Nippon Investment Bespoke Research UK Ltd

Nippon Investment Bespoke Research UK

Equity Bottom-Up

<ul>
<li>Japan Lifeline [JLL] produced historical semi-annual earnings with FY24 1H OP of ¥6,260mil (+14.4% YoY) on sales of ¥27,985mil (+11.4% YoY), which landed above expectation.</li>
<li>Despite this robust performance, JLL has not revised its full-year FY24 guidance as the 2H presents with several potential earnings risks such as 1) fewer operating days, which will impact device sales, 2) an increase in outsourced products reducing GPM, 3) the possibility of a change in the competitive landscape for one of JLL’s core products.</li>
<li>The company’s shareholder return policy is the higher of (1) a pay-out ratio of 40% or (2) a Dividend on Equity [DOE] of 5%.</li>
</ul>


Japan Lifeline [JLL] produced historical semi-annual earnings with FY24 1H OP of ¥6,260mil (+14.4% YoY) on sales of ¥27,985mil (+11.4% YoY), which landed above expectation.
Despite this robust performance, JLL has not revised its full-year FY24 guidance as the 2H presents with several potential earnings risks such as 1) fewer operating days, which will impact device sales, 2) an increase in outsourced products reducing GPM, 3) the possibility of a change in the competitive landscape for one of JLL’s core products.
The company’s shareholder return policy is the higher of (1) a pay-out ratio of 40% or (2) a Dividend on Equity [DOE] of 5%.


Japan Lifeline Co., Ltd (7575 JP): Research Update

Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<ul>
<li>As designed, the JPX-Nikkei400 Index is something of a disaster. It aims to be slightly 'smart' vs other cap-weighted indices like TOPIX, but tracking error vs TOPIX is de minimus.</li>
<li>This year, in week 1, the ADD vs DELETE performance is positive. If we sector-hedge the ADDs vs DELETEs, it's doing even better.</li>
<li>This is probably due to relatively low pre-positioning, and cares. Momentum suggests one could be long ADDs vs DELETEs. And there is the perennial trade to watch out for.</li>
</ul>


As designed, the JPX-Nikkei400 Index is something of a disaster. It aims to be slightly 'smart' vs other cap-weighted indices like TOPIX, but tracking error vs TOPIX is de minimus.
This year, in week 1, the ADD vs DELETE performance is positive. If we sector-hedge the ADDs vs DELETEs, it's doing even better.
This is probably due to relatively low pre-positioning, and cares. Momentum suggests one could be long ADDs vs DELETEs. And there is the perennial trade to watch out for.


2022 JPX Nikkei 400 Rebal Update - Going the Right Way

<ul>
<li>Japan Lifeline announced a buyback on Friday after the close.</li>
<li>The stock saw a huge growth spurt in the first half of the last decade but slowed down post 2018. So the stock has significantly underperformed the sector. </li>
<li>The buyback parameters and the stock's trading history suggest that with the stock near a 5-year low, it is worth looking a little deeper.</li>
</ul>


Japan Lifeline announced a buyback on Friday after the close.
The stock saw a huge growth spurt in the first half of the last decade but slowed down post 2018. So the stock has significantly underperformed the sector. 
The buyback parameters and the stock's trading history suggest that with the stock near a 5-year low, it is worth looking a little deeper.


Japan Lifeline (7575 JP) Throws a Lifeline to Its Share Price

'Quantamental' Japan Specialist, LightStream Research

Campbell Gunn

'Quantamental' Japan Specialist

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.

