TMT & Consumer Independent Equity Research Analyst, Obex Capital Research

Aaron Gabin

TMT & Consumer Independent Equity Research Analyst

TMT & Consumer Independent Equity Research

Obex Capital Research

“Obex” is Latin for Barriers to Entry. Obex Capital Management’s investment philosophy is driven by an intense focus on which business model’s Barriers to Entry are able to withstand the ever increasing competitive disruption in the TMT and Consumer Sectors.

Equity Bottom-Up

SmartKarma Insight Providers Jim Handey and Will Keating have done excellent work detailing the Intel backstory, and outlining the current problems, I wanted to highlight the difficulty of the decisions facing Gelsinger, and the fact that while he has time to execute (his pay package will pay him  &gt;$100M if Intel’s stock is up 200% in 5 years), he doesn’t have the best track record as a CEO. We think a split up of Intel with the US government helping to fund manufacturing may be the best option for Intel. <div class="content-highlight">Obex’s fundamental research process is focused on secular change in the TMT and Consumer sectors. We seek to differentiate between fundamental business analysis and security analysis. Before deciding if a security’s pricing and positioning merit a long or short position, we analyze the four pillars of business fundamentals (Secular Factors, TAM, Competitive Advantage, Business Model) in order to determine if this is a “good” or “not so good” opportunity.</div>

SmartKarma Insight Providers Jim Handey and Will Keating have done excellent work detailing the Intel backstory, and outlining the current problems, I wanted to highlight the difficulty of the decisions facing Gelsinger, and the fact that while he has time to execute (his pay package will pay him  &gt;$100M if Intel’s stock is up 200% in 5 years), he doesn’t have the best track record as a CEO. We think a split up of Intel with the US government helping to fund manufacturing may be the best option for Intel. Obex’s fundamental research process is focused on secular change in the TMT and Consumer sectors. We seek to differentiate between fundamental business analysis and security analysis. Before deciding if a security’s pricing and positioning merit a long or short position, we analyze the four pillars of business fundamentals (Secular Factors, TAM, Competitive Advantage, Business Model) in order to determine if this is a “good” or “not so good” opportunity.

Intel: Are We Sure Gelsinger Is the Best Choice? Maybe Its Time for a Government Bailout.

Semiconductor & Technology Specialist, Ingenuity

William Keating

Semiconductor & Technology Specialist

Ingenuity

Our focus is exclusively on in-depth research & consulting in the broader semiconductor industry. We focus on the key players, namely Intel, Micron, Qualcomm, Apple, Samsung, NVIDIA, AMD, TSMC & Global Foundries - as well as some of the lesser known, but nonetheless critical, companies such as ASML (for EUV), Mellanox, Cavium, Xilinx etc. We specialise in their products, roadmaps, process technologies, competitive advantages & threats etc. We also help our clients understand the implications of new and emerging technologies, e.g. 3D X-Point, 3D NAND, Carbon Nanotubes, Autonomous Driving, Graphene, Silicon Photonics, Wafer-Level Optics, Artificial Intelligence, FPGA, GPU, ASIC etc. 

Semiconductor Analysis & Research

Dutch lithography giant <a href="https://www.smartkarma.com/entities/asml-holding-nv-b0092428-e3ec-4a92-bdd6-2f6eff7f1879" target="_blank" data-smartkarma-citation="entities:28204:1" rel="noopener">ASML</a> this week reported fourth quarter earnings of €4.3 billion, slightly ahead of expectations and an increase of 5.4% year on year. Full year 2020 revenues amounted to €13.98 billion, a sequential increase of 18.3%. The company's 2021 guidance for another year of double digit growth failed to impress the markets overnight with the share price remaining largely unmoved. By their own admission, ASML's forecast is overly conservative and there is significant potential upside that could push the company well into the mid-twenties percentage growth sequentially. Here are our thoughts on their earnings report and where we see that potential upside arising from.

Dutch lithography giant ASML this week reported fourth quarter earnings of €4.3 billion, slightly ahead of expectations and an increase of 5.4% year on year. Full year 2020 revenues amounted to €13.98 billion, a sequential increase of 18.3%. The company's 2021 guidance for another year of double digit growth failed to impress the markets overnight with the share price remaining largely unmoved. By their own admission, ASML's forecast is overly conservative and there is significant potential upside that could push the company well into the mid-twenties percentage growth sequentially. Here are our thoughts on their earnings report and where we see that potential upside arising from. 

