Equity Long-Short Analyst

Pyari Menon

Thematic (Sector/Industry)

<ul>
<li>Major corporations and states will continue driving green energy demand, with renewable energy commitments independent of federal policy.</li>
<li>International green energy firms in Europe and Asia will attract U.S. investment and technologies as supportive policies and consistent demand make these markets appealing.</li>
<li>Despite an "independent fed" lower interest rates are more likely under Trump, which might more than compensate policy changes as investment costs rather than operational costs drive renewables </li>
</ul>


Major corporations and states will continue driving green energy demand, with renewable energy commitments independent of federal policy.
International green energy firms in Europe and Asia will attract U.S. investment and technologies as supportive policies and consistent demand make these markets appealing.
Despite an "independent fed" lower interest rates are more likely under Trump, which might more than compensate policy changes as investment costs rather than operational costs drive renewables 


How a Trump Presidency Could Fuel Green Energy Innovation and Global Growth

Junior Finance Analyst, Steno Research

Ulrik Simmelholt

Junior Finance Analyst

Macro and Geopolitical Research House

Steno Research

Steno Research is a new macro and geopolitical research house. We are based out of Copenhagen, Denmark, but have an international team and a strong network of sources and partners around the world. The team is lead by Andreas Steno, previous global head of strategy at Nordea Bank, and Mikkel Rosenvold, former chief consultant in the Danish Ministry of Finance.

Cross Asset Strategy

<ul><li>We’ve received loads of feedback from our clients regarding our Trump versus Biden basket.</li><li>As a result, we will provide a detailed breakdown of both baskets and explain the rationale behind each.</li><li>We are updating the baskets regularly based on the political proposals of the two candidates.</li></ul>

We’ve received loads of feedback from our clients regarding our Trump versus Biden basket.As a result, we will provide a detailed breakdown of both baskets and explain the rationale behind each.We are updating the baskets regularly based on the political proposals of the two candidates.

Equity Watch: The Trump versus Biden Basket

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.

Our process begins by organizing the universe of actively traded stocks into discrete sectors, then into industry groups. We then apply our technical and quantitative tools to identify developing price trends. Once attractive trends are identified within a selected sector or group, we screen for individual stocks which we believe offer the best risk/reward profile. We provide a historical perspective that often reveals, through our long-term charts, how price patterns often repeat themselves over time.

Technical Analysis

iShares MSCI Emerging Markets / Technical Analysis

<ul>
<li>Indexes have plunged since violating our "lines-in-the-sand" of 3875 on EURO STOXX 50, 14,815 on the DAX, $54 on ACWI ex-US (ACWX-US), $75.25 on EAFE (EFA-US), and $99 on ACWI(ACWI-US).</li>
<li>More recently, Japan’s TOPIX broke below the key 1840 level, as the number of countries breaking down increases.</li>
<li>We remain bearish at the index level as long as these indexes continue to make lower highs, and we expect that any bottoming process would take weeks/months to develop.</li>
</ul>


Indexes have plunged since violating our "lines-in-the-sand" of 3875 on EURO STOXX 50, 14,815 on the DAX, $54 on ACWI ex-US (ACWX-US), $75.25 on EAFE (EFA-US), and $99 on ACWI(ACWI-US).
More recently, Japan’s TOPIX broke below the key 1840 level, as the number of countries breaking down increases.
We remain bearish at the index level as long as these indexes continue to make lower highs, and we expect that any bottoming process would take weeks/months to develop.


