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.

Quantitative Analysis

After weather-driven weakness earlier in the summer, TMI's text-mined Machinery Sentiment Indicator recovered to +1.8x STDEV this week, its best reading since January, with our news attribution pointing to China infrastructure as the key catalyst.  Unlike the US, where residential is currently the sole source of construction growth while infrastructure lags (see our <a href="https://www.smartkarma.com/insights/tmi-snapshot-sentiment-analysis-suggests-infrastructure-likely-a-drag-on-us-non-res-construction" target="_blank" data-smartkarma-citation="insights:43050" rel="noopener">TMI Snapshot: Sentiment Analysis Suggests Infrastructure Likely A Drag On US Non-Res Construction</a>), our China indicators are showing the exact opposite dynamic as the momentum of the earlier post-COVID residential property boom slows down while infrastructure starts picking up the slack.

After weather-driven weakness earlier in the summer, TMI's text-mined Machinery Sentiment Indicator recovered to +1.8x STDEV this week, its best reading since January, with our news attribution pointing to China infrastructure as the key catalyst.  Unlike the US, where residential is currently the sole source of construction growth while infrastructure lags (see our TMI Snapshot: Sentiment Analysis Suggests Infrastructure Likely A Drag On US Non-Res Construction), our China indicators are showing the exact opposite dynamic as the momentum of the earlier post-COVID residential property boom slows down while infrastructure starts picking up the slack.

TMI Snapshot:  Machinery Sentiment Indicator At 8-Month High on China Infrastructure Push

Global Special Situations & Strategy, SR Services Ltd

David Lepper

Global Special Situations & Strategy

SR Services Ltd

SR Services provides Strategic Knowledge and Solutions services for Family Offices and Corporate Business. 

We deliver this via advisory services, strategic planning, opportunity analysis/sourcing, as well as solution implementation. 

Whilst, we create intellectual discipline and operational leverage for your projects or daily activities, our ultimate objective is to empower whilst enhancing your decision making. 

Strategic Knowledge and Solutions

Cross Asset Strategy

Growth as an investment style has remained prominent over the COVID-19 period, reinforcing its decade long dominance over the value. The key question remains:  with earnings and value set to be a key theme over H2 2020 when exactly is the value style expected to reverse its underperformance trend? Our data suggest a greater than 66% chance of reversal shortly. As the value style reversal looks increasingly assured, exposure to GARP style investing and the underlying stocks are set to become even more important as we move into the second half of 2020. We highlight 17 stocks who fit the criteria in Q2 2020.

Growth as an investment style has remained prominent over the COVID-19 period, reinforcing its decade long dominance over the value. The key question remains:  with earnings and value set to be a key theme over H2 2020 when exactly is the value style expected to reverse its underperformance trend? Our data suggest a greater than 66% chance of reversal shortly. As the value style reversal looks increasingly assured, exposure to GARP style investing and the underlying stocks are set to become even more important as we move into the second half of 2020. We highlight 17 stocks who fit the criteria in Q2 2020.

Screening the Silk Road: Q2-2020 Small-Mid Cap GARP (Zulu Warrior Screening)

China Specialist, Auto and Industrial Specialist

Victoria Li

Thematic (Sector/Industry)

In April 2020, China's excavator sales reported at 45,426 units, up 60% yoy, which is well above market expectations. We believe excavator sales growth would remain strong at around 60% yoy in May, because  1) end demand seen by manufacturers remains robust, 2) State Council is giving more push on infrastructure and approved additional Rmb1tn special bonds in April. 3) monetary policy is turning increasingly loose.  Local leaders such as Sany Heavy and Xugong would continue gaining market share as global brands have more supply chain issues. It also appears that the processing of lifting  Covid-19 related lockdowns and recovery in construction activity in foreign countries will take much longer than in China. Zoomlion (1157.HK) would benefit soon as a late cycle construction machinery leader.Reiterate BUY on Sany Heavy (600031.CH) and Zoomlion (1157.HK)

In April 2020, China's excavator sales reported at 45,426 units, up 60% yoy, which is well above market expectations. We believe excavator sales growth would remain strong at around 60% yoy in May, because  1) end demand seen by manufacturers remains robust, 2) State Council is giving more push on infrastructure and approved additional Rmb1tn special bonds in April. 3) monetary policy is turning increasingly loose.  Local leaders such as Sany Heavy and Xugong would continue gaining market share as global brands have more supply chain issues. It also appears that the processing of lifting  Covid-19 related lockdowns and recovery in construction activity in foreign countries will take much longer than in China. Zoomlion (1157.HK) would benefit soon as a late cycle construction machinery leader.Reiterate BUY on Sany Heavy (600031.CH) and Zoomlion (1157.HK)

China Construction Machinery: Excavator Sales Should Grow >50%yoy in May as Well

Japan/Asia Long-Short, LightStream Research

Mio Kato

Japan/Asia Long-Short

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.

