Author: Derek Higa

Derek Higa is a senior equity analyst and a lead for the APAC region and the Consumer Cyclical sector. He serves on the Global Focus List Committee, which approves all equity recommendations for developed, emerging, and frontier markets, and compiles Asia Watch, a weekly recap of regional investing news. Since joining William O’Neil + Company in 2005, he has lent his market expertise to alpha capture, product development, and historical studies on outperforming stocks. Derek graduated summa cum laude from California State University Los Angeles with a B.S. in Finance and Information Systems. He holds a Series 65 securities license.

APAC Weekly Summary

Posted on by Derek Higa

Key points from this week’s report

After a rough week, China A-shares are still in a Confirmed Uptrend.

CSI 300 has three distribution days and is holding above the 50-DMA. Volume remains low. Above all, we believe large cap stocks are still healthy.

Among China A-shares, large-cap stocks are outperforming on a relative basis in the shorter term ( five-day, four-week, and eight-week periods).

In our China Sector Rotation Graph, Consumer Staples stands out.

Large-cap Staples performance has been remarkable, even during last week’s pullback.

Highlighted CAFL Ideas: Jiangsu Hegrui Medicine ( JHM.CN; 600276: CH ) and China International Travel Service ( CTS.CN; 601888.CH ).

See our list of actionable ideas on page 10.

APAC Weekly Summary

Posted on by Derek Higa

Key points from this week’s report

Market conditions and sentiment haven’t changed. The majority of APAC markets remain in a Confirmed Uptrend.

Distribution days are low at 2.4 on average.

Retail has led the last five days and is among the top outperformers over the last 13 weeks. Focus List Ideas Haidilao ( HAIN.HK; 6862: HK ) and Titan ( TIT.IN; TTAN: IN ) are among the most extended on our Focus List ( for HAIN.HK datagraph see below and page five ).

See our included list on page six for other extended ideas on and off our Focus List.

Highlighted recent additions to our Focus List: TSMC ( TSM.TW; 2330: TT ), Energy Absolute ( ENAP.TH; EA: TB ), and Peptidream ( PETI.JP; 4587: JP )

See our list of actionable ideas on page 10.

April 18, 2019 – Is Old Media Poised for a Resurgence?

Posted on by Derek Higa

Disney’s incredible breakout means yet another Old Media stock is showing signs of leadership this year. In this week’s webinar, which will be available in Research View in PANARAY or on our website any time after 11am ET on Thursday, April 18, William O’Neil + Co. Director, Research Analyst Derek Higa will profile leading ideas in Internet/media and analyze developing trends like connected TV, OTT competition, and privacy regulation.

Media and Internet

Posted on by Derek Higa

Key points from the report:

U.S. Media/Internet sentiment

Old Media versus New Media Group Rank

Media –TV/Radio

NXST, GTN

New Media themes

Connected TV

TTD, ROKU

OTT competitive landscape widens: Disney+, AppleTV+

DIS, NFLX

Regulation GDPR

FB

Other ideas

MTCH, WWE, CABO, NYT, YELP

International ideas

YNDX, InfoEdge, PVR

APAC Weekly Summary

Posted on by Derek Higa

Key points from this week’s report

After a strong week, the MSCI Asia ex Japan and major markets are trading mixed through Wednesday. As markets pause, leaders remain constructive.

Rotation into large caps has been especially noticeable recently. See our list of large caps with high A/D Ratings here.

Oil prices have risen to year-to-date highs, but the Energy sector continues to lag on a relative basis over the last 26 weeks. This is noticeable in our Sector Heat Map.

If energy ideas revert to the mean, we anticipate leading energy names will regain momentum.

Energy Absolute ( ENAP.TH; EA: TB ), Petronet ( NET.IN; PLNG: IN ), and highlighted Focus List Idea Reliance ( REL.IN; RIL: IN ) are among the top-rated energy ideas in our Sector Card.

