Equity Bottom-Up

• The majority of its revenue comes from selling float glass, which is used in buildings and construction. 
• The Chinese government has started home ownership relaxation that will reinvigorate the real estate market. 
• It is still trading at 67% lower to 3 years ago. 

• With Indian capital markets booming, companies are tapping capital markets regularly for fundraising even though they have recently raised funds.
• There are also cases where company after concluding IPO in recent years are going for fund raise
• The market are jittery about possible equity dilution and unclear fund raising objectives

• PDD Holdings Inc., an innovative online retail company based in China, seems to show a strong future trajectory based on its first quarter 2024 earnings conference call.
• The company surpassed its year-on-year growth with total revenue reaching RMB 86.8 billion, marking a 131% increase.
• This impressive growth serves as a testament to PDD Holdings’s efforts to deepen its access and widely influence the consumer market.

• April monthly data on pre-tax income shows slowing YoY growth compared with YTD growth
• NIM pressure was severe in past six months and this can be a key driver of less profit growth
• Credit costs in decline supported net profit delta, but this may not longer be sustainable

• Alibaba Health Information Tec (241 HK) operates an online platform for healthcare services and products.  Post COVID the company has maintained and grown it the online healthcare market.
  
• The company which is 53%-owned by Alibaba Group Holding (9988 HK) , recently reported results for 2023 which beat analyst estimates, recording a 65% increase in net profit.
• The company recently bought AJK Technology from Taobao which gives Ali Health  operational rights for advertising of online healthcare merchants on Tmall (Alimama).

• Automotive revenues for Q1CY24 amounted to $603 million, up 35% YoY. This compares to MobilEye’s revenue of $239 million, down 48% YoY
• Automotive design-win pipeline is now $45 billion, up from $30 billion less than two years ago
• CEO Amon said “Every time we enter a new market, we end up building a very strong position”. That’s a shot across the bows for Intel and AMD…

• Market Largely Influenced by Macro Trends and Nvidia Movements This Past Week
• Key Events: Computex, Apple WDC, Key Taiwan May Revenue Releases
• Apple (AAPL US) Is Overhauling Siri In Order to Create a Beautiful Voice-based AI Interface for the iPhone

• NVIDIA Corporation is on track to become the largest company in the world, purely on the basis of its leadership in the artificial intelligence (AI) and graphics processing units (GPU).
• The company, reported its first quarter earnings of the fiscal year 2025.
• The company generated record revenue of $26 billion which is sequentially up by 18% and YoY up by 262%, significantly surpassing its estimated outlook of $24 billion.

• Founded in 1881, Oki Electric Industry Co., Ltd. manufactures electrical and communications equipment, ICT equipment, and systems that utilize these products.
• In FY03/24, OKI reported full-year consolidated sales of JPY421.9bn, operating profit of JPY18.7bn, recurring profit of JPY18.3bn, and net income of JPY25.6bn.
• OKI Electric Industry Co., Ltd. announced that it expects to record income taxes–deferred in its consolidated and non-consolidated financial results for FY03/24.

• Zoom reported total Q1 revenue of $1.141 billion, a 3% year-on-year increase.
• Enterprise revenue, which represented 58% of total revenue, grew 5% year-on-year.
• Gross margin was 79.3%, slightly lower than the 80.5% recorded in the same quarter last year due to investments in AI innovation.

• Action Construction – a leader in construction and heavy equipment theme is going for transformation with a defence foray and new product launches
• With strong guidance and the historical success of good execution makes a good bet on the current infrastructure and manufacturing theme
• The risk includes a slowdown in the election period and stiff competition from larger players

• We hosted a conference call recently with Himax management, the global leader in automotive touch display controllers; the company is experiencing a uniquely stronger automotive supply/demand environment than some peers.
• Discussed in detail how larger or more sophisticated interior displays can drive higher dollar content of display controllers per vehicle. We examine trending new car designs with much larger displays.
• We forecast an exponential jump-up in display controller content value per vehicle as beautiful display designs are becoming key USP for auto brands; Maintain our Structural Long rating for Himax.

• Sumber Alfaria Trijaya (Alfamart) booked a solid set of 1Q2024 results, a testament to its resilience during an election period, with the seasonal impact of Lebaran. 
• Minimarkets continue to be the winning format in Indonesia and Alfamart continued to gain share during 1Q2024, neck and neck with Salim-backed Indomaret if you include Alfamidi, Lawson, and Dan+Dan. 
• Alfamart will slow store openings to 1,300 stores this year after adding more than 1,800 outlets in 2023, with growth prospects remaining positive and profitability intact with a 25% ROE. 

