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

Our bullish outlook, intact since early November, has been based on the fact that virtually all signals from the market have been consistent with risk-on behavior that we would expect to see in bull markets. Now, the picture is less clear; we are still bullish, just slightly less so than we have been over the past 2-3 months. In today’s report we highlight attractive Groups and stocks within Consumer Discretionary, Health Care, Manufacturing, and Technology.

Our bullish outlook, intact since early November, has been based on the fact that virtually all signals from the market have been consistent with risk-on behavior that we would expect to see in bull markets. Now, the picture is less clear; we are still bullish, just slightly less so than we have been over the past 2-3 months. In today’s report we highlight attractive Groups and stocks within Consumer Discretionary, Health Care, Manufacturing, and Technology.

U.S. Equity Strategy: Downgrading Manufacturing & Transports

Semiconductor & Technology Specialist, Ingenuity

William Keating

Semiconductor & Technology Specialist

Ingenuity

Our focus is exclusively on in-depth research & consulting in the broader semiconductor industry. We focus on the key players, namely Intel, Micron, Qualcomm, Apple, Samsung, NVIDIA, AMD, TSMC & Global Foundries - as well as some of the lesser known, but nonetheless critical, companies such as ASML (for EUV), Mellanox, Cavium, Xilinx etc. We specialise in their products, roadmaps, process technologies, competitive advantages & threats etc. We also help our clients understand the implications of new and emerging technologies, e.g. 3D X-Point, 3D NAND, Carbon Nanotubes, Autonomous Driving, Graphene, Silicon Photonics, Wafer-Level Optics, Artificial Intelligence, FPGA, GPU, ASIC etc. 

Semiconductor Analysis & Research

Thematic (Sector/Industry)

Based on the latest quarterly earnings and forecasts of the top 5 global semiconductor wafer fab equipment (WFE) manufacturers, the sector is on track to grow by ~20% sequentially in 2020. This is a remarkable accomplishment considering the challenges these companies have faced during the year as a result of the global pandemic along with the US-China trade restrictions. Furthermore, assuming there are no surprises through the end of the year, 2020 will set an all time record high for annual WFE revenues. Here's a look in more detail at how the sector is performing.

Based on the latest quarterly earnings and forecasts of the top 5 global semiconductor wafer fab equipment (WFE) manufacturers, the sector is on track to grow by ~20% sequentially in 2020. This is a remarkable accomplishment considering the challenges these companies have faced during the year as a result of the global pandemic along with the US-China trade restrictions. Furthermore, assuming there are no surprises through the end of the year, 2020 will set an all time record high for annual WFE revenues. Here's a look in more detail at how the sector is performing. 

Semiconductor WFE. On Track For ~20% YoY Growth Despite US China Restrictions.

President

Thomas Coughlin

Coughlin Associates

Memory and storage demand are a critical ingredient in worldwide  digital transformations, spurred by the pandemic.  Demand for memory and processor investments, including domain specific processing, will drive semiconductor fab growth, especially in Asia through 2024.

Memory and storage demand are a critical ingredient in worldwide  digital transformations, spurred by the pandemic.  Demand for memory and processor investments, including domain specific processing, will drive semiconductor fab growth, especially in Asia through 2024.

The Pandemic Will Help Drive Silicon Wafer Fab Spending Increases Through 2023

Semiconductors, Memory and SSDs Specialist, Objective Analysis

Jim Handy

Semiconductors, Memory and SSDs Specialist

Objective Analysis

Objective Analysis offers third-party independent market research and data for the semiconductor industry and investors in the semiconductor industry.

Semiconductors, Memory and SSDs

Equity Bottom-Up

Semiconductor Manufacturing International Corp (SMIC) / Equity Bottom-Up

Semiconductor Manufacturing International Corp (SMIC)

The US Department of Commerce has added SMIC to its Entity List with the intent of limiting the company's access to US technology.  This Smartkarma Insight explores what that might mean to the company, to  China's national semiconductor efforts, and to SMIC's US-based tool suppliers.

The US Department of Commerce has added SMIC to its Entity List with the intent of limiting the company's access to US technology.  This Smartkarma Insight explores what that might mean to the company, to  China's national semiconductor efforts, and to SMIC's US-based tool suppliers.

