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Smartkarma Daily Briefs

Jun 28
0

Daily Brief Credit: Morning Views Asia: Adani Ports & Special Economic Zone and more

By | Credit, Daily Briefs

In today’s briefing:

  • Morning Views Asia: Adani Ports & Special Economic Zone, Bharti Airtel
  • Softbank Group – Event Flash – Launches Four-Part USD And EUR Bond Offering – Lucror Analytics
  • Bond Market Monitor: No Rate Hikes

Morning Views Asia: Adani Ports & Special Economic Zone, Bharti Airtel

By Leonard Law, CFA

Lucror Analytics Morning Views comprise our fundamental credit analysis, opinions and trade recommendations on high yield issuers in the region, based on key company-specific developments in the past 24 hours. Our Morning Views include a section with a brief market commentary, key market indicators and a macroeconomic and corporate event calendar.

Softbank Group – Event Flash – Launches Four-Part USD And EUR Bond Offering – Lucror Analytics

By Trung Nguyen

Softbank Group (SBG) has launched a four-part benchmark-sized bond offering comprising USD and EUR notes. The proceeds will mainly be used for debt repayment, including the redemption of foreign currency-denominated bonds, as well as for general corporate purposes, including the maintenance of a cash position for the redemption of outstanding notes due over the next two years along with new investments. In particular, SBG will redeem its USD 766.8 mn 4.75% 2024 bonds (due September) early at par.

Bond Market Monitor: No Rate Hikes

By Warut Promboon

  • As we are entering the second half of 2024, inflation has remained sticky as expected.
  • The lingering fear of a global recession has been mitigating rising shipping and production costs and, as a result, kept inflation in check.
  • We see more opportunities in selected Chinese bonds in industries away from property and local government financing vehicle (LGFV) sectors and believe non-Asia emerging bonds offer better value.

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Jun 28
0

Daily Brief Event-Driven: TCM (570 HK): Where’s The Floor? and more

By | Daily Briefs, Event-Driven

In today’s briefing:

  • TCM (570 HK): Where’s The Floor?
  • Brilliance China (1114 HK): Reversing Out of Passive Portfolios
  • Arb Spread Has Opened Today in Classys & Ilooda Merger Swap: Checking Trade Feasibility
  • Kolmar Holdings: Aggressive Plans to Cancel Outstanding Shares + Improving Returns to Shareholders
  • CMCDI (133 HK): Buybacks And Management Fees Into Focus
  • Dr. Reddy’s Laboratories (DRRD IN): Nicotinell Acquisition to Fortify Consumer Healthcare Business
  • Brookfield/Neoen: Share Purchase Agreement, Spread and Convertibles

TCM (570 HK): Where’s The Floor?

By David Blennerhassett

  • Just plain ugly. China Traditional Chinese Medicine (570 HK) (“TCM”) fell 11.7% yesterday. It’s down another 7.9%, on large volume, as I type.  The stock is now ~35% below terms
  • Depending on who you talk to, the sudden move was triggered by a couple of event pods dumping stock; or the incoming CNPGC chairman is not supportive. Or perhaps both. 
  • Since rumours surfaced early Feb as to an Offer, a basket of TCM’s peers are up 8% on average. The HSI is up 15%. TCM’s downside from here appears limited.

Brilliance China (1114 HK): Reversing Out of Passive Portfolios

By Brian Freitas

  • Brilliance China Automotive (1114 HK) is up 220% on a total return basis since we first published our insight in August 2023.
  • The company paid a special dividend in April this year and will pay a large special dividend of HK$4.3/share going ex-div on 3 July.
  • The resultant drop in market cap will result in deletion of the stock from large global passive portfolios at the close on 3 July.

