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

<ul>
<li>The DAX and Hang Seng are reversing their downtrends while MSCI China (MCHI-US) and China Internet (KWEB-US) are currently testing their respective multi-month downtrends.</li>
<li>Reversals of these downtrends would signal a bear market rally in progress.</li>
<li>We will need to see more basing, followed by base breakouts, in order to get bullish -- a process that would likely take weeks or months.</li>
</ul>


The DAX and Hang Seng are reversing their downtrends while MSCI China (MCHI-US) and China Internet (KWEB-US) are currently testing their respective multi-month downtrends.
Reversals of these downtrends would signal a bear market rally in progress.
We will need to see more basing, followed by base breakouts, in order to get bullish -- a process that would likely take weeks or months.


Still Bearish, But On Watch for Bear Market Rally; Buying Toshiba 6502-JP, Defensive Sectors

<ul>
<li>Downtrends remain intact for Japan’s TOPIX/Nikkei 225, Hong Kong’s Hang Seng, Europe’s EURO STOXX50, Germany's DAX, China (MCHI-US), and all the MSCI global indexes (ACWI, ACWI ex-US, EM, and EAFE).</li>
<li>The majority of these indexes are in well-defined downtrends; that means when the downtrends eventually reverse, it will be clear and we will be ready to buy/turn bullish.</li>
<li>Relative strength on Japan's TOPIX is reversing topside a 4.5-year downtrend, signaling Japan is emerging as leadership. We highlight buy opportunities in Japan and also in defensive Sectors</li>
</ul>


Downtrends remain intact for Japan’s TOPIX/Nikkei 225, Hong Kong’s Hang Seng, Europe’s EURO STOXX50, Germany's DAX, China (MCHI-US), and all the MSCI global indexes (ACWI, ACWI ex-US, EM, and EAFE).
The majority of these indexes are in well-defined downtrends; that means when the downtrends eventually reverse, it will be clear and we will be ready to buy/turn bullish.
Relative strength on Japan's TOPIX is reversing topside a 4.5-year downtrend, signaling Japan is emerging as leadership. We highlight buy opportunities in Japan and also in defensive Sectors


Japan Emerging as Leadership; Actionable Themes: Japan and Defensives

<ul>
<li>Since March we have consistently said we believe any bottoming process would likely take weeks or months and could come with more tests of the lows, or even an undercut.</li>
<li>We are testing the March lows now in several global indexes, including the MSCI ACWI (ACWI-US), ACWI ex-US (ACWX-US), and EM (EEM-US).</li>
<li>While this is a logical spot for a bounce, we see rallies as selling opportunities at the index level</li>
</ul>


Since March we have consistently said we believe any bottoming process would likely take weeks or months and could come with more tests of the lows, or even an undercut.
We are testing the March lows now in several global indexes, including the MSCI ACWI (ACWI-US), ACWI ex-US (ACWX-US), and EM (EEM-US).
While this is a logical spot for a bounce, we see rallies as selling opportunities at the index level


MSCI ACWI, ACWI Ex-US, EM Testing Logical Support; Actionable Themes: Defensives & Reopening Stocks

Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

Last Week in Event SPACE:  Swire, Hitachi Metal, Jardine, Softbank, Bingo, Japan Asia, Mainstream

European Event-Driven Analyst

Jesus Rodriguez Aguilar

On 27 April, <a href="https://www.smartkarma.com/entities/orange-sa" target="_blank" data-smartkarma-citation="entities:21522:1" rel="noopener">Orange SA (ORA FP)</a> published the results of its offer for <a href="https://www.smartkarma.com/entities/orange-belgium-sa" target="_blank" data-smartkarma-citation="entities:21340:1" rel="noopener">Orange Belgium SA (MOBB EU)</a>. It now holds a 74.68% stake.
Orange has decided to re-open the tender for five trading days (28 April to 4 May inclusive, offer price unchanged) with the aim of gaining more acceptances.
Orange Belgium closed at €22.25 on 27 April, a 1.8% higher vs. the prior trading session and 1.1% above Orange's re-opened offer. The shares are inexpensive, trading at 5.2x EV/Fwd EBITDA (vs. 5.96x for peers), and offer a 9.3% 21e EFCF yield.
Its seems difficult that Orange will gain any more offer acceptances and as per Polygon's statement, it is far from being able to squeeze-out and delist. In the absence of any negotiations about bumping the offer price, TP lowered to €26.6, in line with peers' median EV/Fwd EBITDA. Reiterate long.
Risks: lower liquidity for the shares (I estimate c. €1 mn daily), lower revenues from higher competition and/or rising wholesale cable costs, higher capex investments than expected (Orange has not made clear whether they will be with a FTTH partner or will seek to acquire a cable company), entrance of a fourth mobile operator.

On 27 April, Orange SA (ORA FP) published the results of its offer for Orange Belgium SA (MOBB EU). It now holds a 74.68% stake.
Orange has decided to re-open the tender for five trading days (28 April to 4 May inclusive, offer price unchanged) with the aim of gaining more acceptances.
Orange Belgium closed at €22.25 on 27 April, a 1.8% higher vs. the prior trading session and 1.1% above Orange's re-opened offer. The shares are inexpensive, trading at 5.2x EV/Fwd EBITDA (vs. 5.96x for peers), and offer a 9.3% 21e EFCF yield.
Its seems difficult that Orange will gain any more offer acceptances and as per Polygon's statement, it is far from being able to squeeze-out and delist. In the absence of any negotiations about bumping the offer price, TP lowered to €26.6, in line with peers' median EV/Fwd EBITDA. Reiterate long.
Risks: lower liquidity for the shares (I estimate c. €1 mn daily), lower revenues from higher competition and/or rising wholesale cable costs, higher capex investments than expected (Orange has not made clear whether they will be with a FTTH partner or will seek to acquire a cable company), entrance of a fourth mobile operator.

France

Orange SA provides telecommunications services to residential, professional, and large business customers. The Company offers public fixed-line telephone, leased lines and data transmission, mobile telecommunications, cable television, Internet and wireless applications, and broadcasting services, and telecommunications equipment sales and rentals.

Price Gauge
52-week Range	0.00 - 0.00
Market Cap (USDm)	0.00
P/E	0.00
Dividend (Yield)	0.00

Orange SA (ORA FP)

Still Bearish, But On Watch for Bear Market Rally; Buying Toshiba 6502-JP, Defensive Sectors

The $DAX and Hang Seng are reversing their downtrends while China $MCHI and China Internet $KWEB are currently testing their respective multi-month...

Vermilion Research

Japan Emerging as Leadership; Actionable Themes: Japan and Defensives

Despite the intact downtrend on Japan's TOPIX, relative strength is reversing topside a 4.5-year downtrend; this tells us Japan is emerging as...

Vermilion Research

MSCI ACWI, ACWI Ex-US, EM Testing Logical Support; Actionable Themes: Defensives & Reopening Stocks

We are testing the March lows in several global indexes, including the MSCI $ACWI, ACWI ex-US $ACWX, and EM $EEM. While this is a logical spot for...

Vermilion Research

Last Week in Event SPACE: Swire, Hitachi Metal, Jardine, Softbank, Bingo, Japan Asia, Mainstream

The weekend is here! Pour yourself a coffee, grab a comfortable seat, and sift through a brief summary of insights on various events discussed...

David Blennerhassett

Orange/Orange Belgium: Offer Re-Opening

The shares are inexpensive (5.2x EV/Fwd EBITDA), and offer a 9.3% 21e EFCF yield. In the absence of further negotiations about offer price, TP...

Jesus Rodriguez Aguilar

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)