Market Outlook 1/11/2017

Wed Nov 1

• US Manufacturing PMI (reported monthly early in the month)
• DBS Group earnings report

Thurs Nov 2

• Best World earnings report
• China Aviation earnings report

Friday Nov 3

• US Nonfarm payroll (reported on first Friday of following month)
• US Non-manufacturing PMI (reported monthly early in the month)
• OCBC earnings report
• Sunningdale Tech earnings report

Summary

Week of small to mid cap earnings reports as well as banks. We see that the banks have already rallied in anticipation of the results this week, so upside risk reward ratio is suppressed. 

Other than the earnings, US monthly figures coming out on Wed might push market higher given that figures have been so good in the recent past. Given HSI decline, could be a good time to enter. 

Brent oil above 60. Positive for Keppel Corp.

US Tech stocks unending rally. Why?

SG Manufacturing stocks recent breakout. Why?

• http://www.businesstimes.com.sg/government-economy/singapore-business-expectations-up-for-next-six-months-services-show-signs-of

Europe Stock Watchlist - 28/10/2017

UK Stocks

1. WORLDPAY GROUP PLC ORD 3P
2. INTERNATIONAL CONSOLIDATED AIRL
3. RPC GROUP PLC ORD 5P
4. METRO BANK PLC ORD 0.0001P
5. PRUDENTIAL PLC ORD 5P
6. ANGLO AMERICAN PLC ORD USD0.549
7. NMC HEALTH PLC ORD 10P
8. BABCOCK INTERNATIONAL GROUP PLC
9. WHITBREAD PLC ORD 76 122/153P
10. WIZZ AIR HOLDINGS PLC ORD GBP0.
11. BARRATT DEVELOPMENTS PLC ORD 10
12. PERSIMMON PLC ORD 10P
13. FEVERTREE DRINKS PLC ORD 0.25P
14. Berkeley Group Holdings PLC

Germany Stocks

1. HELLA KGAA HUECK+CO. O.N.
2. LEG IMMOBILIEN AG NA O.N.
3. KION GROUP AG
4. VONOVIA SE NA O.N.
5. DEUTSCHE WOHNEN AG INH
6. GRAND CITY PROPERT.EO-10
7. ALLIANZ SE NA O.N.
8. BAYER AG NA O.N.
9. WIRECARD AG
10. MTU AERO ENGINES NA O.N.
11. CONTINENTAL AG O.N.
12. INFINEON TECH.AG NA O.N.
13. HENKEL AG+CO.KGAA ST O.N.
14. BECHTLE AG O.N.