Arb Spread Has Opened Today in Classys & Ilooda Merger Swap: Checking Trade Feasibility

By Sanghyun Park

  • The spread is appealing, and Classys’ shorting instrument’s liquidity issue shouldn’t be critical with a manageable position size. The concern is shareholder approval and the stock purchase cost under ₩30B.
  • Despite cancellation risks, there are reasons to stay interested. Bain Capital aims to merge with Ilooda to boost Classys’ valuation, suggesting the merger may proceed even if ₩30B is exceeded.
  • The deadline for dissenting votes and appraisal rights at Ilooda’s meeting is July 8th, ex-rights date July 9th. Shareholders’ meeting: August 13th; rights exercise: August 13th to September 2nd.

Kolmar Holdings: Aggressive Plans to Cancel Outstanding Shares + Improving Returns to Shareholders

By Douglas Kim

  • On 26 June, Kolmar Holdings announced it plans to cancel 2.5 million treasury shares (6.7% of outstanding shares) as part of its participation in the corporate value-up program.
  • Previously, Kolmar Holdings announced that it would return more than 50% of its net profit to shareholders in accordance with the shareholder return policy announced in July 2023. 
  • According to our NAV analysis, it suggests an implied NAV of 555 billion won or NAV per share of 15,088 won, which represents a 39% upside from current price.

CMCDI (133 HK): Buybacks And Management Fees Into Focus

By David Blennerhassett

  • The recent news on China Merchants China Direct Investments (133 HK) was director Elizabeth Kan narrowly getting re-elected. Of interest, ISS recommended shareholders vote AGAINST. Glass Lewis was FOR re-election.
  • The key takeaway here is that the majority of the minorities want change. The next development may occur in the lead up to the management agreement renewal in November. 
  • In addition, Argyle Street Management, CMSCI’s key shareholder activist, is also requesting the company buy back 20% of shares outstanding at 90% of NAV. 

Dr. Reddy’s Laboratories (DRRD IN): Nicotinell Acquisition to Fortify Consumer Healthcare Business

By Tina Banerjee

  • Dr. Reddy’s Laboratories (DRRD IN) has signed a definitive agreement with Haleon (HLN LN) to acquire latter’s global portfolio of consumer healthcare brands in the nicotine replacement therapy outside US.
  • The company will acquire the portfolio for a total consideration of £500M ($633M). In 2023, the portfolio generated ~£217M ($274M) revenue. Purchase consideration values the business at EV/sales of 2.3x.
  • The acquisition will not stretch the balance sheet as Dr. Reddy’s has a cash balance of $990M as on March 31, 2024. The transaction is expected to complete in 4Q24.

Brookfield/Neoen: Share Purchase Agreement, Spread and Convertibles

By Jesus Rodriguez Aguilar

  • On June 24, a share purchase agreement was signed between Brookfield and several shareholders, to acquire 53.12% of Neoen’s outstanding shares at €39.85/share. Brookfield has also received irrevocables for 4.36%.
  • The offer price is generous and this looks a done deal. Spread 5.19%/7.29% (gross/annualised) seems interesting in spite of the longer approval process in energy deals.
  • The convertible NEOEN 2.875 14-SEP-2027 has a balanced profile. It is trading at (mid) 100.75 (vs. €37.82), vs. a fair price estimate of 113.773.

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Jun 28
0

Daily Brief Equity Bottom-Up: Episode 73: Nvidia’s Moment and more

By | Daily Briefs, Equity Bottom-Up

In today’s briefing:

  • Episode 73: Nvidia’s Moment, and The “Platformization” of GPUs
  • MS&AD Insurance – Sell Stocks to Zero; Drive Growth, Dividends. HFD on Policy Sales, Accelerating
  • Oriental Watch FY24: Weaker H2, Value Intact But Outlook Challenging
  • Delta Taiwan Vs. Thailand Monitor: Taiwan’s Nvidia Solutions Show Why TW Better Value Than Thailand
  • Memory Monitor: Micron’s Shares May Be Falling But Results’ Industry Implications Are Positive
  • IHI (7013 JP): 30% Upside Potential as Aerospace and Defense Rebound
  • Tesla Charges Ahead: Energy Storage Leader Drives Record Revenue in Booming Industry
  • Return to Sender: Japan Post Holdings (6178.T) – Entering the Modern Age
  • Tech Supply Chain Tracker (28-Jun-2024): Humanoid robot develpment status.
  • ASX – Listed Companies in Decline, Costs Soaring, Weaker Profit Can Be Dramatic

Episode 73: Nvidia’s Moment, and The “Platformization” of GPUs

By The Circuit

  • Nvidia surpasses $3 trillion valuation, a first in semiconductor industry
  • Company’s rapid growth raises concerns about stock market dynamics
  • Debate on Nvidia’s dominance in AI computing and comparisons to past tech industry booms.

