Equity Bottom-Up

By Shifara Samsudeen, ACMA, CGMA

The US Inflation Reduction Act will have a massively positive impact on Panasonic’s battery earnings for a decade
Panasonic has just broken ground on a new battery plant in Kansas – the yellow brick road to further profitability
We see a further 25% upside to the share price from the IRA impact on current battery capacity and even more on Kansas

M3: Covid Related Trials and Yen Depreciation Support Earnings Beat

M3 Inc (2413 JP) reported 2QFY03/2023 results yesterday. Revenue grew 10.6% YoY to JPY56.7bn (vs consensus JPY54.7bn) while OP increased 31.5% YoY to JPY17.9bn (vs consensus JPY17.0bn).
The company’s earnings were mainly driven by Covid-19 related trials and a weaker Yen which mainly helped the overseas business post strong results.
M3’s growth prospects remain stagnant and the company’s valuation multiple is still expensive as earnings expectation has started to decline.

CanSino Biologics (6185.HK/688185.CH) – Time to Offload; the Rally May Not Last Long

The fake news about China reopen and the COVID-19 vaccine business are the major driving force for the rally of CanSino’s share price. However, such rally would not last long.
CanSino didn’t perform well in Q3 and 2022 would be a difficult year for CanSino. The major turning point of CanSino performance still lies in MCV4, not COVID-19 vaccines.
CanSino’s H-share valuation has become more reasonable,but the downside risk in HKEX is hard to predict. Investors could consider offload and secure the gains. There’s better opportunity to long ahead.

KT&G Announces a Share Buyback Worth 350 Billion Won

On 3 November, KT&G announced that it will buy back 350 billion won worth of common shares (3.7 million shares).
KT&G has mentioned that it could increase its DPS by at least 200 won in 2022. Assuming DPS of 5,000 won in 2022 would suggest a dividend yield of 5.3%.
KT&G had another solid results in 3Q 2022 slightly beating the consensus sales and operating profit estimates.

A Pair Trade Between Nongshim Co & Nongshim Holdings (Youlchon Chem Is Breaking Out)

In this insight, we discuss a pair trade of Nongshim Holdings (072710 KS) (go long) and Nongshim Co Ltd (004370 KS) (go short).
We believe the price gap between these two stocks have widened too much in the past six months and this gap is likely to decrease again.
Nongshim Holdings’ stake in Youlchon Chem has been rising rapidly in the past six months which should also act as a positive catalyst on Nongshim Holdings.

Meta Platforms: Is The Hyper Growth Story Over? (11/22)

Meta Platforms delivered a highly disappointing set of results with a huge earnings miss.
The company’s ballooning costs to fund its virtual reality vision have resulted in a drop in profitability.
We provide the stock of Meta Platforms with a ‘Hold’ rating and a revision in the target price.

Bristol-Myers Squibb: The Turning Point Acquisition & Oncology Expansion

Bristol-Myers delivered another all-around beat as the management continued to make an effort to expand its new product range and inline franchise.
In this quarter, the inline and new product portfolio grew by 13%, and the company managed to deliver non-GAAP EPS growth of 3%.
Revenues in the third quarter were approximately $11.2 billion and the inline and new product portfolio grew strongly up to 13%.

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Nov 03

Daily Brief Equity Bottom-Up: A Pair Trade Between Orion Holdings and Orion Corp and more

By Smartkarma Daily Briefs | Daily Briefs, Equity Bottom-Up

In today’s briefing:

A Pair Trade Between Orion Holdings and Orion Corp
Z Holdings (Neutral) – Q2 22 Results Reaction: Ad Sales Weak but LINE Accounts Hold Up
Xpeng (9868.HK, XPEV): Painful Year, but Payoffs for Technology Improvements Ahead
Pfizer Inc (PFE US): Stellar Q3 Performance; Despite Unfavorable Fx Impact, Raises 2022 Guidance
MHI (7011) | The Time to Act on Energy Transition
SanBio (4592 JP): Remains Unlucky for Second-Time; Delay in First Product Approval Weighs Heavily
KDDI (Buy) – Q2 22 Results Reaction: Mixed Quarter as Power Costs Accelerate
Save Foods Inc.: A Uniquely Positioned Small-Cap In Food Safety
Japanese Cosmetics: Trading Around Q3 Earnings
LICHF: FY23 NIM Guidance Intact Despite One-Off Impact in Q2FY23

A Pair Trade Between Orion Holdings and Orion Corp

In this insight, we discuss a pair trade between Orion Holdings (001800 KS) (go long) and Orion Corp (271560 KS) (go short).
Orion Holdings has a dividend yield of 4.6% versus 0.7% for Orion Corp. For the value investors that seek higher dividends, Orion Holdings is more attractive versus Orion Corp.
We believe the price gap between these two stocks have widened too much in the past several months and this gap is likely to decrease again.

Z Holdings (Neutral) – Q2 22 Results Reaction: Ad Sales Weak but LINE Accounts Hold Up

Ad sales were weaker than we expected and the company has revised full-year guidance for that business down. That is not surprising in light of the macro environment
But it also implies potential ad revenue erosion YoY in H2 which we have never seen before. Even at the worst of the Covid crisis, ad revenue growth was positive
Management appears more confident in hitting FY22 EBITDA targets as it has room to maneuver on the timing of investment spending but we think FY23 targets are looking tougher

Xpeng (9868.HK, XPEV): Painful Year, but Payoffs for Technology Improvements Ahead

By Victoria Li

After a 86% decline on share price YTD, we believe it’s time to revisit Xpeng.
Having gone through all the negatives which led to Xpeng’s underperforming vs peers, we believe the market has overreacted, while the company’s advantages/technology improvements have been ignored.
After 4 months of sales decline, company fundamentals would bottom out from November onwards with G9 starting to speak for itself.

Pfizer Inc (PFE US): Stellar Q3 Performance; Despite Unfavorable Fx Impact, Raises 2022 Guidance

Pfizer Inc (PFE US) reported beat-and-raise Q3 results. Revenue declined 2% operationally to $22.6 billion, beating consensus by $1.5 billion. Adjusted EPS of $1.78 was ahead of consensus of $1.40.
Pfizer raised its 2022 financial guidance, on an operational basis, for revenue and adjusted EPS by approximately $1.7 billion and $0.19, respectively.
The company aims to launch 19 new products or indications, of which more than two thirds have the potential to be blockbusters, in the market over the next 18 months.

