Research Analyst, AlphaBox Advisors

Vijay Lohia, CFA

Research Analyst

Value-Investing Philosophy and Bottom-up Approach

AlphaBox Advisors

At AlphaBox, our recommendations are sector and country agnostic and diversified by market cap. We follow value-investing philosophy and pursue a bottom-up approach to recommending stocks that has a good risk-reward profile and potential to generate market-beating returns, which in some cases would be complemented with an attractive dividend yield. Our recommendations fall into the following two broad categories: (i) Long-term Compounders – Global Markets (ii) EM and FM Alpha

Event-Driven

<ul>
<li>Overall, the sentiments are extremely negative with most sell-side analysts having a Sell/Neutral rating on the stock.</li>
<li>We believe either A) Revenue and earnings growth will pick up under the new management team, or B) Temenos will be taken over by some private equity firm.</li>
<li>While revenue growth has remained subdued, the company’s moat remains intact in our view.</li>
</ul>


Overall, the sentiments are extremely negative with most sell-side analysts having a Sell/Neutral rating on the stock.
We believe either A) Revenue and earnings growth will pick up under the new management team, or B) Temenos will be taken over by some private equity firm.
While revenue growth has remained subdued, the company’s moat remains intact in our view.


Temenos (TEMN SW): World's No.1; Improving Fundamentals; M&A Candidate

Market & Forensics Analyst, Beat the Street

Nimish Maheshwari

Market & Forensics Analyst

Beat the Street

Beat The Street was founded by Nimish Maheshwari and Sudarshan Bhandari, both of whom are Chartered Accountants by Profession, known for their expert analysis in the fields of Business, Sectoral analysis, and Corporate governance.

With a strong social media presence of 45,000+ Subscribers across various platforms, they are considered trusted voices in the industry. Their insights and analysis have been featured in some of India’s most prominent publications, including the Economic Times, Dalal Street Investment Journal, The Morning Context, and The Ken.

Their analysis on Bankrupt & Insolvent companies has been instrumental in saving investors from significant losses. They have a keen eye for identifying red flags and has identified exclusive redflags earlier in Vedanta, Nykaa, Dhani Services, Adani and many more.

Read Business Not Stock Prices

Forensic Accounting

<ul>
<li>Diving Deep into Hindenburg Research's comprehensive report on Temenos triggers a market plunge, alleging accounting manipulations, failed North American expansion, product failures, and troubled European deals.</li>
<li>Allegations include aggressive revenue recognition, excessive R&amp;D capitalization, difficulty in revenue collection, inflated free cash flow, and executive insiders stock divestment.</li>
<li>Temenos denies allegations, defending its business integrity, performance, and financial standing, but market volatility persists, emphasizing the need for transparent communication and governance reassurance.</li>
</ul>


Diving Deep into Hindenburg Research's comprehensive report on Temenos triggers a market plunge, alleging accounting manipulations, failed North American expansion, product failures, and troubled European deals.
Allegations include aggressive revenue recognition, excessive R&amp;D capitalization, difficulty in revenue collection, inflated free cash flow, and executive insiders stock divestment.
Temenos denies allegations, defending its business integrity, performance, and financial standing, but market volatility persists, emphasizing the need for transparent communication and governance reassurance.


Unveiling the Shadows: A Deep Dive into Hindenburg Research's Exposé on Temenos

External broker reports(aggregated public sources), Topline Securities

Topline Securities

External broker reports(aggregated public sources)

Topline Securities is one of the fastest growing brokerage houses in Pakistan. It has strong equity brokerage, economic / equity research, mutual fund distribution, commodity trading and corporate finance & advisory functions. Content available is external broker reports authored by a third party outside the Smartkarma network and has been aggregated by an online aggregator through publicly available sources and is displayed by Smartkarma in this format for user's convenience and general informational purposes only. Content does not constitute investment or financial advice and Smartkarma makes no representation or warranty regarding its accuracy or contents. Original third party author retains all copyright and other proprietary rights in the content. Access or use of third party links not controlled by Smartkarma are at the user's own risk.

Equity Bottom-Up

<ul><li>Temenos held its Capital Markets Day on Feb 20, 2024, where management addressed the allegations made by Hindenburg Research.</li><li>Temenos Chairman who is also the Chair of the Audit Committee, fundamentally refutes the report published by Hindenburg Research and has assured that Temenos is running a very sound business.</li><li>The Chairman also informed that the Board is going to hire a top independent third-party consultant in order to address these allegations. Once the whole examination is completed, he will come back with more detail answer.</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.