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only.

MS&AD Insurance – Sell Stocks to Zero; Drive Growth, Dividends. HFD on Policy Sales, Accelerating

By Daniel Tabbush

  • The new excitement of the MS&AD story is the company’s commitment to sell down all of its cross-shareholdings and to use proceeds to fund growth and dividends.
  • ROE is already far higher now than in recent years, and this can continue with rising dividends.
  • Monthly insurance sales figures give a good window on the core business, with growth rates in May YoY and YTD accelerating.

Oriental Watch FY24: Weaker H2, Value Intact But Outlook Challenging

By Sameer Taneja

  • Oriental Watch (398 HK) reported revenue/profits down 2%/15% YoY for the full year (vs our expectation of 10%). H2 revenue/profitability fell 12%/22% YoY due to a weak Q4. 
  • Cash and investments fell from 1.1 bn to 920 mn HKD, owing to dividend payments, increased inventories, and reduced payables.  Cash represents 55% of market capitalization. 
  • The company maintains a 100% dividend payout, but dividends declined in line with earnings to 51.5 cents (FY23: 60 cents), representing a 15% dividend yield. 

Delta Taiwan Vs. Thailand Monitor: Taiwan’s Nvidia Solutions Show Why TW Better Value Than Thailand

By Vincent Fernando, CFA

  • Delta Taiwan has outperformed Delta Taiwan recently. The parent vs. subsidiary market cap ratio is now trading consistently over 1.0x. and can go higher in our view.
  • Nvidia opportunities and other similar cutting edge technologies will first go to Delta Electronics Taiwan (2308 TT) and not to Delta Electronics Thailand (DELTA TB).
  • Conclusion — Expect further Delta Taiwan outperformance over the long-term vs. Delta Thailand.

Memory Monitor: Micron’s Shares May Be Falling But Results’ Industry Implications Are Positive

By Vincent Fernando, CFA

  • Data Centers — Traditional Data Center Recovery Starting; In Addition to HBM Demand, SSD Memory Seeing Strength for AI Applications
  • PCs — Upcycle to Accelerate “Late CY2024E”, Driven by Windows 12 and End of Windows 10
  • Mobile Devices — Moderate Growth in CY2024E; Potential for Smartphone Upgrade Cycle Acceleration

IHI (7013 JP): 30% Upside Potential as Aerospace and Defense Rebound

By Scott Foster

  • Japan’s rising defense budget and military collaboration with the US and Europe should support a high level of orders for the foreseeable future.
  • Defense is the growth driver, but other divisions should hold up well due to the ongoing rationalization of operations.
  • Profits should rebound this year and rise further in FY Mar-26, bringing the P/E down to 9X or less. The weak yen is a large positive. 

Tesla Charges Ahead: Energy Storage Leader Drives Record Revenue in Booming Industry

By Uttkarsh Kohli

  • Tesla Tops Storage: Tesla dominates North American battery storage (25% market share) as renewables rise, deploying a record 4,053 MWh in Q1 2024.
  • Explosive Industry Growth: U.S. battery storage market projected for a staggering 30.5% CAGR until 2030, driven by clean energy transition.
  • Forefront of Innovation: CATL revealed TENER, a mass-producible energy storage system with zero degradation for five years achieving 430Wh/L density. Innovation to continue fueling growth.

Return to Sender: Japan Post Holdings (6178.T) – Entering the Modern Age

By Rikki Malik

  • The company’s targets are underwhelming given the opportunity but low expectations built in
  • A revamped strategy to increase profitability and shareholder returns is “radical” for this old-school company
  • Execution is key for certain parts of the plan, but the market can do the rest

Tech Supply Chain Tracker (28-Jun-2024): Humanoid robot develpment status.

