Founder/CEO of ROK Advisory, ROK Advisory LLC

Ken S. Kim

Founder/CEO of ROK Advisory

ROK Advisory LLC

ROK is an independent research advisory firm. We guide you to minimize the information gap between foreign and local investors in Northeast Asia with a focus in Korea, Taiwan and Japan.

Independent Research Advisory Firm

Equity Bottom-Up

Taiwan Semiconductor (TSMC) / Equity Bottom-Up

<p>TSMC has been a significant outperformer versus Samsung Electronics.   How can TSMC continue this performance in the near future?   We take a look at their customer profiles as well what has been priced in and has not for the next few years. </p>

TSMC has been a significant outperformer versus Samsung Electronics.   How can TSMC continue this performance in the near future?   We take a look at their customer profiles as well what has been priced in and has not for the next few years. 

TSMC Vs. Samsung.  Where's the Net Add Upside?

Pan-Asia Index Rebalances/ Events/ Delta One, Periscope Analytics

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Quantitative Analysis

<div><p>The Asia Short Interest weekly looks at moves in market wide short interest and highlights movements in stock specific short interest across Hong Kong, Japan, Korea and Taiwan using the last available data published by the relevant authorities.</p></div><div><p>Hong Kong saw shorts rise on <a href="https://www.smartkarma.com/entities/ind-comm-bk-of-china-h" target="_blank" data-smartkarma-citation="entities:1119:1" rel="noopener">ICBC (H) (1398 HK)</a>, <a href="https://www.smartkarma.com/entities/pccw-ltd" target="_blank" data-smartkarma-citation="entities:873:1" rel="noopener">PCCW Ltd (8 HK)</a>, <a href="https://www.smartkarma.com/entities/china-construction-bank-h" target="_blank" data-smartkarma-citation="entities:45:1" rel="noopener">China Construction Bank H (939 HK)</a> and <a href="https://www.smartkarma.com/entities/ping-an-insurance-grp-co-of-china-ltd" target="_blank" data-smartkarma-citation="entities:12880:1" rel="noopener">Ping An Insurance (H) (2318 HK)</a> while there was short covering on <a href="https://www.smartkarma.com/entities/meituan-dianping" target="_blank" data-smartkarma-citation="entities:26970:1" rel="noopener">Meituan (3690 HK)</a>, <a href="https://www.smartkarma.com/entities/alibaba-group" target="_blank" data-smartkarma-citation="entities:28434:1" rel="noopener">Alibaba Group (9988 HK)</a>, <a href="https://www.smartkarma.com/entities/hong-kong-exchanges-clearing" target="_blank" data-smartkarma-citation="entities:490:1" rel="noopener">HKEX (388 HK)</a> and <a href="https://www.smartkarma.com/entities/hsbc-holdings-plc" target="_blank" data-smartkarma-citation="entities:516:1" rel="noopener">HSBC Holdings (5 HK)</a>. Shorts increased in Communication Services, Consumer Staples and Financials stocks and decreased in Consumer Discretionary names.</p></div><div><p>In Japan, stocks that saw the most shorts were <a href="https://www.smartkarma.com/entities/nexon-co-ltd" target="_blank" data-smartkarma-citation="entities:16032:1" rel="noopener">Nexon (3659 JP)</a>, <a href="https://www.smartkarma.com/entities/ana-holdings-inc" target="_blank" data-smartkarma-citation="entities:5308:1" rel="noopener">Ana Holdings (9202 JP)</a>, <a href="https://www.smartkarma.com/entities/fast-retailing-co-ltd" target="_blank" data-smartkarma-citation="entities:751:1" rel="noopener">Fast Retailing (9983 JP)</a> and <a href="https://www.smartkarma.com/entities/sbi-holdings-inc" target="_blank" data-smartkarma-citation="entities:10928:1" rel="noopener">Sbi Holdings (8473 JP)</a> while shorts decreased on <a href="https://www.smartkarma.com/entities/familymart-co-ltd" target="_blank" data-smartkarma-citation="entities:320:1" rel="noopener">FamilyMart Co Ltd (8028 JP)</a>, <a href="https://www.smartkarma.com/entities/toshiba-corp" target="_blank" data-smartkarma-citation="entities:637:1" rel="noopener">Toshiba Corp (6502 JP)</a>, <a href="https://www.smartkarma.com/entities/sumitomo-mitsui-financial-group-inc" target="_blank" data-smartkarma-citation="entities:217:1" rel="noopener">Sumitomo Mitsui Financial Group (8316 JP)</a> and <a href="https://www.smartkarma.com/entities/advantest-corp" target="_blank" data-smartkarma-citation="entities:18107:1" rel="noopener">Advantest Corp (6857 JP)</a>. Sectorally, shorts increased on Communication Services, while shorts were covered on Information Technology and Consumer Staples names.</p></div><div><p>Shorts increased in Korea for the week. Biggest increase in shorts were on <a href="https://www.smartkarma.com/entities/samsung-electronics-co-ltd" target="_blank" data-smartkarma-citation="entities:191:1" rel="noopener">Samsung Electronics (005930 KS)</a>, <a href="https://www.smartkarma.com/entities/sk-hynix-inc" target="_blank" data-smartkarma-citation="entities:16955:1" rel="noopener">SK Hynix (000660 KS)</a>, <a href="https://www.smartkarma.com/entities/lg-household-health-care" target="_blank" data-smartkarma-citation="entities:6501:1" rel="noopener">LG Household &amp; Health Care (051900 KS)</a>, <a href="https://www.smartkarma.com/entities/lg-chem-ltd" target="_blank" data-smartkarma-citation="entities:3583:1" rel="noopener">LG Chem Ltd (051910 KS)</a> and <a href="https://www.smartkarma.com/entities/naver-corp" target="_blank" data-smartkarma-citation="entities:16029:1" rel="noopener">Naver Corp (035420 KS)</a>. </p></div><div><p>Stocks in Taiwan that saw the highest increase in shorts were <a href="https://www.smartkarma.com/entities/taiwan-semiconductor-manufacturing-company" target="_blank" data-smartkarma-citation="entities:11230:1" rel="noopener">TSMC (2330 TT)</a>, <a href="https://www.smartkarma.com/entities/au-optronics-corp" target="_blank" data-smartkarma-citation="entities:6704:1" rel="noopener">Au Optronics (2409 TT)</a>, <a href="https://www.smartkarma.com/entities/acer-inc" target="_blank" data-smartkarma-citation="entities:15726:1" rel="noopener">Acer Inc (2353 TT)</a> and <a href="https://www.smartkarma.com/entities/catcher-technology-co-ltd" target="_blank" data-smartkarma-citation="entities:4957:1" rel="noopener">Catcher Technology (2474 TT)</a> while shorts were covered on <a href="https://www.smartkarma.com/entities/walsin-technology-corp" target="_blank" data-smartkarma-citation="entities:11084:1" rel="noopener">Walsin Technology (2492 TT)</a>, <a href="https://www.smartkarma.com/entities/nanya-technology-corp" target="_blank" data-smartkarma-citation="entities:3269:1" rel="noopener">Nanya Technology (2408 TT)</a>, <a href="https://www.smartkarma.com/entities/novatek-microelectronics-corp" target="_blank" data-smartkarma-citation="entities:10904:1" rel="noopener">Novatek Microelectronics Corp (3034 TT)</a> and <a href="https://www.smartkarma.com/entities/ta-chen-stainless-pipe-co" target="_blank" data-smartkarma-citation="entities:2519:1" rel="noopener">Ta Chen Stainless Pipe Co (2027 TT)</a>. </p></div>

