Independent research on the U.S. markets, Baptista Research

Baptista Research

Independent research on the U.S. markets

Baptista Research is an independent financial research house focused on the U.S. markets. We provide equity research as well as credit research reports on the top-listed U.S. companies with most of our focus on technology, consumer goods and services, automobiles, industrials, oil and gas, pharma, and healthcare. Our research has served more than 3000 institutional investors including mutual funds, hedge funds, banks, family offices, and various buy-side firms. We operate a research subscription service where institutions, as well as retail investors, can have priority access to all our research. We also have a wide distribution of our research reports across some of the top global financial platforms. Apart from equity research and credit research, we also provide advisory services with respect to mergers & acquisitions (M&A), private equity/ venture capital fundraising, valuation reports, and investment management services for corporates.
Baptista Research is owned and managed by Ishan Majumdar, an ex-Venture Capitalist/ Investment Banker, a Chartered Accountant, and a Masters’ degree holder in Management from HEC Paris. Ishan has nearly a decade of experience in Mergers and Acquisitions, Leveraged Buyouts (LBOs), Venture Capital Investing, Corporate Strategy, and Valuation in front-office roles at the likes of BNP Paribas CIB, Credit Agricole CIB, Groupe Danone, and TIW Private Equity. He has worked on and closed multiple acquisition deals, leveraged buyouts, and start-up investment transactions.

Equity Bottom-Up

<ul><li>Louisiana-Pacific Corporation showcased a robust performance in the first quarter of 2024, notably driven by strong outcomes from both the Siding and OSB (Oriented Strand Board) segments.</li><li>The company recorded sales of $724 million, marking a 24% increase year-over-year, while adjusted EBITDA surged to $182 million, up $116 million from the first quarter of 2023.</li><li>The growth in the Siding segment was particularly notable, with a 9% increase in revenue driven by a compound effect of increased net selling prices and higher volumes.</li></ul>

Louisiana-Pacific Corporation showcased a robust performance in the first quarter of 2024, notably driven by strong outcomes from both the Siding and OSB (Oriented Strand Board) segments.The company recorded sales of $724 million, marking a 24% increase year-over-year, while adjusted EBITDA surged to $182 million, up $116 million from the first quarter of 2023.The growth in the Siding segment was particularly notable, with a 9% increase in revenue driven by a compound effect of increased net selling prices and higher volumes.

Louisiana-Pacific Corporation: Will Their Efforts Towards Optimization of Production and Operational Efficiency Improve The Bottom-Line? - Major Drivers

<ul><li>Louisiana-Pacific Corporation (LP) emerged from 2023 with a much stronger finish than its beginning due to the impressive performance of its Siding business segment in the fourth quarter, which recorded the highest EBITDA margin of the year.</li><li>LP managed to return to normal inventory and order flows after experiencing a destocking cycle in the first half of the year.</li><li>The company ended the year with $222 million in cash and over $770 million in liquidity, demonstrating its strong financial position despite its significant investment in SmartSide and ExpertFinish capacity.</li></ul>

Louisiana-Pacific Corporation (LP) emerged from 2023 with a much stronger finish than its beginning due to the impressive performance of its Siding business segment in the fourth quarter, which recorded the highest EBITDA margin of the year.LP managed to return to normal inventory and order flows after experiencing a destocking cycle in the first half of the year.The company ended the year with $222 million in cash and over $770 million in liquidity, demonstrating its strong financial position despite its significant investment in SmartSide and ExpertFinish capacity.

Louisiana-Pacific Corporation: Initiation Of Coverage - What Is Its Core Business Strategy & The Impact Of Volume Sensitivity? - Major Drivers

High Quality Stock Setups, Weekly Stock Bull Finder

Weekly Stock Bull Finder

High Quality Stock Setups

Finding high potential stock setups on quality companies

Thematic (Sector/Industry)

<ul><li>Energy- Rotation to Laggards or Something More Brewing?</li><li>The worst S&amp;P 500 sector so far in 2023 has been energy which is down almost 8% getting trounced by the technology and communication services sectors.</li><li>Inflation readings have benefited so far by energy “staying in the box” in 2023 versus the wild price spikes to $5/gallon gasoline and above which occurred last spring.</li></ul>

Energy- Rotation to Laggards or Something More Brewing?The worst S&amp;P 500 sector so far in 2023 has been energy which is down almost 8% getting trounced by the technology and communication services sectors.Inflation readings have benefited so far by energy “staying in the box” in 2023 versus the wild price spikes to $5/gallon gasoline and above which occurred last spring.

