'Quantamental' Japan Specialist, LightStream Research

Campbell Gunn

'Quantamental' Japan Specialist

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. 

Quantitative Analysis

<p style="text-align: center;"><strong>• RELATIVE PRICE SCORE</strong> •</p><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/098/178/original/2019-09-06_09-42-35.png?1567730614" class="editor-image img-responsive" data-smartkarma-image-id="98178"></figure><div class="content-caption">Source: Japan Analytics</div><p><strong>INTRODUCTION </strong>- The Relative Price Score (RPS) is a measure of stock price performance relative to TOPIX calculated by comparing the current deviation with the mean absolute deviation of monthly and daily relative share prices. As all companies are thus on a comparable scale, 'Overbought' and 'Oversold' outliers and changes in scoring can reveal short-term and longer-term trading opportunities. Company outlier thresholds are set at<strong> +4</strong> &amp; <strong>-2</strong> and equate to the top and bottom first-to-second percentiles of historical observations from which mean reversion takes a matter of months. RPS outliers with a Score of greater than 10.0 are rare outside of the 2000 tech 'bubble'. <a href="https://www.smartkarma.com/entities/lasertec-corp" target="_blank" data-smartkarma-citation="entities:4126:1" rel="noopener">Lasertec (6920 JP)</a> has just joined <a href="https://www.smartkarma.com/entities/goldwin-inc" target="_blank" data-smartkarma-citation="entities:410:1" rel="noopener">Goldwin (8111 JP)</a> in being only the second large-cap RPS 'ten-baggers' in the last twenty years. </p><div class="content-highlight"><p><strong>This insight updates our list of Overbought and Oversold companies, reviews the best and worst-performing companies in terms of RPS over the last three months and adds some specific comments on stocks on each category.</strong></p></div><div></div><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/098/046/original/2019-09-05_12-46-46.png?1567655232" class="editor-image img-responsive" data-smartkarma-image-id="98046"></figure><div class="content-caption">Source: Japan Analytics</div><p><strong>STATISTICS</strong> - Currently, of the 3,706 listed companies for which monthly RPS data is available, 81 companies are 'Overbought', and 133 are 'Oversold' - 2.45% and 3.8%, respectively of the total. For the 737 companies with a market capitalisation of over ¥100b, there are 44 'Overbought' and 37 'Oversold' companies, 6% and 5%, respectively.</p><hr><p style="text-align: center;"><strong>• RELATIVE PRICE SCORE 'TOPS' •</strong></p><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/098/055/original/2019-09-05_13-06-30.png?1567656423" class="editor-image img-responsive" data-smartkarma-image-id="98055"></figure><div class="content-caption">Source: Japan Analytics</div><p><strong>RPS 'TOPS'</strong> - In the last two years, 388 companies have achieved an RPS of '4' or more and the average Overbought 'persistence' is 42 days. 1.26% of the total of 1.94 million traded stock days were by companies with an RPS of over 4. For companies with a market capitalisation higher than ¥100b, the numbers are 95 companies and 74 days - demonstrating the superior persistence of large capitalisation companies in this regard. The chart above highlights the track record of all 95 large caps which are some point were Overbought in the last twenty-four months and illustrates the extreme outlier status of Goldwin and Lasertec.