The Asia Short Interest weekly looks at moves in market wide short interest and highlights movements in stock specific short interest across Hong Kong, Japan, Korea and Taiwan using the last available data published by the relevant authorities.Hong Kong saw shorts rise on ICBC (H) (1398 HK), PCCW Ltd (8 HK), China Construction Bank H (939 HK) and Ping An Insurance (H) (2318 HK) while there was short covering on Meituan (3690 HK), Alibaba Group (9988 HK), HKEX (388 HK) and HSBC Holdings (5 HK). Shorts increased in Communication Services, Consumer Staples and Financials stocks and decreased in Consumer Discretionary names.In Japan, stocks that saw the most shorts were Nexon (3659 JP), Ana Holdings (9202 JP), Fast Retailing (9983 JP) and Sbi Holdings (8473 JP) while shorts decreased on FamilyMart Co Ltd (8028 JP), Toshiba Corp (6502 JP), Sumitomo Mitsui Financial Group (8316 JP) and Advantest Corp (6857 JP). Sectorally, shorts increased on Communication Services, while shorts were covered on Information Technology and Consumer Staples names.Shorts increased in Korea for the week. Biggest increase in shorts were on Samsung Electronics (005930 KS), SK Hynix (000660 KS), LG Household &amp; Health Care (051900 KS), LG Chem Ltd (051910 KS) and Naver Corp (035420 KS). Stocks in Taiwan that saw the highest increase in shorts were TSMC (2330 TT), Au Optronics (2409 TT), Acer Inc (2353 TT) and Catcher Technology (2474 TT) while shorts were covered on Walsin Technology (2492 TT), Nanya Technology (2408 TT), Novatek Microelectronics Corp (3034 TT) and Ta Chen Stainless Pipe Co (2027 TT). 