ASML. Strong Earnings, Conservative Outlook Albeit With Significant Upside Potential.

Taiwan Semiconductor (TSMC) / Equity Bottom-Up

<a href="https://www.smartkarma.com/entities/taiwan-semiconductor-manufacturing-company" target="_blank" data-smartkarma-citation="entities:11230:1" rel="noopener">TSMC</a> last week reported a record fourth quarter along with full year 2020 revenues of $45.5 billion, up 31.4% in US dollar terms year on year. On the back of this stellar growth, the company took the opportunity to raise its long-term growth CAGR from 5-10% to 10-15%. After spending a record $17.24 billion on CapEx in 2020, TSMC also announced that spending in the current year will rise to $28 billion at the high end, an increase of 62.4%. TSMC is betting big on something big.

TSMC last week reported a record fourth quarter along with full year 2020 revenues of $45.5 billion, up 31.4% in US dollar terms year on year. On the back of this stellar growth, the company took the opportunity to raise its long-term growth CAGR from 5-10% to 10-15%. After spending a record $17.24 billion on CapEx in 2020, TSMC also announced that spending in the current year will rise to $28 billion at the high end, an increase of 62.4%. TSMC is betting big on something big. 

President

Thomas Coughlin

Coughlin Associates

Intel's change in CEOs will likely result in changes in the company, such as selling off unprofitable acquisitions.  How will this impact the company's NSG memory products.   I would guess that Intel might decide to accelerate its sale of its NAND flash operations to SK hynix.  However, because of the strategic importance of the next generation server processors to compete against AMD.  I think it is much less likely that the company would sell its Optane products at this time.

Intel's change in CEOs will likely result in changes in the company, such as selling off unprofitable acquisitions.  How will this impact the company's NSG memory products.   I would guess that Intel might decide to accelerate its sale of its NAND flash operations to SK hynix.  However, because of the strategic importance of the next generation server processors to compete against AMD.  I think it is much less likely that the company would sell its Optane products at this time.

Intel CEO Change:  Implications for Company's Memory Products

Semiconductors, Memory and SSDs Specialist, Objective Analysis

Jim Handy

Semiconductors, Memory and SSDs Specialist

Objective Analysis

Objective Analysis offers third-party independent market research and data for the semiconductor industry and investors in the semiconductor industry.

Semiconductors, Memory and SSDs

Intel announced on January 13, 2021, that its CEO Bob Swan would step down to be replaced by departed Intel veteran Pat Gelsinger.  This Smartkarma Insight focuses on the work that Gelsinger must do to win back the company's diminishing prominence in the processor market that it created.

Intel announced on January 13, 2021, that its CEO Bob Swan would step down to be replaced by departed Intel veteran Pat Gelsinger.  This Smartkarma Insight focuses on the work that Gelsinger must do to win back the company's diminishing prominence in the processor market that it created.

Intel CEO Change Brings Focus Back to Technology

United States

Intel Corporation designs, manufactures, and sells computer components and related products.  The Company's major products include microprocessors, chipsets, embedded processors and microcontrollers, flash memory products, graphics products, network and communications products, systems management software, conferencing products, and digital imaging products.

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Intel Corp (INTC US)

Intel: Are We Sure Gelsinger Is the Best Choice? Maybe Its Time for a Government Bailout.

Pat Gelsinger is being hailed as the perfect fit for Intel CEO, but his track record managing VMWare hasn't generated good returns for investors.

Aaron Gabin

ASML. Strong Earnings, Conservative Outlook Albeit With Significant Upside Potential.

ASML's 2021 double digit growth forecast seems overly conservative to us. We think there is potential upside that will add significantly to that...

William Keating

TSMC. Betting Big On Something Big

Citing stronger than expected growth in their HPC platform business and raising 2021 CapEx by 62%, the biggest increase in a decade, TSMC is...

William Keating

Intel CEO Change: Implications for Company's Memory Products

Intel's change in CEOs will likely result in changes in the company, such as selling off unprofitable acquisitions. How will this impact the...

Thomas Coughlin

Intel CEO Change Brings Focus Back to Technology

Intel is changing its CEO. Does incoming CEO Pat Gelsinger have what is needed for the company to regain its position? What steps must he take? ...

Jim Handy

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