</p><p><strong>RPS NEGATIVE MEAN REVERSION</strong> - Some examples of RPS mean reversion in the last three months have been <a href="https://www.smartkarma.com/entities/suzuken-co-ltd" target="_blank" data-smartkarma-citation="entities:14996:1" rel="noopener">Suzuken (9987 JP)</a>, <a href="https://www.smartkarma.com/entities/infomart-corp" target="_blank" data-smartkarma-citation="entities:1301:1" rel="noopener">Infomart (2492 JP)</a>, <a href="https://www.smartkarma.com/entities/nichirei-corp" target="_blank" data-smartkarma-citation="entities:7168:1" rel="noopener">Nichirei (2871 JP)</a>, and <a href="https://www.smartkarma.com/entities/fancl-corp" target="_blank" data-smartkarma-citation="entities:15862:1" rel="noopener">Fancl (4921 JP)</a>. </p><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/098/096/original/2019-09-05_16-25-39.png?1567668352" class="editor-image img-responsive" data-smartkarma-image-id="98096"></figure><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/098/097/original/2019-09-05_16-27-09.png?1567668441" class="editor-image img-responsive" data-smartkarma-image-id="98097"></figure><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/098/098/original/2019-09-05_16-28-42.png?1567668548" class="editor-image img-responsive" data-smartkarma-image-id="98098"></figure><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/098/099/original/2019-09-05_16-30-29.png?1567668640" class="editor-image img-responsive" data-smartkarma-image-id="98099"></figure><div class="content-caption">Source: Japan Analytics</div><hr><p style="text-align: center;"><strong>• RELATIVE PRICE SCORE 'BOTTOMS' •</strong></p><div>
<figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/098/056/original/2019-09-05_13-12-52.png?1567656806" class="editor-image img-responsive" data-smartkarma-image-id="98056"></figure><div class="content-caption">Source: Japan Analytics</div>
</div><p><strong>RPS 'BOTTOMS'</strong> - 259 companies have seen their RPS fall to '-2' or below in the last two years, and the average Oversold 'persistence' is 83 days. 1.46% of the total of 1.94 million traded stock days were by companies with an RPS of less than -2.  For larger capitalisation companies, the numbers are 79 companies and 94 days. The chart above highlights the track record of the 79 large caps which are some point were Oversold in the last twenty-four months and illustrates the strong recovery in the<strong> REITs</strong> Sector and the continuing demise of <strong>Regional Banks</strong>.</p><p><strong>RPS POSITIVE MEAN REVERSION</strong> - Some recent examples of positive RPS mean reversions are <a href="https://www.smartkarma.com/entities/otsuka-holdings-co-ltd" target="_blank" data-smartkarma-citation="entities:12292:1" rel="noopener">Otsuka Holdings (4578 JP) </a>and <a href="https://www.smartkarma.com/entities/line-corp" target="_blank" data-smartkarma-citation="entities:22772:1" rel="noopener">LINE (3938 JP)</a>.</p><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/098/100/original/2019-09-05_16-35-47.png?1567668972" class="editor-image img-responsive" data-smartkarma-image-id="98100"></figure><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/098/102/original/2019-09-05_16-36-50.png?1567669047" class="editor-image img-responsive" data-smartkarma-image-id="98102"></figure><div class="content-caption">Source: Japan Analytics</div><p>As we noted in our June <a href="https://www.smartkarma.com/insights/japan-relative-price-scores-overbought-oversold-companies-june-2019" target="_blank" data-smartkarma-citation="insights:30393" rel="noopener">Insight: -</a></p><blockquote><p><strong><a href="https://www.smartkarma.com/entities/line-corp" target="_blank" data-smartkarma-citation="entities:22772:1" rel="noopener">LINE (3938 JP)</a></strong>- Line has performed poorly since being featured in last year's Sohn Conference and has had negative and worsening Operating Income for each of the previous five quarters. Although there is a possibility of a double-bottom RPS 'bounce' and <strong>the company is now the most-Oversold non-financial large-cap over one year,</strong> there are no fundamental reasons to own the shares.   </p></blockquote><p>In the <strong>DETAIL </strong>section below, we list the current<strong> Very Overbought (RPS&gt;5</strong>), <strong>Too-Late-To-Buy (RPS &gt;4&lt;5)</strong> and <strong>Oversold (RPS &lt;-2)</strong> stocks as well as the most substantial three-month positive and negative changes in RPS.</p>