Japan Stock Watchlist - 28/10/2017

Market cap based on USD

1. 9022.T Central Japan Railway Co - 35.8b - railway
2. 9202.T ANA Holdings Inc - 13.27b - aviation
3. 7735.T Screen Holdings Co Ltd - 3.54b - semiconductor equipment manufacturing
4. 8053.T Sumitomo Corp - 18.22b - industrial conglomerate
5. 3064.T MonotaRO Co Ltd - 3.52b - manufacturing supplier
6. 6098.T Recruit Holdings Co Ltd - 40.56b - recruitment agency
7. 4768.T Otsuka Corp - 6.33b - IT
8. 9684.T Square Enix Holdings Co Ltd - 4.8b - gaming
9. 4716.T Oracle Corp Japan - 10.59b - IT
10. 8876.T Relo Group Inc - 3.6b - welfare outsourcing
11. 4587.T PeptiDream Inc - 4.02b - pharma
12. 9433.T KDDI Corp - 65.33b - telecommunications
13. 9062.T Nippon Express Co Ltd - 6.45b - transportation
14. 6728.T Ulvac Inc - 3.36b - vacuum machinery
15. 6383.T Daifuku Co Ltd - 5.93b - equipment manufacturing
16. 6324.T Harmonic Drive Systems Inc - 4.65b - precision speed reducer
17. 6503.T Mitsubishi Electric Corp - 36.63b - electrical equipment manufacturing
18. 6268.T Nabtesco Corp - 4.78b - industrial machinery manufacturer
19. 6146.T Disco Corp - 8.11b - semiconductor equipment manufacturing
20. 6273.T SMC Corp - 25.08b - manufacturer
21. 9962.T Misumi Group Inc - 7.31b - manufacturer
22. 1925.T Daiwa House Industry Co Ltd - 24.39b - real estate
23. 7747.T Asahi Intecc Co Ltd - 3.6b - healthcare equipment manufacturer
24. 7532.T Don Quijote Holdings Co Ltd - 6.5b - discount stores
25. 7453.T Ryohin Keikaku Co Ltd - 7.57b - self brand retail goods
26. 2782.T Seria Co Ltd - 4.35b - discount stores
27. 3092.T Start Today Co Ltd - 9.47b - e-commerce
28. 8954.T Orix JREIT Inc - 3.47b - reit
29. 8960.T United Urban Investment Corp - 4.32b - reit
30. 3283.T Nippon Prologis REIT Inc - 3.99b - reit
31. 2229.T Calbee Inc - 4.88b - food
32. 3391.T Tsuruha Holdings Inc - 5.91b - drug stores
33. 2127.T Nihon M&A Center Inc - 3.72b - m&a brokering
34. 6770.T Alps Electric Co Ltd - 5.63b - manufacturing
35. 6504.T Fuji Electric Co Ltd - 4.28b - manufacturing
36. 6594.T Nidec Corp - 38.43b - manufacturing
37. 1812.T Kajima Corp - 10.77b - construction
38. 1808.T Haseko Corp - 4.3b - construction
39. 3401.T Teijin Ltd - 4.16b - chemical products
40. 4042.T Tosoh Corp - 7.35b - chemical products
41. 4021.T Nissan Chemical Industries Ltd - 5.69b - chemical products
42. 7269.T Suzuki Motor Corp - 26.99b - automobile
43. 7988.T Nifco Inc - 3.25b - manufacturing
44. 7276.T Koito Manufacturing Co Ltd - 10.46b - automobile equipment manufacturing
45. 7270.T Subaru Corp - 26.79b - automobile
46. 5975.T Topre Corp - 1.52b - automobile equipment manufacturing

Singapore REIT watchlist

1. Mapletree Commercial Trust - 4.4b
2. Keppel REIT - 3.7b
3. Mapletree Industrial Trust - 3.3b
4. Mapletree GCC Trust - 3b
5. Croesus Retail Trust - 1.5b - japan, low rates, potential takeover
6. Keppel DC REIT - 1.4b
7. CapitaLand Retail China Trust - 1.4b
8. Lippo Malls Trust - 1.2b - indonesia, strong spending growth, acquisitions
9. Frasers Commercial Trust - 1.1b
10. First REIT - 1b
11. Viva Industrial Trust - 800m
12. Ascendas India Trust - 
13. Frasers L&I Trust - 

Hong Kong Stock Watchlist

Hong Kong Stock Watchlist:

1. 0700.HK TENCENT - 331.19b - gaming
2. 2318.HK PING AN - 117.31b - insurance
3. 0175.HK GEELY AUTO - 17.33b - automotive
4. 2018.HK AAC TECH - 15.38b - handset and acoustic manufacturing
5. 2238.HK GAC GROUP - 11.7b - automotive
6. 3606.HK FUYAO GLASS - 9.75b - glass manufacturing for vehicles
7. 1093.HK CSPC PHARMA - 8.86b - pharma
8. 0669.HK TECHTRONIC IND - 8.55b - power tools manufacturer
9. 0696.HK TRAVELSKY TECH - 8.36b - it services
10. 2020.HK ANTA SPORTS - 8.08b - sportwear
11. 3311.HK CHINA STATE CON - 7.14b - construction
12. 3969.HK CHINA CRSC - 6.54b - railway services
13. 0285.HK BYD ELECTRONIC - 5.11b - handset component manufacturer
14. 0425.HK MINTH GROUP - 4.73b - automotive component manufacturer
15. 1316.HK NEXTEER - 4.01b - automotive component manufacturer
16. 0958.HK HN RENEWABLES - 2.98b - renewable electric utility
17. 6198.HK QINGDAO PORT - 2.78b - port services
18. 0345.HK VITASOY INT'L - 2.19b - food and beverage supplier
19. 0698.HK TONGDA GROUP - 1.55b - handset electricals manufacturing
20. 1448.HK FU SHOU YUAN - 1.34b - funeral services
21. 0354.HK CHINASOFT INT'L - 1.34b - it services
22. 1579.HK - Yihai International Holding Ltd - 360m - food manufacturer
23. 2283.HK TK GROUP HLDG - 351.11m - plastics manufacturer
24. 1061.HK ESSEX BIO-TECH - 316.12m - pharma eye

