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

TSE Tokyo Price Index TOPIX / Technical Analysis

<ul>
<li>We continue to recommend a tactical overweight to defensives (Staples, Health Care, and Utilities) as the MSCI ACWI (ACWI-US) tests the top-end of our anticipated 2023 trading range at $93.</li>
<li>We also remain overweight Europe, Japan, and India, where a lot more than just defensives continue to outperform.</li>
<li>Actionable Themes: Consumer Discretionary and Defensives, Mainly in Japan and Europe</li>
</ul>


We continue to recommend a tactical overweight to defensives (Staples, Health Care, and Utilities) as the MSCI ACWI (ACWI-US) tests the top-end of our anticipated 2023 trading range at $93.
We also remain overweight Europe, Japan, and India, where a lot more than just defensives continue to outperform.
Actionable Themes: Consumer Discretionary and Defensives, Mainly in Japan and Europe


Remain Overweight Japan, Europe, & India; Buys in Discretionary and Defensives W/ Japan/Europe Focus

Global Healthcare Analyst

Tina Banerjee

Equity Bottom-Up

<ul>
<li>
<a href="https://www.smartkarma.com/entities/medipal-holdings-corp" target="_blank" data-smartkarma-citation="entities:18394:1" rel="noopener">Medipal Holdings (7459 JP)</a> announced strong FY23 result, with year-over-year improvement in sales and profit. While sales were just 1% ahead of forecast, net profit exceeded the guidance by 16%.</li>
<li>Outperformance was mainly driven by PALTAC business. Revenue from PALTAC increased 6% YoY to ¥1,104B, 2% ahead of forecast of ¥1,080B, fueled by 14% growth in OTC pharmaceutical products.</li>
<li>Medipal has guided for accelerated revenue growth of 3% YoY for its pharmaceutical wholesale business in FY24. In FY23, the business recorded revenue growth of 0.6% YoY.</li>
</ul>



Medipal Holdings (7459 JP) announced strong FY23 result, with year-over-year improvement in sales and profit. While sales were just 1% ahead of forecast, net profit exceeded the guidance by 16%.
Outperformance was mainly driven by PALTAC business. Revenue from PALTAC increased 6% YoY to ¥1,104B, 2% ahead of forecast of ¥1,080B, fueled by 14% growth in OTC pharmaceutical products.
Medipal has guided for accelerated revenue growth of 3% YoY for its pharmaceutical wholesale business in FY24. In FY23, the business recorded revenue growth of 0.6% YoY.


Medipal Holdings (7459 JP): Better-Than-Expected FY23 Result; Accelerated Growth Expected in FY24

Equity Analyst, LightStream Research

Shifara Samsudeen, FCMA, CGMA

Equity Analyst

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>Takeda reported FQ4 and full-year FY03/2023 results. Reported revenue increased 9.5% YoY to ¥956.2bn (vs consensus ¥938.6bn) and OP of ¥88.6bn (vs consensus ¥144.5bn) vs an operating loss in 4QFY03/22.</li>
<li>Full-Year revenue and OP increased 12.8% and 6.4% YoY to ¥4.0trn and ¥490.5bn respectively. While reported revenue beat guidance and consensus, OP fell slightly below these two.</li>
<li>
<a href="https://www.smartkarma.com/entities/takeda-pharmaceutical-co-ltd" target="_blank" data-smartkarma-citation="entities:11747:1" rel="noopener">Takeda Pharmaceutical (4502 JP)</a> ’s FY03/2024E guidance is too conservative as we think that the company has been careful not to disappoint investors if it fails to meet its own target.</li>
</ul>


Takeda reported FQ4 and full-year FY03/2023 results. Reported revenue increased 9.5% YoY to ¥956.2bn (vs consensus ¥938.6bn) and OP of ¥88.6bn (vs consensus ¥144.5bn) vs an operating loss in 4QFY03/22.
Full-Year revenue and OP increased 12.8% and 6.4% YoY to ¥4.0trn and ¥490.5bn respectively. While reported revenue beat guidance and consensus, OP fell slightly below these two.

Takeda Pharmaceutical (4502 JP) ’s FY03/2024E guidance is too conservative as we think that the company has been careful not to disappoint investors if it fails to meet its own target.


Takeda: Conservative Guidance Is Not Something to Worry Too Much About..