• RELATIVE PRICE SCORE •Source: Japan AnalyticsINTRODUCTION - The Relative Price Score (RPS) is a measure of stock price performance relative to TOPIX calculated by comparing the current deviation with the mean absolute deviation of monthly and daily relative share prices. As all companies are thus on a comparable scale, 'Overbought' and 'Oversold' outliers and changes in scoring can reveal short-term and longer-term trading opportunities. Company outlier thresholds are set at +4 &amp; -2 and equate to the top and bottom first-to-second percentiles of historical observations from which mean reversion takes a matter of months. RPS outliers with a Score of greater than 10.0 are rare outside of the 2000 tech 'bubble'. Lasertec (6920 JP) has just joined Goldwin (8111 JP) in being only the second large-cap RPS 'ten-baggers' in the last twenty years. This insight updates our list of Overbought and Oversold companies, reviews the best and worst-performing companies in terms of RPS over the last three months and adds some specific comments on stocks on each category.Source: Japan AnalyticsSTATISTICS - Currently, of the 3,706 listed companies for which monthly RPS data is available, 81 companies are 'Overbought', and 133 are 'Oversold' - 2.45% and 3.8%, respectively of the total. For the 737 companies with a market capitalisation of over ¥100b, there are 44 'Overbought' and 37 'Oversold' companies, 6% and 5%, respectively.• RELATIVE PRICE SCORE 'TOPS' •Source: Japan AnalyticsRPS 'TOPS' - In the last two years, 388 companies have achieved an RPS of '4' or more and the average Overbought 'persistence' is 42 days. 1.26% of the total of 1.94 million traded stock days were by companies with an RPS of over 4. For companies with a market capitalisation higher than ¥100b, the numbers are 95 companies and 74 days - demonstrating the superior persistence of large capitalisation companies in this regard. The chart above highlights the track record of all 95 large caps which are some point were Overbought in the last twenty-four months and illustrates the extreme outlier status of Goldwin and Lasertec.RPS NEGATIVE MEAN REVERSION - Some examples of RPS mean reversion in the last three months have been Suzuken (9987 JP), Infomart (2492 JP), Nichirei (2871 JP), and Fancl (4921 JP). Source: Japan Analytics• RELATIVE PRICE SCORE 'BOTTOMS' •
Source: Japan Analytics
RPS 'BOTTOMS' - 259 companies have seen their RPS fall to '-2' or below in the last two years, and the average Oversold 'persistence' is 83 days. 1.46% of the total of 1.94 million traded stock days were by companies with an RPS of less than -2.  For larger capitalisation companies, the numbers are 79 companies and 94 days. The chart above highlights the track record of the 79 large caps which are some point were Oversold in the last twenty-four months and illustrates the strong recovery in the REITs Sector and the continuing demise of Regional Banks.RPS POSITIVE MEAN REVERSION - Some recent examples of positive RPS mean reversions are Otsuka Holdings (4578 JP) and LINE (3938 JP).Source: Japan AnalyticsAs we noted in our June Insight: -LINE (3938 JP)- Line has performed poorly since being featured in last year's Sohn Conference and has had negative and worsening Operating Income for each of the previous five quarters. Although there is a possibility of a double-bottom RPS 'bounce' and the company is now the most-Oversold non-financial large-cap over one year, there are no fundamental reasons to own the shares.   In the DETAIL section below, we list the current Very Overbought (RPS&gt;5), Too-Late-To-Buy (RPS &gt;4&lt;5) and Oversold (RPS &lt;-2) stocks as well as the most substantial three-month positive and negative changes in RPS.

