Report
Dave Nicoski ...
  • Ross LaDuke
EUR 46.57 For Business Accounts Only

Insights: Bullish Stocks

emain Overweight EM vs. EAFE



The MSCI EM index (local currency) has continued to outperform relative to the MSCI EAFE index while the US dollar (DXY) forms a tight consolidation pattern. As a result we continue to favor EM over EAFE; and if EM is going to continue to outperform we would expect to see a breakdown below 98.50 support on the DXY. Like many global indexes, the MSCI EM index remains below resistance from a price perspective. Short-term levels we are watching include resistance at 54,650 and support at 51,500... see chart below.



Below we highlight attractive and actionable themes within EM:



· EM Countries: China (MSCI China, Shanghai Comp., Shenzhen A Share) continues to offer many attractive setups and is a major focus in today's report. Additionally, Taiwan (TAIEX) continues to be worthy of an overweight within the EM universe with the RS uptrend intact... see page 2.

· EM Sectors: MSCI EM Technology, Consumer Discretionary, Health Care, and Communications continue to be leadership -- remain overweight/add exposure. Materials exhibits a bullish RS reversal and has several timely opportunities -- add exposure. Lastly, Consumer Staples are leadership in China and are breaking out from a price perspective -- remain overweight/add exposure... see pages 3-4.

Outside of the above themes, a bottoms-up approach is required to uncover attractive and actionable stocks. On page 5 we include a table of all stocks highlighted in this report.
Underlyings
All About

All About is mainly engaged in the provision of information services through internet website under the name "All About." Co. operates in four business segments. Advertisement segment is engaged in the distribution of advertisements, including traffic advertisements, impression advertisements, editorial advertisements and advertisements for sponsor sites. Style Store segment sells various kind of products. Profile segment is engaged in the provision of specialist information and advice. Financial Service segment offers securities, life insurance and non-life insurance services to individual investors and corporations.

Amoy Diagnostics (A)

Amoy Diagnostics Co., Ltd. is a China-based company principally engaged in the research and development, manufacturing and sales of molecular diagnostic products for tumor precision medical industry. The Company is also engaged in the provision of relevant testing services. Its products are mainly used to detect the status of tumor-related genes and the provision of scientific basis for tumor-targeted drug selection and individualized treatment programs. The Company mainly distributes its products in the domestic market.

Beijing Century Real Technology (A)

Beijing Century Real Technology Co.,Ltd. is a China-based company principally engaged in the development, production and distribution of railway operation safety monitoring system software products, as well as in the provision of integrated railway operation and maintenance services. The Company's products mainly include railway train operation safety monitoring systems, railway integrated operation and maintenance systems, railway communication systems, other related railway information system products, water conservancy products and communication operator products, among others. The Company is also involved in the provision of related safety monitoring system integration, technical training, technical consulting and technical supporting services. The Company operates its business mainly in domestic market.

Changzhou Xingyu Automotive Lighting Systems Co. Ltd Class A

Changzhou Xingyu Automotive Lighting Systems Co., Ltd. is a China-based company principally engaged in the research and development, design, manufacture and sales of automotive lighting products. The Company's main products include the automotive headlamps, tail lamp sets, fog lamps, brake lights and turn signals, among others. The Company is also involved in the manufacture and sales of flexible flat cables and triangular warning signs, as well as the sales and repair of automobiles through its subsidiaries. The Company mainly distributes its products to automobile manufacturers from all over the world.

DaShenLin Pharmaceutical Group Co. Ltd. Class A

Dashenlin Pharmaceutical Group Co Ltd. DaShenLin Pharmaceutical Group Co., Ltd. is a China-based company principally engaged in the pharmaceutical retailing business. The Company's primary business includes direct sales and retailing of Chinese and Western medicine, ginseng nourishing herbs and Chinese medicine pieces, health products, medical apparatus and instruments and other commodities. The Company mainly conducts its business within domestic market.

Formosa Sumco Technology

Formosa Sumco Technology is engaged in the manufacture, sale, import and export of silicon wafers for semiconductor industries.