• Groundhog Tech focuses on expanding 5G in SE Asia to drive growth in the region’s tech industry
• Skymizer introduces ET2 LPU and LLM system platform to enter the chip IP market and enhance its offerings
• Samsung increases staff at Japan lab for chip packaging innovations, while Malaysia plans to invest in chip ecosystem development

• Legend Holdings Corp H (3396 HK) owns 31% of Lenovo (992 HK) , the number one global PC maker
• Lenovo is a leader selling AI enabled PC’s globally.  Its server business is growing rapidly through strong demand for generative AI.  Legend is the leading AI seed investor in China.
• Technical pattern strong for Lenovo reaching a 9 year high.  Legend showing increasing momentum from an historic trough valuation level

• BQE reported Q1 financial results yesterday where the highlight was 114% YoY growth in its recurring operation services segment.
• Technical services revenue was weak however, leading to a slight miss on proportional revenue ($3.4M vs. $3.8M expected) and margins.
• Management’s outlook remained bullish, expecting operation services revenue continuing to grow rapidly and technical services revenue catch back up in H2.

• Zscaler missed billings estimates and lowered full-year revenue guidance due to extended sales cycles and deal closures delays
• Declining performances in the cybersecurity sector indicate potential underperformance for Crowdstrike
• Author predicts potential significant miss in Crowdstrike’s upcoming earnings based on current trends in the market

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.

• A high disease burden, high demand for chronic treatment, and an ageing population makes China an excellent opportunity for an established pharma company.
• A transition period following the inclusion of four large drugs in the NDRL creates an opportunity following a big de-rating.
• With 1/3 of the market cap in cash, a healthy payout ratio, and a FPE of under 8, CMS is one of the bargain beneficiaries in the Chinese healthcare space.

• Anticipate significant downward revision in Arlo Technologies’ long-term revenue guidance
• Management’s lack of transparency regarding key performance indicators may have misled investors
• Initiate a short position before Feb. 29th guidance update to benefit from potential share price decline.

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• VAALCO has brought online four new long (2.75 mile) lateral wells in Canada.
• Three wells delivered IP rates of 500 bbl/d while the fourth well flowed 350 bbl/d for a total production capacity addition of 1.85 mbbl/d.
• This is a good result and compares with individual IP30 oil rates of 374-444 bbl/d achieved at the two wells drilled in 2023.

• China announced game approval for the May 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.
• None of the listed companies that we followed received approval for mobile games.

• Cisarua Mountain Dairy booked a strong set of 1Q2024 results, with sequential quarterly growth in revenues and more so profits as margins recovered driven by both dairy and consumer foods. 
• The company ramped up its advertising, promotion, and marketing spending as it launched new products in the more affordable segments including new flavours for stick yoghurts and affordable consumer foods.
• Cimory remains optimistic for 2024 for a more pronounced recovery in dairy as it pushes out products into general trade and takes more shelf space in modern trade driving growth.

• Chinese outbound travel demand continued its gradual recovery in April 
• Moderating domestic demand? It’s not new, and outbound matters more 
• On a pullback to below US$50, we would again BUY Trip.com’s ADRs

• Nvidia switches to FOPLP for AI server chips to alleviate CoWoS capacity strain, improving efficiency and performance.
• Taiwanese banks embrace GenAI despite challenges, as revealed by a McKinsey survey highlighting growing adoption in the industry.
• European carmakers forge partnerships across continents to compete in the affordable electric vehicle market, focusing on collaboration and innovation.

• Boss Energy, an Australian uranium producer, saw a significant drop in stock price following the sale of shares by three directors.
• The directors sold a substantial amount of their stock, representing 83%, 63%, and 63% of their ordinary shareholdings respectively.
• The high volume of trading on the stock on the day of the sale has raised concerns about the timing and implications of the director’s actions during a critical phase of the company’s life cycle.

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• We hosted a conference call recently with ChipMOS management; the company continues to view 1Q24 as having been the bottom for the memory and display markets.
• Memory customers are increasing utilization further. Since ChipMOS does not significantly serve the HBM DRAM market, this indicates that previously softer non-HBM memory segments are now showing improvement.
• Display industry increasing utilization on expectation for 2H24 large display demand strength driven by sporting events such as the Paris Olympics. ChipMOS remains well below March highs, rate as Outperform.

• Ally remains confident in their ability to navigate challenges with a focus on pricing and underwriting discipline
• Ally’s strong capital position and strategic focus on digital banking position them well to benefit from potential economic recovery and rising interest rates
• Author believes Ally’s stock has significant long-term growth potential and could triple in value, with limited downside risk in the short term

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.

• Tong Yang Industry is now seeing record profit in FY23 and this appears to be in place to continue during FY24
• The automobile and motorcycle parts manufacturing company is seeing strong growth in the US market
• Electric vehicle parts R&D is well underway and this should support continued growth in coming years

• Part of our housing finance checks, we have been visiting Aavas Financiers Ltd (AAVAS IN)  branches for over two years now.
• While the situation was grim early on post the management change and increased competitive intensity, the current channel inputs are encouraging.
• Key areas that warrant attention are growth trajectory, yields, and tech upgrade. 

• RaaS Research Group has published an update report on diversified financials company Bell Financial Group (ASX:BFG) following the company’s presentation at the Bell Potter Emerging Leaders’ Conference yesterday.
• An April YTD trading update provided at the conference points to revenue growth of 23% and Profit After Tax (PAT) growth of 135%, an acceleration on Q1 CY24 Profit Before Tax (PBT) growth rates provided at the AGM, with all divisions profitable.
• This compares to a RaaS H1 CY24 PAT growth estimate of 90%, placing the group on track to achieve our H1 estimates.