🇯🇵 Japan • September Relative Price Scores - Life at the Poles Part 2: Companies

<p style="text-align: center;"><strong>- PEER GROUP SCORE MATRIX -</strong></p>
<figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/079/840/original/2019-02-22_18-26-15.png?1550827634" class="editor-image img-responsive" data-smartkarma-image-id="79840"></figure>
<div class="content-caption">Source: Japan Analytics</div>
<p><strong>INTRODUCTION</strong> - Following on from our review of the Market Composite and Sectors, this Insight will cover the cap-weighted Results &amp; Revision Scores for the 328 Peer Groups that comprise our 30 Sectors providing greater depth to our analysis of current business trends.  Peer Group definitions reflect both standard SIC/GICS classifications as well as local market conventions. The number of constituents and market capitalisation for each Peer Group varies widely. </p>
<p><strong>RRS/RPS SCORE MATRIX</strong> - Combining our Results &amp; Revision Scores (RRS) with each Peer Group's Relative Price Score (RPS) allows a classification of our Peer Group universe into four quadrants -</p>
<ul>
<li>'<strong>Contrarian Buy</strong>'  &gt; Low RRS &amp; Low RPS </li>
<li>'<strong>Contrarian Sell' </strong>&gt; High RRS &amp; High RPS</li>
<li>
<strong>Peak Growth</strong>' &gt; High RRS &amp; Low RPS</li>
<li>'<strong>Ex-Growth/Turnaround</strong>' &gt; Low RRS &amp; High RPS</li>
</ul>
<p><strong>THE 'QUADRANTS'</strong> - In the two '<strong>Contrarian</strong>' quadrants, the market is aligned with the current earnings momentum of the Peer Groups suggesting opportunities exist only for those willing or brave enough to take a contrarian view.  For '<strong>Peak Growth</strong>' Peer Groups, the market is calling for a downturn in momentum that has yet to be reflected in quarterly earnings. Where the cycle is more prolonged than expected, there are often opportunities for short-term rebounds in what are normally relatively-inexpensive companies. The '<strong>Ex-Growth</strong>' quadrant often consists of former '<strong>Contrarian Sell</strong>'s where the market is reluctant to acknowledge that the cycle has turned. This quadrant can also contain '<strong>Turnarounds</strong>' - formerly '<strong>Contrarian Buys</strong>' where the market is correctly anticipating a change in fortunes.    </p>
<div class="content-highlight">
<p>In the <strong>DETAIL</strong> section below, we list the top and bottom twenty Peer Groups ranked by Results &amp; Revision Score and the top and bottom twenty most-changed over the last three months as well the most optimistic and most pessimistic.  In our ranked tables we have listed only those Peer Groups with an aggregate capitalisation of over ¥50b. </p>
</div>

- PEER GROUP SCORE MATRIX -

Source: Japan Analytics
INTRODUCTION - Following on from our review of the Market Composite and Sectors, this Insight will cover the cap-weighted Results &amp; Revision Scores for the 328 Peer Groups that comprise our 30 Sectors providing greater depth to our analysis of current business trends.  Peer Group definitions reflect both standard SIC/GICS classifications as well as local market conventions. The number of constituents and market capitalisation for each Peer Group varies widely. 
RRS/RPS SCORE MATRIX - Combining our Results &amp; Revision Scores (RRS) with each Peer Group's Relative Price Score (RPS) allows a classification of our Peer Group universe into four quadrants -

'Contrarian Buy'  &gt; Low RRS &amp; Low RPS 
'Contrarian Sell' &gt; High RRS &amp; High RPS

Peak Growth' &gt; High RRS &amp; Low RPS
'Ex-Growth/Turnaround' &gt; Low RRS &amp; High RPS

THE 'QUADRANTS' - In the two 'Contrarian' quadrants, the market is aligned with the current earnings momentum of the Peer Groups suggesting opportunities exist only for those willing or brave enough to take a contrarian view.  For 'Peak Growth' Peer Groups, the market is calling for a downturn in momentum that has yet to be reflected in quarterly earnings. Where the cycle is more prolonged than expected, there are often opportunities for short-term rebounds in what are normally relatively-inexpensive companies. The 'Ex-Growth' quadrant often consists of former 'Contrarian Sell's where the market is reluctant to acknowledge that the cycle has turned. This quadrant can also contain 'Turnarounds' - formerly 'Contrarian Buys' where the market is correctly anticipating a change in fortunes.    

In the DETAIL section below, we list the top and bottom twenty Peer Groups ranked by Results &amp; Revision Score and the top and bottom twenty most-changed over the last three months as well the most optimistic and most pessimistic.  In our ranked tables we have listed only those Peer Groups with an aggregate capitalisation of over ¥50b. 


