it was disclosed) podcasting content translated to a $25B increase in market cap since April.Obex’s fundamental research process is focused on secular change in the TMT and Consumer sectors. We seek to differentiate between fundamental business analysis and security analysis. Before deciding if a security’s pricing and positioning merit a long or short position, we analyze the four pillars of business fundamentals (Secular Factors, TAM, Competitive Advantage, Business Model) in order to determine if this is a “good” or “not so good” opportunity.

Forensic Analyst, Trudence Capital Advisors

Nitin Mangal

Forensic Analyst

The controversies created by hate speeches have not only ignited the political angle but have also gradually started to influence the corporate strategic decision making. Various Indian giant corporates have started to boycott news channels that play a hand in spreading toxicity, abuse, fake news,and hate speeches. This is a very strong indication that ESG investing is gaining traction in the country and the companies eventually are becoming quite sensitive to these matters.

The controversies created by hate speeches have not only ignited the political angle but have also gradually started to influence the corporate strategic decision making. Various Indian giant corporates have started to boycott news channels that play a hand in spreading toxicity, abuse, fake news,and hate speeches. This is a very strong indication that ESG investing is gaining traction in the country and the companies eventually are becoming quite sensitive to these matters.

Boycotting Hate Speeches: Will It Find Its Way into ESG Investing?

As we approach the meat of earnings season this week, we give our take on which tech stocks its worth taking earnings risk on. Yea, we still like Amazon. But Google may be poised for the most explosive earnings reaction.

As we approach the meat of earnings season this week, we give our take on which tech stocks its worth taking earnings risk on. Yea, we still like Amazon. But Google may be poised for the most explosive earnings reaction. 

Asset Allocation & Fund Positioning, Copley Fund Research

Steven Holden

Asset Allocation & Fund Positioning

Copley Fund Research

Copley Fund Research provide research and data on asset allocation among Global and Emerging Market equity funds.  The analysis details absolute and relative positioning across countries, sectors and industries together with highly granular data on single stock and single fund allocations.  The data is updated monthly with time series going back to January 2011.

Global Research - Analysis of 165 prominent Global equity funds, combined AUM $335bn
GEM Research - Analysis of 127 prominent global EM equity funds, combined AUM $250bn

Asset Allocation - Global and GEM Equity

Cross Asset Strategy

<ul>
<li>US underweight rises to highest ever level among Global investors</li>
<li>Tech and Consumer Discretionary outperformance drives underweights higher</li>
<li>Increasing underweight driven by passive inflows as large cap stocks dominate indices.</li>
<li>Active funds running larger underweight positions among top index constituents.</li>
<li>Active buying to close underweight holdings fuels the fire of the large-cap rally further still.</li>
</ul>Analysis taken from our global active manager research, covering 391 global funds with a combined AUM of $750bn


US underweight rises to highest ever level among Global investors
Tech and Consumer Discretionary outperformance drives underweights higher
Increasing underweight driven by passive inflows as large cap stocks dominate indices.
Active funds running larger underweight positions among top index constituents.
Active buying to close underweight holdings fuels the fire of the large-cap rally further still.
Analysis taken from our global active manager research, covering 391 global funds with a combined AUM of $750bn

The Anatomy of the US Underweight (And the Effect of Rising Passive ETF Flows in the US).