Temenos held its Capital Markets Day on Feb 20, 2024, where management addressed the allegations made by Hindenburg Research.Temenos Chairman who is also the Chair of the Audit Committee, fundamentally refutes the report published by Hindenburg Research and has assured that Temenos is running a very sound business.The Chairman also informed that the Board is going to hire a top independent third-party consultant in order to address these allegations. Once the whole examination is completed, he will come back with more detail answer.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.

Pakistan Technology: Temenos Capital Markets Day – Key Takeaways; Systems Limited – “Buy Maintained”

<ul><li>Hindenburg Research has released a short report on Temenos, with allegations of accounting irregularities in the company.</li><li>About Hindenburg Research: Hindenburg Research specializes in forensic financial research. While they use fundamental analysis to aid investment decision-making, their research results also came from uncovering hard-to-find information from atypical sources.</li><li>In particular they often look for situations where companies may have any combination of (1) accounting irregularities, (2) bad actors in management or key service provider roles, (3) undisclosed related-party transactions, (4) Illegal/unethical business or financial reporting practices, and (5) Undisclosed regulatory, product or financial issues.</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.

Hindenburg Research has released a short report on Temenos, with allegations of accounting irregularities in the company.About Hindenburg Research: Hindenburg Research specializes in forensic financial research. While they use fundamental analysis to aid investment decision-making, their research results also came from uncovering hard-to-find information from atypical sources.In particular they often look for situations where companies may have any combination of (1) accounting irregularities, (2) bad actors in management or key service provider roles, (3) undisclosed related-party transactions, (4) Illegal/unethical business or financial reporting practices, and (5) Undisclosed regulatory, product or financial issues.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.

Topline Flash Note: Systems Limited (SYS) - Allegations on Temenos

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

<ul>
<li>Global equites (MSCI ACWI) have pulled back some following the FOMC's hawkish-leaning announcement. Short-term support is at $102 on ACWI-US--last week's breakout level-- while longer-term support remains at $98-$99.</li>
<li>A break below $102 would indicate more consolidation is likely but, if ACWI-US remains above $98, we remain bullish on global equities, and we view pullbacks as buying opportunities.</li>
<li>Europe remains bullish, and we remain overweight Japan and India. Actionable Themes: many stocks highlighted within Consumer Discretionary, Energy, Industrials, Services, and Technology</li>
</ul>


Global equites (MSCI ACWI) have pulled back some following the FOMC's hawkish-leaning announcement. Short-term support is at $102 on ACWI-US--last week's breakout level-- while longer-term support remains at $98-$99.
A break below $102 would indicate more consolidation is likely but, if ACWI-US remains above $98, we remain bullish on global equities, and we view pullbacks as buying opportunities.
Europe remains bullish, and we remain overweight Japan and India. Actionable Themes: many stocks highlighted within Consumer Discretionary, Energy, Industrials, Services, and Technology


MSCI ACWI, EURO STOXX 50, TOPIX Remain Bullish; Buys in Cons Disc, Industrials, Services, Technology

Switzerland

Temenos AG provides integrated software solutions. The Company offers analytics, channels, financial crime mitigation, funds and securities, risk and compliance, and front office and digital banking suits for the management of administrative tasks at banks and financial services companies. Temenos operates worldwide.

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Temenos AG (TEMN SW)

Temenos (TEMN SW): World's No.1; Improving Fundamentals; M&A Candidate

World's No.1 Banking Software giant available at attractive valuations. With recent management changes, either earnings growth will pick up, or it...

Vijay Lohia, CFA

Unveiling the Shadows: A Deep Dive into Hindenburg Research's Exposé on Temenos

Reason behind 33% Fall in Temenos Share Price: A Deep Dive into Hindenburg Research's latest exposé on Temenos comprising of financial...

Nimish Maheshwari

Pakistan Technology: Temenos Capital Markets Day – Key Takeaways; Systems Limited – “Buy Maintained”

Temenos held its Capital Markets Day on Feb 20, 2024, where management addressed the allegations made by Hindenburg Research. Temenos Chairman who...

Topline Securities

Topline Flash Note: Systems Limited (SYS) - Allegations on Temenos

Hindenburg Research has released a short report on Temenos, with allegations of accounting irregularities in the company. About Hindenburg...

Topline Securities

MSCI ACWI, EURO STOXX 50, TOPIX Remain Bullish; Buys in Cons Disc, Industrials, Services, Technology

MSCI ACWI, EURO $STOXX 50, $TOPIX Remain Bullish. $ACWI holding above short-term support at $102 (last week's breakout level), though we remain...

Vermilion Research

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