Asia Short Interest Weekly: ICBC, PCCW, Meituan, HKEX, Nexon, FamilyMart, Samsung, TSMC, Acer

Chart based progressive global trading strategies, Chart Partners

Thomas Schroeder

Chart based progressive global trading strategies

Chart Partners

Chart Partners objective is to discover medium-term cycle turns and profit opportunities before they unfold, within structural trends while preserving capital with clear degrees of risk. We have real return ideas. 

Markets are dynamic and trading systems must reflect this. It is crucial to determine underlying correlations and lead-lag relationships within global markets and the impact on linked instruments. Our weekly Chartonics product gives you short-term trading strategies that can be applied within the medium and longer term macro trends that are mapped out in our strategy updates. 

Our methodology fuses global market variables and isolates drivers in trends. We specialize in FX, index trade in NY and Asia with a focus on Asian stocks. 

Technical Analysis

<p>Samsung Electronics is flashing bear signals in the form of the trendline, rising wedge support breaks and bear divergence coming on the heels of weaker forward guidance (this is as good as numbers get for the time being).</p><p>SEC bear divergence noted in the MACD needs to be unwound, showing rising odds of breaking the 53k pivot support.</p><p>Market participants may find that everyone is long SEC and there is an unwind ahead.</p><p>There is scope for a ST reaction rise near term that sets up a short in SEC for a pressure test on 53/54k tactical pivot support.</p>

Samsung Electronics is flashing bear signals in the form of the trendline, rising wedge support breaks and bear divergence coming on the heels of weaker forward guidance (this is as good as numbers get for the time being).SEC bear divergence noted in the MACD needs to be unwound, showing rising odds of breaking the 53k pivot support.Market participants may find that everyone is long SEC and there is an unwind ahead.There is scope for a ST reaction rise near term that sets up a short in SEC for a pressure test on 53/54k tactical pivot support.

<p>3 Key takeaways - NAND aggression, very conservative smartphone guide, shareholder return plan and foundry business.   We go over each of the above and read through for some of the competitors and supply chain. </p>

3 Key takeaways - NAND aggression, very conservative smartphone guide, shareholder return plan and foundry business.   We go over each of the above and read through for some of the competitors and supply chain. 

