Independent Insight Provider, Japanese equities, LightStream Research

Scott Foster

Independent Insight Provider, 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>The shares have dropped back 25% from their November 15 peak, offering a buying opportunity for long-term investors anticipating exponential growth in Japanese cashless payments.</li>
<li>Guidance for FY Sep-22 looks conservative, but current valuations are extremely high.</li>
<li>Rapid growth in payment terminal sales has reduced margins but built a larger base for more profitable service revenues.</li>
</ul>


The shares have dropped back 25% from their November 15 peak, offering a buying opportunity for long-term investors anticipating exponential growth in Japanese cashless payments.
Guidance for FY Sep-22 looks conservative, but current valuations are extremely high.
Rapid growth in payment terminal sales has reduced margins but built a larger base for more profitable service revenues.


GMO Financial Gate (4051 JP): Speculative Buy on Weakness

Japan

MELCO HOLDINGS INC. is a holding company which manages computer peripheral equipment manufacturing subsidiaries.  The Company's subsidiaries develop and produce memory and storage devices and network equipment.

Roland DG Corporation manufactures color printers and computer related products. The Company's product lines include color printers, vinyl cutters, 3D machines,  and software.  Roland DG has group companies in North and South America, Oceania, Europe.

MIMAKI ENGINEERING CO.,LTD. manufactures and sells industrial printers, cutting plotters and related products.

Maxell Ltd develops a diverse portfolio of media devices. The Company's products include batteries, DVD's, memory storage, optical lenses, headphones and other accessories.

Eizo Corp develops, designs, manufactures, and markets computer displays and monitors for amusement products.  The Company's products include liquid crystal displays (LCD) and cathode ray tube (CRT) displays.

RISO KAGAKU CORPORATION is a manufacturer of copying and printing machines for office, home, and educational use.  The Company specializes in lithograph printers and also produces software, computer interfaces, and peripherals such as sorters, card counters, and sheet feeders.

Wacom Co., Ltd. manufactures pen tablets utilizing electronic pen and multitouch technologies. The Company's pen tablets are used in various fields, including film making, industrial  design, medical, education and financials. Wacom also manufactures components for smart phones and tablets.

MUTOH HOLDINGS CO., LTD. designs, manufactures, and markets drafting equipment, computers, and computer software.  The Company's products include computer-aided design (CAD) systems, pen-based components, large format graphics printers, plotters, and sign cutters.

NAGANO KEIKI CO., LTD. manufactures measuring instruments such as pressure gauges, transmitters, and temperature gauges primarily used for automobiles. The Company also makes equipment for the semiconductor industry, such as pressure regulators, transducers, digital pressure gauges, and power supplies.

Nippon Signal Company, Limited. manufactures and sells traffic signals. The Company also develops control system equipment such as ticket vending machines, automatic passenger gates, and automatic check in machines. Nippon Signal's products are used for railway stations, airports, and parking lots.

CMC Magnetics Corporation manufactures and markets digital storage media and magnetic disks.  The Company's products include CD-R (Compact Disc Recordable), CD-RW (Compact Disc Rewritable), DVD-R (Digital Video Disc Recordable), DVD-RAM (Digital Video Disc Random Access Memory), floppy disks, video tapes, and CD (Compact Disc) jewel boxes.  CMC also provides replication services.

Shenzhen Rapoo Technology Company Limited manufactures mouse, keyboards, tools and dies, audio products and accessories, computer games and related peripheral products. The company also develops computer software.

KYE Systems Corporation manufactures and markets mouse devices, scanners, graphic tablets, joysticks, keyboards as well as networking, communication, and multi-media products.  The Company markets its products under the Genius brand name.

Ritek Corporation manufactures and markets digital storage media, electro-optical products, and electronic components.  The Company's products include CD-R (Compact Disc Recordable), CD-RW (Compact Disc Rewritable), DVD-R (Digital Video Disc Recordable), DVD-RAM (Digital Video Disc Random Access Memory), ITO (Indium Tin OxideGlass), and EL Lamp (Electro-Luminescent Lamp).

Shandong New Beiyang Information Technology Co., Ltd. researches, develops, and sells thermal printer and scanning products. The Company's products include receipt printers, label printers and other printers.

Shandong New Beiyng Infrmt Tchlgy (002376 CH)

Wuhan Tianyu Information Industry Company Limited develops, produces, sells and provides services for smart card and related application systems.  The Company's main products are various smart cards including communication smart cards, financial IC cards, city cards, mobile multimedia broadcasting conditional access cards, tax cards, social security cards, fuel cards etc.

Eastman Kodak Company develops, manufactures, and markets imaging products for businesses.  The Company provides disruptive technologies and imaging solutions in the product goods packaging, functional and digital printing markets.  Eastman Kodak also offers products and services in Entertainment Imaging and Commercial Films.

Immersion Corporation develops and licenses hardware and software technologies that enable users to interact with computers using their sense of touch.  The Company's patented TouchSense technologies enable computer peripheral devices to deliver tactile sensations that correspond to on-screen events.

Shenzhen Sinovatio Technology Co., Ltd. produces communication products. The Company develops, manufactures, and sells broadband and mobile network, network content security, big data operation, and other related products. Shenzhen Sinovatio Technology also provides product installation, commissioning, training, and other technical services.

Shenzhen Sinovatio Technology (002912 CH)

Leadtek Research Inc. manufactures and markets communication equipments, computer and peripheral products, industrial control systems, and toys.  The Company also designs and trades information software.

GMO Financial Gate, Inc. develops and manufactures transaction management systems. The Company produces and sells cashless payment systems and equipment. GMO Financial Gate provides its services throughout Japan.

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GMO Financial Gate (4051 JP): Speculative Buy on Weakness

A speculative investment in what could be exponential growth in cashless payments in Japan. Valuations very high, but share price down 25% from...

Scott Foster