Managing Director

Elan Gore

TMI Data Science

TMI Data Science utilizes Natural Language Processing to build custom leading indicators using unstructured data sourced from the global financial, trade & traditional media.  Our proprietary software, TMI Machine, is a text-mining platform designed with the buy-side & capital markets professional in mind, text-mining the global media to discern and quantify nuanced qualitative shifts in press coverage as they apply to macroeconomics, equity indexes/ETFs, commodities, currencies, fixed income & individual equities.  TMI provides custom leading indicators and systematic trading strategies, operating at the nexus of linguistics & statistics drawing on vast experience in investment banking and hedge fund settings in senior quantitative and fundamental roles.  

TMI Data Science was founded by Elan Gore, an award-winning Senior Global Basic Materials Equity Analyst & China Economist with 15 years of experience in North American hedge funds & institutional managers; and Alessandro Porrino, Ph.D., an Algorithmic Trading Analyst and Programmer with 10 years of front-office experience ranging from complex FX option pricing to auto-hedging strategies at Bank of America Merrill Lynch and Standard Chartered.  Mr. Gore holds an MBA in Finance from New York University Stern School of Business, and Mr. Porrino holds a Ph.D. in Systems Engineering from Brunel University London.

Cross Asset Strategy

<ul>
<li>The strength of US housing has been an unassailable consensus theme coming out of the March-April shock, aided by record-low rates and signs of deurbanization</li>
<li>We text-mine across a range of housing vectors to find greater nuance to the story than headlines imply</li>
<li>Extreme sentiment readings are seen in recent reporting on housing data releases (i.e. existing home sales, housing starts, NAHB); but our text-mined indicators of homebuyer intentions, deurbanization pressure and sales reported above asking price have turned softer</li>
<li>This is partially confirmed by Zillow app store data, which peaked on a Y/Y basis in July and on an absolute basis in August, recently turning roughly flat Y/Y; and by Redfin median square footage comps, which peaked in August</li>
<li>Similarly, our indicator of wood product shortages peaked in September and has stabilized since, in-line with forest products ETF relative performance and wood product pricing</li>
<li>We suspect US housing demand has been losing momentum, but remains at elevated absolute levels</li>
</ul><div class="content-highlight"><p>TMI Data Science utilizes Natural Language Processing to build custom leading indicators using unstructured data sourced from the global financial, trade &amp; traditional media. Our proprietary software text-mines the global media to discern and quantify nuanced qualitative shifts in press coverage as they apply to macroeconomics, equity indexes/ETFs, commodities, currencies, fixed income &amp; individual equities. </p></div>


The strength of US housing has been an unassailable consensus theme coming out of the March-April shock, aided by record-low rates and signs of deurbanization
We text-mine across a range of housing vectors to find greater nuance to the story than headlines imply
Extreme sentiment readings are seen in recent reporting on housing data releases (i.e. existing home sales, housing starts, NAHB); but our text-mined indicators of homebuyer intentions, deurbanization pressure and sales reported above asking price have turned softer
This is partially confirmed by Zillow app store data, which peaked on a Y/Y basis in July and on an absolute basis in August, recently turning roughly flat Y/Y; and by Redfin median square footage comps, which peaked in August
Similarly, our indicator of wood product shortages peaked in September and has stabilized since, in-line with forest products ETF relative performance and wood product pricing
We suspect US housing demand has been losing momentum, but remains at elevated absolute levels
TMI Data Science utilizes Natural Language Processing to build custom leading indicators using unstructured data sourced from the global financial, trade &amp; traditional media. Our proprietary software text-mines the global media to discern and quantify nuanced qualitative shifts in press coverage as they apply to macroeconomics, equity indexes/ETFs, commodities, currencies, fixed income &amp; individual equities. 