• Akatsuki Inc (TYO 3932) is a net-net Japanese video game developer with 10 years of profitability.
• They’re undergoing a big transformation in an effort to better compete globally by investing enormous amounts into their core development capabilities and increasing their average budget per game 3-6x.
• They recently formed a capital alliance with Sony (6758) and Koei Tecmo (TYO 3635) with each taking a 10% and 8% stake respectively.

• Samsung aims to revolutionize memory technology by launching 1,000-layer 3D NAND by 2030, utilizing innovative materials for enhanced performance.
• Lenovo expands its market reach with AI PCs targeting a global audience, but faces stiff competition amidst concerns over Indian restrictions on imported PCs and notebooks.
• TSMC’s collaboration in Taiwan on 7nm tech brings together academia and industry, while China, Japan, and South Korea look to strengthen supply chains at a summit for mutual benefit. Samsung aims to increase its presence in China through collaboration.

• As one of the fastest-growing economies globally, India is projected to become the third-largest economy, trailing only China and the US, by 2027.
• Amid macroeconomic challenges worldwide, investors are eager to tap into India’s robust economic growth.
• However, economic growth does not always correlate with equity market growth, as seen in Spain and Italy during the 1980s and 1990s, and more recently in China.

• Disputable Phase III result of Akeso’s (9926 HK) flagship pipeline Ivonescimab (AK112) caused Akeso’s share price to drop 28% in three days, reaching the bottom of a year-long trading range;
• The fundamental difference of opinions is around Ivonescimab’s global prospects against (1) Merck’s Keytruda, (2) J&J’s Rybrevant, (3) Kelun’s SKB264 and domestic prospect against (4) Innovent’s IBI305;
• Some answers are clear while others are now. What can provide answers are (1) SKB264‘s Phase III data, and to a lesser degree (2) AK112’s head-to-head trial against Keytruda.

• LY (4689 JP)‘s Yahoo Shopping looks to be in trouble after five straight quarters of negative growth while Amazon and Rakuten move ahead.
• Despite a revenue increase in 4Q2023, Yahoo Shopping continues to struggle with merchant fraud and a lack of a clear USP.
• If effective integration between the many parts of LY is not forthcoming soon, the company may eventually attract demands for better synergies, as well as a stick-wielding Softbank.

• UMC is currently forecasting a flat to low single digit growth QoQ for 3Q24, which is slight lower than consensus.
• UMC has received orders from domestic and international clients. However, we believe it couldn’t be able to compensate for the loss of Samsung’s 28nm orders so far this year.
• With accelerated construction in Singapore in 2024, the full-year capital expenditure has slightly risen to $3.3 billion.

• The OBA-1 well onshore Morocco has encountered an approximate 70 m gross interval containing elevated resistivities coincident with elevated mud gas readings, indicating potential gas pays, with no water-bearing reservoirs identified.
• While the approximate 200 m gross thickness for the reservoirs is in line with pre-drill expectations, the absence of water in the 70 m gross interval is particularly encouraging and could suggest larger than expected resources (12 bcf pre drill).
• The well is now expected to be tested in 3Q24.

• Lengthening order lead times impacting revenue recognition – Q1-3 FY6/24 results were behind expectations in our view, with sales declining 27.6% YoY.
• Whilst a negative optic, the reason stems from lengthening lead times for shipment, given customer demands for more high-end and exacting technical requirements for custom-made products requiring more time for delivery.
• We believe this highlights the value-added technical expertise of the company and delays in revenue recognition. 

• Virtuoso Optoelectronics (VOEPL IN)  is a contract manufacturer company engaged into production of ACs, Lightings and other equipments. The company is renowned for supplying ACs to Voltas.
• The company has grown sharply over the last five years and has been engaging in constant capex. However, it does struggle in converting its earnings to cash.
• Among the forensic checks, it nets off receivables and payables/advances, the exact nature of these line items cannot be commented upon. VOEPL also faces high cost of borrowings

• ADF announced a series of new contracts totalling $90M spanning the pharmaceutical, industrial, and public infrastructure sectors.
• This includes additional work awarded for the pharmaceutical project in the Midwest U.S. which ADF was recently awarded phase 2 for.
• ADF will be reporting Q1/25 on June 11th, we are expecting $90.1M revenue (12% YoY), 23.5% gross margin, and $17.2M EBITDA (19% margin).

• Baidu’s revenue growth for the first quarter exceeded expectations, with a year-over-year increase of 4%, reaching RMB 23.8 billion.
• Additionally, Baidu’s continued efforts in Gen AI path have resulted in a 12% year-over-year acceleration in the revenue growth from Baidu AI Cloud, which also delivered an operating profit on a non-GAAP basis.
• These positive results signify the company’s successful transition from an internet-centric business to an AI-first business.