By Tech Supply Chain Tracker

  • Humanoid robot development is rapidly advancing with improvements in AI, mobility, and interaction capabilities, exciting progress being made.
  • China’s cloud service spending expected to surge 20% by 2024, with the country leading the hydrogen race through policies and demand.
  • Former TSMC R&D director sheds light on Taiwan chip industry facing geopolitical shifts, reaching a crucial crossroads amidst declining semiconductor market.

ASX – Listed Companies in Decline, Costs Soaring, Weaker Profit Can Be Dramatic

By Daniel Tabbush

  • ASX is seeing the number of listed companies in decline, although there are some positives with average daily turnover and secondary listings.
  • Higher costs are keeping positives from reaching the bottom line fully, with costs to revenue are now 40% in 1H24 where this was 29% in recent interim periods.
  • Capex plans for ASX and sticky inflationary figures on staff costs, the current year and following year net profit can see reasonable pressure.

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Jun 28
0

Daily Brief Crypto: Crypto Moves #34 – The U.S. Ethereum Spot ETFs Are Not Priced In and more

By | Crypto, Daily Briefs

In today’s briefing:

  • Crypto Moves #34 – The U.S. Ethereum Spot ETFs Are Not Priced In

Crypto Moves #34 – The U.S. Ethereum Spot ETFs Are Not Priced In

By Mads Eberhardt

  • Just over a month ago, on May 23, the U.S. Securities and Exchange Commission (SEC) approved U.S.-based Ethereum spot ETFs.
  • However, these ETFs have not yet launched because the SEC still needs to approve the necessary S-1 filings, in addition to the already approved 19b-4 filings from May 23.
  • This final approval is largely a formality, suggesting that a launch is imminent.

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Jun 28
0

Daily Brief Macro: EM Watch: Western investors are tired of China and Japan “crying wolf” and more

By | Daily Briefs, Macro

In today’s briefing:

  • EM Watch: Western investors are tired of China and Japan “crying wolf”
  • Positioning Watch – Markets are buying into US Fixed Income, but fast money don’t agree
  • United Kingdom:  Record Overweights in Run Up to Election
  • CHINA: How China’s Household Savings Are Bailing Out the Property Sector
  • Copper Primer: What We Like About Copper And What to Play
  • [ETP 26/2024] Oil Prices Drop on Surprise Inventory Build; Oil Majors Slide but Retain Gains
  • France:  Global Funds Overweight Ahead of Snap Election
  • Philippines Policy Rate 6.5% (consensus 6.5%) in Jun-24
  • EA Stalled Without Crashing
  • EUR Inflation Watch: Food for pause’istas

EM Watch: Western investors are tired of China and Japan “crying wolf”

By Andreas Steno

  • Welcome to our weekly EM Watch, with a particular focus on China and metals.
  • Allow me to reflect on how the Chinese and Japanese investment cases look from the outside and how Western investors perceive the current rhetoric around the suffering local currencies in the region.
  • The CNY once again “slow burns” versus the USD this week and we are approaching the 7.30 handle, which has typically been the line in the sand for the PBoC in China.

Positioning Watch – Markets are buying into US Fixed Income, but fast money don’t agree

By Andreas Steno

  • Welcome back to our weekly positioning watch, brought to you today from a sunny Copenhagen.
  • The standings at the Euros almost perfectly mirror the current cross-regional uncertainties in equity markets.
  • The European election has increased the option-implied volatility premium of European equities compared to US equities, while the FTSE 100 continues to stay “less volatile” in IV terms. 

United Kingdom:  Record Overweights in Run Up to Election

By Steven Holden

  • Global equity funds are heavily overweight in UK stock heading in to the election on July 4th.
  • Compared to the SPDRs MSCI ACWI ETF benchmark, UK allocations are at a record overweight of +2.64%, with 69% of investors positioned ahead of the benchmark.
  • All sectors in the UK are held net overweight, led by Industrials and Consumer Staples. Key stocks like AstraZeneca, Linde, and Unilever are among the most widely held.