GDS Holdings Ltd. Sponsored ADR Class A

Hainan Poly Pharm (A)

Hainan Poly Pharm Co., Ltd. is a China-based company principally engaged in the research, development, production and sales of medicine. The Company operates through two main segments. The Main Business segment is primarily involved in the research, development and production of injections, oral solid dosages, dry suspensions and active pharmaceuticals ingredients (API). The Company's products include anti-allergic medicine, antibiotic medicine and digestive. The Other Business segment is mainly engaged in the construction engineering design, decoration design and provision of construction engineering technology services, among others.

Hefei Meyer Optoelectronic Technology Inc. Class A

Hefei Meyer Optoelectronic Technology Inc, formerly Hefei Meiya Optoelectronic Technology Inc., is a China-based company principally engaged in the research, development and distribution of optoelectronic identification technology and products. The Company's main products consist of rice color sorting machines, grain color sorting machines, tea color sorting machines, X-ray industrial inspection machines, oral X-ray computed tomography (CT) diagnostic machines and related spare parts, among others. The Company distributes its products in domestic markets and to overseas markets.

iShares U.S. Real Estate ETF

Jiangsu Hengrui Medicine Co. Ltd. Class A

Jiangsu Hengrui Medicine is engaged in the development, manufacture and distribution of raw chemical pharmaceuticals, tablets, capsules, powder injections, lyophilized powder for injections, sterile poured-in powder injections, large & small volume parenteral solutions, bulk drugs, western medicines, eye-drops, medicine packaged materials and raw medicines. Through its subsidiaries, Co. is also engaged in the development, manufacture and wholesale of spray solutions, chinese medicines and raw chemicals and research and development of producing new medicines.

Jonjee Hi-Tech Industrial and Commercial Holding Co. Ltd. Class A

Jonjee Hi-Tech Industrial & Commercial Holding is engaged in urban infrastructure investment; property management; secondary water supply; hi-technology industry investment and development; industrial investment; equipment leasing; provision of technology and communication consultation services; and sale of industrial materials, general merchandises, hardware, electrical appliances; chemical products, needles, textile products and construction materials. Through its subsidiaries, Co. is also engaged in production of sauce, flavoring, non-alcoholic beverage, and automobile and motorcycle accessories.

Juewei Food Co. Ltd. Class A

Juewei Food Co., Ltd is a China-based company principally engaged in the research, development, production and sales of marinating snack foods. The Company operates through three main segments. The Marinating Snack Foods segment is mainly engaged in the production and sales of marinating foods. The products can be divided into two categories, including marinating meat snack foods which are made from raw materials, such as duck meat, chicken and pork, as well as marinating vegan snack foods which are made from green soy beans, carrots and peanuts. The Franchisee Management segment is mainly engaged in the enterprise management and the provision of consulting services. The Others segment is primarily engaged in the container cleaning and provision of product packages, among others.

Kushim

iStudy is engaged in the creation and sale of software products. Co. has three main businesses. iLearning segment creates and sells educational software "iStudy "and provide a learning environment online. "iStudy" covers contents for database, operating systems, network application and language studies and is designed for IT engineers seeking information technology (IT)-related qualification. Learning segment provides engineering training courses and training support services primarily for IBM Japan, Ltd and Oracle Corp. Co. provides temporaty staffing services.

Lonking Holdings Limited

Lonking Holdings is an investment holding company. Through its subsidiaries, Co. is engaged in the manufacture and distribution of wheel loaders, road rollers, excavators, forklifts and other infrastructure machinery and the provision of finance leases for infrastructure machinery. Co.'s operating segments include the sale of construction machinery and the finance lease of construction machinery.

Lotes

Lotes and its subsidiaries are engaged in the design and manufacture of connectors, CPU socket, coolers and antennafor notebook computer, personal computer, mobile electronic device and digital video.

Meiji Holdings Co. Ltd.

