Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<ul>
<li>In 2018, Suruga Bank got itself in trouble, the shares fell 80% or more in a year-plus. In 2019 they took a big hit, and the Okano family sold out.</li>
<li>
<a href="https://www.smartkarma.com/entities/nojima-corp" target="_blank" data-smartkarma-citation="entities:9655:1" rel="noopener">Nojima Corp (7419 JP)</a> bought the shares -85% from the peak. Now they are selling those shares, plus the ones they already owned. Down nearly 10% from where they bought. </li>
<li>This is an instant 15+% boost to BVPS and 22+% boost to EPS. That's great. But that may be where greatness stops.</li>
</ul>


In 2018, Suruga Bank got itself in trouble, the shares fell 80% or more in a year-plus. In 2019 they took a big hit, and the Okano family sold out.

Nojima Corp (7419 JP) bought the shares -85% from the peak. Now they are selling those shares, plus the ones they already owned. Down nearly 10% from where they bought. 
This is an instant 15+% boost to BVPS and 22+% boost to EPS. That's great. But that may be where greatness stops.


<ul>
<li>Hokuhoku made a somewhat startling buyback announcement in late December and the shares jumped.</li>
<li>Then they bought back almost nothing in January, and bought back 17.4% of traded volume in February.</li>
<li>There is a lot left over and Hokuhoku remains one of the cheapest regional banks out there.</li>
</ul>


Hokuhoku made a somewhat startling buyback announcement in late December and the shares jumped.
Then they bought back almost nothing in January, and bought back 17.4% of traded volume in February.
There is a lot left over and Hokuhoku remains one of the cheapest regional banks out there.


Hokuhoku Financial (8377 JP) - Buyback Dynamics For March... 👀

<ul>
<li>
<a href="https://www.smartkarma.com/entities/hokuhoku-financial-group-inc" target="_blank" data-smartkarma-citation="entities:19006:1" rel="noopener">Hokuhoku Financial Group (8377 JP)</a> is one of Japan's cheapest regional banks. It has adequate capital but large cross-holdings, and a mid-tier NIM.</li>
<li>Comparing the bank vs its large regional and small regional and liquidity-bucket peers, the stock presents itself as inexpensive on every metric.</li>
<li>The bank just announced an on-market buyback which is worth looking at.</li>
</ul>



Hokuhoku Financial Group (8377 JP) is one of Japan's cheapest regional banks. It has adequate capital but large cross-holdings, and a mid-tier NIM.
Comparing the bank vs its large regional and small regional and liquidity-bucket peers, the stock presents itself as inexpensive on every metric.
The bank just announced an on-market buyback which is worth looking at.


Hokuhoku Financial (8377 JP) Buyback Worth Looking At

Senior Bank Analyst - Japanese Banks, Windamee Research

J. Brian Waterhouse

Senior Bank Analyst - Japanese Banks

Windamee Research

Japanese Banks

Equity Bottom-Up

<p><strong><em><a href="https://www.smartkarma.com/entities/bank-of-toyama-ltd" target="_blank" data-smartkarma-citation="entities:3496:1" rel="noopener">Bank Of Toyama /Ltd (8365 JP)</a></em></strong>’s share price has risen over 36% in the last 30 days on 4x normal daily trading volume and has shot up an astonishing +135% in the last six months.  What is going on, and why do foreign investors still own under 1% of outstanding shares if this bank is such an outstanding performer?</p>
<p>Although the stock prices of major Japanese banks have barely moved over the last month, some regional bank stocks have seen a surge in trading volume and double-digit improvements in their share prices.  This surge is attributable to comments made in early September by newly-elected Japanese prime minister Yoshihide Suga that there were “too many regional banks”, prompting speculation that mergers of regional and secondary regional banks might be actively encouraged under the incoming Suga Government.</p>
<p>However, we think the sudden rise in Bank of Toyama’s stock price has less to do with PM Suga’s comments on overbanking in Japan and more to do with stock ‘cornering’ by a group or groups of domestic speculators.  This has all the signs of a classic domestic ‘ramp’, designed to quickly push up the share price of a target stock and then offload the accumulated shares for a quick profit close to the top of the price range onto unsuspecting punters drawn by the action.  The bank’s fundamentals simply do not support current valuations.  Foreign investors should steer well clear.   <em>Caveat emptor!</em>  (May the buyer beware!)</p>

Bank Of Toyama /Ltd (8365 JP)’s share price has risen over 36% in the last 30 days on 4x normal daily trading volume and has shot up an astonishing +135% in the last six months.  What is going on, and why do foreign investors still own under 1% of outstanding shares if this bank is such an outstanding performer?
Although the stock prices of major Japanese banks have barely moved over the last month, some regional bank stocks have seen a surge in trading volume and double-digit improvements in their share prices.  This surge is attributable to comments made in early September by newly-elected Japanese prime minister Yoshihide Suga that there were “too many regional banks”, prompting speculation that mergers of regional and secondary regional banks might be actively encouraged under the incoming Suga Government.
However, we think the sudden rise in Bank of Toyama’s stock price has less to do with PM Suga’s comments on overbanking in Japan and more to do with stock ‘cornering’ by a group or groups of domestic speculators.  This has all the signs of a classic domestic ‘ramp’, designed to quickly push up the share price of a target stock and then offload the accumulated shares for a quick profit close to the top of the price range onto unsuspecting punters drawn by the action.  The bank’s fundamentals simply do not support current valuations.  Foreign investors should steer well clear.   Caveat emptor!  (May the buyer beware!)