CHINA: How China’s Household Savings Are Bailing Out the Property Sector

By David Mudd

  • The PBOC has launched a home purchase program providing a 300 billion yuan re-lending facility which will fund local government SOE’s purchases of unsold homes.
  • With government bond rates at record low yields the PBOC has started to issue long term debt to finance its property support plan.
  • Households with total savings of Rmb 140T  and seeking alternatives to low bank deposit rates are enthusiastic buyers of new government issues offering higher returns.

Copper Primer: What We Like About Copper And What to Play

By Sameer Taneja

[ETP 26/2024] Oil Prices Drop on Surprise Inventory Build; Oil Majors Slide but Retain Gains

By Suhas Reddy

  • An unexpected increase in US crude oil and gasoline inventories pushed oil prices down but the ongoing conflicts capped the downside.
  • Growing natural gas output dampens Henry Hub’s uptrend. Europe will ban transshipments of Russian LNG in its ports from March 2025.
  • Chevron’s Wheatstone LNG facility in Australia resumed full production. Wells Fargo lowered its target price on Shell but raised it on Occidental.

France:  Global Funds Overweight Ahead of Snap Election

By Steven Holden

  • 68.2% of global equity funds are positioned ahead of the benchmark in France, with an average overweight of 2%, making it the second largest country overweight after the UK.
  • France is currently the second largest country overweight after the UK, effectively offsetting some of the underweights in the USA, China & Hong Kong, and Australia.
  • Overweights driven by by Schneider Electric, L’Oreal, and LVMH, whilst Pernod Ricard and Sanofi see investor outflows.

Philippines Policy Rate 6.5% (consensus 6.5%) in Jun-24

By Heteronomics AI

  • The BSP’s decision to maintain the policy rate at 6.5% aligns with consensus forecasts. It reflects confidence in managing downside inflation risks despite ongoing pressures from higher food, transport, and electricity prices.
  • Favourable domestic growth prospects, supported by a strong labour market and robust net exports, allow the BSP to hold steady on monetary policy while remaining cautious about potential external spillovers.
  • Anticipated easing of price pressures in the year’s second half could provide scope for a less restrictive policy stance. Still, the BSP remains vigilant, ready to adjust settings to maintain price stability and support sustainable economic growth.
This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only.

EA Stalled Without Crashing

By Phil Rush

  • European surveys are sending mixed messages, as the PMIs crash while the ESI is stalled. We see residual seasonality polluting the PMI, making its moves more noise than signal.
  • Employment growth remains strong amid poor productivity, although the EEI has dipped, and its strength has narrowed, shrinking its gap to the ESI level and breadth.
  • Services price expectations are also resilient in the Commission’s survey. Extrapolating the noisier weak metrics risks excess stimulus and a policy reversal in 2025.

EUR Inflation Watch: Food for pause’istas

By Andreas Steno

  • The market consensus for the European June inflation numbers is very soft, both seasonally adjusted and relative to the developments seen in June over the past 5 years.
  • It seems like the bet on a soft transportation category (car insurance and the likes) is the major reason behind the weak EUR-flation consensus numbers, but there is a statistically solid case to bet on the upside here, even a potentially large surprise to the upside.
  • We see risks clearly tilted in that direction.

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Jun 27
0

Daily Brief Australia: Core Lithium Ltd, Redox and more

By | Australia, Daily Briefs

In today’s briefing:

  • Tax-Loss Selling In Australia 2024 – Time To Reverse The Trade (7.2-8.6% Rtn in Two Months So Far)
  • Redox IPO Lock-Up Expiry – Limited Liquidity Might Provide a Good Excuse to Sell

Tax-Loss Selling In Australia 2024 – Time To Reverse The Trade (7.2-8.6% Rtn in Two Months So Far)

By Travis Lundy

  • The original trade was discussed at end-April in Tax-Loss Selling in Australia 2024 – Historical Analysis and A Trade Basket then updated here and here. 
  • That has done OK. The LIQUID basket has delta neutral performance of +8.4% over 2mos; LIQUID+LESSLIQUID +7.2%; If one did a mixed basket (3x L+LL + 1x Illiquids) it’s +8.6%.
  • Now it is time to reverse the trade, buying the basket you were short, and running it against index for the next 6-8 weeks.

