Financials & FinTech research, Galliano’s Financials Research

Victor Galliano

Financials & FinTech research

Financials & FinTech, EM & Developed Markets

Galliano’s Financials Research

Galliano's Financials Research provides fundamental research in Emerging Markets financials, including FinTech, as well as financials in select Developed Markets.

The investment style applied is generally value oriented, although Growth At Reasonable Price (GARP) strategies can also be used where appropriate. 

Our investment research approach aim is often contrarian, looking to capitalise on overly sceptical or optimistic consensus views. In terms of valuation techniques, the focus is on PBV ratio to ROE, PE multiples and dividend yield, as well as the application of PEG ratios and, where appropriate, Sum of the Parts (SOTP) valuations.

Thematic (Sector/Industry)

<ul>
<li>We stick with our core theme for exchanges of growing post-trading revenues, as well as capitalising on “big data” in financial transactions and data services, as we head into 2023</li>
<li>We identify four relative value opportunities in exchanges; HKEx, LSEG, MexBolsa and Deutsche Borse feature positively multiple times in our value screens and they are all diversifying revenue streams</li>
<li>We stick with Coinbase as the exchange to avoid, in our view; its revenue streams are heavily exposed to low volumes of crypto transactions, and recent events highlight counterparty risk</li>
</ul>


We stick with our core theme for exchanges of growing post-trading revenues, as well as capitalising on “big data” in financial transactions and data services, as we head into 2023
We identify four relative value opportunities in exchanges; HKEx, LSEG, MexBolsa and Deutsche Borse feature positively multiple times in our value screens and they are all diversifying revenue streams
We stick with Coinbase as the exchange to avoid, in our view; its revenue streams are heavily exposed to low volumes of crypto transactions, and recent events highlight counterparty risk


Global Exchanges – Conviction Picks for 2023

Alpha-Centric ESG Research

Kyle Rudden

<ul>
<li>Last week, SGX and the New York Stock Exchange announced a collaboration focusing on dual listings and new products (primarily ETFs)... and all with an overarching ESG imperative.</li>
<li>Typically, these kinds of announcements are met with a healthy dash of skepticism by investors but the SGX/NYSE agreement is a clear exception, deserving atypical early-stage optimism.</li>
<li>Complementary skill sets (Right Partners), once-in-lifetime market opportunities (Right Place), and leveraging <em>existing</em> cabilities to meet <em>current</em> ESG investing demand (Right Products).</li>
</ul>


Last week, SGX and the New York Stock Exchange announced a collaboration focusing on dual listings and new products (primarily ETFs)... and all with an overarching ESG imperative.
Typically, these kinds of announcements are met with a healthy dash of skepticism by investors but the SGX/NYSE agreement is a clear exception, deserving atypical early-stage optimism.
Complementary skill sets (Right Partners), once-in-lifetime market opportunities (Right Place), and leveraging existing cabilities to meet current ESG investing demand (Right Products).


SGX/NYSE Collaboration Agreement: Right Partners, Right Place, Right Products

<ul>
<li>Exchanges continue to seek revenue streams outside of the traditional trading fees in post-trading, as well as capitalising on “big data” in financial transactions and data services</li>
<li>We identify three relative value opportunities in exchanges; MexBolsa, B3 and Deutsche Borse feature positively multiple times in our value screens and they are all diversifying revenue streams</li>
<li>Coinbase remains the exchange to avoid, in our view, despite its share price collapse; aside from negative news-flow, its revenue streams are heavily exposed to low volumes of crypto transactions</li>
</ul>


Exchanges continue to seek revenue streams outside of the traditional trading fees in post-trading, as well as capitalising on “big data” in financial transactions and data services
We identify three relative value opportunities in exchanges; MexBolsa, B3 and Deutsche Borse feature positively multiple times in our value screens and they are all diversifying revenue streams
Coinbase remains the exchange to avoid, in our view, despite its share price collapse; aside from negative news-flow, its revenue streams are heavily exposed to low volumes of crypto transactions