Thematic (Sector/Industry)

<p style="text-align: center;"><strong>• 'WORST' &amp; BEST •</strong></p><p style="text-align: left;">All the large-caps that announced results or forecasts yesterday had positive scores, and none saw a quarter-on-quarter decline in Results &amp; Revisions Score. Therefore, the 'worst' side of our daily pair is a company where earnings momentum has already peaked out, and the upward revision to full-year earnings is below the trailing result - <a href="https://www.smartkarma.com/entities/koei-tecmo-holdings-co-ltd" target="_blank" data-smartkarma-citation="entities:20277:1" rel="noopener">Koei Tecmo (3635 JP)</a>. Conversely, the company with the largest undiscounted 'surprise' is <a href="https://www.smartkarma.com/entities/macnica-fuji-electronics-hol" target="_blank" data-smartkarma-citation="entities:26074:1" rel="noopener">Macnica Fuji Electronics (3132 JP)</a>. </p><section class="figure"><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/184/502/original/2021-01-26_06-07-10.png?1611608842" class="editor-image img-responsive" data-smartkarma-image-id="184502"></figure></section><section class="figure"><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/184/504/original/2021-01-26_06-12-39.png?1611609171" class="editor-image img-responsive" data-smartkarma-image-id="184504"></figure></section><div class="content-caption"> Source for all charts &amp; tables: Japan Analytics</div>

• 'WORST' &amp; BEST •All the large-caps that announced results or forecasts yesterday had positive scores, and none saw a quarter-on-quarter decline in Results &amp; Revisions Score. Therefore, the 'worst' side of our daily pair is a company where earnings momentum has already peaked out, and the upward revision to full-year earnings is below the trailing result - Koei Tecmo (3635 JP). Conversely, the company with the largest undiscounted 'surprise' is Macnica Fuji Electronics (3132 JP).  Source for all charts &amp; tables: Japan Analytics

🇯🇵 JAPAN • Results & Revisions ​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​01/​​​​​​​​​25 - Koei-Tecmo & Nidec

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

<p style="text-align: center;"><strong>- PEER GROUP SCORE MATRIX -</strong></p>
<figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/079/840/original/2019-02-22_18-26-15.png?1550827634" class="editor-image img-responsive" data-smartkarma-image-id="79840"></figure>
<div class="content-caption">Source: Japan Analytics</div>
<p><strong>INTRODUCTION</strong> - Following on from our review of the Market Composite and Sectors, this Insight will cover the cap-weighted Results &amp; Revision Scores for the 328 Peer Groups that comprise our 30 Sectors providing greater depth to our analysis of current business trends.  Peer Group definitions reflect both standard SIC/GICS classifications as well as local market conventions. The number of constituents and market capitalisation for each Peer Group varies widely. </p>
<p><strong>RRS/RPS SCORE MATRIX</strong> - Combining our Results &amp; Revision Scores (RRS) with each Peer Group's Relative Price Score (RPS) allows a classification of our Peer Group universe into four quadrants -</p>
<ul>
<li>'<strong>Contrarian Buy</strong>'  &gt; Low RRS &amp; Low RPS </li>
<li>'<strong>Contrarian Sell' </strong>&gt; High RRS &amp; High RPS</li>
<li>
<strong>Peak Growth</strong>' &gt; High RRS &amp; Low RPS</li>
<li>'<strong>Ex-Growth/Turnaround</strong>' &gt; Low RRS &amp; High RPS</li>
</ul>
<p><strong>THE 'QUADRANTS'</strong> - In the two '<strong>Contrarian</strong>' quadrants, the market is aligned with the current earnings momentum of the Peer Groups suggesting opportunities exist only for those willing or brave enough to take a contrarian view.  For '<strong>Peak Growth</strong>' Peer Groups, the market is calling for a downturn in momentum that has yet to be reflected in quarterly earnings. Where the cycle is more prolonged than expected, there are often opportunities for short-term rebounds in what are normally relatively-inexpensive companies. The '<strong>Ex-Growth</strong>' quadrant often consists of former '<strong>Contrarian Sell</strong>'s where the market is reluctant to acknowledge that the cycle has turned. This quadrant can also contain '<strong>Turnarounds</strong>' - formerly '<strong>Contrarian Buys</strong>' where the market is correctly anticipating a change in fortunes.    </p>
<div class="content-highlight">
<p>In the <strong>DETAIL</strong> section below, we list the top and bottom twenty Peer Groups ranked by Results &amp; Revision Score and the top and bottom twenty most-changed over the last three months as well the most optimistic and most pessimistic.  In our ranked tables we have listed only those Peer Groups with an aggregate capitalisation of over ¥50b. </p>
</div>