Redox IPO Lock-Up Expiry – Limited Liquidity Might Provide a Good Excuse to Sell

By Sumeet Singh

  • Redox (RDX AU), a chemical and ingredients distributor, raised US$270m in its IPO in Jun 2023. Some of its founding family shareholders will be released from their IPO lockup soon.
  • Redox primarily serves the ANZ market, and it has a presence in Malaysia and the US. It is one of the largest chemicals and ingredients distributors in Australia.
  • In this note, we talk about the upcoming lock-up expiry and possible deal dynamics.

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Jun 27
0

Daily Brief South Korea: Sanil Electric, Classys, Coupang and more

By | Daily Briefs, South Korea

In today’s briefing:

  • Sanil Electric IPO – Strong Profitability Growth, but Highly Dependent on Its Top Customers
  • Merger Between Classys and Ilooda Likely to Reduce Local Competition
  • Coupang Inc.: Artificial Intelligence Integration & 5 Major Growth Drivers

Sanil Electric IPO – Strong Profitability Growth, but Highly Dependent on Its Top Customers

By Ethan Aw

  • Sanil Electric (062040 KS) is looking to raise up to US$164m in its Korean IPO.
  • Sanil Electric is a specialized company that manufactures and sells reactors, transformers, railway vehicle parts, and switchboards.  As an industrial transformer manufacturer, the company mainly manufactures power and distribution transformers.
  • In this note, we talk about the company’s historical performance.

Merger Between Classys and Ilooda Likely to Reduce Local Competition

By Douglas Kim

  • On 25 June, Classys (214150 KS) announced a merger with Ilooda (164060 KS). The merger ratio is set at 0.1405237 to 1 for Classys and Ilooda.
  • This merger aims to combine Classys’ expertise in high-intensity focused ultrasound (HIFU) with Ilooda’s in micro-needle radio frequency (RF) and laser technologies.
  • We have a positive view of this merger between Classys and Ilooda. This merger is likely to reduce the overall competition in the aesthetics devices market in Korea.

Coupang Inc.: Artificial Intelligence Integration & 5 Major Growth Drivers

By Baptista Research

  • Coupang has commenced 2024 with a notable performance that underscores both strengths and areas in need of meticulous attention.
  • During the first quarter, Coupang reported a robust 28% year-over-year growth in revenues in constant currency terms, attributed primarily to increased spending across customer cohorts, including its longest-standing customers.
  • This points to successful customer retention and the appealing nature of its offerings.

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Jun 27
0

Daily Brief United States: Broadcom , Warner Bros Discovery , Clean Harbors, Cencora , APA , Coursera , Southwest Airlines Co, Calix Inc and more

By | Daily Briefs, United States

In today’s briefing:

  • Broadcom Inc: How Are They Expanding AI and Networking Technologies! – Major Drivers
  • Warner Bros. Discovery Inc.: A Growth Story Around Strategic Partnerships and Global Expansion! – Major Drivers
  • Clean Harbors Inc.: Enhancing Environmental Services Through Expanded Solutions & PFAS Regulation Response! – Major Drivers
  • Cencora Inc.: These Are The 6 Pivotal Factors Impacting Their Performance! – Financial Forecasts
  • APA Corporation: What Are The Biggest Cost Synergies from Callon Acquisition? – Major Drivers
  • Coursera Inc.: What Are Their Latest Innovations in Learning Platforms and Technology?
  • Southwest Airlines: Dissecting the Drivers of Profitability Drag
  • Calix Inc.: Is The Management Focus on Small and Medium Business Segments Paying Off?