Meiji Holdings is a holding company based in Japan. Co. and its affiliates are mainly engaged in the manufacture and sale of confectionery, dairy products and pharmaceuticals. Co., through its subsidiaries and affiliates, has two business segments: food and medicinal drug. The Food segment provides confectionery, ice cream, sugar, market milk, milk powder, condensed milk, butter, cheese, beverage, health food and drug store-oriented pharmaceutical products. The Medicinal Drug segment provides ethical pharmaceuticals, as well as agricultural chemicals and veterinary drugs.

Moscow Exchange MICEX-RTS PJSC

Moskovskaya Birzha MMVB-RTS PAO. Moskovskaya Birzha MMVB-RTS PAO (MMVB-RTS OAO) is a Russia-based integrated stock exchange that provides electronic trade organization, clearing and settlements on trades, depository and information services. The Company provides trading and settlement services in such segments of the financial market as foreign exchange (FX) market, federal bonds market, market of derivative financial instruments, cash equities market, corporate and regional fixed income market, commodities market, as well as market for state and municipal orders. The Company was established as a result of the merger between MMVB ZAO and RTS OAO. It operates through six branches and three representative offices. As of February 27, 2013, the Company's major shareholder was the Central bank of the Russian Federation with a stake of 22.47%. In January 24, 2014, the Company sold its whole stake in MMVB-IT ZAO.

Nanjing King-friend Biochemical Pharmaceutical Co. Ltd. Class A

Nanjing King-Friend Biochemical Pharmaceutical Co., Ltd. is a China-based company principally engaged in the research and development, production and sales of heparin-related products. The Company's main products include standard heparin raw materials, low molecular weight heparin raw materials and their preparations, such as heparin sodium raw materials, heparin sodium, enoxaparin sodium injection, dalteparin sodium injection and Naqu Heparin Calcium Injection. The Company mainly exports its products to the United States and European countries.

Ovctek China Inc. Class A

OVCTEK CHINA INC. is a China-based company principally engaged in the research and development, production and sales of eye-sight products and the provision of eye-sight services. The Company's main business is non-surgical vision correction. The Company's main products include orthokeratology, general contact lens and care products. Its core product is Dream David orthokeratology. In addition, The Company is also engaged in general glass frame sales business. The Company mainly operates its business in the domestic market.

Pegatron Corporation

Pegatron is a Taiwan-based DMS (Design and Manufacturing Service) company with activities centered on product development with vertically integrated capabilities. Co. develops diversified product lines covering motherboards, desktop PCs, notebooks, broadband, wireless systems, game consoles, networking, PBX, multimedia, LCD TV, handheld devices, mobile Internet devices, motherboards, video graphic cards, media players, e-readers and digital photo frames, and liquid crystal display-televisions, as well as broadband communication products. In addition, Co. engages in trading activities; installing, repairing, and selling electronic products; and manufacturing medical appliances.

Shandong Hiking International (A)

SHANDONG HIKING INTERNATION CO., LTD. is a China-based company principally engaged in the manufacture, processing and export of hair products, textile and garment products. The Company's principal products include toupee, women's wigs, hair extensions, teaching wigs, wig accessories and other human hair products, as well as knitwear, clothing, home textiles, and textile fabrics. Its brands include S&O, OnRite and NewImage. The Company's products are mainly exported to the United States, Europe and Japan.

Shanghai M&G Stationery Inc.

SHANGHAI M&G STATIONERY INC. is a China-based company mainly engaged in the research and development, design, manufacture and sales of writing instruments, student stationery and office stationery. The Company is also involved in the development of fine stationery experience centers, the provision of one-stop office service platforms, as well as the Internet and e-commerce platforms. The Company's writing instruments mainly include gel pens, ball-point pens, mechanical pencils, water-based pens, functional pens and brushes.

Shanxi Xinghuacun Fen Wine Factory Co. Ltd. Class A

Shanxi Xinghuacun Fen Wine Factory is engaged in the production and sales of Fen and Zhuyeqing brand wine and other series of wine and provision of advertising services for Co.'s wine series; high new technology and product research, development, production and application of wine; investments in enterprises' establishment; and provision of related consultation services. Through its subsidiaries, Co. is also engaged in the design, acting as domestic newspaper agent, broadcasting, television, printing, street sign and lamp box advertisement; sales of white wine, grape wine, beer, beverages and condiments; and involved in wine packaging.