MHI (7011) | The Time to Act on Energy Transition

It is just 3 days 7 hours 52 minutes before the private jets start touching down at Sharm El-Sheikh International Airport for COP27
Expect a lot of jawboning on energy transition and decarbonization – music to the ears of MHI shareholders
MHI excels at Energy Transition as carbon intensive industries such as power generation and steelmaking shift to decarbonize

SanBio (4592 JP): Remains Unlucky for Second-Time; Delay in First Product Approval Weighs Heavily

In March, SanBio Co Ltd (4592 JP) completed the application filing for approval for its investigational product SB623, as a treatment for chronic motor deficit from traumatic brain injury.
With a priority review designation, SB623 approval was expected in September. SanBio is expecting a delay in the approval. SB623 is now expected to be approved next year.
For FY23, the company is now expecting operating expenses of ¥8.1 billion, which exceeds the earlier expectations by ¥2.2 billion due to an anticipated increase in manufacturing-related expenses.

KDDI (Buy) – Q2 22 Results Reaction: Mixed Quarter as Power Costs Accelerate

KDDI posted its best revenue growth since 2019 but an acceleration in power costs and expenses associated with the July network outage kept a lid on margins
On balance, the print is positive and management remains confident on full-year targets
There are sector reads from corporate sales (good), higher power costs (bad), and stable competitive intensity whilst modest erosion in roaming revenue indicates Rakuten’s rebound from peak losses is modest

Save Foods Inc.: A Uniquely Positioned Small-Cap In Food Safety

This is our first research note on Save Foods Inc.
The company is a distinguished player within the field of developing green solutions for the food industry in order to improve food safety and increase shelf life.
With a rising number of quality inspections faced by food companies, increased awareness of foodborne illnesses, and the necessity to avoid food contamination, Save Foods’ offerings are in high demand.

Japanese Cosmetics: Trading Around Q3 Earnings

A couple of Japanese cosmetics names, reported their quarterly results this week, with considerable earnings misses
Kao Corp (4452 JP) fell 8.5% today following a 40% OP miss while Pola Orbis Holdings (4927 JP) was flat after a narrow miss of 2% from a relatively low consensus estimate.
If the two reports released this week are something to go by, we could expect large misses, for Fancl Corp (4921 JP) and Kose Corp (4922 JP) next week.

LICHF: FY23 NIM Guidance Intact Despite One-Off Impact in Q2FY23

By Ankit Agrawal, CFA

While LIC Housing Finance (LICHF IN) posted substantial decline in NIM to 1.80% vs 2.54% QoQ, this was largely due to one-off impact from a couple of items.
LICHF has maintained its prior guidance of beating FY22 NIM of 2.29%, which means that for full-year FY23, LICHF is still on track for a NIM of 2.3% or above.
There was a one-off provisioning relating to INR 180cr of write-offs, which was fully provided for, but due to Ind-AS accounting had to be booked again resulting in excess provisioning.

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Nov 02

Daily Brief Equity Bottom-Up: Toyota’s Q2 Is a Huge Miss; EV Strategy in Flux and more

By Smartkarma Daily Briefs | Daily Briefs, Equity Bottom-Up

In today’s briefing:

Toyota’s Q2 Is a Huge Miss; EV Strategy in Flux
SONY (6758) | Q2 Earnings Beat, Guidance Raise
Komatsu(6301) | Post 2Q Earnings – BACKTEST STILL Says over 45% Upside
Close Out the Pair Trade Between LG Chem & LG Energy Solution
Hana – Granular Data On China
Japan Tobacco: Revised Guidance & Growth in the US With Altria JV Could Get The Shares Moving Again
CIMC Enric (3899 HK): Maintaining a Solid Trend
KPIT: Strong Execution and Bullish Outlook
HDFC Bank: Strong Results – In Line with Expectation
WuXi AppTec (603259.CH/2359.HK) 22Q3- It’s Too Early to Think That The Past Rapid Growth Has Resumed

Toyota’s Q2 Is a Huge Miss; EV Strategy in Flux

By SC Capital

Toyota’s Q2 EPS undershot estimates by 28%. FY3/23 guidance was kept flat, but given a more favorable assumption for forex tailwinds, Toyota effectively lowered FY3/23 EPS by 7%.
Management partially admitted to parts of recent media reports that Toyota was overhauling its EV strategy. Targets of 3.5m BEVs by 2030 are unchanged, but the ramp may be slower.
Toyota’s 2H FY3/23 hurdles are low and its auto division’s operating profits appear to be bottoming. Stock may still be a laggard, but we’re bullish on a 12-month basis.

SONY (6758) | Q2 Earnings Beat, Guidance Raise

Q2 OP rises +8% to Y344 billion on strong growth in Music and Image Sensors, despite 49% profit fall in Games segment.
SONY sold 3.3 million PS5 units in the quarter, the same figure as a year ago. Managment remains confident of hitting 18m units by the end of the fiscal year
Sony’s stock is down -30% YTD. We think the Q2 results/guidance lift should help put a floor under the stock. We would be buyers below 15x earnings

Komatsu(6301) | Post 2Q Earnings – BACKTEST STILL Says over 45% Upside

Komatsu reported above Consensus 2Q OP; lifted OP guidance; and raised dividends. Outlook for next FY3/24 looks bright
Share price is pricing in a severe recession. A PBR of 1.1x is implies a significant OP decline. We see no evidence of an earnings contraction next year
We expect the share price to re-rate as the market prices in resilient earnings outlook. Our back test still suggests over 45% upside

Close Out the Pair Trade Between LG Chem & LG Energy Solution

On 25 October, we recommended a pair trade between LG Chem (go long) and LGES (go short). Since then, this trade has resulted in a net gain of 15.7%.
It is very unusual to get this kind of alpha sized gains on Korean large caps in such a short time period.
Given the sharp net appreciation on this pair trade in the past week, we would close out this trade.