The much-anticipated acquisition by <a href="https://www.smartkarma.com/entities/nvidia-corp" target="_blank" data-smartkarma-citation="entities:5891:1" rel="noopener">NVIDIA</a> of <a href="https://www.smartkarma.com/entities/arm-holdings-plc" target="_blank" data-smartkarma-citation="entities:21816:1" rel="noopener">Arm</a> from <a href="https://www.smartkarma.com/entities/softbank-group-corp" target="_blank" data-smartkarma-citation="entities:315:1" rel="noopener">Softbank</a> was formally <a href="https://nvidianews.nvidia.com/news/nvidia-to-acquire-arm-for-40-billion-creating-worlds-premier-computing-company-for-the-age-of-ai" target="_blank" rel="noopener">announced</a> on Monday. The transaction is valued at $40 billion, an approximately equal combination of cash and NVIDIA stock.On the surface the deal looks strategically solid from NVIDIA's perspective. It places the company at the center of Arm's one hundred and eighty billion connected device ecosystem. Perhaps even more importantly, it opens up the possibility of an outright assault on <a href="https://www.smartkarma.com/entities/intel-corp" target="_blank" data-smartkarma-citation="entities:16764:1" rel="noopener">Intel's</a> data center dominance by adding Arm-based server processors to complement NVIDIA's existing lineup of GPUs and interconnect.Underneath the surface however, this deal is fraught with issues and risks. While Arm has been a very successful company, their growth is flatlining as smartphone sales stagnate. Furthermore, we see the rise of RISC-V as a very real threat to Arm's business model in the coming years. Arm has never competed with its customers. Under NVIDIA ownership, this will be virtually impossible to avoid.From a regulatory perspective, Arm IP moving under american ownership will raise the very real prospect that this technology will become a future weapon in the US-China trade and technology wars. In today's environment, it's difficult to see why China would agree to facilitate that possibility.All in all we think this deal is not as good as it seems on the surface and that it will be practically impossible to get through the regulatory approval process.

The much-anticipated acquisition by NVIDIA of Arm from Softbank was formally announced on Monday. The transaction is valued at $40 billion, an approximately equal combination of cash and NVIDIA stock.On the surface the deal looks strategically solid from NVIDIA's perspective. It places the company at the center of Arm's one hundred and eighty billion connected device ecosystem. Perhaps even more importantly, it opens up the possibility of an outright assault on Intel's data center dominance by adding Arm-based server processors to complement NVIDIA's existing lineup of GPUs and interconnect.Underneath the surface however, this deal is fraught with issues and risks. While Arm has been a very successful company, their growth is flatlining as smartphone sales stagnate. Furthermore, we see the rise of RISC-V as a very real threat to Arm's business model in the coming years. Arm has never competed with its customers. Under NVIDIA ownership, this will be virtually impossible to avoid.From a regulatory perspective, Arm IP moving under american ownership will raise the very real prospect that this technology will become a future weapon in the US-China trade and technology wars. In today's environment, it's difficult to see why China would agree to facilitate that possibility.All in all we think this deal is not as good as it seems on the surface and that it will be practically impossible to get through the regulatory approval process. 

NVIDIA+Arm. Strategically Solid But Practically Impossible.

United States

Applied Materials, Inc. develops, manufactures, markets, and services semiconductor wafer fabrication equipment and related spare parts for the worldwide semiconductor industry.  The Company's customers include semiconductor wafer and integrated circuit manufacturers, flat panel liquid crystal displays, solar photovoltaic cells and modules and other electronic devices manufacturers.

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Applied Materials (AMAT US)

U.S. Equity Strategy: Downgrading Manufacturing & Transports

In today’s report we highlight attractive Groups and stocks within Consumer Discretionary, Health Care, Manufacturing, and Technology

Vermilion Research

Semiconductor WFE. On Track For ~20% YoY Growth Despite US China Restrictions.

Despite the double headwinds of COVID-19 and US China trade restrictions, the semiconductor WFE segment is turning in an outstanding performance...

William Keating

The Pandemic Will Help Drive Silicon Wafer Fab Spending Increases Through 2023

Increased semi fab investments in Asia, spurred by investments to provide services during the pandemic, will drive digital transformations

Thomas Coughlin

US Government Puts the Squeeze on SMIC

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Jim Handy

NVIDIA+Arm. Strategically Solid But Practically Impossible.

The long-anticipated acquisition by NVIDIA of Arm Holdings (ARM LN)

William Keating

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