External broker reports(aggregated public sources), CMB International

CMB International

External broker reports(aggregated public sources)

Incorporated in Hong Kong, supported by the mainland and targeting in global market, CMB International Capital Corporation Limited (“CMBI”) is an integrated financial institution providing comprehensive and professional services. As a wholly-owned subsidiary of China Merchants Bank ("CMB"), by leveraging on the Group’s synergy and coordination in domestic and overseas markets, as well as CMB’s strong resources and outstanding social reputation, CMBI and its subsidiaries have been actively implementing diversified business strategies and set up an overall layout of main business segments including Corporate Finance, Asset Management, Wealth Management, Global Markets and Structured Finance, etc. Adhering to the philosophy of “being clients oriented and increasing our own values by the way of creating value for clients”, CMBI endeavors to provide quality and integrated financial services to institutional, corporate and individual customers both domestic and overseas including Hong Kong IPO sponsorship and underwriting, share placement and rights issue for listed companies, financial advisors, bonds issuance services, asset management, direct investment, wealth management, equity sales and trading, etc.

Equity Bottom-Up

<ul><li>ServiceNow announced 1Q24 results: total revenue increased by 24% YoY to US$2.60bn, in line with consensus estimate of US$2.59bn; non-GAAP net income grew by 46% YoY to US$707mn, beating consensus estimate by 7%, mainly driven by the enhanced operating efficiency.</li><li>cRPO was up 21% YoY on a constant currency basis in 1Q24, which is a 100bps beat versus pervious guidance, thanks to the strong deal acquisition in 1Q24.</li><li>For 2Q24E, management guide subscription revenue/cRPO to grow by 22/20.5% YoY on a constant currency basis, in line with the consensus estimates.</li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

ServiceNow announced 1Q24 results: total revenue increased by 24% YoY to US$2.60bn, in line with consensus estimate of US$2.59bn; non-GAAP net income grew by 46% YoY to US$707mn, beating consensus estimate by 7%, mainly driven by the enhanced operating efficiency.cRPO was up 21% YoY on a constant currency basis in 1Q24, which is a 100bps beat versus pervious guidance, thanks to the strong deal acquisition in 1Q24.For 2Q24E, management guide subscription revenue/cRPO to grow by 22/20.5% YoY on a constant currency basis, in line with the consensus estimates.Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

ServiceNow (NOW US) - Strong Adoption of GenAI Solutions

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.

<ul><li>ServiceNow's Q4 2023 earnings present a compelling story of growth powered by artificial intelligence (AI).</li><li>The company reported subscription revenue growth of 25.5% at constant currency, 200 basis points above its guidance and cRPO growth of 23% at constant currency, also 200 basis points above its guidance.</li><li>In addition, the company reported 168 deals greater than $1 million in net new ACV, a 33% increase from the previous year.</li></ul>

ServiceNow's Q4 2023 earnings present a compelling story of growth powered by artificial intelligence (AI).The company reported subscription revenue growth of 25.5% at constant currency, 200 basis points above its guidance and cRPO growth of 23% at constant currency, also 200 basis points above its guidance.In addition, the company reported 168 deals greater than $1 million in net new ACV, a 33% increase from the previous year.

ServiceNow Inc: The Increasing Scope Of Its Gen AI technology And Other Major Drivers

Thematic (Sector/Industry)

<ul><li>US internet and software companies delivered mixed performances in 1Q24 in terms of revenue growth: advertising and cloud services revenue growth saw a reacceleration trend, while SaaS services revenue growth edged down slightly. However, the optimization in labour cost, increase in economies of scale and operating efficiency improvement continue to drive YoY margin expansion, which looks likely to sustain in 2Q24, in our view, but will face higher comps in 2H24.</li><li>AI-related monetization and profitability expansion remain the key investment themes for US internet and software stocks, while the sectors’ stock performance reacts positively to interest rate cuts , albeit the expectation might have been partly reflected in price.</li><li>Our stock picks are Microsoft (MSFT US; BUY; well positioned to ride on the tide of rapid development of Gen AI and related monetization), Amazon (AMZN US; BUY; solid margin expansion could exceed market expectation), and ServiceNow (NOW US; BUY; steady current remaining performance obligations (cRPO) growth and profitability expansion likely to sustain).</li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

