CEO, A. Stotz Investment Research

Dr. Andrew Stotz, CFA

Quantamental Investing to beat Benchmarks

A. Stotz Investment Research

We pick stocks. We construct portfolios. All our effort is focused on how to better pick stocks and construct portfolios. We serve fund management companies, family offices, and high net worth individuals.

Equity Bottom-Up

We maintain our HOLD recommendation on ACE based on our unchanged target price of Bt3.49, implying a downside of 6% from the current price. We think ACE deserves to trade at a premium to Thai Utilities due to its pronounced growth prospects and target a 2021E PE of 23.2x.
Investment thesis:
<ul>
<li>Power producer with high growth potential, but already priced in</li>
<li>Long-term contracts and supply control drive high profitability</li>
<li>Government driven demand can pose a risk</li>
</ul>
Interim: ACE’s revenue grew by 19% YoY in 3Q20, but down 9% QoQ. The lower share in the revenue mix of natural gas power makes us revise our gross margin upward in 2020E. Though, higher-than-expected tax payments leave a lower net profit in 2020E.
Risks: Adverse regulatory changes, reliance on a few customers, volatility in fuel prices, unexpected disruptions in production, delays in project execution, change in political leadership can sometimes impact companies.

We maintain our HOLD recommendation on ACE based on our unchanged target price of Bt3.49, implying a downside of 6% from the current price. We think ACE deserves to trade at a premium to Thai Utilities due to its pronounced growth prospects and target a 2021E PE of 23.2x.
Investment thesis:

Power producer with high growth potential, but already priced in
Long-term contracts and supply control drive high profitability
Government driven demand can pose a risk

Interim: ACE’s revenue grew by 19% YoY in 3Q20, but down 9% QoQ. The lower share in the revenue mix of natural gas power makes us revise our gross margin upward in 2020E. Though, higher-than-expected tax payments leave a lower net profit in 2020E.
Risks: Adverse regulatory changes, reliance on a few customers, volatility in fuel prices, unexpected disruptions in production, delays in project execution, change in political leadership can sometimes impact companies.

ACE: Better Gross Margin but We Stay on HOLD

We upgrade our recommendation on ACE to HOLD from SELL based on raising our target price to Bt3.49 from Bt2.64, implying an upside of 8% from the current price. We think ACE deserves to trade at a premium to the Thai sector due to its pronounced growth prospects, we use a target 2020E PE of 29.4x.
Investment thesis:
<ul>
<li>Power producer with high growth potential, but already priced in</li>
<li>Long-term contracts and supply control drive high profitability</li>
<li>Government driven demand can pose a risk</li>
</ul>
Interim: ACE has delivered good 2Q20 results and follows up on its continuous expansion plan, justifying high growth prospects. We revise our forecast upward to account for the strong results.
Risks: Adverse regulatory changes, reliance on a few customers, volatility in fuel prices, unexpected disruptions in production, delays in project execution, change in political leadership can sometimes impact companies.

We upgrade our recommendation on ACE to HOLD from SELL based on raising our target price to Bt3.49 from Bt2.64, implying an upside of 8% from the current price. We think ACE deserves to trade at a premium to the Thai sector due to its pronounced growth prospects, we use a target 2020E PE of 29.4x.
Investment thesis:

Power producer with high growth potential, but already priced in
Long-term contracts and supply control drive high profitability
Government driven demand can pose a risk

Interim: ACE has delivered good 2Q20 results and follows up on its continuous expansion plan, justifying high growth prospects. We revise our forecast upward to account for the strong results.
Risks: Adverse regulatory changes, reliance on a few customers, volatility in fuel prices, unexpected disruptions in production, delays in project execution, change in political leadership can sometimes impact companies.

ACE: Results Are Not Stunning, Stay on HOLD

Thailand

Ua Withya PCL manufactures transmission line towers, substation steel structures and provides hot-dipped galvanizing services.

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Ua Withya PCL (UWC TB)

ACE: Better Gross Margin but We Stay on HOLD

We maintain our HOLD recommendation on ACE based on our target price of Bt3.49, implying a downside of 6%. We think ACE deserves to trade at a...

A. Stotz Investment Research

ACE: Results Are Not Stunning, Stay on HOLD

Good 2Q20 results and follows up on its continuous expansion plans. We revise our forecast to account for the strong results.

A. Stotz Investment Research

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