Equity Bottom-Up

Zoomlion Heavy Industry S A / Equity Bottom-Up

Some of China’s A-share construction machinery names had a very good 2019 as Sany rose 112%, XMCG rose 69% and Zoomlion rose 88% during the year. Given that performance has been exceptionally strong, but that the outlook for Chinese infrastructure spending also remains strong, we believe a shift toward later-cycle plays such as Zoomlion offers the best risk-reward.

Some of China’s A-share construction machinery names had a very good 2019 as Sany rose 112%, XMCG rose 69% and Zoomlion rose 88% during the year. Given that performance has been exceptionally strong, but that the outlook for Chinese infrastructure spending also remains strong, we believe a shift toward later-cycle plays such as Zoomlion offers the best risk-reward.

Zoomlion – Consensus Appears to Be Underestimating the Operating Leverage of This Late-Cycle Play

* Our Q3-2019 Small-Mid Cap High-Risk list of stocks ( <a href="https://www.smartkarma.com/insights/screening-the-silkroad-small-mid-cap-high-risk-names-to-avoid-q3-2019" target="_blank" data-smartkarma-citation="insights:31999" rel="noopener">Screening the Silkroad: Small-Mid Cap High-Risk Names to Avoid: Q3 2019 ) </a> produced a market cap average price return of 5%. In comparison, the MSCI Asia Pacific Index posted 8.5% over the same period. The stock rank quality of the Q3 2019 list declined 5.1 points or 6.6% for the period.  * 16-stocks appear in our Q4 2019 screen, compared to 14, 19 and 26 in Q3, Q2 and Q1 respectively. The average stock rank has decreased marginally to 74.9 points from the 76.9 points in August 2019. The fact that the screen presents with a high stock rank remains a concern. In our view, this reflects the increased level of risk in the market which is being seen in other metrics as well. * Deteriorating credit metrics support our view that the level of risk appears is increasing within the small-mid cap universe.

* Our Q3-2019 Small-Mid Cap High-Risk list of stocks ( Screening the Silkroad: Small-Mid Cap High-Risk Names to Avoid: Q3 2019 )  produced a market cap average price return of 5%. In comparison, the MSCI Asia Pacific Index posted 8.5% over the same period. The stock rank quality of the Q3 2019 list declined 5.1 points or 6.6% for the period.  * 16-stocks appear in our Q4 2019 screen, compared to 14, 19 and 26 in Q3, Q2 and Q1 respectively. The average stock rank has decreased marginally to 74.9 points from the 76.9 points in August 2019. The fact that the screen presents with a high stock rank remains a concern. In our view, this reflects the increased level of risk in the market which is being seen in other metrics as well. * Deteriorating credit metrics support our view that the level of risk appears is increasing within the small-mid cap universe. 

Screening the Silk Road: Small-Mid Cap High Risk Names to Avoid: Q4 2019

China

Sany Heavy Equipment International Holdings Co Ltd. manufactures coal mining equipment, including roadheaders.

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Sany Heavy Equipment (631 HK)

TMI Snapshot: Machinery Sentiment Indicator At 8-Month High on China Infrastructure Push

TMI's Machinery Indicator has surged t

Elan Gore

Screening the Silk Road: Q2-2020 Small-Mid Cap GARP (Zulu Warrior Screening)

Growth as an investment style has remained prominent over the COVID-19 period, reinforcing its decade long dominance over the value. The key...

David Lepper

China Construction Machinery: Excavator Sales Should Grow >50%yoy in May as Well

In April 2020, China's excavator sales reported at 45,426 units, up 60% yoy, which is well above market expectations. We believe excavator sales...

Victoria Li

Zoomlion – Consensus Appears to Be Underestimating the Operating Leverage of This Late-Cycle Play

Some of China’s A-share construction machinery names had a very good 2019 as Sany rose 112%, XMCG rose 69% and Zoomlion rose 88% during the year....

Mio Kato

Screening the Silk Road: Small-Mid Cap High Risk Names to Avoid: Q4 2019

* Our Q3-2019 Small-Mid Cap High-Risk list of stocks ( Screening the Silkroad: Small-Mid Cap High-Risk Names to Avoid: Q3 2019 ) produced a market...

David Lepper

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