Singapore Stocks Watchlist - 14/62017

Singapore Stocks Watchlist - 14/62017

1. D05.SI DBS - 37.98b - bank
2. V03.SI Venture - 2.51b - industrial manufacturing
3. OV8.SI Sheng Siong - 1.07b - grocery
4. CGN.SI Best World - 576m - beauty product sales
5. AP4.SI Riverstone - 555m - rubber glove manufacturer
6. BHQ.SI Sunningdale Tech - 295m - industrial manufacturing
7. CH8.SI China Sunsine - 291m - chemical manufacturer
8. KJ9.SI Cogent - 274m - logistics
9. 1D8.SI Singapore O&G - 241m - healthcare
10. RE4.SI Geo Energy Res - 222m - coal producer
11. 5OT.SI SingMedical - 208m - healthcare
12. 5TG.SI 800 Super - 171m - rubbish
13. AWX.SI AEM - 134m - semiconductor industrial manufacturer
14. 40T.SI ISEC - 125m - healthcare
15. T12.SI Tat Seng Pkg - 68m

US Stock List - 14/6/2017

1. GOOGL - Alphabet Inc - 673.57b - tech, advertising
2. AMZN - Amazon.com, Inc. - 467b - e-commerce
3. FB - Facebook Inc - 443.12b - social media, advertising
4. BABA - Alibaba Group Holding Ltd - 345b - e-commerce
5. TSM - Taiwan Semiconductor Manufacturing Co Ltd - 184.3b - semiconductor manufacturer
6. DIS - Walt Disney Company (The) Commo - 168.90b - entertainment
7. SBUX - Starbucks Corporation - 92.43b - food and beverage
8. NKE - Nike, Inc. Common Stock - 87.10b - sportswear
9. NVDA - NVIDIA Corporation - 86.26b - graphics and artificial intelligence
10. NVO - Novo Nordisk A/S Common Stock - 80.07b - pharma
11. CRM - Salesforce.com Inc - 64.41b - it services
12. GM - General Motors Company Common S - 50.63b - automotive
13. NTES - NetEase Inc - 37.81b - gaming
14. APH - Amphenol Corp - 23.03b - electricals manufacturer
15. TSN - Tyson Foods, Inc. Common Stock - 21.25b - food producer
16. ULTA - Ulta Salon Cosmetics and Fragrance Inc - 19.07b - beauty services
17. WB - Weibo Corp - 16.07b - social media, advertising
18. CNC - Centene Corp - 12.71b - healthcare
19. UHS - Universal Health Services, Inc. - 11.33b - healthcare, hospitals
20. ANET - Arista Networks Inc - 10.54b - it services
21. ZTO - ZTO Express (Cayman) Inc - 10.37b - e-commerce logistics
22. TAL - TAL Education Group American De - 9.23b - education
23. VEEV - Veeva Systems Inc - 9.17b - it services 
24. NVR - NVR, Inc. Common Stock - 8.59b - home construction
25. CGNX - Cognex Corporation - 8.09b - tech manufacturer
26. ATHM - Autohome Inc - 4.86b - online automobile website
27. THO - Thor Industries, Inc. Common St - 4.76b - recreational vehicles
28. PAYC - Paycom Software Inc - 3.93b - it services
29. GRUB - GrubHub Inc - 3.77b - restaurant website
30. ELLI - Ellie Mae Inc - 3.68b - it services
31. LCII - LCI Industries - 2.17b - automotive component manufacturer
32. LOPE - Grand Canyon Education, Inc. - 3.69b - education

