Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Event-Driven

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In this insight, we provide an updated sum-of-the parts (SoTP) valuation on <a href="https://www.smartkarma.com/entities/sk-holdings-co-ltd" target="_blank" data-smartkarma-citation="entities:393:1" rel="noopener">SK Holdings (034730 KS)</a>. There are many moving parts of SK Holdings and it helps to review the main factors that have been impacting its share price. Our base case valuation of SK Holdings is 448,850 won, which represents a 54% upside from current levels. 
We believe that the 6 MOST IMPORTANT FACTORS impacting the share price of SK Holdings are currently as follows:
I. A Big Investment ($1.5 Billion) in Plug Power
II. SK IE Technology IPO
III. Sale of SK Lubricants
IV. SK Telecom's Higher Share Price Trend
V. Changing values of SK Siltron, SK E&amp;S and other private companies
VI. Changing values of <a href="https://www.smartkarma.com/entities/sk-biopharmaceuticals-co-ltd" target="_blank" data-smartkarma-citation="entities:28966:1" rel="noopener">SK Biopharmaceuticals (326030 KS)</a>, <a href="https://www.smartkarma.com/entities/oci-materials-co-ltd" target="_blank" data-smartkarma-citation="entities:19390:1" rel="noopener">Sk Materials (036490 KS)</a>, <a href="https://www.smartkarma.com/entities/skc-co-ltd" target="_blank" data-smartkarma-citation="entities:3970:1" rel="noopener">SKC Co Ltd (011790 KS)</a>, and other public companies
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In this insight, we provide an updated sum-of-the parts (SoTP) valuation on SK Holdings (034730 KS). There are many moving parts of SK Holdings and it helps to review the main factors that have been impacting its share price. Our base case valuation of SK Holdings is 448,850 won, which represents a 54% upside from current levels. 
We believe that the 6 MOST IMPORTANT FACTORS impacting the share price of SK Holdings are currently as follows:
I. A Big Investment ($1.5 Billion) in Plug Power
II. SK IE Technology IPO
III. Sale of SK Lubricants
IV. SK Telecom's Higher Share Price Trend
V. Changing values of SK Siltron, SK E&amp;S and other private companies
VI. Changing values of SK Biopharmaceuticals (326030 KS), Sk Materials (036490 KS), SKC Co Ltd (011790 KS), and other public companies


SK Holdings: Sum-Of-The Parts Valuation Analysis & Key Catalysts

Managing Director

Elan Gore

TMI Data Science

TMI Data Science utilizes Natural Language Processing to build custom leading indicators using unstructured data sourced from the global financial, trade & traditional media.  Our proprietary software, TMI Machine, is a text-mining platform designed with the buy-side & capital markets professional in mind, text-mining the global media to discern and quantify nuanced qualitative shifts in press coverage as they apply to macroeconomics, equity indexes/ETFs, commodities, currencies, fixed income & individual equities.  TMI provides custom leading indicators and systematic trading strategies, operating at the nexus of linguistics & statistics drawing on vast experience in investment banking and hedge fund settings in senior quantitative and fundamental roles.  

TMI Data Science was founded by Elan Gore, an award-winning Senior Global Basic Materials Equity Analyst & China Economist with 15 years of experience in North American hedge funds & institutional managers; and Alessandro Porrino, Ph.D., an Algorithmic Trading Analyst and Programmer with 10 years of front-office experience ranging from complex FX option pricing to auto-hedging strategies at Bank of America Merrill Lynch and Standard Chartered.  Mr. Gore holds an MBA in Finance from New York University Stern School of Business, and Mr. Porrino holds a Ph.D. in Systems Engineering from Brunel University London.

Cross Asset Strategy

<ul>
<li>Our US Defense Composite Indicator is showing signs of bottoming following pre-election uncertainty; the indicator is strongly correlated with defense prime equity relative returns</li>
<li>The momentum of decline was arrested immediately post-elections as "Blue Wave" predictions failed to materialize, followed on by Biden's announcement of a relatively hawkish Pentagon transition team</li>
<li>Cyclical rotation and an October lull in Department of Defense contracting may have magnified the negative trend, but incoming data suggests the worst may be over</li>
<li>In October, our Hydrogen Economy Sentiment Indicator took a hit as the Nikola (NKLA) scandal unfolded and the GM/NKLA partnership was in doubt</li>
<li>Following some volatility in key hydrogen economy equities, our indicator surged in the MTD on a barrage of positive news flow from multiple auto &amp; truck players, as well as hydrogen infrastructure news; though "Blue Wave" expectations of a supercharged renewables push were initially questioned, the theme resumed its rally in November </li>
</ul><div class="content-highlight">TMI Data Science utilizes Natural Language Processing to build custom leading indicators using unstructured data sourced from the global financial, trade &amp; traditional media. Our proprietary software text-mines the global media to discern and quantify nuanced qualitative shifts in press coverage as they apply to macroeconomics, equity indexes/ETFs, commodities, currencies, fixed income &amp; individual equities. </div>


Our US Defense Composite Indicator is showing signs of bottoming following pre-election uncertainty; the indicator is strongly correlated with defense prime equity relative returns
The momentum of decline was arrested immediately post-elections as "Blue Wave" predictions failed to materialize, followed on by Biden's announcement of a relatively hawkish Pentagon transition team
Cyclical rotation and an October lull in Department of Defense contracting may have magnified the negative trend, but incoming data suggests the worst may be over
In October, our Hydrogen Economy Sentiment Indicator took a hit as the Nikola (NKLA) scandal unfolded and the GM/NKLA partnership was in doubt
Following some volatility in key hydrogen economy equities, our indicator surged in the MTD on a barrage of positive news flow from multiple auto &amp; truck players, as well as hydrogen infrastructure news; though "Blue Wave" expectations of a supercharged renewables push were initially questioned, the theme resumed its rally in November 
TMI Data Science utilizes Natural Language Processing to build custom leading indicators using unstructured data sourced from the global financial, trade &amp; traditional media. Our proprietary software text-mines the global media to discern and quantify nuanced qualitative shifts in press coverage as they apply to macroeconomics, equity indexes/ETFs, commodities, currencies, fixed income &amp; individual equities. 