Broadcom Inc: How Are They Expanding AI and Networking Technologies! – Major Drivers

By Baptista Research

  • Broadcom Inc. presented its second quarter fiscal year 2024 financial results, underscoring notable growth and strategic advancements, particularly through its semiconductor and software segments.
  • The revenue recorded was $12.5 billion, a substantial 43% increase year-on-year, buoyed significantly by the inclusion of a full quarter’s financial contribution from VMware.
  • Excluding this factor, revenue was up 12% from the previous year.

Warner Bros. Discovery Inc.: A Growth Story Around Strategic Partnerships and Global Expansion! – Major Drivers

By Baptista Research

  • Warner Bros. Discovery commenced the first quarter of 2024 with a focus on adjusting its operations for future sustainability in an industry marked by rapid disruption due to technological advancements.
  • The company acknowledges the transformative necessities dictated by changing consumer behaviors and the technological landscape.
  • On a positive note, Warner Bros. Discovery reported an encouraging increase in subscriber growth for its streaming service, Max, which saw an addition of 2 million subscribers across various regions, pushing its total Direct-to-Consumer (D2C) subscriber count towards 100 million.

Clean Harbors Inc.: Enhancing Environmental Services Through Expanded Solutions & PFAS Regulation Response! – Major Drivers

By Baptista Research

  • Clean Harbors reported a firm start to 2024, with various elements of the business performing strongly, though challenges linger primarily in pricing environments affecting some segments.
  • The Environment Services (ES) division, a pivotal part of the company’s operations, showcased an impressive 10% revenue increase, bolstered by both organic growth and strategic mergers, including recent acquisitions like Thompson and HEPACO.
  • With a particular strength displayed in technical services which saw an 11% spike driven by high operation volumes, ES stands out as a robust contributor to Clean Harbors’ overall financial health.

Cencora Inc.: These Are The 6 Pivotal Factors Impacting Their Performance! – Financial Forecasts

By Baptista Research

  • Cencora, a leading healthcare solutions company, held a discussion reviewing its fiscal 2024 second-quarter results, highlighting both strengths and areas of concern as the organization continues to navigate a complex and evolving market landscape.
  • The transition announcement of Bob Mauch replacing Steven Collis as CEO presents both an opportunity for continuity and the challenge of strategic execution during leadership changes.
  • Revenue for the quarter increased by 8%, with an adjusted EPS growth of 9%.

APA Corporation: What Are The Biggest Cost Synergies from Callon Acquisition? – Major Drivers

By Baptista Research

  • In APA Corporation’s first-quarter 2024 financial and operational results, the performance seemed rather mixed.
  • In terms of production efficiency, APA Corporation reported a notable 16% increase in U.S. oil volumes compared to the same period last year, primarily driven by its operations in the Permian Basin.
  • This marks the fifth consecutive quarter where the company has met or exceeded its U.S. oil production guidance, underscoring its ability to maintain production efficiency consistently.

Coursera Inc.: What Are Their Latest Innovations in Learning Platforms and Technology?

By Baptista Research

  • Coursera reported mixed financial results for the first quarter of 2024, reflecting progress on strategic initiatives but facing challenges in revenue growth, particularly within their consumer segment.
  • The company reported a 15% year-over-year increase in revenue, which, despite aligning with progression in its product offerings and user base growth, fell short of internal expectations primarily due to softness in North American paid learners.
  • On the positive side, Coursera continues to strengthen its platform with enhanced educational content and broader partnerships, evidenced by the addition of new professional certificates and degrees, and significant emphasis on integrating generative AI technologies into its offerings.

Southwest Airlines: Dissecting the Drivers of Profitability Drag

By Neil Glynn

  • Southwest continues to suffer revenue generation challenges and issued another profit warning today, yet pricing pressure simply exposes a lack of control over its costs
  • Our detailed analysis of Southwest’s financial performance illustrates it has seen labor inflation decimate its conversion of gross profit to EBITDAR, now ranking among the bottom tier of the sector
  • Our deep dive on peer financial performances illustrates that only American, Delta and United have managed to broadly protect gross profit/EBITDAR conversion while all others have seen labor costs bite

Calix Inc.: Is The Management Focus on Small and Medium Business Segments Paying Off?