🇯🇵 Japan: Winter Peer Group Results & Revision Scores - Contrarian Buys & Sells/Peak & Ex-Growth

<p><strong>MOVING AVERAGE OUTLIERS</strong> - Our moving average outlier indicator uses a weighted sum of the share price relative to the 5-day, 20-day, 60-day, 120 day and 240-day moving averages. Extreme values are weighted sums greater than 100% and less than -100%. We would caution that this indicator is best used for timing shorter-term reversals and, in many cases, higher highs and lower lows will be seen in future. </p><p><strong>POSITIVE MOVING AVERAGE OUTLIERS 28TH OCTOBER</strong> - Of the positive outlier identified last week, <a href="https://www.smartkarma.com/entities/8467" target="_blank" data-smartkarma-citation="entities:8467:1">Workman (7564 JP)</a> has since declined by 3% and is still overbought with a Relative Price Score of 4.65. The interim results released on 6th November show a slowing of earnings momentum scoring '4' compared to a score of '9' the previous quarter. We continue to advise profit taking. </p><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/069/394/original/2018-11-11_15-13-17.png?1541916831" class="editor-image img-responsive" data-smartkarma-image-id="69394"></figure><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/069/395/original/2018-11-11_15-14-13.png?1541916865" class="editor-image img-responsive" data-smartkarma-image-id="69395"></figure><div class="content-caption">Source: Japan Analytics</div><p><strong>NEGATIVE MOVING AVERAGE OUTLIERS 28TH OCTOBER</strong> - <a href="https://www.smartkarma.com/entities/9990" target="_blank" data-smartkarma-citation="entities:9990:1">Shima Seiki (6222 JP)</a> which was the most extreme negative outlier recovered 9% but is still the third-most oversold large cap. Of our so=called 'Fallen Angels', <a href="https://www.smartkarma.com/entities/4126" target="_blank" data-smartkarma-citation="entities:4126:1">Lasertec (6920 JP)</a> rose by 25% after good results and <a href="https://www.smartkarma.com/entities/9145" target="_blank" data-smartkarma-citation="entities:9145:1">Tokai Carbon (5301 JP)</a> recovered by 13%. Both remain overbought are likely to peak out in terms of their share price in the next few months. Of the other Fallen Angels, the best performance was from <a href="https://www.smartkarma.com/entities/14527" target="_blank" data-smartkarma-citation="entities:14527:1">Ulvac (6728 JP)</a> which rose 20%, and the worst was <a href="https://www.smartkarma.com/entities/15801" target="_blank" data-smartkarma-citation="entities:15801:1">Nippon Gas (8174 JP)</a> which rose 8%. <a href="https://www.smartkarma.com/entities/379" target="_blank" data-smartkarma-citation="entities:379:1">Sumco (3436 JP)</a> had the second-best two-week performance after <a href="https://www.smartkarma.com/entities/18107" target="_blank" data-smartkarma-citation="entities:18107:1">Advantest (6857 JP)</a> rising by 26% as it Q3 results were very strong, and their initial full-year forecast suggest FYOP will be 10% above TTM OP.  Our two 'bounce-but-fully-priced' stocks <a href="https://www.smartkarma.com/entities/13316" target="_blank" data-smartkarma-citation="entities:13316:1">M3 (2413 JP)</a> and <a href="https://www.smartkarma.com/entities/3294" target="_blank" data-smartkarma-citation="entities:3294:1">Pigeon (7956 JP)</a> rose by 3% and 11%, respectively although they remain 'Fully Priced'. <a href="https://www.smartkarma.com/entities/109" target="_blank" data-smartkarma-citation="entities:109:1">Idemitsu Kosan (5019 JP)</a> was unchanged over the period.</p><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/069/396/original/2018-11-11_15-39-17.png?1541918405" class="editor-image img-responsive" data-smartkarma-image-id="69396"></figure><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/069/397/original/2018-11-11_15-39-55.png?1541918418" class="editor-image img-responsive" data-smartkarma-image-id="69397"></figure><div class="content-caption">Source: Japan Analytics</div><div class="content-highlight"><p>In the <strong>DETAIL</strong> section below, we highlight the current top and bottom twenty-five larger capitalisation outliers as well as those companies that have seen the most significant positive and negative changes in their outlier percentage in the last two weeks and provide short comments on companies of particular note. </p></div>