- PEER GROUP SCORE MATRIX -

Source: Japan Analytics
INTRODUCTION - Following on from our review of the Market Composite and Sectors, this Insight will cover the cap-weighted Results &amp; Revision Scores for the 328 Peer Groups that comprise our 30 Sectors providing greater depth to our analysis of current business trends.  Peer Group definitions reflect both standard SIC/GICS classifications as well as local market conventions. The number of constituents and market capitalisation for each Peer Group varies widely. 
RRS/RPS SCORE MATRIX - Combining our Results &amp; Revision Scores (RRS) with each Peer Group's Relative Price Score (RPS) allows a classification of our Peer Group universe into four quadrants -

'Contrarian Buy'  &gt; Low RRS &amp; Low RPS 
'Contrarian Sell' &gt; High RRS &amp; High RPS

Peak Growth' &gt; High RRS &amp; Low RPS
'Ex-Growth/Turnaround' &gt; Low RRS &amp; High RPS

THE 'QUADRANTS' - In the two 'Contrarian' quadrants, the market is aligned with the current earnings momentum of the Peer Groups suggesting opportunities exist only for those willing or brave enough to take a contrarian view.  For 'Peak Growth' Peer Groups, the market is calling for a downturn in momentum that has yet to be reflected in quarterly earnings. Where the cycle is more prolonged than expected, there are often opportunities for short-term rebounds in what are normally relatively-inexpensive companies. The 'Ex-Growth' quadrant often consists of former 'Contrarian Sell's where the market is reluctant to acknowledge that the cycle has turned. This quadrant can also contain 'Turnarounds' - formerly 'Contrarian Buys' where the market is correctly anticipating a change in fortunes.    

In the DETAIL section below, we list the top and bottom twenty Peer Groups ranked by Results &amp; Revision Score and the top and bottom twenty most-changed over the last three months as well the most optimistic and most pessimistic.  In our ranked tables we have listed only those Peer Groups with an aggregate capitalisation of over ¥50b. 


🇯🇵 Japan: Winter Peer Group Results & Revision Scores - Contrarian Buys & Sells/Peak & Ex-Growth

Japan

Japan Lifeline Co., Ltd. is a wholesaler of cardiovascular-related medical supplies and equipment.  The Company mainly trades and sells pace makers, artificial organs including artificial heart valves, and disposable catheters.

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Japan Lifeline (7575 JP)

Japan Lifeline Co., Ltd (7575 JP): Research Update

Japan Lifeline [JLL] produced historical semi-annual earnings with FY24 1H OP of ¥6,260mil (+14.4% YoY) on sales of ¥27,985mil (+11.4% YoY), which...

Nippon Investment Bespoke Research UK

2022 JPX Nikkei 400 Rebal Update - Going the Right Way

JPX Nikkei 400 rebalance is going the right way in the 6 trading days so far, and it wasn't done on Day1 (which was lacklustre). It may be under...

Travis Lundy

🇯🇵 JAPAN • Results & Revisions 01/25 - Koei-Tecmo & Nidec

All the large-caps that announced results or forecasts yesterday had positive scores, and none saw a quarter-on-quarter decline in Results &...

Campbell Gunn

🇯🇵 Japan: Winter Peer Group Results & Revision Scores - Contrarian Buys & Sells/Peak & Ex-Growth

- PEER GROUP SCORE MATRIX - INTRODUCTION - Following on from our review of the Market Composite and Sectors, this Insight will cover the...

Campbell Gunn

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Market Cap (USDm)

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Japan Lifeline Co., Ltd (7575 JP): Research Update

Japan Lifeline [JLL] produced historical semi-annual earnings with FY24 1H OP of ¥6,260mil (+14.4% YoY) on sales of ¥27,985mil (+11.4% YoY), which...

Nippon Investment Bespoke Research UK

2022 JPX Nikkei 400 Rebal Update - Going the Right Way

JPX Nikkei 400 rebalance is going the right way in the 6 trading days so far, and it wasn't done on Day1 (which was lacklustre). It may be under...

Travis Lundy