Smartkarma Daily Briefs

• TSMC: +16.1% Premium; Strong Spread Rebound, Potential Opportunity to Short the Spread
• UMC: +1.6% Premium; Consider Shorting the Spread at This Level
• ASE: +3.8% Premium; Uncertainty Remains on the Sustainability of the Recent Breakdown

• We summarized the varieties that would miss 2024 NRDL negotiation and have to wait until 2026 to enter medical insurance coverage. This however means competing products would have more advantages.
• As the NRDL negotiation becomes more transparent/reasonable, there will be a balance point among companies’ profits, patient affordability and medical insurance budget. So, there’s no need to be overly pessimistic.
• The approval process of CanSino’s PCV13i could be faster than expected. 2024 is the best time to bottom-fish this stock. Reasonable market value is at least RMB5 billion.

• Last Week — TSMC’s July Revenue Soared, Asustek Guided for PC Growth Acceleration, While KYEC, Mediatek, and UMC Rebounded
• Key Events — This Week Look to Hon Hai & Zhen Ding Earnings and Guidance for Servers, AI PCs/Mobiles, iPhone 16
• PC Monitor: Promising Uptake of Microsoft Copilot and AI Services; Remain Structurally Long 

• We compile our selection of small and mid-cap names with our desired characteristics of high dividend yields, value, and margin of safety.
• Our top picks are Perfect Medical Health (1830 HK), The Keepers Holdings (KEEPR PM), Taste Gourmet (8371 HK), Uchi Technologies (UCHI MK), and Ginebra San Miguel (GSMI PM).
• We provide updates on recent results for Plover Bay Technologies (1523 HK) and upcoming H1 results for the Philippines names. 

• BeiGene’s 24Q2 results far exceeded expectations. Sales of BRUKINSA may exceed that of Calquence for the first time next year. Breakeven in 2024 becomes possible if effective cost control continues.
• BeiGene’s 2024 revenue could exceed Hengrui, marking the official transition of China’s innovative pharmaceutical industry from the old generation to the new one. Reasonable market value for BeiGene is US$19-27.5bn.
• Current valuation cannot reflect strong fundamentals.As BeiGene has established a convincing profit model, the market turmoil actually provides investors with a good opportunity to buy the stock at low price.

• Pacific Basin Shipping (2343 HK) may realise at least US$60m of revenue, or around 10% higher total TCE, in 2H24, based on its solid forward vessel coverage.  
• Sustained re-routing of vessels due to Middle East tension and higher demand from China due to fixed asset spending are supportive of rates. FFA is now 3-4% higher than spot.
• The stock is inexpensive at 9.7x PER and 0.8x P/B, and its 7.6% dividend yield is attractive. A solid balance sheet also means an upside on the payout ratio. 

• Despite rising spot rates, Maersk Q224 revenue and EBITDA both fell Y/Y
• After lifting pessimistic guidance in June, Maersk upped FY24 targets again
• We believe Maersk probably moved to limit spot exposure a year ago

• Zylox is a beneficiary of VBP and it has turned losses into profits. 2024 full-year revenue could be up 40-50% YoY. Net profit could be close to RMB100 million.
• Whether in terms of the number of products on the market or the efficiency of R&D, Zylox’s performance is superior to peers.Its valuation is expected to be higher than peers.
• We’re in a bear market, together with weak liquidity, Zylox’s valuation doesn’t fully reflect its strong fundamentals. So, while this is a good company, investors may need to be patient.

• RaaS has published a flash comment on 3D spatial data solutions group Pointerra (ASX:3DP) after its announcement that it has been awarded US$0.8m in new contracts by existing US energy utility customer Florida Power & Light (FPL).
• The contracts will see Pointerra3D, the company’s AI-driven analytics platform, used to extract information and insights from 3D LiDAR and 2D imagery data.
• We view the contracts as a positive sign that the contract delays and deferrals experienced by Pointerra in FY24 in its dealings with the US energy utility sector are coming to an end.

• AGUIL is a sports/casino operator spun out of Televisa, with potential for earnings growth through expansion of casinos and broadcast rights for Club America soccer team
• Current market cap of $320 million and low valuation of 9x current PE make AGUIL an attractive investment opportunity
• Recent purchases of stock by Emilio Azcarraga Jean from Televisa US ADR holders further support long-term upside potential for AGUIL

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only. This article was originally published 3 months ago on Value Investors Club.