MOVING AVERAGE OUTLIERS - Our moving average outlier indicator uses a weighted sum of the share price relative to the 5-day, 20-day, 60-day, 120 day and 240-day moving averages. Extreme values are weighted sums greater than 100% and less than -100%. We would caution that this indicator is best used for timing shorter-term reversals and, in many cases, higher highs and lower lows will be seen in future. POSITIVE MOVING AVERAGE OUTLIERS 28TH OCTOBER - Of the positive outlier identified last week, Workman (7564 JP) has since declined by 3% and is still overbought with a Relative Price Score of 4.65. The interim results released on 6th November show a slowing of earnings momentum scoring '4' compared to a score of '9' the previous quarter. We continue to advise profit taking. Source: Japan AnalyticsNEGATIVE MOVING AVERAGE OUTLIERS 28TH OCTOBER - Shima Seiki (6222 JP) which was the most extreme negative outlier recovered 9% but is still the third-most oversold large cap. Of our so=called 'Fallen Angels', Lasertec (6920 JP) rose by 25% after good results and Tokai Carbon (5301 JP) recovered by 13%. Both remain overbought are likely to peak out in terms of their share price in the next few months. Of the other Fallen Angels, the best performance was from Ulvac (6728 JP) which rose 20%, and the worst was Nippon Gas (8174 JP) which rose 8%. Sumco (3436 JP) had the second-best two-week performance after Advantest (6857 JP) rising by 26% as it Q3 results were very strong, and their initial full-year forecast suggest FYOP will be 10% above TTM OP.  Our two 'bounce-but-fully-priced' stocks M3 (2413 JP) and Pigeon (7956 JP) rose by 3% and 11%, respectively although they remain 'Fully Priced'. Idemitsu Kosan (5019 JP) was unchanged over the period.Source: Japan AnalyticsIn the DETAIL section below, we highlight the current top and bottom twenty-five larger capitalisation outliers as well as those companies that have seen the most significant positive and negative changes in their outlier percentage in the last two weeks and provide short comments on companies of particular note. 

Japan: Moving Average Outliers - Results Driven

<figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/067/916/original/2018-10-28_08-34-54.png?1540683306" class="editor-image img-responsive" data-smartkarma-image-id="67916"></figure><p><strong>MOVING AVERAGE OUTLIERS</strong> - In addition to our Relative Price Score, we also monitor deviations from moving averages to highlight extreme price trends which often occur within the Overbought (+4) and Oversold (-2) levels of the Price Score, but still offer interesting short-term reversal opportunities. Our indicator uses a weighted sum of the share price relative to the 5-day, 20-day, 60-day, 120 day and 240-day moving averages. Extreme values are weighted sums greater than 100% and less than -100%. <a href="https://www.smartkarma.com/entities/9990" target="_blank" data-smartkarma-citation="entities:9990:1">Shima Seiki (6222 JP)</a> - chart above - is currently the most extreme negative outlier and the stock with the wort two-week negative change. Having declined by 41% in a month and 19% on Friday, is now likely to see a positive short-term reversal.</p><p><strong>A NOTE OF CAUTION</strong> - We would caution that this indicator is best used for timing shorter-term reversals and, in many cases, higher highs and lower lows will be seen in future. For longer-term positioning, the Relative Price Score and Volume Scores are preferred in addition to our residual income valuation metrics. </p><p><strong>MARKET TIMING</strong> - The number of extreme positive and negative moving average outlier values can also be indicative of the state of market optimism or pessimism.  Currently, there are only 15 very positive outliers and 149 very negative outliers. Both are the highest such number in over three years. However, we would suggest that the number of negative outliers needs to reach over 300 for a 'capitulation low'. </p><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/067/921/original/2018-10-28_11-44-53.png?1540694710" class="editor-image img-responsive" data-smartkarma-image-id="67921"></figure><div class="content-caption">Source: Japan Analytics</div><div class="content-highlight"><p>In the <strong>DETAIL</strong> section below, we cover the top and bottom twenty-five large capitalisation outliers as well as those companies that have seen the most significant positive and negative changes in their outlier percentage in the last two weeks and provide short comments on companies of particular note. </p></div>