• Liquid cooling market expected to double by 2025, but industry shakeout predicted by Auras chair.
• Apple plans to ship over 9 million units of OLED iPad Pro, aiming to boost its market presence.
• South Korea aims to enhance its IC design sector, currently holding just a 1% share of the global market.

• Microsoft last week launched their CoPilot+ PC category which enables their CoPilot to run locally on your PC, as long as it has an NPU with >40 TOPS
• With Qualcomm being the only one currently offering such an NPU, their Snapdragon processors will be powering the first wave of CoPilot+ PC’s
• It’s an extraordinary accomplishment for Qualcomm & likely an inflection point for Arm powered PCs. It’s also really bad news for Intel and not great for AMD

• JD.com, a China-based multinational technology conglomerate, has announced its first-quarter results for 2024 in an earnings call and reported robust profit and revenue growth, along with an encouragingly high Net Promoter Score (NPS).
• The revenue growth was accelerated by strong execution amidst evolving industry dynamics, improved user experience, price competitiveness, and platform ecosystems.
• Importantly, the general merchandise and supermarket category recorded a notable jump in terms of gross merchandise value (GMV) and revenue growth.

• An overlooked old economy sector in Asia ripe for a comeback
• Industry dynamics will provide  a long-term tailwind for the company
• Opportunity created by  deletion from an index and corporate restructuring

• Impending block deals which generally create supply over-hang on the stock leads to a negative impact on the stock
• These block deals generally include selling promoters and big funds at a price discount to its current market price
• Historically, such events suggest once the block deal is done; stock reacts positively creating a Special Situation Opportunity

• iQIYI, an innovative market-leading online entertainment service provider in China, delivered robust first-quarter 2024 results, achieving numerous record highs, such as non-GAAP operating income and its corresponding margin.
• CEO, Mr. Yu Gong, shared that the expanding margin could be attributed to the high-quality growth of the company.
• The Membership Services business continued its growth trajectory with monthly ARM observed an all-time high.

• The music industry in the west focuses on speculative assets and bundling services, while in Japan firms have 360-degree deals with artists.
• Amuse, a major player in the Japanese music industry, historically managed the successful band Southern All Stars but has diversified beyond them.
• Despite still having concentration in top acts like Masaharu Fukuyama, Amuse’s business model and intrinsic value are seen as attractive to investors.

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.

• Take-Two Interactive Software Inc reported a healthy performance for the fiscal fourth quarter of 2024 with net bookings of $1.35 billion.
• The fiscal year 2024 saw net bookings of $5.33 billion.
• The performance for the period was attributed to the success of NBA 2K24, Zynga’s in-app purchases, Match Factory!, the Red Dead Redemption series, and the Grand Theft Auto series.

• Genel Energy is a high-risk arbitration opportunity with potential for significant reward due to its legal dispute with the Kurdistan government
• Despite previous market capitalization reduction in the 2014 oil crisis, Genel Energy is now an undervalued asset with strong cash position and minimal debt
• With current market cap at £210 million and significant cash reserves, the company has notable potential for growth, but the unpredictable nature of the situation makes it difficult to model or quantify with certainty

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.

• TSMC’s Latest 2024E Industry Guidance Provided at Symposium in Taiwan
• More Potential Details on Nvidia & Mediatek’s AI PC Chip to Compete with Qualcomm & Intel
• Samsung’s HBM DRAM Chips Face Challenges in Meeting Nvidia’s AI Requirements

• Vanguard should declare to established 12″ Fab in Singapore within 2014.
• Vanguard is likely to announce the establishment of 2 sets of 12″ fabs in the next 6 months.  
• China is expanding 28/22nm and above technologies, and we believe it’s more appropriate for Vanguard to compete with others rather than TSMC.

• The NHSA issued a Notice on “improving the quality and expanding the scope of VBP”. The trend of full coverage of VBP of conventional drugs/consumables is determined.TCM is under pressure.
• We analyzed the potential demand growth rate of the glove industry, which is already better than most cyclical stocks. Therefore, we see no need to remain pessimistic about this industry.
• Holding platform companies have valuation discounts.HK$50-60 billion is reasonable market value for China Resources Pharmaceutical.Better to go long when share price is below HK$5 and then hold to receive dividends.

• Since late 2020, Search’s share of digital advertising revenue has stabilised at around 8-10%, seemingly retaining its core advertising customers and industries.
• Baidu management expects AI Cloud to maintain strong revenue growth momentum in the upcoming quarters.
• Baidu trades on a 3.6x NTM EV/EBITDA multiple, well below one standard deviation lower than its 5-year historical average trading range and the lowest it has ever been.

• Our index shows April pricing momentum remained positive in deep-sea trades
• Evergreen Marine posted strong revenue and earnings growth in Q124
• Container carriers have performed well YTD in 2024; we expect convergence

• In 1Q24, Revenues of Xpeng, Tongcheng, Kanzhun, and Gaotu grew by 62% YoY, 50%, YoY, 43% YoY and 34% YoY.
• KE’s revenue decreased by 20% YoY in 1Q24 due to the weak property market.
• Bilibili’s value added services revenue grew by 17% YoY and advertising revenue grew by 31% YoY.