Hana – Granular Data On China

By Daniel Tabbush

Hana Financial Group reported a loss in its China banking business in 9MQ22
Hana Bank (China) recorded credit costs at KRW119bn or 20% of group total
Off balance sheet commitments in China appear to be moving on balance sheet

Japan Tobacco: Revised Guidance & Growth in the US With Altria JV Could Get The Shares Moving Again

Japan Tobacco (2914 JP)’s 3Q22 was stronger than expected with revenue and OP surpassing consensus by 9.2% and 8.8% respectively through better than expected performance in almost all the markets.
Just as we predicted in our previous insights, JT upgraded its revenue, OP, FCF and DPS guidance by ¥182bn, ¥100bn, ¥77bn and ¥38 respectively sighting stronger volumes and favorable pricing.
We believe this earnings upgrade and a JV with Altria to expand Ploom in the US should get the share price going again after being held back by Russia fears.

CIMC Enric (3899 HK): Maintaining a Solid Trend

CIMC Enric Holdings (3899 HK) has a steady 3Q22 with good revenue growth for the chemical & environmental and liquid food segments. Management also said margin has expanded YoY.
Overall order backlog of Rmb13.7bn is generally sufficient to cover individual segment’s revenue over the next 6-15 months, comfortably securing the growth prospects.
With significant overseas revenue, it is benefiting from depreciation of Rmb against the USD. It also anticipates a pick-up in domestic clean energy segment growth in FY23.

KPIT: Strong Execution and Bullish Outlook

By Ankit Agrawal, CFA

KPIT Technologies (KPIT) reported decent Q2FY23 earnings. Sales grew 8.3% QoQ and 27% YoY in Constant Currency (CC) terms. EBITDA and Net Profit grew 33% and 28% YoY, respectively.
Led by an all-time high order pipeline, KPIT Technologies (KPITTECH IN) gave a bullish outlook and upgraded its FY23 growth guidance. KPIT’s Technica acquisition also looks very promising.
In terms of order pipeline, KPIT has a couple of mega deals ($100mm+) in the offing, which if realized, would be the first-ever in its history.

HDFC Bank: Strong Results – In Line with Expectation

By Ankit Agrawal, CFA

Annualized credit cost at 87bp was at the lowest in many quarters. This provides further room to the bank to invest for future growth.
HDFCB continues to focus on enhancing its distribution presence, both physical and digital. It is continuing to add new branches. Its digital efforts are also paying off well.
At a valuation of 20x P/E, HDFC Bank (HDFCB IN) is attractively priced and offers potential for 23%+ IRR over the next 3Y.

WuXi AppTec (603259.CH/2359.HK) 22Q3- It’s Too Early to Think That The Past Rapid Growth Has Resumed

WuXi AppTec’s 2022Q3 results beat the market expectations. The Company’s performance showed good recovery from the prior pandemic/lockdown, but it has not yet entirely reversed the trend of slowing growth.
Wuxi AppTec has a problem of decreasing future gross margins. Although the Q3 results could bring short-term catalyst for WuXi AppTec’s share price, such rebound may not last long.
We further analyzed WuXi AppTec’s business, and we remain to be conservative on the Company, because the whole outlook and investment logic of CXO have changed.

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Nov 01

Daily Brief Equity Bottom-Up: Oriental Land: Modest Price Reaction to Revised Guidance Indicates a Breakdown Is Imminent and more

By Smartkarma Daily Briefs | Daily Briefs, Equity Bottom-Up

In today’s briefing:

Oriental Land: Modest Price Reaction to Revised Guidance Indicates a Breakdown Is Imminent
Mercari – Q1 23 Results Reaction: Strong Domestic Drives OP Beat but Spending to Rise
Los Andes Copper: Insider Buying Continues and PFS in Next 60 Days
Vitasoy (345): Time to Bounce
Kino Indonesia (KINO IJ) – Staples with a Discretionary Edge
Foxconn / Hon Hai: Quick-Take On The Zhengzhou Outbreak; Accumulate on Weakness
Mitra Keluarga Karyasehat Tbk (MIKA IJ) – Higher Volumes Lower Intensity
Takeda: Thrilling Journey Ahead with a Dengue Vaccine Launch and New Approvals
Asahi Intecc (7747 JP): Stellar Performance in FY22 Likely to Accelerate in FY23
Ping An Healthcare and Technology (1833.HK) – The New Acquisition Is Hard to Turn Things Around

Oriental Land: Modest Price Reaction to Revised Guidance Indicates a Breakdown Is Imminent

Oriental Land (4661 JP) raised its FY23 revenue and OP guidance by 8.4% and 59.4% respectively last week sighting a recovery in demand for leisure during the second-half of the year.
The modest price reaction to upgraded guidance could be an indication that a breakdown is imminent.
Cost overruns of ¥70bn and a delay to the scheduled opening of Fantasy Springs from FY23 to FY24, could force investors to second guess consensus medium-term expectations.

Mercari – Q1 23 Results Reaction: Strong Domestic Drives OP Beat but Spending to Rise

Domestic results were better than we expected driving operating income to its highest level in six quarters. Management will launch credit card services to boost fintech exposure
The US business remains a drag on results with platform sales down 5% YoY and expanding operating losses. A downgrade to expectations is likely in the quarters ahead
Q1 results were better than we expected but a weak US business and higher spending ahead may disappoint markets that bid shares 28% higher over the last month

Los Andes Copper: Insider Buying Continues and PFS in Next 60 Days

By Nicolas Van Broekhoven

Los Andes Copper, our preferred copper junior exploration company, will have an updated PFS out in the coming 60 days.
Meanwhile, regular insider buying continues by Chief Executive Michael Jones.
Los Andes Copper remains key M&A target for larger diversified miners.

Vitasoy (345): Time to Bounce

By Henry Soediarko

Vitasoy Intl Holdings (345 HK) was shunned by investors last year as its products were taken off the shelves in China, causing its revenue from China to plummet.
Recently announced a substantial increase in net profit vs last year.
Despite the recent uptick, Vitasoy’s share price is still trading at 50% PBR vs 5 years ago.

Kino Indonesia (KINO IJ) – Staples with a Discretionary Edge

Kino Indonesia (KINO IJ) is one of Indonesia’s most interesting staples players with a strong share in a number of segments within beverages and personal care which dominate its sales.
The company has seen a decent rebound in its beverages business as mobility has improved but continues to face some headwinds from higher input costs and packaging for personal care.
Kino Indonesia (KINO IJ) has been selectively increasing prices to offset higher costs and is seeing an improvement in sales of some of its more discretionary products.