Global Exchanges – The Quest for Recurring Revenues

China and US Equity Analyst

Roger Xie

Equity Bottom-Up

<ul>
<li>LME Nickel future trading will be resumed on March 16 after its epic price surge before halting; the focus will be on safe reopen as more restrictions will be applied</li>
<li>The trading suspension benefits Chinese billionaire behind Nickel short position, who has secured bank lending in past few days. The angry parties are mainly hedge fund and financial investors. </li>
<li>We remain bullish on HKEX (388 HK) with the view that China economy will likely rebound in 2022, which will drive the rebound of IPO activities and trading volume. </li>
</ul>


LME Nickel future trading will be resumed on March 16 after its epic price surge before halting; the focus will be on safe reopen as more restrictions will be applied
The trading suspension benefits Chinese billionaire behind Nickel short position, who has secured bank lending in past few days. The angry parties are mainly hedge fund and financial investors. 
We remain bullish on HKEX (388 HK) with the view that China economy will likely rebound in 2022, which will drive the rebound of IPO activities and trading volume. 


HKEx (388.HK): Aftermath of Epic Short Squeeze of Nickel Future

<ul>
<li>Among EM banks, our top picks are Sberbank in Russia, Banco do Brasil and HDFC Bank in India; we are negative on recent IPO Nubank due to inflated market expectations</li>
<li>Our top picks for 2022 are BBVA and Banco BPM for Southern Europe banks. In Exchanges, we are positive on B3 of Brazil and SGX</li>
<li>In payments, we like Mastercard and Pagseguro, but we are negative on Paytm; we see BTG Pactual as an attractive pick and winner in the digital wealth managers and brokers</li>
</ul>


Among EM banks, our top picks are Sberbank in Russia, Banco do Brasil and HDFC Bank in India; we are negative on recent IPO Nubank due to inflated market expectations
Our top picks for 2022 are BBVA and Banco BPM for Southern Europe banks. In Exchanges, we are positive on B3 of Brazil and SGX
In payments, we like Mastercard and Pagseguro, but we are negative on Paytm; we see BTG Pactual as an attractive pick and winner in the digital wealth managers and brokers


2022 High Conviction Ideas in FinTech & Financials

United States

The Bank of New York Mellon Corporation (BNY Mellon) is a global financial services company. The Company provides asset and wealth management, asset servicing, issuer, clearing, and treasury services for institutions, corporations, and high net worth individuals.

BlackRock, Inc. provides diversified investment management services to institutional clients and to retail investors through various investment vehicles. The Company offers the BlackRock Funds and Blackrock Liquidity Funds, and also provides risk management services to fixed income institutional investors.

Ameriprise Financial, Inc. is a financial planning and services firm.  The Company provides financial planning, products and services that are designed to be utilized as solutions for its clients' cash and liquidity, asset accumulation, income, protection, and estate and wealth transfer needs.

CME Group Inc. operates a derivatives exchange that trades futures contracts and options on futures, interest rates, stock indexes, foreign exchange and commodities.  The Exchange brings together buyers and sellers of derivatives products on its trading floors, electronic trading platform, and through privately negotiated transactions that it clears.

The Charles Schwab Corporation provides a variety of financial services to individual investors, independent investment managers, retirement plans, and institutions.  The Company provides its clients with securities brokerage, banking, and related financial services through offices in the United States, Puerto Rico, and the United Kingdom.

Moody's Corporation is a credit rating, research, and risk analysis firm.  The Company provides credit ratings and related research, data and analytical tools, quantitative credit risk measures, risk scoring software, and credit portfolio management solutions and securities pricing software and valuation models.

KKR & Co. Inc. operates as an investment firm. The Company manages investments such as private equity, energy, infrastructure, real estate, credit strategies, and hedge funds. KKR & Co serves clients worldwide.

State Street Corporation services institutional investors and manages financial assets worldwide.  The Company's products and services include custody, accounting, administration, daily pricing, international exchange services, cash management, financial asset management, securities lending, and investment advisory services.