• Recommendation to buy ISEC shares at Rs 840 per share with a price target of Rs 1200 per share
• Dissatisfaction among minority shareholders due to insider’s attempt to acquire remaining shares at a lower price
• Illiquidity and limited institutional investors due to Parent owning 75% of shares, potential merger poses a risk but shareholders can extract fair value even in a merger scenario

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.

• Pluxee is a spin-off company with a strong business model, offering an attractive investment opportunity.
• The company’s undervalued stock price and potential for growth make it a compelling choice for investors.
• With large insider ownership, new initiatives, and the Bellon family as controlling shareholders, Pluxee is expected to see improvements and long-term success.

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.

• Warby Parker disrupted the eyewear industry in 2010 with affordable prices and innovative styles, known for their commitment to social impact
• The company has faced challenges with slowing growth and increased competition, leading to concerns about its uniqueness and disrupter status
• Critics believe that Warby Parker’s focus on technology and business model changes indicate a potential decline, making it a target for short selling.

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.

• Alibaba Group’s March Quarter and Full Fiscal Year 2024 results show that major segments such as the Taobao and Tmall Group, Alibaba International Digital Commerce, and core public cloud offerings are experiencing growth.
• The Taobao and Tmall Group achieved double-digit year-over year growth, while Alibaba International Digital Commerce revenue increased by 45%.
• Moreover, AI related revenue increased triple digit year-over-year, demonstrating the potential of AI technology in fueling the company’s growth.

• Grape King Bio has one of the most remarkable consistency in profit margins among all Asian F&B companies. Its net margins ranged from 13% to 15% in the past decade.
• The company’s dividend yield increased from 3.8% in 2021 to 4.1% in 2022, and 4.4% in 2023. Its annual dividend payout averaged 69.6% from 2019 to 2023. 
• Established in 1969, Grape King Bio is one of the leading health food, drink, and supplement products manufacturers in Taiwan.

• Sony Group Corporation recently reported its FY 2023 results and offered insights into its FY 2024 forecast as well as its fifth mid-range plan.
• The corporation experienced a record high in consolidated sales at JPY 13,020.8 billion while consolidated operating income was JPY 1,208.8 billion.
• Net income stood at JPY 970.6 billion, and consolidated adjusted EBITDA was JPY 1,880 billion.

• Honda Motor’s earnings of FY ’24 reveals that the mobility company has been posting a historic high operating profit of JPY 1,381.9 billion, with an operating profit margin of 6.8%.
• Underpinning this growth has been the company’s core strategy of focusing on environmental sustainability and safety, which is resonating well with the consumers.
• For FY ’25, Honda has set a higher target for operating profit at JPY 1.42 billion, aiming to achieve an operating profit margin of 7%, a year ahead of their original plan.

• Legend Biotech Corporation is a biotech company specializing in CAR-T cell therapy for the treatment of multiple myeloma.
• In Quarter 1 2024, two major approvals by the US Food and Drug Administration (FDA) and European Commission for the company’s CARVYKTI therapy for second line relapsed or refractory multiple myeloma have solidified its position in the industry.
• This historical quarterly update positions Legend Biotech’s CARVYKTI on the path to transforming the treatment landscape for thousands of patients suffering from multiple myeloma.

• StoneCo Ltd., a financial technology company in Brazil, provided its Q1 2021 results with an updated outlook on the business.
• The company’s business performed strongly, delivering strategic priorities with significant growth in financial services across all client offerings.
• StoneCo also launched instant payments in Ton, which fulfills a key request from micro-merchant clients.

• SharkNinja’s first quarter 2024 earnings revealed a company with strong financial performance, a robust global supply chain, and a commitment to a growth strategy that has yielded positive results.
• In the first quarter, the company saw adjusted net sales increase by 28% and adjusted EBITDA grow by 30%.
• This can be attributed to significant investments in selling and marketing initiatives aimed at expanding the company’s presence in emerging international markets and driving global awareness of their new products.

• Dropbox, Inc.’s Q1 2024 earnings showed both positive and negative aspects of the company’s financial performance.
• In terms of positives, the company reported revenue for the quarter that met its expectations.
• In addition, Dropbox reported an increase in paying users with 35,000 net new additions, despite a challenging fourth quarter.

• Cisco Systems (Cisco) had a promising Q3, with organic revenue aligning with the higher end of guidance expectations.
• The company has transformed its business model, with over half of its total revenue now coming from subscription services, providing the company with a robust base for potential long-term growth.
• The acquisition of Splunk was also completed, adding over $4 billion in annualized recurring revenue and strengthening Cisco’s position as one of the world’s major software companies.

• In the first quarter of 2024, The Home Depot’s total sales amounted to $36.4 billion, marking a decrease of 2.3% from the same period last year.
• The company’s comp sales declined by 2.8% and US stores also reported negative comps of 3.2%.
• The diluted earnings per share were noted to be $3.63 for the first quarter, a dip from $3.82 during the first quarter of the previous year.