Foxconn / Hon Hai: Quick-Take On The Zhengzhou Outbreak; Accumulate on Weakness

Some workers have been fleeing Hon Hai’s largest iPhone production facility in Zhengzhou, China over the weekend, due to COVID-19 outbreak lock-downs.
Even a significant hit to 4Q22E earnings is unlikely to change the 2023E and 2024E financial outlook or valuation multiples for the company, in our view.
Even after considering that Q4 is a high production period, if we assume November is about 1/10th of annual production, then only an estimated 2% annual reduction is at risk.

Mitra Keluarga Karyasehat Tbk (MIKA IJ) – Higher Volumes Lower Intensity

By Shifara Samsudeen, ACMA, CGMA

Mitra Keluarga‘s 3Q2022 results reflected the changing environment with patient volumes higher and back above COVID levels but treatment intensity came down YoY in 3Q2022 given last year’s Delta base.
MIKA continues to expand its hospital numbers through greenfield and brownfield expansions with three new hospitals due to open in the next 12 months plus it is open to M&A.
Mitra Keluarga’s treatment intensity should start to improve over the next few quarters given management’s focus on this plus easier YoY comparisons. Valuations remain attractive versus historical levels.

Takeda: Thrilling Journey Ahead with a Dengue Vaccine Launch and New Approvals

Takeda Pharmaceutical (4502 JP) reported 2QFY03/2023 results last week. Reported revenue increased 18.6% YoY to JPY1.0trn (vs consensus JPY962bn) while OP increased 7.2% YoY to JPY104.4bn (vs consensus JPY119bn).
Growth in sales was driven by Takeda’s blockbuster drug Entyvio (+36.6% YoY), Takhzyro (+75.8%) and immunoglobulin products (HYQVIA in particular).
The company also has raised its peak sales estimate for Entyvio to US$7.5-9.0bn (from US$5.5-6.5bn) driven by further market growth and market share expansion.

Asahi Intecc (7747 JP): Stellar Performance in FY22 Likely to Accelerate in FY23

Asahi Intecc (7747 JP) reported better-than-expected FY22 results, driven by overseas sales primarily in Europe and China mainly due to market recovery and a weaker yen versus other major currencies.
Asahi has raised FY23 revenue guidance to ¥89.3 billion (+15% y/y) from ¥83.5 billion earlier. However, with weakening yen, another beat is on card.
Although Asahi shares have strong upside potential, continued hospital staff shortages in the U.S. and COVID-related restrictions in China are the main downside risks.

Ping An Healthcare and Technology (1833.HK) – The New Acquisition Is Hard to Turn Things Around

In 2022H1, Ping An Health’s losses narrowed and gross profit margin increased, with various financial indicators showing an improving trend. The Company also announced a new acquisition recently.
In the process of turning from 2C business to 2B business, Ping An Health hopes to expand B-end users who can contribute higher margin, but this transformation would encounter difficulties.
If the payment method in China is not changed (still dominated by national medical insurance payment, with small portion of commercial insurance), it’s difficult to improve the profitability qualitatively.

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Oct 31

Daily Brief Equity Bottom-Up: Keyence(6861 JP) | The Rise of the Phoenix – A Company like No Other and more

By Smartkarma Daily Briefs | Daily Briefs, Equity Bottom-Up

In today’s briefing:

Keyence(6861 JP) | The Rise of the Phoenix – A Company like No Other
Seiko Epson(6724 JP)| Neutral 2Q Earnings; Negative Outlook – Remain Bearish
Intel Vs. TSMC/UMC Long/Short Monitor: Intel Results Drive Share Spike, Still Can Re-Rate
Dongfang Electric (1072 HK): Surge in 3Q22 Profit and Acceleration of New Orders
Delta Taiwan Vs. Thailand Monitor: Delta Taiwan Reports Better Margin Trend, Rel Valuation Reverts
Aeon: Making Omnichannel a Reality
Mediatek Results Takeaways — Inventory Correction Bottom Potential 4Q22, Mobile, TV Recovery 1H23?
Chipotle Mexican Grill: Major Drivers
Moody’s Corporation: ESG Insurance Underwriting Solutions & Other Drivers
China Internet Weekly (31Oct2022): Alibaba, Tencent, Meituan, Kuaishou, S.F.

Keyence(6861 JP) | The Rise of the Phoenix – A Company like No Other

Keyence reported record 2Q Sales and OP, thoroughly beating street expectations. The company recorded high double-digit growth in all regions – even in Europe.
Pricing power is on display 10-35% price hikes to shore up the dip in GPM to 81.3%, depressed on higher raw material costs. Sets up for future earnings growth.
The share price has underperformed the TOPIX -26%YTD. Valuations at the bottom of the recent range. We expect a share price recovery and are bullish.

Seiko Epson(6724 JP)| Neutral 2Q Earnings; Negative Outlook – Remain Bearish

2Q Earnings Neutral; Mainly FX driven. The company sidestepped the worse of what we are seeing in broader printer market (See XEROX; Canon)
The outlook remains Negative. Macro conditions set to be worse in H2 vs H1. Core Home & Office Printing Business key IJP unit sales struggling with severe margin pressures.
Ongoing share buyback mildly supportive but unlikely to be a game changer with falling earnings. Target-based 0.8x PBR implying ¥1700 TP.

Intel Vs. TSMC/UMC Long/Short Monitor: Intel Results Drive Share Spike, Still Can Re-Rate

Intel’s 3Q22 earnings beat expectations, and the shares reacted positively, rising 10.7%.
The company announced $3bn of cost savings for 2023E and $8-10bn in annual cost savings by 2025E. 2023E earnings guidance will be provided at the company’s February Investor Day.
Intel has outperformed TSMC and UMC since our pre-Intel Innovation Conference catalyst piece. Intel could still re-rate further relative to the companies into its next earnings.

Dongfang Electric (1072 HK): Surge in 3Q22 Profit and Acceleration of New Orders

Dongfang Electric (1072 HK) logged a 40.1% growth in reported profit and a 36.5% increase in new orders in 3Q22, both represent excellent sequential momentum.
A 0.5pp 3Q22 gross margin expansion demonstrated order execution and cost control strengths. We also forecast end-FY22 backlog at 1.8x FY22F revenue, well securing outlook.
DEC is set to see accelerated growth momentum from rising power storage, particularly pumped storage, demand in the medium term. Yet, it only trades on cheap 8.1x FY23F PER.