MOVING AVERAGE OUTLIERS - In addition to our Relative Price Score, we also monitor deviations from moving averages to highlight extreme price trends which often occur within the Overbought (+4) and Oversold (-2) levels of the Price Score, but still offer interesting short-term reversal opportunities. Our indicator uses a weighted sum of the share price relative to the 5-day, 20-day, 60-day, 120 day and 240-day moving averages. Extreme values are weighted sums greater than 100% and less than -100%. Shima Seiki (6222 JP) - chart above - is currently the most extreme negative outlier and the stock with the wort two-week negative change. Having declined by 41% in a month and 19% on Friday, is now likely to see a positive short-term reversal.A NOTE OF CAUTION - We would caution that this indicator is best used for timing shorter-term reversals and, in many cases, higher highs and lower lows will be seen in future. For longer-term positioning, the Relative Price Score and Volume Scores are preferred in addition to our residual income valuation metrics. MARKET TIMING - The number of extreme positive and negative moving average outlier values can also be indicative of the state of market optimism or pessimism.  Currently, there are only 15 very positive outliers and 149 very negative outliers. Both are the highest such number in over three years. However, we would suggest that the number of negative outliers needs to reach over 300 for a 'capitulation low'. Source: Japan AnalyticsIn the DETAIL section below, we cover the top and bottom twenty-five large capitalisation outliers as well as those companies that have seen the most significant positive and negative changes in their outlier percentage in the last two weeks and provide short comments on companies of particular note. 

Japan: Moving Average Outliers - Playing the Extremes

Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<p>One year, one week, and one day after the Nikkei reported Hitachi was looking to sell Hitachi Kokusai, we have a Tender Offer on the table. </p><p>The original deal at ¥2503 was announced at the end of April after almost 7 months of speculation had brought the price to ¥2600+. The stock traded down close to terms, then traded up as people considered the deal price a "put option" and further gains in the then-ebullient SPE space appeared possible. By early August, the stock had reached ¥2900/share and when it came time for KKR to launch its Tender Offer, the support from the Independent Committee had dissolved. </p><p>My original piece <a href="https://www.smartkarma.com/insights/hitachi-kokusai-tob-minorities-are-asked-to-take-it-or-leave-it" target="_blank" data-smartkarma-citation="insights:10275">Hitachi Kokusai TOB - Minorities Are Asked To Take It Or Leave It</a> in April suggested possible minority shareholder complaints because of the low-balled forecasts. Indeed, the forecasts were later changed and this was one reason for why the Independent Committee changed its support stance. Yesterday, the company revised its forecasts further (OP forecast had been lowered to ¥17.5bn for the original announcement, then lifted back to ¥22.5bn), lifting revenue estimates for the year 7.5%, OP estimates 28.9% to ¥29bn, and NP forecasts 37.2% to ¥19.9bn. The new Net Profit forecast for the year is 13.7% higher than the original OP forecast. </p><p>But my follow-on piece <a href="https://www.smartkarma.com/insights/hitachi-kokusai-tob-curbing-my-enthusiasm" target="_blank" data-smartkarma-citation="insights:12721">Hitachi Kokusai TOB - Curbing My Enthusiasm</a> when the stock closed at ¥2894 suggested there wasn't much upside. There was ¥6. The reason was that Hitachi was already effectively financing the bid through its back end sale of shares at a lower price and uptake of the video &amp; comms solutions business.</p><p>The new Offer, and the timing underlying the back end trades, is slightly different as regards the relationship between Hitachi Kokusai, <a href="https://www.smartkarma.com/entities/7797" target="_blank" data-smartkarma-citation="entities:7797:1">Hitachi Ltd (6501 JP)</a>, and KKR, but for minorities it is effectively the same, at a price 15.8% higher than the old price. </p><p>KKR has set the minimum tender threshold at 24,815,899 shares, which is a majority of the minority after Hitachi's shares and the treasury share holdings are eliminated. They could have gained complete control and squeezed out everybody just by purchasing 34% of the minority, so they are "playing fair" even if minorities don't think the price is that great. And Hitachi Kokusai's board has recommended. </p><p>So once again, minorities are asked to take it or leave it. </p><p>Is it the right price? It depends on your view of the cycle. It is 15x EPS on newly revised forecasts, which is more expensive than say <a href="https://www.smartkarma.com/entities/1116" target="_blank" data-smartkarma-citation="entities:1116:1">Lam Research Corp (LRCX US)</a>'s forecast PER, but... if you think there is room to run on the thin film depo business, then something could probably be done to get this done at a higher level. Eventually.</p>

