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

iShares MSCI ACWI ETF / Technical Analysis

<ul>
<li>The MSCI ACWI (ACWI-US), ACWI ex-US (ACWX-US), EAFE (EFA-US), and EM (EEM-US) are all reversing topside their 2-month downtrends.</li>
<li>Despite this being a bullish short-term development, we still expect $93 to cap upside on the ACWI-US, leaving about 4-5% upside from here (at time of writing)</li>
<li>As a result, we would use any further strength as an opportunity to get more defensive. Actionable Themes: REA-AU, GFL-CA, GFL-US, Consumer Staples, Health Care, and Gold Miners</li>
</ul>


The MSCI ACWI (ACWI-US), ACWI ex-US (ACWX-US), EAFE (EFA-US), and EM (EEM-US) are all reversing topside their 2-month downtrends.
Despite this being a bullish short-term development, we still expect $93 to cap upside on the ACWI-US, leaving about 4-5% upside from here (at time of writing)
As a result, we would use any further strength as an opportunity to get more defensive. Actionable Themes: REA-AU, GFL-CA, GFL-US, Consumer Staples, Health Care, and Gold Miners


Shift To Defensives as $ACWI Makes Push for $93; Remain Overweight Europe; Opptys in China/HK, Japan

iShares MSCI ACWI ex US ETF / Technical Analysis

<ul>
<li>The bear market rally we have discussed since our Sept. 29 Int'l Compass has managed to surpass our price targets, which were the YTD downtrends on the ACWX-US and EFA-US.</li>
<li>As you will see below, many countries are reversing topside their 6.5-month to YTD downtrends.</li>
<li>As a result of these bullish reversals and breakdowns on the US dollar (DXY) and 10-year Treasury yield, we are upgrading our outlook to neutral. Buy on pullbacks.</li>
</ul>


The bear market rally we have discussed since our Sept. 29 Int'l Compass has managed to surpass our price targets, which were the YTD downtrends on the ACWX-US and EFA-US.
As you will see below, many countries are reversing topside their 6.5-month to YTD downtrends.
As a result of these bullish reversals and breakdowns on the US dollar (DXY) and 10-year Treasury yield, we are upgrading our outlook to neutral. Buy on pullbacks.


Positive Character Changes; MSCI ACWI Ex-US, EAFE, STOXX 50, Countless Others Reversing Downtrends

European Event-Driven Analyst

Jesus Rodriguez Aguilar

Event-Driven

<ul>
<li>The Additional Acceptance Period ended on 29 September. On 3 October, FEMSA announced the satisfaction of all conditions. On 5 October, FEMSA announced that its participation amounts to 96.87%.</li>
<li>Settlement will occur on 7 October. FEMSA intends to initiate a squeeze-out procedure and delist the Valora shares from trading on SIX Swiss Exchange.</li>
<li>The tender was good news for shareholders. My TP is CHF 252.2/share, therefore I believe the offer is fair and there was no counterbid. </li>
</ul>


The Additional Acceptance Period ended on 29 September. On 3 October, FEMSA announced the satisfaction of all conditions. On 5 October, FEMSA announced that its participation amounts to 96.87%.
Settlement will occur on 7 October. FEMSA intends to initiate a squeeze-out procedure and delist the Valora shares from trading on SIX Swiss Exchange.
The tender was good news for shareholders. My TP is CHF 252.2/share, therefore I believe the offer is fair and there was no counterbid. 


FEMSA/​Valora Holding: Offer Success and Squeeze-Out

<ul>
<li>Valora has agreed to a CHF 260/share cash offer (52% premium, 7.6x EV/Fwd EBITDA, 24.7x Fwd P/E) from FEMSA, which intends to use it as a platform for European expansion.</li>
<li>I consider the offer as fair (my DCF valuation of Valora is CHF 252.2/share, WACC 8.5%, 1.7% implied perpetuity growth rate).</li>
<li>Valora should benefit from FEMSA's know-how and added scale. A counterbid could be possible from the likes of Migros and Coop.</li>
</ul>


Valora has agreed to a CHF 260/share cash offer (52% premium, 7.6x EV/Fwd EBITDA, 24.7x Fwd P/E) from FEMSA, which intends to use it as a platform for European expansion.
I consider the offer as fair (my DCF valuation of Valora is CHF 252.2/share, WACC 8.5%, 1.7% implied perpetuity growth rate).
Valora should benefit from FEMSA's know-how and added scale. A counterbid could be possible from the likes of Migros and Coop.