Centene (CNC)

9/6/2017
accumulate

metrics

• market cap usd 13.37b
• pe 19.15, pb 2.2
• 5 year: revenue cagr 38.04%, earnings cagr 30%, consistent
• total debt to equity 78.97%
• roe 13.88, roa 4.05, recent fall
• growing cash pile with strong operating cash flow

operations

• multi-national healthcare enterprise that provides a portfolio of services to government sponsored healthcare programs, focusing on under-insured and uninsured individuals
• Managed Care 92% revenues
• provides health plan coverage to individuals through government subsidized programs, including Medicaid
• and Specialty Services 8%
• We provide or arrange health care benefits for services normally covered by Medicare, plus a broad range of health care benefits for services not covered by traditional Medicare, usually in exchange for a fixed monthly premium per member from CMS
• We offer commercial health care products to individuals and large and small employer groups as well as products to individuals through the Health Insurance Marketplace
• 30 years track record
• the federal government is a significant customer to our Specialty Services segment due to our Federal Services business
• We operate in a highly competitive environment

outlook

• We believe recognition of the value of managed care as a means of delivering improved health outcomes for Medicaid beneficiaries and effectively controlling costs will continue to strengthen. A growing number of states have mandated that their Medicaid recipients enroll in managed care plans. Other states are considering moving to a mandated managed care approach
• revenue guidance for 2017: up 17% yoy 

Alibaba Group Holding (BABA)

9/6/2017
buy
unstoppable e-commerce giant with strong and consistent growth. #1 e-commerce sites and diversified business. pe 50.27 reasonable for strong growth in bullish market.

metrics

• market cap usd 310.8b
• pe 50.27, pb 7.57
• 5 year: revenue cagr 35.62%, earnings cagr 38.68%, consistent
• total debt to equity 32.55%
• roe 17.5%, roa 10.62%, inconsistent
• growing cash pile with strong operating cash flow

operations

• taobao.com - #1 e-commerce app in china
• lazada.com - #1 e-commerce app in 5 SEA countries
• many others #1 everywhere
• segments: core commerce, cloud computing, digital media and entertainment, innovation and initiatives, strategic investments

outlook

• unstoppable
• goal to reach usd 1tn gross merchandise volume by 2020, currently usd 547 bn 

Alphabet (GOOGL)

9/6/2017
buy
monopoly company, owning the #1 search engine in the world and #1 video streaming website in the world. revenues from advertisements expected to grow into the future. ultra large cap stock with strong yoy growth and reasonable pe of 32.37.

metrics

• market cap usd 687.5b
• pe 32.37, pb 4.80
• 5 year: revenue cagr 14.37%, earnings cagr 12.75%, consistent
• total debt to equity 2.83%
• roe 15.02%, roa 12.37%, stable
• growing cash pile and operating cash flow

operations

• We generate revenues primarily by delivering relevant, cost-effective online advertising
• Google.com, the Google app, YouTube, and other Google owned and operated properties like Gmail, Google Maps, and Google Play
• Apps, in-app purchases, and digital content in the Google Play store; • Hardware; • Google Cloud offerings; and • Other miscellaneous products and services.
• 50% revenue in US, 30% EMEA, 15% APAC, 5% rest of world

outlook

• online shift will continue to benefit our business
• Non-advertising revenues have grown over time
• hardware sales, sales of apps, in-app purchases and digital content products, and service and licensing fees

risks

• foreign exchange risk from revenues derived overseas
• competition
• economic conditions

Chinasoft International (0354.HK)

22/5/2017

metrics

• market cap 10,545.98 mil hkd (1.88bn sgd)
• last done 4.38 hkd
• pe 19.60, pb 2.18, ev/ebitda 11.82
• dividend yield 0.28
• 10 year: revenue cagr 23% consistent, 6 year: earnings cagr 25% consistent
• total debt / equity 31.92%
• roe 11.77%, roa 6.04%, both consistently increasing
• strong cash flow and healthy and increasing cash in balance sheet