Bank of Toyama (8365 JP):  Irrational Exuberance

'Quantamental' Japan Specialist, LightStream Research

Campbell Gunn

'Quantamental' Japan Specialist

ja research

ja research is an independent research platform focused exclusively on Japanese equities. Leveraging data and graphic analysis provided by Japan Analytics, we provide insights on small and medium-sized companies that have been ignored by the sell-side as well as challenging conventional wisdom on larger companies. We also offer analyst and corporate access, the latter with translation if required. 

Quantitative Analysis

<div>
<p style="text-align: center;"><strong>• RELATIVE PRICE SCORE - COMPANIES •</strong></p>
<figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/110/839/original/2019-12-17_10-16-56.png?1576545466" class="editor-image img-responsive" data-smartkarma-image-id="110839"></figure><div class="content-caption">Source: Japan Analytics</div>
<p><strong>COMPANY RELATIVE PRICE SCORE OUTLIERS </strong>- The Relative Price Score (RPS) is a measure of price performance relative to TOPIX calculated by comparing the current deviation with the mean absolute deviation of monthly and daily relative share prices over the last 28 years and 24 months, respectively. As all companies are put on a comparable scale, 'Overbought' and 'Oversold' outliers and short-term changes in scoring can reveal attractive trading opportunities. Company outlier thresholds are set at +4 &amp; -2 and equate to the top and bottom first-to-second percentiles of historical observations from which mean reversion takes a matter of months. </p>
</div><div><div><p>Following on from our previous Insight <a href="https://www.smartkarma.com/insights/japan-december-sector-peer-group-relative-price-scores-from-defensives-to-cylicals" target="_blank" data-smartkarma-citation="insights:35266" rel="noopener">December Sector &amp; Peer Group Relative Price Scores - From Defensives to Cylicals</a> which covered <strong>Sectors</strong> and <strong>Peer Groups</strong>, in the <strong>DETAIL</strong> section below, we update our list of Overbought and Oversold large-cap companies (market capitalisation over ¥100b) with the current <strong>Very Overbought</strong> (RPS&gt;5), <strong>Too-Late-To-Buy</strong> (RPS &gt;4.5) and <strong>Oversold</strong> (RPS &lt;-2) companies, as well as the largest positive and negative <strong>3-month Changes</strong> in RPS adding some stock-specific comments in each category.</p></div></div>


• RELATIVE PRICE SCORE - COMPANIES •
Source: Japan Analytics
COMPANY RELATIVE PRICE SCORE OUTLIERS - The Relative Price Score (RPS) is a measure of price performance relative to TOPIX calculated by comparing the current deviation with the mean absolute deviation of monthly and daily relative share prices over the last 28 years and 24 months, respectively. As all companies are put on a comparable scale, 'Overbought' and 'Oversold' outliers and short-term changes in scoring can reveal attractive trading opportunities. Company outlier thresholds are set at +4 &amp; -2 and equate to the top and bottom first-to-second percentiles of historical observations from which mean reversion takes a matter of months. 
Following on from our previous Insight December Sector &amp; Peer Group Relative Price Scores - From Defensives to Cylicals which covered Sectors and Peer Groups, in the DETAIL section below, we update our list of Overbought and Oversold large-cap companies (market capitalisation over ¥100b) with the current Very Overbought (RPS&gt;5), Too-Late-To-Buy (RPS &gt;4.5) and Oversold (RPS &lt;-2) companies, as well as the largest positive and negative 3-month Changes in RPS adding some stock-specific comments in each category.

🇯🇵 JAPAN • December Company Relative Price Scores - Opportunities in the Outliers

Japan

Hokuhoku Financial Group, Inc. is a holding company, which manages financial operations for its subsidiaries.  As a financial group, the Company provides general banking services including deposits, loans, and foreign exchange transactions.  The Group also provides other financial services such as leasing and credit cards.

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Hokuhoku Financial Group (8377 JP)

HUGE Suruga Bank (8358 JP) Buyback

Suruga Bank will do a large ToSTNeT-3 Buyback this morning at last trade. It is 15.7% accretive to BVPS and 22.7% accretive to EPS. That's great....

Travis Lundy

Hokuhoku Financial (8377 JP) - Buyback Dynamics For March... 👀

Hokuhoku Financial share buyback picked up pace in Feb but needs a lot more pace in March to complete. Expect a ToSTNeT-3 buyback tranche. And more...

Travis Lundy

Hokuhoku Financial (8377 JP) Buyback Worth Looking At

Hokuhoku Financial - a regional bank in northern Japan (largest in Toyama and #2 in Hokkaido) is about the cheapest amongst its peers and it just...

Travis Lundy

Bank of Toyama (8365 JP): Irrational Exuberance

Bank Of Toyama /Ltd (8365 JP)’s share price has risen over 36% in the last 30 days on 4x normal daily trading volume and has shot up an astonishing...

J. Brian Waterhouse

🇯🇵 JAPAN • December Company Relative Price Scores - Opportunities in the Outliers

• RELATIVE PRICE SCORE - COMPANIES • COMPANY RELATIVE PRICE SCORE OUTLIERS - The Relative Price Score (RPS) is a measure of price performance...

Campbell Gunn

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