Author: Dean Kim

Dean Kim is an Executive Director, Research Analyst for William O’Neil + Co.. Mr. Kim joined the firm to establish equity research coverage of the financial technology (“fintech”) sector. He has unique insight into the industry’s growth drivers, with broad experience covering the financial sector as an analyst and overhauling corporate business processes as a management consultant. Most recently, Mr. Kim served as Chief Financial Officer of Jios Aerogel Limited, a leading producer of the aerogel nanotechnology-based insulation material. As CFO, he raised more than $5 million in capital and managed liquidity, budgeting, and forecasting. Previously, he was an equity analyst for more than a decade. From 2007–2011, Mr. Kim headed equity research for BNP Paribas’ Korea office and simultaneously covered the banking sector, for which he was ranked number one by the Thomson Reuters/Joong-Ang Daily poll. He was also an equity analyst on Lehman Brothers' proprietary trading desk in Hong Kong, and on an Institutional Investor-ranked small cap team at UBS. Earlier in his career, Mr. Kim, an engineer, worked as a business process redesign specialist at Deloitte Consulting, analyzing the organization-wide processes of utilities and manufacturing companies. Mr. Kim earned a Bachelor’s degree in Electrical Engineering at Yale University, and an MBA from Columbia Business School. Outside of work, Mr. Kim enjoys coaching his kids’ soccer teams and traveling with his family.

MSCI

Posted on by Dean Kim

Key points from this report:

 

  • The stock is currently forming the right side of a cup-with-handle base spanning seven weeks, and we recommend accumulating above $320.
  • Earnings stability rating is strong at 3 (1 is best) given its consistent growth across all segments.
  • Double-digit EPS growth in the last several quarters has generated a strong EPS Rank of 98.
  • Sound fundamentals are captured in its strong Composite Rating of 98 and top SMR Rating of A.
  • Accelerating pretax margin over the trailing four years.
  • RS line is trending higher with RS Rating of 97 and Up/Down Volume ratio of 0.8.
  • The number of funds owning the stock has improved to 1,622 in December 2019 from 1,308 in December 2018.

Where is the Bottom for Banks?

Posted on by Dean Kim

Attached is a note on U.S. Banks from Executive Director, Research Analyst Dean Kim. In this report, we perform a scenario analysis to see if bank stocks have priced in the worst-case scenario based on recent historical data. While there are still uncertainties related to the magnitude of economic damage as well as timing of a recovery, we believe much has been priced into the banks and shares may be oversold at this stage. We will, however, refrain from adding any banks to our U.S. Focus List until stocks break above their 200-DMA.

Square

Posted on by Dean Kim

Key points:

 

  • The stock recently broke out of a 19-week cup base. The next support level is the 50-DMA at $71.86.
  • SMR Rating A, Composite Rating 97, EPS Rank 99.
  • Technical ratings: RS Rating 83, Up/Down Volume ratio 1.3, A/D Rating B.

Global Exchanges Overview

Posted on by Dean Kim

Key points from this report:

 

  • Global exchanges on average are fundamentally strong, with 18.7% ROE, 55.7% OP margin, 63.3% EBITDA margin, and trading at 24x 2020E PE.
  • The macro backdrop for volume and investment growth looks positive, with upticks in domestic demand and investments in OECD countries.
  • Exchanges will benefit from the continued proliferation of ETFs, expected to double to $12T in assets by 2023.
  • We gravitate toward exchanges with high earnings growth as well as higher non-volume recurring revenues from data services ( indices and analytics ).
  • These include London Stock Exchange ( LSE.GB, on our Focus List ), B3 Brasil Bolsa ( BMF.BR, on our Focus List ), Euronext ( ENX.FR, on our Focus List ), Intercontinental Exchange ( ICE ), and Hong Kong Stock Exchange ( HKEX.HK ).

Visa

Posted on by Dean Kim

Key points:

 

  • The stock is constructively trading along its rising 21-DMA.
  • Strong fundamental ratings: SMR Rating A. Composite Rating 93. EPS Rank 95.
  • The average pretax margin and ROE for the last five years stand at 65% and 27%, respectively.
  • Technical ratings: RS Rating 82. Up/Down Volume ratio 1.7. A/D Rating B.

Sul America

Posted on by Dean Kim

Key points:

 

  • The stock is breaking out of a cup-with-handle.
  • Good fundamental ratings, including an EPS Rank of 90. Expectations call for 22% EPS growth in 2019.
  • Technical ratings: RS Rating 89, Up/Down Volume ratio 0.6, A/D Rating B+.
  • Institutional sponsorship increased 29% y/y to 606 funds in September.

Banks Breaking Out

Posted on by Dean Kim

The Financial sector has been underperforming the market since 2018. However, we are seeing rotation into Financials as the market believes the sector may have bottomed, or it sees a short-term relief rally based on lower geopolitical risks better-than-expected U.S. economic data. The sector is now outperforming both on a short-term (four weeks) and longterm (26 weeks) basis, according to our PANARAY Sector Rotation Map