Author: Cornelio Ash

Cornelio Ash is a senior equity analyst and member of the U.S. Focus List and the Global Focus List Committees, which approves all equity recommendations for developed, emerging, and frontier markets. He is also a lead for the Technology sector and specializes in the Americas region. Cornelio joined the firm in 2005 and received his B.A. in Finance from California State University, Northridge. He holds a Series 65 securities license.

Software: Gaming

Posted on by Cornelio Ash

Key points from this report:

 

  • Due to the COVID-19 outbreak, gaming downloads are up 30% in Q1 FY20 versus Q4.
  • Daily time spent on mobile in China, the largest gaming market in the world, spiked 30% to five hours per day in February. This has been the highest increase compared with any other country including South Korea, 3.9 hours (+7%); Japan, 3.5 hours (+7%); Spain, 2.6 hours (+5%); and France, 2.5 hours (+7%).
  • Top gaming picks: Tencent ( TCNT.HK ), NetEase ( NTES ), and Sea Limited ( SE ).

Amazon

Posted on by Cornelio Ash

Key points:

 

  • The stock is emerging from a long consolidation after bouncing back from a recent pullback. It is under accumulation with an RS Rating of 92 and A/D Rating of B. Buy.
  • Focus on the significant increase in earnings growth, which is poised to accelerate further in the back half of FY20 and beyond.
  • Earnings improvement is due to the retail segment, both in North America and internationally, quickly approaching profitability.

Global Laggards

Posted on by Cornelio Ash

Highlighted Charts

 

U.S.: Kennametal (KMT), News Corporation (NWSA), Sanderson Farms (SAFM), Cosan Ltd Cl A (CZZ), Everest RE (RE), Avanos Medical (AVNS), Echostar Corp (SATS), Appian Corp (APPN).

 

Developed: Nitto Denko (IF@N.JP; 6988 JP), Sandvik (SAND.SE; SAND SS), Relo Group (RESE.JP; 8876 JP), Beirsdorf (BEIX.DE; BEI.GR), Citic Securities (CSCY.HK; 6030 HK), H Lundbeck (LUN.DK; LUN DC), Ohsho Food Service (OSHO.JP; 9936 JP), Ibiden (IBIN.JP; 4062 JP), Telstra (TLS.AU; TLS AU).

 

Emerging: LG Household & Healthcare (LHH.KR; 051900 KR), Hua Nan Financial (HNB.TW; 2880 TT), Telekomunikasi Indonesia (RLK.ID; TLKM IJ).

Global Laggards

Posted on by Cornelio Ash

Highlighted Charts

 

U.S.: Vale SA Adr (VALE), OSI Systems (OSIS), Adtalem Global Education (ATGE), Madison Square Garden Company (MSG), Loews (L), Inspire Medical (INSP), Advance Auto Parts (AAP), Juniper (JNPR), Manpowergroup (MAN), Southwest Airlines (LUV).

 

Developed: Shandong Gold Mining ‘H’ (SHGM.HK; 1787 HK), SIG Combibloc (SIGN.CH; SIGN SW), Vivendi (EX@F.FR; VIV FP), Teijin (TJ@N.JP; 3401 JP), China Overseas Land Investment (COLI.HK; 688 HK), Ansell (ANN.AU; ANN:AU), Pandora (PND.DK, PNDORA DC), Wolters Kluwer (WSG.NL; WKL NA), Mtr (MTRC.HK; 66 HK).

 

Emerging: Voltas (VLT.IN; VOLT IN), Fomento Economico Mexicano (FMU.MX; FEMSAUBD MM).

Global Laggards

Posted on by Cornelio Ash

Highlighted Charts

 

U.S.: Huntsman Corp ( HUN ), Timken ( TKR ), Gray Television ( GTN ), Whirlpool ( WHR ), SVB Financial Group ( SIVB ), Elanco ( ELAN ), Cheesecake Factory ( CAKE ), Echostar ( SATS ), CDK Global ( CDK ), Ryanair ( RYAAY ).

 

Developed: Sumitomo Chemical ( SC@N.JP; 4005 JP ), Skf ( SKFB.SE; SKFB SS ), Ihi ( IH@N.JP; 7013 JP ), Suzuki Motor ( IX@N.JP; 7269: JP ), Sydney Airport Stapled ( SYD.AU; SYD AU ), Suncor Energy ( SU.CA; SU CN ), Erste Group Bank ( ERS.AT; ERS.AT ), H Lundbeck ( LUN.DK; LUN:DC ), Skylark ( LARK.JP; 3197 JP ), Trelleborg ( TT@G.SE; TRELB SS ), Cancom ( COKX.DE; COK GR ).

 

Emerging: PVR ( PV.IN; PVRL: IN ), Fomento Economico Mexicano ( FMU.MX;FEMSAUBD MF ), Shin Kong Financial ( SHK.TW; 2888 TW ).

Global Technology Sector— Software

Posted on by Cornelio Ash

Key points:

 

  • The Software ETF ( IGV ) is pulling back after a strong start to 2020. Support is at the 50-DMA ($246) followed by price support at the top of the prior base ($230), which is likely to  coincide with the rising 200-DMA.
  • 70% of IGV constituents have reported Q4 FY19 results, showing median revenue and EPS growth of 18% and 13%, respectively. However, profitability continues to decelerate as the IGV remains in an earnings trough.
  • Consensus expectations suggest Q1 FY20 will mark the bottom of the software earnings trough as profitability re-accelerates in the back half of 2020.
  • 2020 top picks include Salesforce.com ( CRM ) and ServiceNow ( NOW ).