Delta Taiwan Vs. Thailand Monitor: Delta Taiwan Reports Better Margin Trend, Rel Valuation Reverts

Delta Electronics (2308 TT) reported its earnings on October 28th, after its subsidiary Delta Electronics Thai (DELTA TB) had reported on October 25th.
Sales grew 33% YoY and gross margin expanded sequentially, which outperformed Delta Thailand’s margin performance.
Delta Taiwan shares have outperformed Delta Thailand since having dropped to a historically-extreme relative market cap below 1.0x. However, Delta Taiwan remains historically cheap on a relative basis.

Aeon: Making Omnichannel a Reality

By Michael Causton

In search of ¥1 trillion in ‘digital-related’ sales by 2026, Aeon opened its first, built-from-scratch online-offline marketing store in Yokohama this month.
The new Aeon SC introduces a range of features and processes to make e-commerce a natural supplement to the store and the shopping experience.
Aeon has a way to go to reach its targets for e-commerce but is moving in the right direction and has a clearer direction than rival, Seven & I.

Mediatek Results Takeaways — Inventory Correction Bottom Potential 4Q22, Mobile, TV Recovery 1H23?

Mediatek’s business continues to grow YoY, albeit slower than earlier expected. Management comments provided insight into the inventory cycle.
Management expects to see the worst impact of the inventory correction cycle in 4Q22E, but then in 1H23E sees potential for a turn around.
We are still developing a conviction view, however we see the latest results as net-positive for the shares given signs of a turn around ahead and the stock’s laggard status.

Chipotle Mexican Grill: Major Drivers

Chipotle Mexican Grill delivered a mixed set of results.
In the quarter, Chipotle continues to view broadening trends by the income levels with the consumers with lower income reducing frequency.
We provide the stock of Chipotle Mexican Grill with a ‘Hold’ rating and a revision in the target price.

Moody’s Corporation: ESG Insurance Underwriting Solutions & Other Drivers

Moody’s Corporation delivered a disappointing result, failing to meet Wall Street expectations with respect to both, revenues as well as earnings.
The Moody’s Analytics business continued to perform quite well with strong revenue growth and an increase in the annualized recurring revenue.
We provide the stock of Moody’s with a ‘Hold’ rating with a revision in the target price.

China Internet Weekly (31Oct2022): Alibaba, Tencent, Meituan, Kuaishou, S.F.

By Ming Lu

In 3Q22, S. F. Holdings’s revenue grew by 45% YoY and net profit increased by 89% YoY.
Alibaba resumed its link on Kuaishou’s live streaming sales before Singles’ Day.
Tencent denied the rumor that it would be acquired by China Mobile.

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Oct 30

Daily Brief Equity Bottom-Up: BFI Finance Indonesia (BFIN IJ) – Multi-Finance Masterpiece and more

By Smartkarma Daily Briefs | Daily Briefs, Equity Bottom-Up

In today’s briefing:

BFI Finance Indonesia (BFIN IJ) – Multi-Finance Masterpiece
Nanya Tech: SK Hynix & Samsung Results Supportive for Memory Chip Industry 2023E Outlook
Suzuki (7269 JT) | Way Too Cheap Ahead of 2Q Earnings – India’s Maruti (MSIL IN) Shows the Way
AbbVie (ABBV US): Q3 Sales Miss as Humira OUS Declines; 2022 Guidance Narrowed; Dividend Raised

BFI Finance Indonesia (BFIN IJ) – Multi-Finance Masterpiece

BFI Finance Indonesia (BFIN IJ) released a strong set of 3Q2022 results with record quarterly bookings and total receivables almost back to pre-pandemic levels with NPFs at less than 1%.
Growth has been driven by non-dealer used car financing with new growth coming from both heavy equipment financing and leasing plus strong growth from used-car aggregators such as Moladin.
BFI Finance Indonesia (BFIN IJ) has one of the lowest cost of funds of any multi-finance company in Indonesia underpinning growth. Valuations are attractive in 2.0x PBV with 21% ROE.

Nanya Tech: SK Hynix & Samsung Results Supportive for Memory Chip Industry 2023E Outlook

SK Hynix and Samsung both released their latest earnings last week. The companies are the leading players for Nanya Tech’s memory chip industry.
SK Hynix’s latest gross margin performance confirms Nanya Tech performing in-line with the industry leaders.
Guidance from both SK Hynix and Samsung indicates a likely improvement in supply/demand dynamics in 2023E for the memory chip space.

Suzuki (7269 JT) | Way Too Cheap Ahead of 2Q Earnings – India’s Maruti (MSIL IN) Shows the Way

Maruti Suzuki reported above Consensus 2Q driven by strong volumes and improved margins
Earnings bode well for Suzuki’s 2Q earnings on Nov 8. Also, Maruti indicated significant easing of semi-driven supply constraints. Positive readacross for Suzuki.
Suzuki’s ex-Maruti operations are now cheaper than ever at under 2.5x PER. We see upside to earnings vs. Consensus and keep our bullish stance on the stock.

AbbVie (ABBV US): Q3 Sales Miss as Humira OUS Declines; 2022 Guidance Narrowed; Dividend Raised

Abbvie Inc (ABBV US) reported Q3 revenue of $14.8 billion, an increase of 5% y/y operationally, mainly driven by a 16% y/y operational growth in immunology portfolio.
While Humira revenue increased 7% y/y in the U.S. to $5 billion, internationally Humira revenue declined 26% y/y to $603 million due to biosimilar competition.
While management reiterated mid-point of 2022 adjusted EPS guidance range, they have narrowed the range to $13.84–13.88 from $13.76–13.96. 2022 revenue guidance has been slightly lowered to $58.2 billion.