One year, one week, and one day after the Nikkei reported Hitachi was looking to sell Hitachi Kokusai, we have a Tender Offer on the table. The original deal at ¥2503 was announced at the end of April after almost 7 months of speculation had brought the price to ¥2600+. The stock traded down close to terms, then traded up as people considered the deal price a "put option" and further gains in the then-ebullient SPE space appeared possible. By early August, the stock had reached ¥2900/share and when it came time for KKR to launch its Tender Offer, the support from the Independent Committee had dissolved. My original piece Hitachi Kokusai TOB - Minorities Are Asked To Take It Or Leave It in April suggested possible minority shareholder complaints because of the low-balled forecasts. Indeed, the forecasts were later changed and this was one reason for why the Independent Committee changed its support stance. Yesterday, the company revised its forecasts further (OP forecast had been lowered to ¥17.5bn for the original announcement, then lifted back to ¥22.5bn), lifting revenue estimates for the year 7.5%, OP estimates 28.9% to ¥29bn, and NP forecasts 37.2% to ¥19.9bn. The new Net Profit forecast for the year is 13.7% higher than the original OP forecast. But my follow-on piece Hitachi Kokusai TOB - Curbing My Enthusiasm when the stock closed at ¥2894 suggested there wasn't much upside. There was ¥6. The reason was that Hitachi was already effectively financing the bid through its back end sale of shares at a lower price and uptake of the video &amp; comms solutions business.The new Offer, and the timing underlying the back end trades, is slightly different as regards the relationship between Hitachi Kokusai, Hitachi Ltd (6501 JP), and KKR, but for minorities it is effectively the same, at a price 15.8% higher than the old price. KKR has set the minimum tender threshold at 24,815,899 shares, which is a majority of the minority after Hitachi's shares and the treasury share holdings are eliminated. They could have gained complete control and squeezed out everybody just by purchasing 34% of the minority, so they are "playing fair" even if minorities don't think the price is that great. And Hitachi Kokusai's board has recommended. So once again, minorities are asked to take it or leave it. Is it the right price? It depends on your view of the cycle. It is 15x EPS on newly revised forecasts, which is more expensive than say Lam Research Corp (LRCX US)'s forecast PER, but... if you think there is room to run on the thin film depo business, then something could probably be done to get this done at a higher level. Eventually.

KKR TOB for Hitachi Kokusai at ¥2900 - Again a Matter of Take It Or Leave It

Japan

ULVAC, Inc. manufactures vacuum devices for industries such as semiconductor, electronics, chemical, pharmaceutical and food.  The Company's products include pumps, valves, gas analyzers, leak detectors, and surface profile measurement.

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

Ulvac Inc (6728 JP)

🇯🇵 Japan • September Relative Price Scores - Life at the Poles Part 2: Companies

• RELATIVE PRICE SCORE •INTRODUCTION - The Relative Price Score (RPS) is a measure of stock price performance relative to TOPIX calculated by...

Campbell Gunn

🇯🇵 Japan: Winter Peer Group Results & Revision Scores - Contrarian Buys & Sells/Peak & Ex-Growth

- PEER GROUP SCORE MATRIX - INTRODUCTION - Following on from our review of the Market Composite and Sectors, this Insight will cover the...

Campbell Gunn

Japan: Moving Average Outliers - Results Driven

MOVING AVERAGE OUTLIERS - Our moving average outlier indicator uses a weighted sum of the share price relative to the 5-day, 20-day, 60-day, 120...

Campbell Gunn

Japan: Moving Average Outliers - Playing the Extremes

MOVING AVERAGE OUTLIERS - In addition to our Relative Price Score, we also monitor deviations from moving averages to highlight extreme price...

Campbell Gunn

KKR TOB for Hitachi Kokusai at ¥2900 - Again a Matter of Take It Or Leave It

One year, one week, and one day after the Nikkei reported Hitachi was looking to sell Hitachi Kokusai, we have a Tender Offer on the table. The...

Travis Lundy

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)