Monitoring For A Bottom; Focus On Defensives

Alpha-Centric ESG Research

Kyle Rudden

In a recently published report (<a href="https://www.smartkarma.com/insights/cop26-u-n-climate-conference-to-address-mitigation-financing-and-carbon-pricing" target="_blank" data-smartkarma-citation="insights:59779" rel="noopener">COP26: U.N. Climate Conference to Address Mitigation, Financing, and Carbon Pricing</a>) I mentioned how the COP26 international climate conference (31 October to 12 November) will have far-reaching implications for global capital markets and investing.That Insight was largely about the COP26 conference itself – background, objectives, three critical agenda items with trillions of dollars at stake, and that will influence global financial markets from today (headlines coming out of the conference) through the end of this century.That report was necessary context for this Insight and others that will follow; successively deeper dives into country-specific climate action plans, and investment themes and trading ideas around the COP26 conference and climate change in general. This is the first of those follow-up reports.Herein, I present a brief overview of investment themes and angles directly linked to the three key COP26 agenda items: 1) mitigation of global warming, 2) climate finance, and 3) the development of international carbon markets and pricing mechanisms. Themes and subthemes such as:<ul>
<li>
Climate Transition: "Green" utilities, renewable energy, cleantech, electric vehicles and other areas of smart mobility, green buildings, and related. The "buy solar, sell coal" kinds of stuff.</li>
<li>
Climate Financing: Financial sector stocks poised to benefit from climate change mitigation, reduced risk from portfolio debarbonisation, and new inflows into sustainable/ESG funds.</li>
<li>
Carbon Markets: Pure-play (or close thereto) carbon capture and storage/sequestration (CCS) stocks, plus a few financial sector overlaps (e.g., related to carbon markets, futures, etc.)</li>
</ul>

In a recently published report (COP26: U.N. Climate Conference to Address Mitigation, Financing, and Carbon Pricing) I mentioned how the COP26 international climate conference (31 October to 12 November) will have far-reaching implications for global capital markets and investing.That Insight was largely about the COP26 conference itself – background, objectives, three critical agenda items with trillions of dollars at stake, and that will influence global financial markets from today (headlines coming out of the conference) through the end of this century.That report was necessary context for this Insight and others that will follow; successively deeper dives into country-specific climate action plans, and investment themes and trading ideas around the COP26 conference and climate change in general. This is the first of those follow-up reports.Herein, I present a brief overview of investment themes and angles directly linked to the three key COP26 agenda items: 1) mitigation of global warming, 2) climate finance, and 3) the development of international carbon markets and pricing mechanisms. Themes and subthemes such as:

Climate Transition: "Green" utilities, renewable energy, cleantech, electric vehicles and other areas of smart mobility, green buildings, and related. The "buy solar, sell coal" kinds of stuff.

Climate Financing: Financial sector stocks poised to benefit from climate change mitigation, reduced risk from portfolio debarbonisation, and new inflows into sustainable/ESG funds.

Carbon Markets: Pure-play (or close thereto) carbon capture and storage/sequestration (CCS) stocks, plus a few financial sector overlaps (e.g., related to carbon markets, futures, etc.)


COP26: An Overview of Investment Themes and Catalysts Related to COP26 Conference

European Event-Driven Analyst

Jesus Rodriguez Aguilar

Event-Driven

Infrastructure Investments Fund, a vehicle advised by J.P. Morgan Investment Management, agreed to buy a 60% stake in <a href="https://www.smartkarma.com/entities/falck-renewables-spa" target="_blank" data-smartkarma-citation="entities:34071:1" rel="noopener">Falck Renewables SpA (FKR IM)</a> from Falck SpA, at €8.81/share. IIF is paying a premium of 29.2% to the 3-month VWAP. Deal authorization will be subject to Italian Government Golden Power, as the energy sector is deemed strategic. 
Deal value (for the 60% stake) is c. €1,529 million; the implied equity value is c. €2,548 million and the implied EV is €3,508 million. Multiples: 8x EV/Fwd revenue, vs. the 6.3x median of previous sector transactions and 7.1x at which comps are trading, 16.3x EV/Fwd EBITDA and 59.6x Fwd P/E. Interest for renewables is very strong with pension funds investing in both solar and wind farms as well as clean energies projects, which is leading to large M&amp;A premiums.
IIF invests in infrastructure, with a focus on contracted energy assets and utilities. The deal will increase IIF's exposure in the renewable energies since Falck Renewables has exposure to Italy, the United Kingdom, Germany, France and other countries.
Falck Renewables said the stake transaction should complete by end of Q1 2022. Upon closing of the transaction, IIF will launch a mandatory cash tender offer for Falck Renewables’s remaining share capital at €8.81/share, with the intention to delist the company.
Fair valuation (multiples based) is €6.73/share, the level at which the share was trading prior to the deal announcement. On this basis, the premium offered implies a full price, in my view, and the market believes the deal will complete. The deal authorization will be subject to Italian Government Golden Power, as the energy sector is deemed strategic.
On 20 October, Falck Renewables closed 14% higher. Gross spread is an unexciting 1.4% for a mandatory offer that could take up to a year to complete.