TMI Snapshot: Some US Housing Indicators Lose Momentum as Deurbanization Theme Appears Transitory

Technical Analyst, Vermilion Research

Joe Jasper

Technical Analyst

Technical and Quantitative Research

Vermilion Research

Vermilion’s objective is to deliver timely, actionable, and unique technical research to professional investors through the application of our various technical indicators.

Our research strategists seek to highlight securities which we believe are at major inflection points, based on our various technical and quantitative indicators, and offer asymmetric risk/return profiles. Our unique research methodology, centered on relative strength, enables our strategists to deliver superior investment recommendations.

Our process begins by organizing the universe of actively traded stocks into discrete sectors, then into industry groups. We then apply our technical and quantitative tools to identify developing price trends. Once attractive trends are identified within a selected sector or group, we screen for individual stocks which we believe offer the best risk/reward profile. We provide a historical perspective that often reveals, through our long-term charts, how price patterns often repeat themselves over time.

Technical Analysis

<p>We have said it before and we will say it again; new highs are not a sell signal. This time we are referring to the S&amp;P 500 which is breaking out to all-time highs (above the prior February highs), something we have been able to say about the Nasdaq 100 for over two months. Breadth remains <em>constructive</em> for small- and large-caps and yesterday’s price action appears to be the start of yet another rotation into cyclical value/”reopening” plays. Our outlook remains bullish and we believe the path of least resistance remains higher. In today’s report we highlight attractive Groups and stocks within Materials &amp; Technology.</p>

We have said it before and we will say it again; new highs are not a sell signal. This time we are referring to the S&amp;P 500 which is breaking out to all-time highs (above the prior February highs), something we have been able to say about the Nasdaq 100 for over two months. Breadth remains constructive for small- and large-caps and yesterday’s price action appears to be the start of yet another rotation into cyclical value/”reopening” plays. Our outlook remains bullish and we believe the path of least resistance remains higher. In today’s report we highlight attractive Groups and stocks within Materials &amp; Technology.

U.S. Equity Strategy: All-Time Highs Are Not a Sell Signal

United States

Boise Cascade Company manufactures and markets wood products. The Company offers lumber, plywood, engineered wood, and particleboard, as well as adhesive sealants, concrete, fasteners, flashing, vents, framing accessories, gypsum, insulating, locks, and roofing products.

Clearwater Paper Corp. manufactures consumer tissue, bleached paperboard, and wood products.  The Company supplies private label tissue to major retail grocery chains and produces bleached paperboard that is used by printers and packaging converters.

United States Steel Corporation operates as an integrated steel producer. The Company manufactures flat-rolled and tubular products with production operations in North America and Europe. United States Steel serves the automotive, appliance, container, industrial machinery, construction, and oil and gas industries.

Sealed Air Corporation manufactures packaging and performance-based materials and equipment systems that serve food, industrial, medical, and consumer applications.

Balchem Corporation develops, manufactures, and markets specialty performance ingredients for the food, feed, and medical sterilization industries. The Company micro-encapsulates performance ingredients, and also repackages and markets specialty gases. Balchem sells its products through its own sales force, independent distributors, and sales agents.

Graphic Packaging Holding Company is an integrated provider of paperboard and integrated paperboard packaging solutions to multinational beverage and consumer products companies.  The Company manufactures folding cartons for frozen and non-frozen food and beverage products.

Graphic Packaging Holding Company (GPK US)

Eagle Materials Inc. manufactures and distributes cement, gypsum wallboard, recycled paperboard, and concrete and aggregates.  The Company's products are used in the construction of homes, commercial and industrial buildings, and governmental buildings across the United States.

Alcoa Corporation manufactures metal products. The Company produces and sells bauxite, alumina, and aluminum products. Alcoa serves aluminum industry worldwide.

Axalta Coating Systems Ltd. manufactures, markets and distributes coatings systems. The Company offers products and services which includes paint, color matching tools, application technologies, and customer  training and business management systems. Axalta Coating Systems serves automotive, transportation,  general industrial, and architectural and decorative sectors.

Ashland Global Holdings Inc. operates as a holding company. The Company, through its subsidiaries, produces and distributes chemicals and thermoplastic resins. Ashland Global Holdings serves construction, automotive, energy, and pharmaceutical sectors worldwide.

Shandong Sunpaper Co., Ltd. produces and distributes paper and paperboard. The company's major products include coated paperboard, raw paper, and fine paper used in office environment.