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Oct 29

Daily Brief Equity Bottom-Up: Japan Weekly | Ibiden and more

By Smartkarma Daily Briefs | Daily Briefs, Equity Bottom-Up

In today’s briefing:

Japan Weekly | Ibiden, Fanuc, Canon
September Brazil Bank Data Charts – Arrears Imply Better NPLs Trends to Come; Have Spreads Peaked?
Vertex Pharmaceuticals (VRTX US): Better-Than-Expected Q3 Result; Guidance Raised 2nd Time This Year
Intel 3Q22: Still Too Optimistic
Micron Technology: The New York Mega Fab & Other Drivers
Rio Tinto ADR: Initiation of Coverage – Business Strategy
Nike Inc: The Connected Partnership & Other Drivers

Japan Weekly | Ibiden, Fanuc, Canon

NKY +0.80%WoW; TOPIX +0.91%WoW; TSE Mothers +3.0%WoW. 3 days up; 2 days down this week as small caps; high valuation and tech stocks rallied
PM Kishida orders additional fiscal stimulus of ¥29.1 trillion. Including other private sector investment and funding, the total stimulus size to exceed ¥71 trillion.
Bank of Japan maintains their ultra looks monetary policy in place at the end of their 2-day policy meeting

September Brazil Bank Data Charts – Arrears Imply Better NPLs Trends to Come; Have Spreads Peaked?

By Victor Galliano

In September, we highlight that data on credit in arrears (15-90 days overdue) showed MoM improvements in all our measures; this implies a positive leading indicator for NPLs
System loan growth was +16.8% for the twelve months to September, a slight acceleration from the August YoY rate (+16.7%), due largely to faster corporate loan growth
New credit spreads appear to have peaked, even if spreads on average loans are set to remain elevated; we favour Banco do Brasil, for good credit quality and attractive valuations

Vertex Pharmaceuticals (VRTX US): Better-Than-Expected Q3 Result; Guidance Raised 2nd Time This Year

Vertex Pharmaceuticals (VRTX US) reported 18% y/y revenue growth to $2.3 billion, led by 46% growth outside the U.S. on continued strong uptake of Trikafta. U.S. revenue grew 5% y/y.
The company raised full-year 2022 product revenue guidance by 2% at the mid-point to $8.8–8.9 billion, representing 17% y/y growth at the mid-point.
The company will submit biologics licensing application (BLA) for exa-cel to the FDA, beginning in November 2022 and expects to complete the submission by the end of Q1 2023.

Intel 3Q22: Still Too Optimistic

By Aaron Gabin

Intel put forth a significant cost cutting program to generate $3B in savings in 2023 and $8-10B by 2025.
CEO Gelsinger’s PC forecasting track record is horrendous, we wouldn’t bet on a down MSD 2023 market.
Datacenter…which once carried near 60% margins hit breakeven this quarter… an astonishing fall.

Micron Technology: The New York Mega Fab & Other Drivers

Micron delivered a mixed set of results for the previous quarter, missing out on the revenue expectations of Wall Street but managing an earnings beat.
As a result, demand is being reduced for the other parts of the supply chain, which already have more than enough inventory, because the servers cannot be built.
Therefore, although the overall demand for clouds is generally healthy, this is one factor that is having an impact on it.

Rio Tinto ADR: Initiation of Coverage – Business Strategy

This is our first report on global metals and mining giant, Rio Tinto.
The company has been witnessing a decent demand for all of its primary commodities as per recent results.
Moreover, the Rio Tinto Safe Production System is still being effectively implemented, and there are now 15 deployments at 11 sites, up from 5 sites at the beginning of the year.

Nike Inc: The Connected Partnership & Other Drivers

Nike successfully delivered yet another all-around beat in the first quarter of the new fiscal with its key brands, Nike, Jordan, and Converse continue to enjoy strong consumer affinity and demand.
For the quarter, their revenue grew by double-digits and the company generated the highest net revenue quarter ever for Nike Digital.
Customers are still supporting Nike Digital, as evidenced by the Nike commerce app’s record-breaking Q1 traffic.

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Oct 28

Daily Brief Equity Bottom-Up: Fanuc (6954 JP) – Let the Derating Begin and more

By Smartkarma Daily Briefs | Daily Briefs, Equity Bottom-Up

In today’s briefing:

Fanuc (6954 JP) – Let the Derating Begin
Z Holdings (Neutral) – Quick Thoughts on the Read Across from Google, Meta, and CyberAgent
META Platforms 3Q22: You Got to Keep ‘em Separated
Nagacorp: Contrary News Flow Is a Symptom of How Volatility Can Hide True Value
China Healthcare – A Pair Trade: Long Sino Biopharm (1177.HK), Short Hengrui Medicine (600276.CH)
Zijin Mining Plans $1.4 Billion Bond as It Buys Up Metal Used in Green Transition
China Longyuan (916 HK): Continuing the Good Upturn
PT Nippon Indosari Corpindo (ROTI IJ) – The Nation’s Baker
SK Biopharmaceuticals (326030 KS): Strong Xcopri US Sales Not Reflected in Share Price Performance
Align Technology (ALGN US): Q3 Result Not Aligned with Consensus; Outlook Remains Cloudy

Fanuc (6954 JP) – Let the Derating Begin

2Q earnings miss and full year guidance cut – negative surprise to the market
Core FA orders down sequentially QoQ; Weak FA negative for overall OPM
Maintain bearish stance as negative YoY Machine Tool orders yet to come.

Z Holdings (Neutral) – Quick Thoughts on the Read Across from Google, Meta, and CyberAgent

Internet advertising revenue growth has come in below expectations for Google, Meta and CyberAgent as ad budgets appear to be shrinking
There is an indirect read-across to Z Holdings which has almost always posted slower ad growth although it has some insulation from volatility with eCommerce and LINE official accounts
Sill, management targets for ad revenue growth of 5-10% look increasingly challenging which is an issue when Media generates c. 80% of profitability. We remain cautious

META Platforms 3Q22: You Got to Keep ‘em Separated

By Aaron Gabin

Blowout (in a bad way) opex and capex guidance triggered a puke in META. Metaverse spending slowdowns completely ignored by Zuck.
Underlying engagement trends are suprisingly solid, as is underlying revenue growth (which was 8% organic this quarter ex-FX, IDFA, and Reels).
The key question is…what is the LT capital intensity for META to retain its competitive advantage through AI – related spending.

Nagacorp: Contrary News Flow Is a Symptom of How Volatility Can Hide True Value

By Howard J Klein

Within days of each other, news reports both bullish and bearish for the shares of this sector leader have diluted visibility of a strong bull case intermediate term.
Moody’s downgraded Nagacorp debt due to continuing concerns about China’s zero tolerance policy seeming to have no defined duration ahead. Lowered VIP also seen as bearish.
Another report within two weeks showed evidence of continuing strong recovery of Nagaworld GGR in VIP, premium mass and mass. Context is needed on all coveage.