• The company recently announced poor earnings down 56% YoY in 1Q24
• Dwindling cash is another major concern especially with higher debt/ebitda
• At 15-25% ROE is sensible but now back toward 5% there is less enthusiasm

• Global EV charger market overview with key players highlighted in the industry, including a focus on technological advancements.
• Ex-IBM Chief Accessibility Officer seeks to revolutionize digital inclusion in Taiwan’s manufacturing sector through innovative strategies and initiatives.
• Updates on notebook shipment for April 2024, global smartphone sales in the first quarter of 2024 as well as collaborations such as SDC & Lenovo teaming up to launch slidable display devices by 2025.

• PDD reported C1Q24 top-line, non-GAAP EBIT, and non-GAAP net income 1.3%, 67.0%, and 80.0% vs. our estimate, and 13.9%, 82.0%, and 94.7% vs. consensus, respectively;
• Temu unit economics improvement drove the 1Q beat. Per order outlay on marketing and fulfilment declined 20-25% qoq, we estimate;
• PDD continues to effectively squeeze merchants for its benefit,while also benefiting from weak consumer sentiment in China and overseas. We maintain BUY,and raise TP to US$172, implying 12.3x CY24 PE.

• The continued “higher for longer” interest rates in the US, along with widening JGB yields adds weight to the Bank of Japan potentially raising benchmark rates further
• In this report, we expand our coverage of the bigger cap banks’ metrics to include the equity holdings of the top six market caps and the banks’ BoJ deposits
• We see further upside for Japanese bank shares, especially those geared into higher domestic rates and with the potential for equity holdings disposals; we like Resona, Mizuho, SMFG and Concordia

• Kuaishou reported C1Q24 revenue, IFRS OP, and IFRS Net income inline, 58%, and 78% vs. our estimates; and inline, 67% and 86% vs. consensus
• Company suggested contribution of Generative AI (GAI) to the growth of the advertising business to be substantial;
• We reiterate our BUY rating and raised target price to HK$83, implying 17x PE in 2025.

• Uber has kicked off 2024 with positive growth, reporting a 21% year-on-year increase in rides, which equates to its gross bookings growth rate. Their user base expanded by 15%, underpinned by 7.1 million drivers and couriers operating on the platform. The firm’s record adjusted EBITDA of $1.4 billion and the generation of $4.2 billion in free cash flow over the last year reflect a significant financial upswing. However, the world of automobiles is shifting towards autonomous vehicles (AVs), posing both challenges and opportunities for Uber. The firm needs to strategize to withstand expected competition from entities like Tesla. CEO Dara Khosrowshahi maintains that breakthroughs in AV technology will eventually prove profitable for Uber, as they promise safer rides and broader accessibility. However, the transition period from human-driven to autonomous vehicles will demand a balanced approach, exploiting both to keep the business steady. Baptista Research looks to evaluate the different factors that could influence the company’s price in the near future and attempts to carry out an independent valuation of the company using a Discounted Cash Flow (DCF) methodology. In this report, we have carried out a fundamental analysis of the historical financial statements of the company. We have added reasonable forecasts of the annualized income statement and cash flows and carried out a DCF valuation of the company using its Weighted Average Cost of Capital (WACC) to determine a forecasted share price. We have further incorporated a sensitivity analysis/ scenario analysis to understand how changes in key assumptions could impact the valuation under 3 scenarios – a base case, a bull case, and a bear case. These additional layers of analysis serve to provide a comprehensive and robust valuation, giving investors a nuanced understanding of the inherent risks and opportunities.

• Exact Sciences Corporation’s first quarter 2024 earnings. The quarter demonstrated robust performance with first quarter revenue growing by 6% to $638 million. Particularly noteworthy was the 7% increase in screening revenue to $475 million, which is attributed to the company’s successful optimization of billing and patient compliance systems. However, Exact Sciences faces a tough comparison base, as its growth in the previous year was buoyed by enhancements to billing and patient compliance systems and a weak flu season. The expansion of Precision Oncology revenue by 5% to $163 million also contributed to the company’s growth. Baptista Research looks to evaluate the different factors that could influence the company’s price in the near future and attempts to carry out an independent valuation of the company using a Discounted Cash Flow (DCF) methodology. In this report, we have carried out a fundamental analysis of the historical financial statements of the company. We have added reasonable forecasts of the annualized income statement and cash flows and carried out a DCF valuation of the company using its Weighted Average Cost of Capital (WACC) to determine a forecasted share price. We have further incorporated a sensitivity analysis/ scenario analysis to understand how changes in key assumptions could impact the valuation under 3 scenarios – a base case, a bull case, and a bear case. These additional layers of analysis serve to provide a comprehensive and robust valuation, giving investors a nuanced understanding of the inherent risks and opportunities.

