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>As discussed in last week's Compass (9/26/23), we continue to believe the odds of a deeper pullback to SPX 4165-4200/the 200-day MA have increased </li>
<li>Our reasoning continues to be due to the major breakouts in the U.S. dollar (DXY) and Treasury yields (10- and 30-year), coupled with a handful of Sectors/indexes breaking below supports.</li>
<li>We are also monitoring 1-year uptrends on the S&amp;P 500 and Russell 2000 (IWM), currently at 4240 and $173. Flirting with breakdowns below these levels today. Buys in retail/energy shippers</li>
</ul>


As discussed in last week's Compass (9/26/23), we continue to believe the odds of a deeper pullback to SPX 4165-4200/the 200-day MA have increased 
Our reasoning continues to be due to the major breakouts in the U.S. dollar (DXY) and Treasury yields (10- and 30-year), coupled with a handful of Sectors/indexes breaking below supports.
We are also monitoring 1-year uptrends on the S&amp;P 500 and Russell 2000 (IWM), currently at 4240 and $173. Flirting with breakdowns below these levels today. Buys in retail/energy shippers


S&P 500 and Russell 2000 Testing 1-Year Uptrends; "Magnificent Seven" Supports to Watch

Head of Research, IPOs & Placements, Aequitas Research

Sumeet Singh

Head of Research, IPOs & Placements

IPOs and Placements coverage across Asia Pacific

Aequitas Research

We cover all listing across the Asia Pacific along with follow-up placements. As of Dec 2020, our team had covered 539 IPOs with a hit rate of 73.5% and 685 placements with a hit rate of 66.8%.

We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic coverage across new listings and placements. Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis as well.

Equity Capital Markets

Kokusai Electric  / Equity Capital Markets

<ul>
<li>KKR is looking to raise around US$750m via selling a stake in <a href="https://www.smartkarma.com/entities/kokusai-electric-corp" target="_blank" data-smartkarma-citation="entities:40152:1" rel="noopener">Kokusai Electric (6525 JP)</a> (KE) in its Japan IPO.</li>
<li>KE main business activities consist of the manufacturing, sales and maintenance service of semiconductor manufacturing equipment.</li>
<li>In our previous notes we have looked at the company’s past performance. In this note, we will undertake a peer comparison.</li>
</ul>


KKR is looking to raise around US$750m via selling a stake in Kokusai Electric (6525 JP) (KE) in its Japan IPO.
KE main business activities consist of the manufacturing, sales and maintenance service of semiconductor manufacturing equipment.
In our previous notes we have looked at the company’s past performance. In this note, we will undertake a peer comparison.


Kokusai Electric Pre-IPO - Peer Comparison

Managing Director, Zero One, Zero One

Vincent Fernando, CFA

Managing Director, Zero One

Zero One

Founded in 2015, Zero One produces independent investment research and provides corporate finance advisory services with a focus on both listed and private technology companies. Founder Vincent Fernando has over 20 years of experience in US and Asia capital markets.

Independent Investment Research

Equity Bottom-Up

Taiwan Semiconductor (TSMC) - ADR / Equity Bottom-Up

<ul>
<li>Taiwan AI names rebounded strongly after having previously suffered declines. Nevertheless, many names have outperformed Nvidia and could be good hedges vs. a Long Nvidia position.</li>
<li>Nanya Tech crashed after the market reacted to Micron's weaker than expected near-term guidance. We believe the negative reaction to Micron is short-sighted. Please see our piece.</li>
<li>Delta Thailand crashed vs. Delta Taiwan after the parent sold a stake in the Thai subsidiary. We continue to believe Delta Taiwan offers substantially better value.</li>
</ul>


Taiwan AI names rebounded strongly after having previously suffered declines. Nevertheless, many names have outperformed Nvidia and could be good hedges vs. a Long Nvidia position.
Nanya Tech crashed after the market reacted to Micron's weaker than expected near-term guidance. We believe the negative reaction to Micron is short-sighted. Please see our piece.
Delta Thailand crashed vs. Delta Taiwan after the parent sold a stake in the Thai subsidiary. We continue to believe Delta Taiwan offers substantially better value.


