Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<a href="https://www.smartkarma.com/entities/idec-corp" target="_blank" data-smartkarma-citation="entities:19312:1" rel="noopener">Idec Corp (6652 JP)</a> is a company which makes all manner of parts which sit between humans and machine, in the production line process for automated and semi-automated goods (almost always on the operator side, not the end-user side).Go into a building to see where the management office is controlling the lights for the garage, hallways, the elevators and escalators, electronic doors, etc, and you may see an array of programmable controllers by IDEC. Go to a restaurant with any kind of automation and you may find order input controllers, and monitoring systems (how does the restaurant know when that sushi has made too many rounds on the conveyor? RFID chip and monitoring system). Go into the subway in Tokyo and you will see barriers keeping people from falling onto the tracks, with automated doors. The sensors in those doors might be IDEC, as might be the giant red emergency stop buttons you see. They make switches and relays and sensors to run automated inspection lines in factories, and they run control units for industrial robots. They also make controllers, automated barcode readers, and operator interface controls for all kinds of conveyor systems - especially those used in factories in the shipment area, or in sorting and shipping centers for warehouse/distribution. And they make parts/switches/etc for all the software others might bring to the table. They are not quite ubiquitous but they have a decent and growing business. And if you wanted to set up a new automated production line for something and manage shipping, you'd buy their products. This does not seem like the wrong business to be in right now.<div class="content-highlight">
As of 19 March, the stock is -49.5% year-to-date. What was a $700mm market cap 4-5 months ago is now just over $300mm.
On 19 March, after the close, the company <a href="http://jp.idec.com/cms/pdf/usr/ir/news/2020/jikokabu202003.pdf" target="_blank" rel="noopener">announced</a> a buyback of up to 3 million shares for up to ¥4 billion. That is a buyback of 9.57% of the shares out for 11.5% of market cap. The period of the buyback is until 30 September 2020.
That's a decent chunk of change.  More discussion below.
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Idec Corp (6652 JP) is a company which makes all manner of parts which sit between humans and machine, in the production line process for automated and semi-automated goods (almost always on the operator side, not the end-user side).Go into a building to see where the management office is controlling the lights for the garage, hallways, the elevators and escalators, electronic doors, etc, and you may see an array of programmable controllers by IDEC. Go to a restaurant with any kind of automation and you may find order input controllers, and monitoring systems (how does the restaurant know when that sushi has made too many rounds on the conveyor? RFID chip and monitoring system). Go into the subway in Tokyo and you will see barriers keeping people from falling onto the tracks, with automated doors. The sensors in those doors might be IDEC, as might be the giant red emergency stop buttons you see. They make switches and relays and sensors to run automated inspection lines in factories, and they run control units for industrial robots. They also make controllers, automated barcode readers, and operator interface controls for all kinds of conveyor systems - especially those used in factories in the shipment area, or in sorting and shipping centers for warehouse/distribution. And they make parts/switches/etc for all the software others might bring to the table. They are not quite ubiquitous but they have a decent and growing business. And if you wanted to set up a new automated production line for something and manage shipping, you'd buy their products. This does not seem like the wrong business to be in right now.
As of 19 March, the stock is -49.5% year-to-date. What was a $700mm market cap 4-5 months ago is now just over $300mm.
On 19 March, after the close, the company announced a buyback of up to 3 million shares for up to ¥4 billion. That is a buyback of 9.57% of the shares out for 11.5% of market cap. The period of the buyback is until 30 September 2020.
That's a decent chunk of change.  More discussion below.


IDEC (6652) Bets on a Bonkers Big Buyback

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.

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Technical Analysis

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Global equities are now breaking out to new highs amid positive technical developments -- something we noted was increasingly likely in last week’s Int’l Compass. These breakouts and other technical developments highlighted below argue that this is the beginning of a new leg higher. Now is the time to be playing offense. In today’s report we highlight our favorite setups within Industrials, spanning the Vermilion international Manufacturing, Services, and Transportation Sectors.

Global Equity Strategy: Global Equities Beginning a New Leg Higher

Japan

IDEC CORPORATION manufactures and markets controlling devices such as switches, display lights, relays, and timers.  The Company has manufacturing bases in Japan, Taiwan and US, and markets its products worldwide through its sales subsidiaries in Canada, Australia, Germany, UK, Singapore, Taiwan, and US.

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IDEC Corp (6652 JP)

IDEC (6652) Bets on a Bonkers Big Buyback

Idec Corp (6652 JP) is a company which makes all manner of parts which sit between humans and machine, in the production line process for automated...

Travis Lundy

Global Equity Strategy: Global Equities Beginning a New Leg Higher

Global equities are now breaking out to new highs amid positive technical developments -- something we noted was increasingly likely in last week’s...

Vermilion Research

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