In today’s briefing:
- Trading Opportunity Coming on SK Telecom ADR Premium
- MVIS Global Rare Earth/Strategic Metals Index Rebalance Preview: Potential Adds & Capping Flows
- Nintendo (7974) – Earnings Forecasts⬇︎ Stock Split, Buyback, and HOW TO SELL WELL
- Another BIG SONY (6758) Buyback, But…
- Link Admin (LNK AU): 13 July Scheme Meeting As Dye & Durham Takes A Bath
Trading Opportunity Coming on SK Telecom ADR Premium
- ADRs are traded at a significant premium when the foreign room for underlying shares is exhausted. This is the pattern that KT showed in 2018.
- SKT’s foreign room is currently 1.85%. That is, the burnout rate is 98.15%. Only about 2M shares need to be burned to hit bottom. This is 0.91% of SO.
- The shortage of SKT ADRs is likely to intensify, which in turn suggests that the ADR premium may rise further.
MVIS Global Rare Earth/Strategic Metals Index Rebalance Preview: Potential Adds & Capping Flows
- Core Lithium Ltd (CXO AU) could be added to the MVIS Global Rare Earth/Strategic Metals Index in June. Lake Resources Nl (LKE AU) is the next highest ranked non-index constituent.
- Irrespective of whether there are inclusions, there will be passive selling on ioneer Ltd (INR AU) and Australian Strategic Materials (ASM AU) due to capping changes to the index constituents.
- Inclusions to the index jump post announcement. The review cutoff date is 31 May, so weakness in the potential inclusions could be used to pre-position (if they outperform index constituents).
Nintendo (7974) – Earnings Forecasts⬇︎ Stock Split, Buyback, and HOW TO SELL WELL
- Nintendo has announced in-line-ish results for March 2022, and quite disappointing forecasts for March 2023. Mio Kato called it on 30 March as a sell. Excellent timing.
- Nintendo has a buyback tomorrow and if you don’t like the guidance, you should DEFINITELY read on below.
- But Nintendo also announced something truly extraordinary – a stock split. Everyone pooh-poohs the impact of a stock split but… in this case it is probably not nothing.
Another BIG SONY (6758) Buyback, But…
- A release showed up on TDNET last week that Sony Corp (6758 JP) had completed its ¥200bn 25mm share (2.02%) buyback program announced 28 April 2021.
- The details showed they had actually bought back 8.2mm shares spending only ¥97bn, despite the shares trading below T-1 Announcement Date Price for four months straight.
- Today, with earnings, SONY announced a NEW buyback. ¥200bn, 25mm shares, 2.02%. Same as last year.
Link Admin (LNK AU): 13 July Scheme Meeting As Dye & Durham Takes A Bath
- The Supreme Court of New South Wales today approved the convening of a Scheme Meeting for Link Administration Holdings (LNK AU) on the 13 July.
- The Explanatory Booklet has been registered with ASIC. The Independent Expert (Deloitte) has concluded that the A$5.50/share Scheme Consideration is fair and reasonable.
- Separately, the Offeror, Canada’s Dye & Durham, has seen its shares decline 57% since the release of its 2Q22 results.
Before it’s here, it’s on Smartkarma