US internet and software companies delivered mixed performances in 1Q24 in terms of revenue growth: advertising and cloud services revenue growth saw a reacceleration trend, while SaaS services revenue growth edged down slightly. However, the optimization in labour cost, increase in economies of scale and operating efficiency improvement continue to drive YoY margin expansion, which looks likely to sustain in 2Q24, in our view, but will face higher comps in 2H24.AI-related monetization and profitability expansion remain the key investment themes for US internet and software stocks, while the sectors’ stock performance reacts positively to interest rate cuts , albeit the expectation might have been partly reflected in price.Our stock picks are Microsoft (MSFT US; BUY; well positioned to ride on the tide of rapid development of Gen AI and related monetization), Amazon (AMZN US; BUY; solid margin expansion could exceed market expectation), and ServiceNow (NOW US; BUY; steady current remaining performance obligations (cRPO) growth and profitability expansion likely to sustain).Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Internet - AI and Margin Expansion Still Key Themes

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

iShares MSCI Emerging Markets / Technical Analysis

<ul>
<li>The bullish outlook we initiated in early November 2023 remains intact. The SPX and QQQ still refuse to close below their 20-day MAs/21-day EMAs for more than 2-3 consecutive days.</li>
<li>Even if/when they do, important supports are close by, including 4983-5050 on the S&amp;P 500 and $425-$433 on QQQ (gap supports from 2/22/24). Anything above 4800 SPX is a buy.</li>
<li>We continue to get an ever-increasing number of global indexes/Sectors with long-term breakouts, the latest being the MSCI Emerging Market and Frontier indexes. Clearly risk-on behavior.</li>
</ul>


The bullish outlook we initiated in early November 2023 remains intact. The SPX and QQQ still refuse to close below their 20-day MAs/21-day EMAs for more than 2-3 consecutive days.
Even if/when they do, important supports are close by, including 4983-5050 on the S&amp;P 500 and $425-$433 on QQQ (gap supports from 2/22/24). Anything above 4800 SPX is a buy.
We continue to get an ever-increasing number of global indexes/Sectors with long-term breakouts, the latest being the MSCI Emerging Market and Frontier indexes. Clearly risk-on behavior.


Long-Term Breakouts for Emerging and Frontier Markets; Treasury Yields and Commodities Rising YTD

<ul><li>The anticipation that the US’s tightening cycle is over has sent the US tech sector share performance to new highs.</li><li>US software and cloud computing sectors have recorded rapid growth over the past 20 years, driven by enterprise digitization demand.</li><li>The software sector contributes about 38% of US tech sector market cap in 2023. </li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

The anticipation that the US’s tightening cycle is over has sent the US tech sector share performance to new highs.US software and cloud computing sectors have recorded rapid growth over the past 20 years, driven by enterprise digitization demand.The software sector contributes about 38% of US tech sector market cap in 2023. Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

US Software Sector – Best Proxy to Benign Interest-Rate Environment

United States

ServiceNow, Inc. provides enterprise information technology (IT) management software. The Company designs, develops, and produces prepackaged computer software, cloud services, and IT service management platform. ServiceNow serves customers throughout the United States.

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Servicenow Inc (NOW US)

ServiceNow (NOW US) - Strong Adoption of GenAI Solutions

ServiceNow announced 1Q24 results: total revenue increased by 24% YoY to US$2.60bn, in line with consensus estimate of US$2.59bn; non-GAAP net...

CMB International

ServiceNow Inc: The Increasing Scope Of Its Gen AI technology And Other Major Drivers

ServiceNow's Q4 2023 earnings present a compelling story of growth powered by artificial intelligence (AI). The company reported subscription...

Baptista Research

Internet - AI and Margin Expansion Still Key Themes

US internet and software companies delivered mixed performances in 1Q24 in terms of revenue growth: advertising and cloud services revenue growth...

CMB International

Long-Term Breakouts for Emerging and Frontier Markets; Treasury Yields and Commodities Rising YTD

Long-Term Breakouts for Emerging and Frontier Markets $EEM $FM; Bullish Outlook Intact on $SPX $QQQ; Treasury Yields and Commodities Rising YTD has...

Vermilion Research

US Software Sector – Best Proxy to Benign Interest-Rate Environment

US software and cloud computing sectors have recorded rapid growth over the past 20 years, driven by enterprise digitization demand.

CMB International

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