Alpha-Centric ESG Research

Kyle Rudden

After a year-long investigation, the U.S. Department of Justice (DOJ) <a href="https://www.justice.gov/opa/pr/justice-department-sues-monopolist-google-violating-antitrust-laws" target="_blank" rel="noopener">announced</a> that it filed a civil <a href="https://www.justice.gov/opa/press-release/file/1328941/download" target="_blank" rel="noopener">antitrust lawsuit</a> against Google; owned by, and nearly synonymous with, <a href="https://www.smartkarma.com/entities/alphabet-inc-cl-c" target="_blank" data-smartkarma-citation="entities:11369:1" rel="noopener">Alphabet (GOOG US)</a>.Not exactly a surprise since Google and its FAANG brethren have been in the crosshairs for a while. Still, the formality hits hard. Like getting dumped; you know it's coming, but the words still sting.DOJ's case is already quoted ad nauseam in the media, so I will regurgitate just a few small bits for context, then delve into my particular "angle" on this – i.e., how the U.S. Elections factor in.In Facebook parlance, "It's Complicated," but here is the gist:<ul>
<li>Antitrust cases of this magnitude and complexity can be drawn out over many, many years.</li>
<li>Long-term, big-picture? Bad. Even just the overhang. Bad for Google, foreboding for others.</li>
<li>If you zoom in to a smaller near-term window, however… it's still bad. But maybe, a bit less.</li>
<li>The 2020 U.S. Elections could change the antitrust mood and direction, even if Trump wins.</li>
<li>Google will still have issues (there is bi-partisan thirst for its blood, just on different terms).</li>
<li>Still, post-elections, this likely goes from "bad and chaotic" to "bad, but somewhat orderly."</li>
</ul>This is a quick take on what is still today's news, but the overall thought process is similar to <a href="https://www.smartkarma.com/insights/delisting-deceitful-chinese-companies-act-not-a-slam-dunk-and-has-more-bark-than-bite-if-it-passes" target="_blank" data-smartkarma-citation="insights:40025" rel="noopener">"Delisting Deceitful Chinese Companies Act" Not a Slam Dunk and Has More Bark Than Bite if It Passes</a>.

After a year-long investigation, the U.S. Department of Justice (DOJ) announced that it filed a civil antitrust lawsuit against Google; owned by, and nearly synonymous with, Alphabet (GOOG US).Not exactly a surprise since Google and its FAANG brethren have been in the crosshairs for a while. Still, the formality hits hard. Like getting dumped; you know it's coming, but the words still sting.DOJ's case is already quoted ad nauseam in the media, so I will regurgitate just a few small bits for context, then delve into my particular "angle" on this – i.e., how the U.S. Elections factor in.In Facebook parlance, "It's Complicated," but here is the gist:
Antitrust cases of this magnitude and complexity can be drawn out over many, many years.
Long-term, big-picture? Bad. Even just the overhang. Bad for Google, foreboding for others.
If you zoom in to a smaller near-term window, however… it's still bad. But maybe, a bit less.
The 2020 U.S. Elections could change the antitrust mood and direction, even if Trump wins.
Google will still have issues (there is bi-partisan thirst for its blood, just on different terms).
Still, post-elections, this likely goes from "bad and chaotic" to "bad, but somewhat orderly."
This is a quick take on what is still today's news, but the overall thought process is similar to "Delisting Deceitful Chinese Companies Act" Not a Slam Dunk and Has More Bark Than Bite if It Passes.

Google Antitrust Lawsuit: The 2020 Election Angle

United States

Meta Platforms Inc. operates as a social technology company. The Company builds applications and technologies that help people connect, find communities, and grow businesses. meta Platform is also involved in advertisements, augmented and virtual reality.

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Meta (META US)

Spotify 3Q20: We Still Can't Hear You

Spotify gave us another quarter of declining pricing power, middle of the road revenue growth and no disclosures about how podcasting benefits the...

Aaron Gabin

Boycotting Hate Speeches: Will It Find Its Way into ESG Investing?

In this insight, we are highlighting how the boycott of toxic channels can find its way in ESG investing and act as a catalyst in shifting...

Nitin Mangal

3Q20 Best Bets: Mega Cap Wins

Some top of mind thinking about large cap TMT earnings heading into the thick of the meat grinder which is earnings season. We like secular...

Aaron Gabin

The Anatomy of the US Underweight (And the Effect of Rising Passive ETF Flows in the US).

ETF inflows drive underweights in US equities to record levels. Active buying to close underweights in major index stocks fuels the rally further...

Steven Holden

Google Antitrust Lawsuit: The 2020 Election Angle

What, precisely, the U.S. DOJ antitrust case will mean for Google, only time will tell. One thing is certain, however. Politics – particularly the ...

Kyle Rudden

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