Japan/Asia Long-Short, LightStream Research

Mio Kato

Over 15 years analysing Japanese and Asian stocks from a long/short perspective

I focus on cyclically driven sectors such as Gaming, Factory Automation and Autos

An eclectic background as a long-short analyst, upper management at a financial data startup through its listing, and as the founder of a team analysing big/alternative data, all of which supports independent and differentiated views... we hope

An appreciation for Mathematics drives the development of a "Micro-Quantamental" process which can provide a data-driven, historically-informed and semi-automated foundation upon which to layer more qualitative and judgemental analysis, thus improving investment decision-making speed and accuracy

Japan/Asia Long-Short

Subaru: Downward Revision Not Conservative, Next Year Could Be Even Worse

SUBARU: 2QFY17 Downward Revision as a Result of Lower than Anticipated Sales

Subaru Break Lower Has a Message for Mazda

SUBARU Company Visit Takeaways: Weaker Sales than the Plan with Windfall from FX

Subaru Set to Exceed 1m Unit Sales With Industry Leading Margins. Time to Short?

SUBARU: 1QFY17 Better Looking Result with Disappointing Details

August 2017 US Automotive Sales: Tropical Storm Harvey Reduced Selling Rate but by How Much?

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

<h2>Incentives, Depreciation and R&amp;D Expenses Squeeze Operating Margins</h2><p>Subaru has been generating the highest operating margins in the industry in recent history. However, margins are likely to decline towards 10% and perhaps even below that towards industry average levels, owing to increasing depreciation costs in US and overseas plants in line with their increasing capacity, coupled with a boost in vehicle incentives. Further, rising research and development costs for autonomous driving and electrification will increase pressure on the margins of the mid size firm, although its relationship with Toyota should help it disperse some of the cost burden.</p>

Incentives, Depreciation and R&amp;D Expenses Squeeze Operating MarginsSubaru has been generating the highest operating margins in the industry in recent history. However, margins are likely to decline towards 10% and perhaps even below that towards industry average levels, owing to increasing depreciation costs in US and overseas plants in line with their increasing capacity, coupled with a boost in vehicle incentives. Further, rising research and development costs for autonomous driving and electrification will increase pressure on the margins of the mid size firm, although its relationship with Toyota should help it disperse some of the cost burden.

Subaru: Margin Pressure Is Key Despite Strong Revenue Growth

Subaru Corp

Subaru: Margin Pressure Is Key Despite Strong Revenue Growth