<ul>
<li>
<a href="https://www.smartkarma.com/entities/astellas-pharma-inc" target="_blank" data-smartkarma-citation="entities:6091:1" rel="noopener">Astellas Pharma (4503 JP)</a> recorded 17% growth in revenue to ¥1,519B in FY23, driven by 24% growth of Xtandi. Core operating profit grew 17% and core net profit increased 18%.</li>
<li>The company has guided for flat revenue and core operating profit for FY24, mainly due to negative impact of Fx.  </li>
<li>Astellas expects to obtain FDA approval for fezolinetant for vasomotor symptoms associated with menopause in May 2023. The company will file for marketing approval for zolbetuximab in Q1FY24.</li>
</ul>



Astellas Pharma (4503 JP) recorded 17% growth in revenue to ¥1,519B in FY23, driven by 24% growth of Xtandi. Core operating profit grew 17% and core net profit increased 18%.
The company has guided for flat revenue and core operating profit for FY24, mainly due to negative impact of Fx.  
Astellas expects to obtain FDA approval for fezolinetant for vasomotor symptoms associated with menopause in May 2023. The company will file for marketing approval for zolbetuximab in Q1FY24.


Astellas Pharma (4503 JP): FY23 Result and FY24 Guidance Meet Expectation; New Drugs Hold Key

iShares MSCI ACWI ETF / Technical Analysis

<ul>
<li>Our 2023 outlook, initially discussed in our January 6th 2023 Int'l Compass, was for $93 to cap upside on the MSCI ACWI (ACWI-US); this has again proven prescient.</li>
<li>Since late-January/early-February we have recommended shifting to defensives, and MSCI ACWI defensive Sectors including Health Care (IXJ-US), Utilities (JXI-US), and Consumer Staples (KXI-US) are now hitting 3-4-month RS highs.</li>
<li>With the ACWI-US just now starting to turn down after testing $93, we continue to recommend a tactical overweight to the aforementioned defensive Sectors, and also to gold miners (GDX-US).</li>
</ul>


Our 2023 outlook, initially discussed in our January 6th 2023 Int'l Compass, was for $93 to cap upside on the MSCI ACWI (ACWI-US); this has again proven prescient.
Since late-January/early-February we have recommended shifting to defensives, and MSCI ACWI defensive Sectors including Health Care (IXJ-US), Utilities (JXI-US), and Consumer Staples (KXI-US) are now hitting 3-4-month RS highs.
With the ACWI-US just now starting to turn down after testing $93, we continue to recommend a tactical overweight to the aforementioned defensive Sectors, and also to gold miners (GDX-US).


Stay Tactically Overweight Defensives; Remain Overweight Europe, Japan, & EAFE. Buys in Defensives

Japan

Takeda Pharmaceutical Co Ltd focuses on the Research & Development, Manufacturing, Sales and Marketing and Import/Export of Pharmaceutical Drugs. The Company focuses on the following core therapeutic areas: Cardiovascular & Metabolic, Oncology, Central Nervous System, Respiratory & Immunology, General Medicine (Gastrointestinal & Genitourinary) and Vaccine.

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Takeda Pharmaceutical (4502 JP)

Remain Overweight Japan, Europe, & India; Buys in Discretionary and Defensives W/ Japan/Europe Focus

We continue to recommend a tactical overweight to defensives as $ACWI tests the top-end of our anticipated 2023 trading range at $93. Remain...

Vermilion Research

Medipal Holdings (7459 JP): Better-Than-Expected FY23 Result; Accelerated Growth Expected in FY24

In FY23, Medipal Holdings’ revenue was 1% ahead of forecast, while net profit exceeded the guidance by 16%. The company guided for 3% YoY revenue...

Tina Banerjee

Takeda: Conservative Guidance Is Not Something to Worry Too Much About..

Takeda's FY03/24 guidance suggests slowdown in earnings due to expiry of Azilva and Vyvanse. Recent new launches have seen strong uptake and the...

Shifara Samsudeen, FCMA, CGMA

Astellas Pharma (4503 JP): FY23 Result and FY24 Guidance Meet Expectation; New Drugs Hold Key

Astellas reported double-digit revenue growth in FY23, while FY24 revenue is expected to be flat due to unfavorable Fx. Flagship Xtandi still has...

Tina Banerjee

Stay Tactically Overweight Defensives; Remain Overweight Europe, Japan, & EAFE. Buys in Defensives

$93 on $ACWI continues to be a key resistance that we have discussed since early-Jan as capping upside for 2023. Stick with defensives $IXJ $XLV...

Vermilion Research

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