China Healthcare – A Pair Trade: Long Sino Biopharm (1177.HK), Short Hengrui Medicine (600276.CH)

Due to VBP/NRDL negotiation, 2022 is the low point of Hengrui’s performance.The question is to what extent would Hengrui recover?Its development model isn’t an advantage since the game rule changes.
Unlike Hengrui, Sino Biopharm hasn’t given up on generics business,which becomes a ” performance buffer”. Its BD capability/vision is commendable, which would help the company find the next “golden egg”.
The stock price trend of the two companies could diverge. Sino Biopharm is more likely to outperform Hengrui in the medium to long term. Long Sino Biopharm, and short Hengrui.

Zijin Mining Plans $1.4 Billion Bond as It Buys Up Metal Used in Green Transition

By Caixin Global

China’s Zijin Mining Co. Ltd. plans to issue a 10 billion yuan ($1.4 billion) convertible bond to fund its acquisitions of gold and molybdenum ore mines
About 2.5 billion yuan of proceeds will be used to purchase an 84% stake in a molybdenum ore mine located in East China’s Anhui province – Asia’s largest mine of the rare metal which is used as an alloy to make stronger steel.
The planned deal will cost 5.9 billion yuan and will increase the company’s molybdenum reserves to 2.9 million tons from the current 920,000 tons

China Longyuan (916 HK): Continuing the Good Upturn

China Longyuan Power (916 HK) has a very good 3Q22 with earnings increased 55.1% YoY. This has reversed the trend of lower profit YoY in the last two quarters.
The pressure on margin has lessened relative to 1H22 and this is partly reflected by good cost performance. Tariffs for wind and other renewables also look resilient.
Recent pullback in share price has returned Longyuan to attractive multiples. Its growth stories stay intact and outperformance against national power generation is encouraging.

PT Nippon Indosari Corpindo (ROTI IJ) – The Nation’s Baker

PT Nippon Indosari Corpindo (ROTI IJ) released a strong set of 3Q2022 results against all odds given the increased pressure from higher raw material prices and specifically wheat.
Quarterly sales hit record levels with modern trade driving growth and the company improved margins despite surging raw material costs and saved on operational costs through reduced ad spend.
Wheat prices are now -34% from peak levels which should be positive for ROTI’s margins and it continues to expand distribution and new products, driving growth. Valuations are attractive.

SK Biopharmaceuticals (326030 KS): Strong Xcopri US Sales Not Reflected in Share Price Performance

SK Biopharmaceuticals Co Ltd (326030 KS) is reporting continued stellar performance of its flagship drug cenobamate in US, with Q2 sales rising 114% y/y and 27% q/q to KRW40.3 billion.
Thus far, cenobamate has been launched in the U.S. and EU. The company is looking to launch the drug in Korea, China, and Japan in 2025.
Going forward, the company is expected to narrow its losses, and should turn profitable in 2024. The company is expected to launch new drug, carisbamate in global market in 2025.

Align Technology (ALGN US): Q3 Result Not Aligned with Consensus; Outlook Remains Cloudy

On a constant-currency basis, Q3 revenue of Align Technology (ALGN US) was reduced by 3% sequentially and 6% year-over-year, one of the largest quarterly foreign exchange impacts.
Weak consumer sentiment is taking a toll on Invisalign shipment, with adult case starts plunging 11% q/q and 16% y/y to 377K. Invisalign ASPs nosedived to nine-quarter low of $1,150.
Amid increasing competition and macroeconomic headwinds, long-term model of 20–30% revenue growth is hard to achieve. The company is also expected to miss 2022 operating margin target of 20%.

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Oct 27

Daily Brief Equity Bottom-Up: Oriental Watch: Trading at 17% Yield and more

By Smartkarma Daily Briefs | Daily Briefs, Equity Bottom-Up

In today’s briefing:

Oriental Watch: Trading at 17% Yield, 60% Mkt Cap in Cash
Calbee – Price Hikes Are Appealing to Institutional Investors
Samsung C&T: Soundly Beat Consensus Operating Profit Estimates by 68% in 3Q 2022
CyberAgent 4Q: Gaming Deteriorates Further with Absence of New Hit Titles
Ultrajaya Milk Industry & Trading (ULTJ IJ) – The Raw Milk Dividend
Johnson Hitachi (JCHAC IN) | Losing Its “Cool”
CyberAgent (4751) | World Cup Boost for Abema
Sinotrans (598 HK): Showing Its Sustained Resilience
Spotify 3Q22: Another TikTok Victim?
Zhifei Biological Products (300122.CH) – More Downside Ahead, with Untenable Logic in HPV Vaccine

Oriental Watch: Trading at 17% Yield, 60% Mkt Cap in Cash

By Sameer Taneja

We remain cautious on Oriental Watch (398 HK) despite the recovery in sales in June this year. Wealth destruction in financial markets could impact sales in the short term.
Having said that, the stock is extremely cheap at 6.7x FY23 earnings (-32% YoY from FY22), with more than one bn HKD in cash (60% of market capitalization).
With a generous payout ratio of >100%, the stock trades at >17% yield. We believe the company will dip into cash reserves to maintain a high yield.

Calbee – Price Hikes Are Appealing to Institutional Investors

Japan’s largest snacks maker, Calbee Inc (2229 JP) is raising prices by 10-20% for almost 75% of its product range.
These price hikes have boded well with institutional investors with a vast most of them deciding to up their stake in the company following the first price hike announcement.
While institutional-investors bet on earnings growth over long-term through regular price revisions, we think there could also be short and medium-term gains as OP growth turns positive after many years.

Samsung C&T: Soundly Beat Consensus Operating Profit Estimates by 68% in 3Q 2022

By Shifara Samsudeen, ACMA, CGMA

Samsung C&T had outstanding results that soundly beat consensus estimates in 3Q 2022.
Samsung C&T generated operating profit of 796.8 billion won in 3Q 2022, up 465% YoY and 67.7% higher than the consensus estimates.
The strong growth of sales and operating profit was led by the biologics, construction, fashion, and resort businesses.