Samsung Electronics Earnings Review and Read Thru

Korea / Special Sits, Pairs, Index Rebalancing, Clepsydra Capital

Sanghyun Park

Korea / Special Sits, Pairs, Index Rebalancing

Event-Driven

<p>Samsung postponed the finalization of a new 3-yr shareholder return plan. Also, they delayed the execution of the current plan's remaining to meet the 3-yr 50% FCF target to the next quarterly earnings call.</p><p>Was it a surprise?</p><p>Well, they need price management in the next two months to prevent the price from soaring for the inheritance taxes.</p><p>It is a 2-month before and after the passing date. The 60D prior was ₩58,515. The 60D post so far sits at ₩59,325. Understandably, they would want to be cautious.</p><table class="table table-striped">
<colgroup>
<col width="300">
<col width="100">
<col width="100">
<col width="100">
</colgroup>
<tbody>
<tr>
<td data-sheets-value='{"1":2,"2":"Family shareholding in Electronics"}'>Inheritance taxes calculation period</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"Start"}'>Start</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"Ending"}'>Ending</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"60D avg."}'>60D avg.</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Reference date"}'>Reference date</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":44129}' data-sheets-numberformat='{"1":5,"2":"yyyy\". \"m\". \"d","3":1}'>2020. 10. 25</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"-"}'>-</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"-"}'>-</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"60D prior"}'>60D prior</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":44068}' data-sheets-numberformat='{"1":5,"2":"yyyy\". \"m\". \"d","3":1}'>2020. 8. 25</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":44128}' data-sheets-numberformat='{"1":5,"2":"yyyy\". \"m\". \"d","3":1}'>2020. 10. 24</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":58515}' data-sheets-numberformat='{"1":4,"2":"[$₩]#,##0"}' data-sheets-formula="=average(R[10]C[-2]:R[49]C[-2])">₩58,515</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"60D post"}'>60D post</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":44129}' data-sheets-numberformat='{"1":5,"2":"yyyy\". \"m\". \"d","3":1}'>2020. 10. 25</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":44189}' data-sheets-numberformat='{"1":5,"2":"yyyy\". \"m\". \"d","3":1}'>2020. 12. 24</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":59325}' data-sheets-numberformat='{"1":4,"2":"[$₩]#,##0"}' data-sheets-formula="=average(R[5]C[-2]:R[8]C[-2])">₩59,325</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":" - So far"}'>- So far</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":44068}' data-sheets-numberformat='{"1":5,"2":"yyyy\". \"m\". \"d","3":1}'>2020. 8. 25</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":44133}' data-sheets-numberformat='{"1":5,"2":"yyyy\". \"m\". \"d","3":1}'>2020. 10. 29</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":58588.63636363636}' data-sheets-numberformat='{"1":4,"2":"[$₩]#,##0"}' data-sheets-formula="=average(R[4]C[-2]:R[47]C[-2])">₩58,589</td>
</tr>
<tr><td colspan="4" rowspan="1" data-sheets-value='{"1":2,"2":"Source: KRX"}'>Source: KRX</td></tr>
</tbody>
</table><p><strong>But it doesn't mean that we have less chance to hear year-end special bonus (either dividends or buyback) for this year.</strong></p><p><strong>So, let's objectively estimate the current 50% FCF situation based on the latest data given in yesterday's earnings call.</strong></p>

Samsung postponed the finalization of a new 3-yr shareholder return plan. Also, they delayed the execution of the current plan's remaining to meet the 3-yr 50% FCF target to the next quarterly earnings call.Was it a surprise?Well, they need price management in the next two months to prevent the price from soaring for the inheritance taxes.It is a 2-month before and after the passing date. The 60D prior was ₩58,515. The 60D post so far sits at ₩59,325. Understandably, they would want to be cautious.








Inheritance taxes calculation period
Start
Ending
60D avg.


Reference date
2020. 10. 25
-
-


60D prior
2020. 8. 25
2020. 10. 24
₩58,515


60D post
2020. 10. 25
2020. 12. 24
₩59,325


- So far
2020. 8. 25
2020. 10. 29
₩58,589

Source: KRX

But it doesn't mean that we have less chance to hear year-end special bonus (either dividends or buyback) for this year.So, let's objectively estimate the current 50% FCF situation based on the latest data given in yesterday's earnings call.

Samsung Electronics FY18~20 FCF Estimations & Issues

South Korea

Samsung Electronics Co., Ltd. manufactures a wide range of consumer and industrial electronic equipment and products such as semiconductors, personal computers, peripherals, monitors, televisions, and home appliances including air conditioners and microwave ovens. The Company also produces Internet access network systems and telecommunications equipment including mobile phones.

Samsung Electronics Pref Shares (005935 KS)

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Samsung Electronics Pref Shares (005935 KS)

TSMC Vs. Samsung. Where's the Net Add Upside?

Why TSMC is still a buy as we look into 2022. Does Samsung have the scale to keep Qualcomm in their grasp and if not what is the next catalyst for...

Ken S. Kim

Asia Short Interest Weekly: ICBC, PCCW, Meituan, HKEX, Nexon, FamilyMart, Samsung, TSMC, Acer

We highlight the largest changes in short interest on stocks across Hong Kong, Japan, Korea and Taiwan to provide insight into the positions being...

Brian Freitas

SEC Downside Risk

Samsung Electronics is flashing bear signals in the form of the trendline, rising wedge support breaks and bear divergence coming on the heels of...

Thomas Schroeder

Samsung Electronics Earnings Review and Read Thru

Samsung Electronics - moves for the long term signaled in most recent third quarter earnings with regards to their NAND business as well as holding...

Ken S. Kim

Samsung Electronics FY18~20 FCF Estimations & Issues

This insight estimates Samsung Electronics' FY18~20 FCF based on the numbers given in yesterday's earnings call. It also checks the issues...

Sanghyun Park

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