Shenzhen Kangtai Biological Products Co. Ltd. Class A

Shenzhen Kangtai Biological Products Co.,Ltd. is a China-based company and mainly engaged in research and development, manufacture and sale of vaccine. The main products of the company are recombinant hepatitis B virus, haemophilus influenzae type b combined vaccine, measles rubella combined attenuated live vaccine, non-cell Bai Bai Po haemophilus influenzae combined vaccine and other products. The Company operates its businesses primary in domestic market.

Silergy Corp.

Silergy and its subsidiaries are principally engaged in the research and development, design, and sale of power-management integrated circuit products, and related technical services. Co.'s major products include LED lighting, tablet computers, notebook computers, solid-state drives, video surveillance systems, servers, digital set-top boxes, smart phones, televisions, LED backlight modules, routers, mobile power sources, and smart meters.

SonoScape Medical (A)

SonoScape Medical Corp. Sonoscape Medical Corp. is a China-based company principally engaged in the research, development, manufacture and distribution of electronic diagnostic medical equipments. The Company operates through two main segments. The Main Business segment is primarily involved in the research, development, manufacture and distribution of medical endoscopes, ultrasound diagnostic equipments including Color Doppler ultrasound and B-scan ultrasonography, as well as accessories and other equipments. The Other Business segment is primarily involved in the provision of products after-sales service. The Company distributes its products both to domestic and overseas markets.

Space Group Holdings Ltd.

Top Glove Corporation Bhd.

Top Glove is a holding company. Co. is engaged in the provision of management services. Through its subsidiaries, Co. is engaged in the manufacturing and trading of gloves, the provision of management services, property investment, investment holding, producing and selling concentrate latex, as well as plantation of rubber trees. Through its associate, Sonic Clean Pte. Ltd., Co. provides aqueous cleaning services, consumable cleaning and subassembly work in clean room environment and investment holding. Co. and its subsidiaries have five reportable operating segments: Malaysia, Thailand, The People's Republic of China, The British Virgin Islands, and Others.

Topchoice Medical Corp. Class A

Top choice Medical Investment Co.,Inc. is a China-based company engaged in the provision of healthcare service. The Company mainly operates through the segment of oral healthcare service. The Company operates its businesses primarily in domestic market, with Zhejiang province as its major market. The Company operates various oral healthcare hospitals, including Hangzhou Dental Hospital, Hangzhou Chengxi Dental Hospital and Ningbo Dental Hospital. The Company is also engaged in the in vitro fertilization (IVF) service business.

Unimicron Technology Corp.

Unimicron Technology is engaged in the manufacture, processing and sale of printed circuit boards, electrical engineering equipment and materials, electronic products, integrated circuit products testing and preburning systems. Co.'s products include single or multi-layer CSP (chip scale package), BGA (ball grid array), SIP (system in package), Embedded Passive Product, super thin substrate, Flip Chip Substrate, HDI (high density interconnect ) PCB, high layer count PCB (up to 30 layers), Rigid-Flex, CSP (chip scale package used in cell phones and PDA), multiplayer CSP, and PBGA (plastic ball grid array package).

Wuhu Sanqi Interactive Entertainment Network Technology Group Co. Ltd. Class A

WUHU SANQI INTERACTIVE ENTERTAINMENT NETWORK TECHNOLOGY GROUP CO., LTD., formerly WUHU SHUNRONG SANQI INTERACTIVE ENTERTAINMENT NETWORK TECHNOLOGY CO., LTD., is a China-based company, principally engaged in the network games industry. The Company operates its businesses through two segments. The Network Games segment is engaged in the research and development of web games and mobile games, as well as the production, promotion and distribution of video games, films and web television, among others. The Automobile Parts segment is engaged in the research, development, production and distribution of automobile plastic fuel tanks. The Company distributes its products in domestic market and to overseas markets.

Yihai International Holding Ltd.