• Insulet Corporation reported an excellent first quarter of 2024 that has exceeded expectations. The demand for Omnipod 5 continues to rise, the leading insulin delivery system, fueling a robust revenue growth. Performance-wise, the company achieved an overall Omnipod revenue growth of 21%, including a US growth of 23% and an international growth of 15%.
• The Omnipod 5 has brought significant success to Insulet in both the US and international markets, thanks to its simplicity and affordability. This offering has assisted in driving market growth, as demonstrated by the fact that during the quarter, approximately 85% of new starts came from people previously utilizing multiple daily injections. This pattern of new starts is encouraging because these new starters originated from Insulet’s target market. Baptista Research looks to evaluate the different factors that could influence the company’s price in the near future and attempts to carry out an independent valuation of the company using a Discounted Cash Flow (DCF) methodology. In this report, we have carried out a fundamental analysis of the historical financial statements of the company. We have added reasonable forecasts of the annualized income statement and cash flows and carried out a DCF valuation of the company using its Weighted Average Cost of Capital (WACC) to determine a forecasted share price. We have further incorporated a sensitivity analysis/ scenario analysis to understand how changes in key assumptions could impact the valuation under 3 scenarios – a base case, a bull case, and a bear case. These additional layers of analysis serve to provide a comprehensive and robust valuation, giving investors a nuanced understanding of the inherent risks and opportunities.

• Duolingo Inc. recently released its Q1 2024 shareholder letter, announcing positive financial results while outlining future initiatives. The company achieved revenue and bookings growth of 45% and 41% respectively and saw active daily users grow by 54% YoY, signaling the effectiveness of their product-driven flywheel. The strategy of offering efficient language tutoring, driving user growth, and converting users to subscribers has proven to be beneficial for the platform. Duolingo also announced record profitability for the quarter. Baptista Research looks to evaluate the different factors that could influence the company’s price in the near future and attempts to carry out an independent valuation of the company using a Discounted Cash Flow (DCF) methodology. In this report, we have carried out a fundamental analysis of the historical financial statements of the company. We have added reasonable forecasts of the annualized income statement and cash flows and carried out a DCF valuation of the company using its Weighted Average Cost of Capital (WACC) to determine a forecasted share price. We have further incorporated a sensitivity analysis/ scenario analysis to understand how changes in key assumptions could impact the valuation under 3 scenarios – a base case, a bull case, and a bear case. These additional layers of analysis serve to provide a comprehensive and robust valuation, giving investors a nuanced understanding of the inherent risks and opportunities.

• Hyatt revealed in its Q1 Earnings that the year has started vigourously for them, displaying growth in multiple dimensions and expanding fees. The occupancy and RevPAR trends they have been observing are strong, driven by noteworthy demands across all customer segments. An increase of 5.5% in system-wide RevPAR was seen in Q1 on the back of robust leisure travel trends. While there is expectation of a subdued year-over-year growth rate, the rates are noticeably above pre pandemic levels. They also observed healthy business transient revenue indicating resumption in business travel. Furthermore, Hyatt’s loyalty program saw a growth of 22% over the past year, reaching a total of approximately 46 million members. Baptista Research looks to evaluate the different factors that could influence the company’s price in the near future and attempts to carry out an independent valuation of the company using a Discounted Cash Flow (DCF) methodology. In this report, we have carried out a fundamental analysis of the historical financial statements of the company. We have added reasonable forecasts of the annualized income statement and cash flows and carried out a DCF valuation of the company using its Weighted Average Cost of Capital (WACC) to determine a forecasted share price. We have further incorporated a sensitivity analysis/ scenario analysis to understand how changes in key assumptions could impact the valuation under 3 scenarios – a base case, a bull case, and a bear case. These additional layers of analysis serve to provide a comprehensive and robust valuation, giving investors a nuanced understanding of the inherent risks and opportunities.

• Total revenue growth rate climbed up 27% YoY in 1Q24 with all businesses growing strongly.
• Smartphone shipments grew by 34% YoY and achieved global No. 3.
• In 1Q24, the gross margins of all major businesses obviously improved.

• Sun Art Retail (6808 HK)‘s FY24 (fiscal year ending March) numbers were overall unimpressive, with sales down 13% yoy and net loss increasing to RMB1.6bn.
• The new CEO’s strategy is to refocus on SSSG of offline traffic and restore price competitiveness.  April and May SSSG improved. 
• The stock is up 20% since my initial insight on the name in March, and I believe more upside remains.

• In a tough macro environment with travel as perhaps the only bright spot in consumption
• However, equally compelling is the demand negatives of overseas travel as a somewhat luxurious consumption item and tough competition at home;
• Given the stock’s valuation, we maintain the rating as SELL but raise TP to US$45/ADS, implying 2025 PE of 15x.

• FTA’s revenue growth accelerated in Q124 and exceeded management guidance
• Gross and OpInc margins (cash basis) both improved sharply in Q124
• Growth, profitability, mix improved, but FTA no longer so cheap; HOLD

• Toyota Motor Corporation recently concluded its fiscal year ended March 2024 with notable financial results and established expectations for the upcoming fiscal year.
• The company’s actual operating income reached a record JPY 5.35 trillion, significantly bolstered by support and cooperation from various stakeholders, including employees, suppliers, and dealers.
• This substantial figure reflects the company’s commitment to region and product-based management over many years.

