Smartkarma Daily Briefs

• Hollysys Automation Technologies (HOLI US) and Dazheng have traded barbs since Glass Lewis and ISS recommended voting against Ascendent’s US$26.50 offer at the EGM on 8 February.  
• While Dazheng may have been held to a higher standard than Ascendent, the proxy statement shows that the impasse was mainly due to Dazheng’s inability to get its act together. 
• The simple majority voting threshold and no shareholder publicly backing Dazheng’s call to vote NO will help the vote get up. The gross/annualised spread for an end-March close is 7.1%/52.1%.

Key points (machine generated)

• 111 Inc’s privatization process has been ongoing for 14 months, but no definitive agreement has been reached, leading to investor fatigue and a significant drop in stock price.
• Chinese companies listed in the US typically have long privatization timelines, with some taking over 2 years to finalize the process.
• The extended timeline in 111 Inc’s case may be causing concern among investors, resulting in a wider spread between the offer price and the stock price, but relisting the company in China could potentially lead to a higher valuation.

This article is sourced from an online content aggregator through publicly available sources and is displayed below for general informational purposes only. This article was originally published 3 months ago on Value Investors Club.

• Microchip used to be the bellwether for semiconductor demand After many semis guided weaknesses in automotive, industrial, and digital consumer much earlier, Microchip’s 19% miss in 1Q24 gives no surprise.
• Why the worst among all? We attributed Microchip to over 85% of its products on automotive, industrial, and digital consumer. Other semis have higher exposure on PC and comm.
• Priced in? We estimate over 20% y/y decline in 2024 sales vs. Bloomberg’s -8% y/y. 2024E EPS of US$2.94 is likely below US$1. Price is only 10% below historical peak.

• ASEH expects inventory adjustments to be completed in 1H24 and the growth to accelerate in 2H24. ASEH also expects IC-ATM to grow similarly to the semiconductor logic market in 2024H.
• The 1Q24F guidance is looking at sales and GM levels for both IC ATM and EMS to be similar to 1Q23 levels.
• Most customers will be back on the recovery path by at least 3Q24F.  

• NTGR is making a CEO change just as the business has stabilized. Patrick Lo has retired and is being replaced by CJ Prober 
• NTGR has also issued updated fourth quarter results with the business achieving positive non-GAAP operating margin
• NTGR is forecasting revenue of between $179 million and $189 million. We were already projecting revenue of $187.3 million and are keeping our estimate unchanged

• The BlokID team BlokID, a next-generation developer of privacy protection solutions for the digital advertising industry, has completed its US$1.25 million seed round of financing led by Ascend Vietnam Ventures and AppWorks.
• The Vietnamese startup will use the capital to accelerate product development, focus on user acquisition, and initiate market expansion, with an outlook to launch by Q2 2024. The company plans to roll out Google Analytics plug-ins and Financial Identity features to empower users further and safeguard their information.
• Also Read: Bitcoin and Ethereum simplified for a five-year-old Founded in July 2023, BlokID leverages blockchain technology to bring an independent, immutable source of truth to digital advertising.

• Q423 revenues of $6.2 billion, $100 million above the guided midpoint, up 6% QoQ and up 10% YoY
• Q124 guidance was for $5.4 billion at the midpoint, down 13% QoQ and flat YoY.
• We forecast 2024 Data Center growth of >70% YoY with potential for further upside