Going forward, we are using this new format for our weekly notes, which will include our Sector Heat Map, Market Conditions, Key Metrics, and Sector Card on an ongoing basis.

See our list of Actionable Focus List Ideas here.

APAC Weekly Summary

Posted on by Derek Higa

The MSCI Asia ex Japan rose to year highs on Wednesday, as did China, Hong Kong, and India. The index has seemingly
changed character this week as it approaches August 2018 highs.
India has risen to all‐time highs, rising above 39,200 intraday before pulling back to the lower end of a three‐day range.
We expect a pause or consolidation near term as the market gets ready for general elections.
A total of 1,170 APAC stocks broke out of bases in March. Approximately 38% were from China A‐share stocks. India had
the most stocks trading near pivot, accounting for 19% of 4,995 stocks in APAC.
In APAC Sector Rotation, Basic Materials are still lagging long term, but have recently displayed the most improvement in
momentum across all sectors in the region. Its RS Rating has also improved.
See Basic Material ideas with Strong Ratings and Rankings here.
See Actionable Ideas on our Focus List here.
Highlighted Focus List Ideas: Asian Paints ( API.IN; APNT: IN ) and Pidilite ( PID.IN; PIDI: IN ).

APAC Weekly Summary

Posted on by Derek Higa

Key Points:
We downgraded Japan and South Korea to an Uptrend Under Pressure. The Nikkei’s action this month
has been been erratic and volatile with two massive drawdowns on March 8 and 25. We see Japan’s late
follow‐through day and sharp declines as reasons for a cautious approach.
APAC distribution has risen to 3.5 days on average (versus 3.2 last week) but we believe the majority of
markets have taken the volatility in stride and are holding above support.
The number of Focus List ideas has steadily risen this year, so we remain optimistic. Should this trend
change, an increase in the number of removals could be a negative sign for market conditions, but this
has yet to happen.
We share our top Focus List picks in APAC, including our thoughts on each Datagraph™ ( IEI.IN, LASE.JP,
REL.IN, NAN.AU, XRO.AU, AGP.HK, HAIN.HK ).
Update on Haidilao ( HAIN.HK; 6862:HK ): look to add to positions on a breakout to all‐time highs.

APAC Weekly Summary

Posted on by Derek Higa

Key Points:

 

  • India is back in a Confirmed Uptrend after briefly testing the 200-DMA. Distribution days have reset to zero as the Sensex has risen to year highs, making those in February irrelevant.
  • The November 2 (2018) follow-through day remains intact. The next stop is likely ~39,000, also were we view next significant resistance.
  • We continue to view India’s April/May elections as a significant catalyst to a sustainable uptrend.
  • Year-to-date performance is improving but the breadth of breakouts are still low.
  • In Sector Rotation, we highlight outperforming sectors Transportation ( VGA.IN ), Retail ( TIT.IN ), and Energy ( REL.IN ). The Financial sector ( HFC.IN, ICG.IN, KOK.IN ) looks most timely, with several India banks recently becoming actionable. Cyclical is still early.
  • Several leaders among large cap ideas. For best-of-breed large-cap ideas, see our list here.
  • For other stocks of interest and actionable ideas in India, see our list here.
  • Highlighted Focus List idea: Kotak Mahindra Bank ( KOK.IN, KMB: IN ) is pivoting.

PVR Cinemas

Posted on by Derek Higa

Key points from the report:

On March 18, the stock broke out of a stage-one nine-week cup base on above average volume and is actionable.

The Company had three- and five-year EPS growth of 22% and 27%, respectively. Its EPS Rank is expected to improve, driven by double-digit EPS growth estimates for FY19 and FY20.

Excellent fundamental ratings: best-in-class Composite Rating of 99, EPS Rank of 90, SMR Rating of B.

Strong technical ratings: RS line is trending upward, RS Rating of 87, A/D Rating of B-.