FEMSA/Valora Holding: Fair Offer and Possible Counterbid

Global Emerging Market Equities, Propitious Research

Wium Malan, CFA

Global Emerging Market Equities

Independent, Fundamental Quantitative Research

Propitious Research

Fully independent, fundamental and quantitative equity research, focused on companies in the Telecommunication, Media, Technology, Internet and Healthcare sectors in the Global Emerging Markets. Idea generation focused on Quality stocks, trading below their intrinsic Value, with sound Corporate Governance.

Quantitative Analysis

<ul>
<li>An overview (and output) of our machine learning-driven GEM screening model, which seeks to find the best medium-term long ideas within the top100 stocks in the MSCI GEM Index.</li>
<li>The model is based on 1) a quantitative multifactor screening model, enhanced by two AI Technology-based approaches; 2) a Deep Neural Network model, and 3) a Recurrent Neural Network model.</li>
<li>Developed over roughly 4 years and implemented in its current state for 2 years, the model has a solid real-world alpha-generating performance track record, discussed in detail below.</li>
</ul>


An overview (and output) of our machine learning-driven GEM screening model, which seeks to find the best medium-term long ideas within the top100 stocks in the MSCI GEM Index.
The model is based on 1) a quantitative multifactor screening model, enhanced by two AI Technology-based approaches; 2) a Deep Neural Network model, and 3) a Recurrent Neural Network model.
Developed over roughly 4 years and implemented in its current state for 2 years, the model has a solid real-world alpha-generating performance track record, discussed in detail below.


Mexico

Fomento Economico Mexicano, S.A.B. de C.V. (FEMSA) is a Company that through its subsidiaries produces, distributes and markets non-alcoholic beverages throughout Latin America as part of the Coca-Cola system. The Company owns and operates convenience stores in Mexico and Colombia and holds a stake in Heineken.

Fomento Economico Mexica-Ubd (FEMSAUBD MM)

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

Fomento Economico Mexica-Ubd (FEMSAUBD MM)

Shift To Defensives as $ACWI Makes Push for $93; Remain Overweight Europe; Opptys in China/HK, Japan

$ACWI, $ACWX, $EFA, and $EEM all reversing topside their 2-month downtrends. Despite this bullish short-term development, we still expect $93 to...

Vermilion Research

Positive Character Changes; MSCI ACWI Ex-US, EAFE, STOXX 50, Countless Others Reversing Downtrends

MSCI ACWI ex-US $ACWX and EAFE $EFA reversing their YTD downtrends, with countless other countries doing the same. This is a clear character...

Vermilion Research

FEMSA/Valora Holding: Offer Success and Squeeze-Out

On 5 October, FEMSA announced that it holds 96.87% of Valora. With all conditions satisfied and settlement scheduled for 7 October, the following...

Jesus Rodriguez Aguilar

FEMSA/Valora Holding: Fair Offer and Possible Counterbid

FEMSA intends to break into European convenience retail/food with a fair cash offer for Valora. A counterbid is not to be ruled out from the likes...

Jesus Rodriguez Aguilar

Screening for GEMs: May 2022

This insight provides an overview of our, machine learning-driven, proprietary GEM screening model, based on a Multifactor model, a Deep Neural...

Wium Malan, CFA

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Shift To Defensives as $ACWI Makes Push for $93; Remain Overweight Europe; Opptys in China/HK, Japan

$ACWI, $ACWX, $EFA, and $EEM all reversing topside their 2-month downtrends. Despite this bullish short-term development, we still expect $93 to...

Vermilion Research

Positive Character Changes; MSCI ACWI Ex-US, EAFE, STOXX 50, Countless Others Reversing Downtrends

MSCI ACWI ex-US $ACWX and EAFE $EFA reversing their YTD downtrends, with countless other countries doing the same. This is a clear character...

Vermilion Research

FEMSA/​Valora Holding: Offer Success and Squeeze-Out

On 5 October, FEMSA announced that it holds 96.87% of Valora. With all conditions satisfied and settlement scheduled for 7 October, the following...

Jesus Rodriguez Aguilar

FEMSA/Valora Holding: Fair Offer and Possible Counterbid

FEMSA intends to break into European convenience retail/food with a fair cash offer for Valora. A counterbid is not to be ruled out from the likes...

Jesus Rodriguez Aguilar

Screening for GEMs: May 2022

This insight provides an overview of our, machine learning-driven, proprietary GEM screening model, based on a Multifactor model, a Deep Neural...

Wium Malan, CFA

FEMSA/Valora Holding: Offer Success and Squeeze-Out