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.

Equity Bottom-Up

<ul>
<li>ULVAC regained its May 2024 price peak last Tuesday, when it announced 3Q results showing a big increase in new orders, which rose 29% from 2Q and 109% YoY.</li>
<li>Orders growth was led by strong demand for vacuum equipment used in the AI semiconductor boom, rare earth magnet production, and OLED displays. The 3Q Book-to-Bill ratio was 1.46X.</li>
<li>Sales and profits lagged as the end of the EV power device downturn passed through the income statement, but should rebound in 1H of FY Jun-27.</li>
</ul>


ULVAC regained its May 2024 price peak last Tuesday, when it announced 3Q results showing a big increase in new orders, which rose 29% from 2Q and 109% YoY.
Orders growth was led by strong demand for vacuum equipment used in the AI semiconductor boom, rare earth magnet production, and OLED displays. The 3Q Book-to-Bill ratio was 1.46X.
Sales and profits lagged as the end of the EV power device downturn passed through the income statement, but should rebound in 1H of FY Jun-27.


Ulvac (6728 JP): Opportunities in Rare Earth Magnets and AI

Japan Specialist

Mark Chadwick

Thematic (Sector/Industry)

<ul>
<li>Japanese equities slid as rising US long-term yields overwhelmed strong domestic fundamentals and hit AI-linked, long-duration technology valuations. </li>
<li>Treasury long-end buybacks helped yields retreat, exposing Japanese semiconductor stocks’ growing sensitivity to Washington’s debt-management decisions. </li>
<li>AI capex remains Japan’s growth engine, but higher US term premia threaten valuations, making November’s buyback expiry a key test.</li>
</ul>


Japanese equities slid as rising US long-term yields overwhelmed strong domestic fundamentals and hit AI-linked, long-duration technology valuations. 
Treasury long-end buybacks helped yields retreat, exposing Japanese semiconductor stocks’ growing sensitivity to Washington’s debt-management decisions. 
AI capex remains Japan’s growth engine, but higher US term premia threaten valuations, making November’s buyback expiry a key test.


Japan Strategy Weekly | AI Winners Held Hostage to US Bond Yields

Japanese Equity Specialist, Ortus Advisors

Andrew Jackson

Japanese Equity Specialist

Ortus Advisors

<ul>
<li>Quantum theme keeps running but Socionext still struggles to catch a bid.</li>
<li>Aixtron's numbers set a strong tone for Japan SPE names Ulvac and Kokusai.</li>
<li>QD Laser -8.5%, Kioxia -7.4% and Ibiden -5.4% yesterday may be playing catch up today with overnight gains.</li>
</ul>


Quantum theme keeps running but Socionext still struggles to catch a bid.
Aixtron's numbers set a strong tone for Japan SPE names Ulvac and Kokusai.
QD Laser -8.5%, Kioxia -7.4% and Ibiden -5.4% yesterday may be playing catch up today with overnight gains.


Japan Morning Connection: Hopes of Ceasefire Extension to Lift Sentiment

<ul>
<li>Meta, Tesla and Microsoft all post big capex guidance beats which sets strong tone for JP SPE.</li>
<li>Lam Research numbers beat, while Advantest AH yesterday knocked it out of the park.</li>
<li>Seagate +19% will add fuel to the fire for HDD components and memory names.</li>
</ul>


Meta, Tesla and Microsoft all post big capex guidance beats which sets strong tone for JP SPE.
Lam Research numbers beat, while Advantest AH yesterday knocked it out of the park.
Seagate +19% will add fuel to the fire for HDD components and memory names.


Japan Morning Connection: Huge Earnings After Hours All Point to Increased AI Capex Spending

<ul>
<li>Breakout move higher for Lam Research should add some more zest to TEL which continues to lag.</li>
<li>Sandisk 14% as NAND heats up, but has Kioxia gone too far with huge blocks probably not too far off.</li>
<li>US Eco data cements expectations for a Sep cut sending rates down and home builders up.</li>
</ul>


Breakout move higher for Lam Research should add some more zest to TEL which continues to lag.
Sandisk 14% as NAND heats up, but has Kioxia gone too far with huge blocks probably not too far off.
US Eco data cements expectations for a Sep cut sending rates down and home builders up.


Japan Morning Connection: Tech Strength Continues with a Swing to Semi-Cap, Boding Well for Japan

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.

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Ulvac Inc (6728 JP)

Ulvac (6728 JP): Opportunities in Rare Earth Magnets and AI

New orders jumped in the March quarter, pointing to profit recovery in FY Jun-27. Demand from makers of AI semiconductors and rare earth magnets...

Scott Foster

Japan Strategy Weekly | AI Winners Held Hostage to US Bond Yields

Japanese AI winners are enjoying a powerful capex boom, but their valuations are increasingly hostage to US long-term yields and Treasury policy.

Mark Chadwick

Japan Morning Connection: Hopes of Ceasefire Extension to Lift Sentiment

Japan to play catch up after yesterday's pullbacks with ceasefire extension hopes lifting sentiment. Aixtron's blowout numbers put Ulvac and...

Andrew Jackson

Japan Morning Connection: Huge Earnings After Hours All Point to Increased AI Capex Spending

Meta is surging +11% after reporting 1Q sales guidance. Tesla plans to invest $2bn in Musk’s xAI. Expect whole SPE ecosystem in Japan to be sharply...

Andrew Jackson

Japan Morning Connection: Tech Strength Continues with a Swing to Semi-Cap, Boding Well for Japan

EDA names bounce back after yesterdays weakness. TEL flagged as an interesting underperforer. Kioxia may be running out of room to climb higher.

Andrew Jackson

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