In today’s briefing:
- JAPAN ACTIVISM: Strategic Capital Target Daido (3205) Now A Murakami Target Too
- Screening For The Next Douyu (DOYU US)
- Sunwels Co (9229) – Nursing Care Operator Offering and TOPIX Inclusion
- A Practical Guide to Create A Workable Electronic File for KOSPI 200 Rebalancing Simulation
- S&P 500 / S&P 1500: Deriving Forecasts & First Prediction for September
JAPAN ACTIVISM: Strategic Capital Target Daido (3205) Now A Murakami Target Too
- Small cap Japanese manufacturer and purveyor of apparel Daidoh Ltd (3205 JP) has consistently been a target for value investors. In late 2022, Strategic Capital went over 5%.
- They have bought more, and as of end-March, they declared 24.85% of TSO (28% of voting rights), but they have 33%. They made proposals for the AGM. They won one.
- Now Murakami-san has bought in, going over 5%. This gets interesting. Together they have 39.4% as of last week, and probably more now. That should get them 50+% next AGM/EGM.
Screening For The Next Douyu (DOYU US)
- In a particularly altruistic move, live-streaming game platform play Douyu International Holdings (DOYU US) announced a special cash dividend of US$9.76/share, vs. a last price of US$12.59.
- The cash outlay is roughly US$308mn, and Douyu had cash (as at 1Q24) of US$936.6mn. And no debt. Founder/chairman/CEO Shaojie Chen (17.2% shareholder) will pocket a tidy ~US$53mn.
- An outlier; or should we expect more of the same for other cash-rich US-listed China plays?
Sunwels Co (9229) – Nursing Care Operator Offering and TOPIX Inclusion
- On 2 July 2024, nursing care operator SUNWELS Co (9229 JP) announced a sale of Treasury shares and newly-issued shares, and with it, a move to TSE Prime (therefore TOPIX)
- The stock, of course, popped. The stock starts with VERY low float because the CEO and his company own 64% of shares out ex-treasury.
- The offering is much larger than the TOPIX inclusion, so this is really more about the growth story.
A Practical Guide to Create A Workable Electronic File for KOSPI 200 Rebalancing Simulation
- Predicting KOSPI 200 rebalancing is straightforward, focusing on quantitative screening rather than qualitative factors, unlike other indices.
- Accurate simulation of KOSPI 200 requires daily data on shares, volume, and prices for six months, typically sourced from KOSCOM due to limitations in free data access.
- I plan to share a practical KOSPI 200 simulation file with Smartkarma readers, leveraging freely available data from Google Finance.
S&P 500 / S&P 1500: Deriving Forecasts & First Prediction for September
- Index Committee’s discretion decreases the predictability of index changes. Even when a company passes all eligibility criteria and thresholds, it might still not be selected.
- Understanding triggers for index changes, types of additions/deletions and selection patterns, narrows down the pool of candidates and increases conviction of forecasts.
- Dell Technologies (DELL US) is currently the main candidate to be added by transition to the S&P 500 in September 2024 Quarterly Rebalance.
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