• Chailease is facing pressure in all of its markets, Taiwan, China and Asean, with no signs of easing.
• High frequency data (HFD) from Chailease gives us April monthly numbers, with double digit  net profit decline and a greater EPS decline
• Credit costs are now elevated at peak levels since early FY19 for the past two quarters, and we wonder if FY24 will see far higher figures, given economic weaknesses?

• Terumo Corp (4543 JP) reported 18% revenue growth in Q4FY24, driven by C&V and TBCT businesses. With the steady progress in profit improvement measures, operating profit rose 45%.
• For FY25, the company expects revenue of ¥980B (up 6% YoY), operating profit of ¥165B (up 18% YoY), and net profit of ¥122B (up 15% YoY).
• The company remains cautious and provided a conservative FY25 guidance. Improvement in any its assumptions provides room for upward revision of the guidance.

• The major K-Pop stocks had the biggest up day so far this year on 23 May, driven by potential easing of Korean cultural contents restrictions by the Chinese government. 
• In the past nine years, there has been a ban on Korean singers’ performances in China.
• Among the major K-Pop stocks, we continue to have a Positive View on S.M.Entertainment Co (041510 KS) but bearish on HYBE (352820 KS) and YG Entertainment (122870 KS).

• China International Capital Corporation (3908 HK) is a laggard among the Chinese securities companies. With the rebound in HSI and Shanghai Composite, such divergence should narrow.
• The investment banking business should recover following the rebound in the secondary market and equity valuations. HK’s IPO funds raised are forecast to double in 2024.
• At 0.4x 12-month P/B, the market has deeply discounted CICC’s earnings outlook. However, as earnings recovery will be fast, its share price will react rapidly.

• Marvell has historically performed well in the market but is now shifting its focus to growth areas such as AI, cloud computing, and faster data networks
• Despite recent cyclical weakness, the company is expected to see improved performance and strong earnings growth
• Reactivating the account is a strategic move to capitalize on Marvell’s promising future prospects and potential increase in stock value

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.

• Total revenue rose by 131% in 1Q24 with advertising up by 56% YoY and commission up by 327% YoY.
• In 1Q24, both the operating profit and the operating margin reached record highs.
• The historical price / sales ratios suggests a significant upside. Buy.

• Fancl Corp (4921 JP)‘s share price has declined 18% year-to-date, greatly under-performing the Nikkei 225 (NKY INDEX) which was up 17% year-to-date. 
• The company recently announced FY24 results (fiscal year ending March).  Sales grew 7% yoy and operating profit grew 60% yoy in FY24. 
• I believe the stock price is attractive at 23x 2024 PE with 15% expected earnings CAGR for the next 3 years.

• Daifuku released FY3/24 results on 10 May. Since then the share price has declined by 15%, giving investors an attractive entry point.
• Daifuku is a key beneficiary of warehouse automation, which is forecast to grow at a CAGR of over 6%, with industry spend projected to reach $37 billion by 2030
• We expect the market to price in an order recovery in the core electronics segment and believe that the MTP is yet to be factored into the current share price.

• UMC Singapore fab is in the process of moving in new equipment to enhance its production capabilities.
• Japan has a target of manufacturing 12 million software-defined vehicles by the year 2030.
• India continues to enforce import restrictions on IT products, impacting the sector’s growth and development. Power HV brings advanced technology to transformer monitoring in the energy industry for increased reliability.

• We add value plays Bandhan and UBI to the buy list alongside HDFC Bank and Baroda, turning neutral from negative on SBI. Bandhan is our core Indian bank pick, UBI benefits from improving return trends

• LI Auto’s decision to push out its BEV launch to 2025 is a delay of multi-faces at a time when China’s EV market is chaotically.
• We keep rating @BUY because LI still possesses the SUV niche, enjoys a healthy margin and have ample cash. 
• We cut TP from US$40 to US$25 and maintain BUY.

• AMAT Q124 revenues of $6.65 billion, in line with guidance and essentially flat both QoQ and YoY. Current quarter guidance also flat sequentially
• WFE valuations are at all time record highs while revenues remain on life support from China
• If China revenues fall off before non-China returns to growth, the WFE segment could be in for a world of pain.

• In 1Q24, revenue grew by 17% YoY and e-commerce GMV grew by 28% YoY.
• Both the operating margin and the operating profit reached historical highs in 1Q24.
• We set an upside of 47% and the price target at HK$86.00. Buy.

• Making EV itself doesn’t make money, which is why independents like Nio and XPeng are thinking alternative ways to breakeven;
• Tesla envisioned to make money through scale, of which BYD bettered. Tesla also envisioned to make money from autonomous driving (ADS);
• Nio plans to sell its battery swapping service while XPeng is selling ADS to Volkswagen. Both are experiments aiming at breakeven. Both also have new models to launch.

• INOD is benefiting from the movement to incorporate artificial intelligence (“A.I.”) into many applications
• INOD provides the datasets required for training A.I. and it has quickly become a leading provider of such service
• The Company is now on pace to grow at a faster pace than expected and should lead to higher earnings and free cash flow in coming quarters