Tradeweb Markets Inc. builds and operates electronic marketplaces for rates, credit, equities/ETFs and money markets. The company serves institutional, wholesale and retail clients in 62 countries including large global asset managers, insurance companies, central banks, financial advisory firms, proprietary trading firms, hedge funds, banks and dealers.

Raymond James Financial, Inc. provides financial services to individuals, corporations, and municipalities through its subsidiary investment firms. The Company operates throughout the United States, Canada and overseas.

Macquarie Group Ltd. offers banking, financial advisory, investment and funds management services.  The Company offers financial advice, cash management, wealth management and private banking, life insurance, securities brokerage, corporate debt financing, real estate funds management, real estate development financing, investment funds management, and foreign exchange services.

London Stock Exchange Group plc is the United Kingdom's primary stock exchange. The LSE provides markets that facilitate the raising of capital and the trading of corporate securities, access to a trading environment, as well as real-time pricing and reference information services worldwide.  Market coverage includes equities, derivatives and fixed-interest securities.

London Stock Exchange Group plc is the United Kingdom's primary stock exchange. The LSE provides markets that facilitate the raising of capital and the trading of corporate securities, access to a trading environment, as well as real-time pricing and reference information services worldwide. Market coverage includes equities, derivatives and fixed-interest securities.

London Stock Exchange Group PL (LNSTY US)

Banco BTG Pactual S/A. provides financial services. The Company offers asset and wealth management, investment banking, trading, corporate lending, sales, and other related solutions. Banco BTG Pactual serves customers in Brazil.

CITIC Securities Co., Ltd. provides securities brokerage, trading, underwriting, investment banking, asset management, and investment consulting services.

Hong Kong Exchanges & Clearing Limited owns and operates the stock exchange, futures exchange, and their related clearing houses in Hong Kong.  The Company provides the trading platforms for a range of cash and derivatives products and the facilities for processing trades.

Deutsche Boerse AG provides a variety of stock exchange introduction, trading, and operational services to institutions and private investors. The Company offers electronic trading systems for buying and selling of securities on stock exchanges in Europe.  Deutsche Boerse offers indices such as DAX, MDAX, SDAX, and XTF, as well as trading in options and futures.

3i Group plc is an international investor focused on private equity, infrastructure and debt management. The Company's investments are located across multiple continents through local investment teams in Europe, Asia and North America.

CSC Financial Co., Ltd. provides investment management services. The Company offers investment banking, wealth management, and trading and institutional client services. CSC Financial conducts its business in Hong Kong.

Intercontinental Exchange, Inc. operates global commodity and financial products marketplaces.  The Company operates electronic energy markets and soft commodity exchanges as well.  ICE offers access to contracts based on crude oil and refined products, natural gas, power and emissions, as well as agricultural commodities including cocoa, coffee, cotton, orange juice, and sugar.

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

Intercontinental Exchange (ICE US)

Global Exchanges – Conviction Picks for 2023

Our 2023 picks of HKEx, LSEG, MexBolsa and Deutsche Borse feature positively multiple times in our value screens and they are all diversifying...

Victor Galliano

SGX/NYSE Collaboration Agreement: Right Partners, Right Place, Right Products

SGX and NYSE recently announced a collaboration agreement that warrants early optimism. Right partners (complementary skills), right place (market...

Kyle Rudden

Global Exchanges – The Quest for Recurring Revenues

We identify MexBolsa, B3 and Deutsche Borse as exchanges that feature positively multiple times in our value screens and that are diversifying away...

Victor Galliano

HKEx (388.HK): Aftermath of Epic Short Squeeze of Nickel Future

LME nickel future trading will be resumed trading after epic short squeeze. The trading halt benefits Chinese billionaire behind nickel short...

Roger Xie

2022 High Conviction Ideas in FinTech & Financials

Our 2022 high conviction ideas include buys on Sberbank, Banco do Brasil and HDFC Bank, as well as BBVA, Banco BPM, B3, SGX, Mastercard and...

Victor Galliano

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)