Taiwan Tech Weekly: Taiwan AI Names Rebound; Memory Crashes; Look for Nvidia Hedges

Taiwan Tech Focused Senior Analyst

Patrick Liao

King Yuan Electronics Co, Ltd. / Equity Bottom-Up

<ul>
<li>
<a href="https://www.smartkarma.com/entities/nvidia-corp" target="_blank" data-smartkarma-citation="entities:5891:1" rel="noopener">NVIDIA Corp (NVDA US)</a> drives <a href="https://www.smartkarma.com/entities/king-yuan-electronics-co-ltd" target="_blank" data-smartkarma-citation="entities:6630:1" rel="noopener">King Yuan Electronics Co, Ltd. (2449 TT)</a> stock price, but their growth is still limited in 2023F.</li>
<li>
<a href="https://www.smartkarma.com/entities/king-yuan-electronics-co-ltd" target="_blank" data-smartkarma-citation="entities:6630:1" rel="noopener">King Yuan Electronics Co, Ltd. (2449 TT)</a> acts as a buffer for <a href="https://www.smartkarma.com/entities/mediatek-inc" target="_blank" data-smartkarma-citation="entities:772:1" rel="noopener">Mediatek Inc (2454 TT)</a> end demand during 2023F.</li>
<li>Although it is not yet the time to reverse the downturn in 2023F, <a href="https://www.smartkarma.com/entities/king-yuan-electronics-co-ltd" target="_blank" data-smartkarma-citation="entities:6630:1" rel="noopener">King Yuan Electronics Co, Ltd. (2449 TT)</a> is expected to continue its upward trend throughout 2H23F.</li>
</ul>



NVIDIA Corp (NVDA US) drives King Yuan Electronics Co, Ltd. (2449 TT) stock price, but their growth is still limited in 2023F.

King Yuan Electronics Co, Ltd. (2449 TT) acts as a buffer for Mediatek Inc (2454 TT) end demand during 2023F.
Although it is not yet the time to reverse the downturn in 2023F, King Yuan Electronics Co, Ltd. (2449 TT) is expected to continue its upward trend throughout 2H23F.


KYEC (2449.TT): Beneficiary of AI with Contribution of CoWoS Testing

<ul>
<li>Micron's FY4Q23 results beat expectations. The company expects to return to a positive margin by FY2H24, however projected a higher FY1Q24 loss than consensus expected.</li>
<li>As suggested would be the case in our pre-results piece, the company said it sees memory prices bottoming and expects improving pricing and profitability ahead for the industry.</li>
<li>While next quarter's guidance may be weaker than some expected, we believe the key take-away is that Micron is seeing a memory prices bottom.</li>
</ul>


Micron's FY4Q23 results beat expectations. The company expects to return to a positive margin by FY2H24, however projected a higher FY1Q24 loss than consensus expected.
As suggested would be the case in our pre-results piece, the company said it sees memory prices bottoming and expects improving pricing and profitability ahead for the industry.
While next quarter's guidance may be weaker than some expected, we believe the key take-away is that Micron is seeing a memory prices bottom.


Micron Management Calls Memory Price Trough, Improving Pricing & Profitability Ahead

United States

NVIDIA Corporation designs, develops, and markets three dimensional (3D) graphics processors and related software.  The Company's products provide interactive 3D graphics to the mainstream personal computer market.

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NVIDIA Corp (NVDA US)

S&P 500 and Russell 2000 Testing 1-Year Uptrends; "Magnificent Seven" Supports to Watch

As discussed last week, we continue to believe the odds of a deeper pullback to $SPX 4165-4200/the 200-day MA have increased following major...

Vermilion Research

Kokusai Electric Pre-IPO - Peer Comparison

KKR is looking to raise around US$750m via selling a stake in Kokusai Electric (6525 JP) (KE) in its Japan IPO. In this note we undertake a peer...

Sumeet Singh

Taiwan Tech Weekly: Taiwan AI Names Rebound; Memory Crashes; Look for Nvidia Hedges

Taiwan AI names rebounded strongly after having previously suffered declines. Nevertheless, many names have outperformed Nvidia and could be good...

Vincent Fernando, CFA

KYEC (2449.TT): Beneficiary of AI with Contribution of CoWoS Testing

It is not yet the time to judge, the upturn in 2023F, KYEC is expected to continue its upward trend throughout 2H23F. Nvidia is the driver of...

Patrick Liao

Micron Management Calls Memory Price Trough, Improving Pricing & Profitability Ahead

Micron's FY4Q23 results beat expectations. The company expects to return to a positive margin by FY2H24, however projected a higher FY1Q24 loss...

Vincent Fernando, CFA

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