TMI Snapshots: US Defense Equity Sentiment Bottoming; Hydrogen Economy Sentiment Surges Again

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

mportant price support levels previously highlighted have held strong, including the 3200-3230 level on the S&amp;P 500, 10,855 on the Nasdaq 100, and $145/the 200-day MA on the Russell 2000 (IWM). Additionally, both the S&amp;P 500 and Nasdaq 100 are breaking out from their bullish falling wedge patterns that have been taking shape since the early-September highs. These bullish inflections are encouraging and, combined with market dynamics which remain mostly healthy, lead us to believe the lows of this recent correction are likely in.  In today’s report we highlight attractive Groups and stocks within Consumer Discretionary &amp; Technology: Casinos &amp; Gaming, Small-Cap, Solar Energy, Fuel Cells/Lithium Batteries, and Software, Customer Relationship Mgt.

mportant price support levels previously highlighted have held strong, including the 3200-3230 level on the S&amp;P 500, 10,855 on the Nasdaq 100, and $145/the 200-day MA on the Russell 2000 (IWM). Additionally, both the S&amp;P 500 and Nasdaq 100 are breaking out from their bullish falling wedge patterns that have been taking shape since the early-September highs. These bullish inflections are encouraging and, combined with market dynamics which remain mostly healthy, lead us to believe the lows of this recent correction are likely in.  In today’s report we highlight attractive Groups and stocks within Consumer Discretionary &amp; Technology: Casinos &amp; Gaming, Small-Cap, Solar Energy, Fuel Cells/Lithium Batteries, and Software, Customer Relationship Mgt.

We have said it before and we will say it again; new highs are not a sell signal. This time we are referring to the S&amp;P 500 which is breaking out to all-time highs (above the prior February highs), something we have been able to say about the Nasdaq 100 for over two months. Breadth remains constructive for small- and large-caps and yesterday’s price action appears to be the start of yet another rotation into cyclical value/”reopening” plays. Our outlook remains bullish and we believe the path of least resistance remains higher. In today’s report we highlight attractive Groups and stocks within Materials &amp; Technology.

We have said it before and we will say it again; new highs are not a sell signal. This time we are referring to the S&amp;P 500 which is breaking out to all-time highs (above the prior February highs), something we have been able to say about the Nasdaq 100 for over two months. Breadth remains constructive for small- and large-caps and yesterday’s price action appears to be the start of yet another rotation into cyclical value/”reopening” plays. Our outlook remains bullish and we believe the path of least resistance remains higher. In today’s report we highlight attractive Groups and stocks within Materials &amp; Technology.

U.S. Equity Strategy: All-Time Highs Are Not a Sell Signal

The risk of a correction due to a “second wave” of infections has given way to optimism over increased monetary and fiscal stimulus and a potential COVID-19 steroid treatment. For now we view recent weakness as a countertrend move that helped correct the overbought conditions we noted last week. As long as the S&amp;P 500 is above the 2940-2980 support zone we remain bullish and view this as a buyable pullback. In today’s report we highlight attractive Groups and stocks within Consumer Discretionary and Technology.

The risk of a correction due to a “second wave” of infections has given way to optimism over increased monetary and fiscal stimulus and a potential COVID-19 steroid treatment. For now we view recent weakness as a countertrend move that helped correct the overbought conditions we noted last week. As long as the S&amp;P 500 is above the 2940-2980 support zone we remain bullish and view this as a buyable pullback. In today’s report we highlight attractive Groups and stocks within Consumer Discretionary and Technology.

U.S. Equity Strategy: Signs Point To Healthy Pullback Opportunity

United States

Plug Power, Inc. designs, develops, manufactures and commercializes fuel cell systems for electric lift trucks and materials handling equipment.  The Company offers its products globally to retail, grocery, and institutional food distribution centers as well as manufacturing facilities.

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Plug Power Inc (PLUG US)

SK Holdings: Sum-Of-The Parts Valuation Analysis & Key Catalysts

In this insight, we provide an updated sum-of-the parts valuation on SK Holdings (034730 KS). Our base case valuation of SK Holdings is 448,850...

Douglas Kim

TMI Snapshots: US Defense Equity Sentiment Bottoming; Hydrogen Economy Sentiment Surges Again

We see clear signs of a bottom forming in US defense equities with a split government and hawkish Biden Pentagon transition team. In addition, our...

Elan Gore

U.S. Equity Strategy: Correction Over?

In today’s report we highlight attractive Groups and stocks within Consumer Discretionary & Technology: CD-24 Casinos & Gaming, Small-Cap,...

Vermilion Research

U.S. Equity Strategy: All-Time Highs Are Not a Sell Signal

We have said it before and we will say it again; new highs are not a sell signal. This time we are referring to the S&P 500 which is breaking...

Vermilion Research

U.S. Equity Strategy: Signs Point To Healthy Pullback Opportunity

The risk of a correction due to a “second wave” of infections has given way to optimism over increased monetary and fiscal stimulus and a potential...

Vermilion Research

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