Yihai International Holding Ltd is an investment holding company. The Company and its subsidiaries are principally engaged in the research, development, manufacturing, distribution and sales of compound condiments. The Company's products mainly include hot pot soup flavoring, hot pot dipping sauce, chicken essence and Chinese-style compound condiment products. The Company's subsidiaries include Yihai Ltd., Yihai (China) Co., Ltd., Yihai (Shanghai) Food Co., Ltd. Zhengzhou Shuhai Enterprise Co., Ltd, Chengdu Yueyihai Co., Ltd., Yihai Beijing Trading Co., Ltd, as well as Yihai (Bazhou) Food Co., Ltd., among others. The Company distributes its products within domestic and to overseas markets.

Zhangzhou Pientzehuang Pharmaceutical Co. Ltd. Class A

Zhangzhou Pientzehuang Pharmaceutical is engaged in the manufacture of pastille, tablets, granule, capsule, ointment, syrup, tincture, decoct ointment, and pill; the manufacture and sale of Pientzehuang royal jelly capsule and Liyan Buccal tablets; the import of production necessary auxiliary materials equipment and related technology; undertaking of China and foreign countries joint ventures and cooperation in production; undertaking the processing of materials, sample and assembling parts supplied by clients; and develop compensation trading. Co. primarily provides Pienzehuang series products for pain-inhibition, anti-inflammation and detoxification and curing hepatitis.

Zhejiang Dingli Machinery Co. Ltd. Class A

Zhejiang Dingli Machinery Co Ltd. ZHEJIANG DINGLI MACHINERY CO.,LTD is a China-based company principally engaged in the research and development, manufacture, sales and provision of services of aerial work platforms. The Company's main products include three types of aerial work platforms, which include scissor type, arm type and mast type. The Company's products are applied in various industries, such as aircraft and ship building and maintenance, building construction and installation, highway and bridge construction, municipal engineering projects, warehousing and supermarket.

Zhejiang Wolwo Bio-Pharmaceutical Co. Ltd. Class A

Zhejiang Wolwo Bio-Pharmaceutical Co., Ltd. is a China-based company principally engaged in the research, development, production and sale of bio-pharmaceutical products. The Company's main products include Dermatophagoides Farinae Drops and Dermatophagoides Farinae Skin Prick Diagnostic Kits. The Company's products are primarily used for the treatment of allergic rhinitis caused by dust mite allergy, the desensitization of allergic asthma and the in-vivo diagnosis of dust mite drops. The Company distributes its products in domestic market.

Zhongji Innolight Co. Ltd. Class A

ZHONGJI INNOLIGHT CO., LTD. is a China-based company mainly engaged in high-end optical communication transceiver module business and intelligent equipment manufacturing business. The Company is committed to the research, development, manufacturing and sales of high-end optical communication transceiver modules. The products mainly serve the fields of cloud computing data centers, data communications, 5G wireless networks and telecommunications transmission networks. The intelligent equipment manufacturing business includes the research and development, manufacturing, sales and after-sales service of motor stator winding manufacturing equipment. The products are mainly used in automotive motors, industrial motors, household appliances motors and other fields. The Company operates its businesses in both domestic and overseas markets.

Provider
Vermilion Research
Vermilion Research

Vermilion Research delivers timely, actionable, and unique research inputs to professional investors. Our research strategists highlight securities which we believe are at major inflection points, based on our various proprietary technical indicators, and offer asymmetric risk/return profiles. We believe our research methodology, which is not limited by industry sector or market capitalization, enables us to deliver superior investment recommendations.

Our process begins by organizing all actively traded stocks into coherent sectors, then into logical industry groups. We then apply our proprietary relative strength tools to identify developing price trends. Once attractive trends are identified within a selected sectors or groups, we screen for individual stocks which we believe offer the best risk/reward profile. Vermilion offers U.S. and global equity market research products. Vermilion’s research team, which has received numerous awards and accolades, has a combined 70 year of experience in the analysis of investment securities.

Analysts
Dave Nicoski

Ross LaDuke

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