Infrastructure Investments Fund, a vehicle advised by J.P. Morgan Investment Management, agreed to buy a 60% stake in Falck Renewables SpA (FKR IM) from Falck SpA, at €8.81/share. IIF is paying a premium of 29.2% to the 3-month VWAP. Deal authorization will be subject to Italian Government Golden Power, as the energy sector is deemed strategic. 
Deal value (for the 60% stake) is c. €1,529 million; the implied equity value is c. €2,548 million and the implied EV is €3,508 million. Multiples: 8x EV/Fwd revenue, vs. the 6.3x median of previous sector transactions and 7.1x at which comps are trading, 16.3x EV/Fwd EBITDA and 59.6x Fwd P/E. Interest for renewables is very strong with pension funds investing in both solar and wind farms as well as clean energies projects, which is leading to large M&amp;A premiums.
IIF invests in infrastructure, with a focus on contracted energy assets and utilities. The deal will increase IIF's exposure in the renewable energies since Falck Renewables has exposure to Italy, the United Kingdom, Germany, France and other countries.
Falck Renewables said the stake transaction should complete by end of Q1 2022. Upon closing of the transaction, IIF will launch a mandatory cash tender offer for Falck Renewables’s remaining share capital at €8.81/share, with the intention to delist the company.
Fair valuation (multiples based) is €6.73/share, the level at which the share was trading prior to the deal announcement. On this basis, the premium offered implies a full price, in my view, and the market believes the deal will complete. The deal authorization will be subject to Italian Government Golden Power, as the energy sector is deemed strategic.
On 20 October, Falck Renewables closed 14% higher. Gross spread is an unexciting 1.4% for a mandatory offer that could take up to a year to complete.

IIF/Falck Renewables: Acquisition of Majority Stake

Denmark

Orsted A/S provides utility services. The Company engages in the development, construction, and operation of offshore wind farms, as well as generates power and heat from power stations. Orsted serves customers worldwide.

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Orsted AS (ORSTED DC)

How a Trump Presidency Could Fuel Green Energy Innovation and Global Growth

States and corporations drive U.S. green energy demand. Interest rates, and innovations rather than Trump admin policies will shape renewables...

Pyari Menon

Equity Watch: The Trump versus Biden Basket

We’ve received loads of feedback from our clients regarding our Trump versus Biden basket. As a result, we will provide a detailed breakdown of...

Steno Research

Monitoring For A Bottom; Focus On Defensives

Defensive Sectors including Consumer Staples, Health Care, and Utilities are emerging as leadership -- add exposure. Today we are focusing on...

Vermilion Research

IIF/Falck Renewables: Acquisition of Majority Stake

The premium offered implies a full price. Gross spread is an unexciting 1.4% for a mandatory offer that could take up to a year to complete.

Jesus Rodriguez Aguilar

Price Gauge

52-week Range

Market Cap (USDm)

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How a Trump Presidency Could Fuel Green Energy Innovation and Global Growth

States and corporations drive U.S. green energy demand. Interest rates, and innovations rather than Trump admin policies will shape renewables...

Pyari Menon

Equity Watch: The Trump versus Biden Basket

We’ve received loads of feedback from our clients regarding our Trump versus Biden basket. As a result, we will provide a detailed breakdown of...

Steno Research

Monitoring For A Bottom; Focus On Defensives

Defensive Sectors including Consumer Staples, Health Care, and Utilities are emerging as leadership -- add exposure. Today we are focusing on...

Vermilion Research

COP26: An Overview of Investment Themes and Catalysts Related to COP26 Conference

COP26, the climate conference happening now, will impact global capital markets. Perhaps over the next two weeks, depending on headlines, but...

Kyle Rudden

IIF/Falck Renewables: Acquisition of Majority Stake

The premium offered implies a full price. Gross spread is an unexciting 1.4% for a mandatory offer that could take up to a year to complete.

Jesus Rodriguez Aguilar