West Fraser Timber Co. Ltd. produces dimension lumber and related wood products, fiberboard, pulp, linerboard, kraft paper, and newsprint.  The Company has operations in British Columbia, Alberta and in the southern United States.

Empresas CMPC S.A. manufactures and markets wood and forest products.  The Company produces cellulose, graphic papers, cardboard, tissue paper, office paper, newsprint, and packaging materials.  CMPC is based in Chile and, through subsidiaries, markets its products in Latin America, North America, Europe, and Asia.

Oji Holdings Corp manufactures paper, pulp, and processed paper goods, including news print, carbonless paper, wrapping and packaging paper, and paperboard. The Company also produces sanitary paper goods such as disposable diapers. Oji Paper has forests in Japan and overseas, and operates forestry, timber sales, and real estate businesses.

PT Indah Kiat Pulp & Paper Corporation Tbk operates a pulp and paper mill located in Perawang, a paper mill in Tangerang, and a packaging product mill in Serang. The Company manufactures various types of printing and writing paper including coated and uncoated free-sheets, photo copy paper, packaging container boards, corrugated shipping containers, and boxboards.

Metsa Board OYJ is a producer of fresh forest fibre cartonboards, a manufacturer of coated white-top kraftliners and a paper supplier. The Company offers solutions for consumer and retail packaging, graphics and office end-uses. Metsa's global sales network serves brand owners, carton printers, corrugated packaging manufacturers, printers, merchants and office suppliers.

Mondi PLC is an international packaging and paper group, with key operations in central Europe, Russia and South Africa. The Company is integrated across the paper and packaging process and is principally involved in the manufacture of packaging paper, converted packaging products and uncoated fine paper. Dually-listed company with MND SJ.

Stella-Jones Inc. produces and markets industrial structures and support components produced with pressure treated wood.  The Company specializes in the production of treated wood poles supplied to electrical utilities and telecommunications companies.  Stella-Jones's other products include railway ties as well as marine and foundation pilings.

Nine Dragons Paper Holdings Limited produces a wide range of containerboard products. The Company primarily produces linerboard, including kraft linerboard, test linerboard, white top linerboard, high performance corrugating medium and coated duplex board.

Stora Enso Oyj is an integrated, paper, packaging, and forest products company. The Company produces publication and fine papers, packaging boards, and wood products.  Stora Enso operates in more than 40 countries around the world. Stora Enso sells its products to publishers, printing houses, and merchants, as well as the packaging, joinery, and construction industries worldwide.

Louisiana-Pacific Corporation manufactures building materials and engineered wood products in the United States, Canada, Chile, and Brazil.  The Company's products are used by homebuilders and light commercial builders. Louisiana Pacific's products include oriented strand board sheathing, flooring, radiant barrier panels,  siding and trim, I-joists, and laminated veneer lumber.

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Louisiana Pacific (LPX US)

Louisiana-Pacific Corporation: Will Their Efforts Towards Optimization of Production and Operational Efficiency Improve The Bottom-Line? - Major Drivers

Louisiana-Pacific Corporation showcased a robust performance in the first quarter of 2024, notably driven by strong outcomes from both the Siding...

Baptista Research

Louisiana-Pacific Corporation: Initiation Of Coverage - What Is Its Core Business Strategy & The Impact Of Volume Sensitivity? - Major Drivers

Louisiana-Pacific Corporation (LP) emerged from 2023 with a much stronger finish than its beginning due to the impressive performance of its...

Baptista Research

Weekly Stock Bullfinder - Week of 7/10

The worst S&P 500 sector so far in 2023 has been energy which is down almost 8% getting trounced by the technology and communication services sectors.

Weekly Stock Bull Finder

TMI Snapshot: Some US Housing Indicators Lose Momentum as Deurbanization Theme Appears Transitory

We see potentially peaking momentum in US housing, as data suggests the pandemic-driven deurbanization theme seen as a multi-year secular catalyst...

Elan Gore

U.S. Equity Strategy: All-Time Highs Are Not a Sell Signal

We have said it before and we will say it again; new highs are not a sell signal. This time we are referring to the S&P 500 which is breaking...

Vermilion Research

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