By Baptista Research

  • The Calix’s financial performance for the first quarter of 2024 underscores the company’s resilience amid shifting market conditions.
  • Calix recorded a revenue of $226.3 million, settling within the provided guidance.
  • This positioning affirms the continued relevance and efficacy of its platform, cloud, and managed services in driving its business agenda despite current industry challenges.

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Jun 27
0

Daily Brief India: Shankara Building Products L and more

By | Daily Briefs, India

In today’s briefing:

  • Shankara Building Products: Updated Forensic Analysis

Shankara Building Products: Updated Forensic Analysis

By Nitin Mangal

  • Shankara Building Products L (SHANKARA IN) is seeing a healthy topline growth in the last three years but this is accompanied with margin contractions.  
  • As far as the forensics are concerned, the company does not have grave auditor red flags like earlier but there are still some eye-catching checks.
  • Caution must be given to the finance costs of the company which look on a higher side vis-a-vis the borrowings. Moreover, inadequate provisioning might also expose out some receivables.

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Jun 27
0

Daily Brief China: China Traditional Chinese Medicine, Tencent, Midea Real Estate Holding , Bayzed Health Group and more

By | China, Daily Briefs

In today’s briefing:

  • China Traditional Chinese Medicine (570 HK): Something Is Brewing, but Nobody Knows Quite What
  • Tencent/Netease: One Game Approval for Tencent in June
  • Midea Real Estate (3990 HK): Ex-In-Specie, The Rump Is Rich
  • Pre-IPO Bayzed Health Group – Here Are the Concerns and Potential Risks

China Traditional Chinese Medicine (570 HK): Something Is Brewing, but Nobody Knows Quite What

By Arun George

  • On no news, China Traditional Chinese Medicine (570 HK) shares declined 12% today. We spoke to several readers to gauge the likely reasons for the fall.
  • The speculation is that the fall could be due to forced liquidation, Sinopharm’s new Chairman pulling the offer, the consortium unravelling, SAMR issues and Ping An blocking the deal. 
  • There is clearly news behind today’s fall, but none of the above rumours seem credible. The risk/reward is attractive as the upside (25% spread) outweighs the downside (18% to undisturbed).

Tencent/Netease: One Game Approval for Tencent in June

By Ke Yan, CFA, FRM

  • China announced game approval for the June batch. The number of games approved remained at a higher level than 2023.
  • The pace of China game approval appears to have accelerated to the same level as pre-tightening, though the number of approvals appears to be slower than March.
  • Of companies that we are monitoring, Tencent and iDreamSky clinched one approval each.

Midea Real Estate (3990 HK): Ex-In-Specie, The Rump Is Rich

By David Blennerhassett

  • In an unusual move, property developer Midea Real Estate Holding (3990 HK)  announced the In-Specie distribution of its core ops, either in unlisted scrip, or HK$5.90/share in cash. 
  • As this is considered a “very substantial disposal“, a Scheme-like vote from independent shareholders is required at an EGM. And controlling shareholders – with 81.13% – are required to abstain. 
  • The EGM will be held on the 2 September, with the cash payment expected on (or before) the 18 October. The question is: what is the Rump worth?

Pre-IPO Bayzed Health Group – Here Are the Concerns and Potential Risks

By Xinyao (Criss) Wang

  • Bayzed’s business model is similar to that of Hygeia and Inkon Life Technology. However, Bayzed’s profit margin is largely lagging behind peers. This makes us concerned about its future profitability.
  • The nationwide expansion of oncology hospitals is very challenging. Bayzed’s expansion pace may not be as fast as expected if it hopes to control the quality of expansion.
  • Due to “heavy asset” model, Bayzed would continue to face capital pressure.The latest valuation of Bayzed in 2023 is RMB2.625 billion. We think Bayzed’s valuation should be lower than peers.

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