CyberAgent 4Q: Gaming Deteriorates Further with Absence of New Hit Titles

CyberAgent Inc (4751 JP) reported 4QFY09/22 financial results after the market closed on 26th. Revenue for the quarter decreased 1.9% YoY to JPY 176.2bn vs consensus revenue of JPY 175.5bn.
OP declined 50.8% YoY to JPY 13.2bn vs consensus JPY 16.0bn (miss of 9%) due to decline in profits from gaming business. OPM declined to 7.5% from 14.9% in 4QFY09/21.
CA’s earnings have come under pressure with absence of new hit game titles. Media segment continues to see strong growth and FIFA World Cup is only a one-off boost.

Ultrajaya Milk Industry & Trading (ULTJ IJ) – The Raw Milk Dividend

Ultrajaya Milk Industry & Trading‘s last set of results reflected both the recovery in sales as mobility improved as well the pressure from rising packaging and imported milk powder prices.
Both whole milk powder and skimmed milk powder prices have declined by around 30% from the peak in April this year, which should help to underpin better margins in 2H2022.
Ultrajaya Milk Industry & Trading has increased its advertising and promotional spending to take advantage of improved mobility, with strong growth momentum likely to persist in 2H2022 and into FY2023.

Johnson Hitachi (JCHAC IN) | Losing Its “Cool”

By Pranav Bhavsar

Our channel interactions continue to suggest, Johnson Controls-Hitachi Air Conditioning India (JCHAC IN) will not be able to recover market share over the next two years.
More disappointment in line with what we have seen in Q2 remains a strong probability.
Other annual report concerns also warrant attention, best to AVOID in spite of a sharp correction in stock price.

CyberAgent (4751) | World Cup Boost for Abema

CyberAgent’s stock price could fall after releasing very weak guidance for the coming fiscal year
We would buy into any weakness as we see CyberAgent well placed to benefit from the structural growth of the Digital Ad market
We expect losses in ABEMA TV to shrink further next year and think the whole Media segment can break-even, driven by betting platform, Winticket

Sinotrans (598 HK): Showing Its Sustained Resilience

Sinotrans (598 HK) delivered sustained healthy earnings in 3Q22, with reported profit rose 32.7% and recurring one up 13.2%. They are resilient given the adverse market environment.
Gross margin expansion and higher gross profit showed that lower freight rate has not had significant impact on profitability. DHL-Sinotrans’ contribution also recovered sequentially.
It cancelled the 0.62% of shares that it bought back, providing enhancement to forward EPS. The 9M22 result equals 91% of full-year consensus, suggesting room for earnings upgrade.

Spotify 3Q22: Another TikTok Victim?

By Aaron Gabin

MAUs beat, margins miss, guidance weak. Where / when is the operating leverage?
Podcasting business took a restructuring charge this quarter, not bullish for the business meant to expand gross margins.
TikTok reportedly readying a new streaming music app… not good.

Zhifei Biological Products (300122.CH) – More Downside Ahead, with Untenable Logic in HPV Vaccine

Due to the lack of competitiveness, Zhifei’s self-developed products cannot contribute solid performance to make up for the shrinking revenue of HPV vaccines when more competing products gradually launched.
The real potential of HPV vaccine market in China is not as big as imagined. So, the companies involved have the problem of inflated market values.
Due to low demand of COVID-19 vaccine/negative impact of pandemic on HPV vaccination, Zhifei’s revenue YoY growth could be 10%-20%; Net profit YoY growth could be negative in 2022.

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Oct 26

Daily Brief Equity Bottom-Up: Hong Kong Stocks Priced For Liquidation and more

By Smartkarma Daily Briefs | Daily Briefs, Equity Bottom-Up

In today’s briefing:

Hong Kong Stocks Priced For Liquidation
Yamazaki Baking: Profitability to Double Over The Next Few Years
Closing the Gap Between LG Energy Solution & LG Chem Pair Trade
Tencent (700 HK): Game Market Weak in 3Q22 and to Be Worse in 2023
Delta Taiwan Vs. Thailand Monitor: Major Disconnect Post Thai Earnings, Trade Taiwan Into Earnings
Asia Gaming: Despite Continuing Covid Headwinds, Melco Remains Too Cheap to Ignore, as Dips Prevail
Alibaba ADR: Initiation of Coverage – Business Strategy & Key Drivers
IRDM: Orbiting Subscriber Growth
IBM Corporation: Acquisition-Led Growth In The Cloud Market & Other Drivers
Lam Research: Major Drivers

Hong Kong Stocks Priced For Liquidation

By David Blennerhassett

With investors chucking in the towel and the HSI touching a thirteen-year low, it’s time for some old school perspective.
This insight looks at Benjamin Graham’s Net Nets, (current assets less current liabilities), then subtract any debt not included in current liabilities. More simply, current assets less total liabilities.
Graham would conclude these stocks are priced for liquidation. Stocks discussed include Sinopec Engineering (2386 HK), PC Partner (1263 HK), Linklogis (9959 HK), Antengene (6996 HK) and property service companies.

Yamazaki Baking: Profitability to Double Over The Next Few Years

Yamazaki Baking (2212 JP)’s Q3 was mixed with revenue growing 5.6% YoY to surpass consensus by 3% but OP of ¥1.6bn was ¥650m below consensus.
However, this was mostly priced-in, as shares are currently trading at the bottom end of the upward trend channel.
With wheat prices down 23% from the peak, pressure from input price inflation should alleviate, resulting in margin upside in the fourth quarter.

Closing the Gap Between LG Energy Solution & LG Chem Pair Trade

In this insight, we discuss a pair trade between LG Chem Ltd (051910 KS) (go long) and LG Energy Solution (373220 KS) (go short).
LG Chem’s shares are trading at nearly 66% discount to its NAV which we believe to be excessive.
Another major factor that could negatively impact LGES’ shares in the next several months is the end of the lock-up period for the company’s ESOA shares in about three months.

Tencent (700 HK): Game Market Weak in 3Q22 and to Be Worse in 2023

By Ming Lu

In 3Q22, the game market size shrank in China and globally.
The limitations on time spent on games by juveniles, imposed earlier by the authorities, severely impacted the domestic market.
We believe the key impact for 2023 is the predictable license approval.

Delta Taiwan Vs. Thailand Monitor: Major Disconnect Post Thai Earnings, Trade Taiwan Into Earnings

Delta Electronics Thailand shares rose sharply ahead of its earnings result, where profit beat expectations. Delta Taiwan shares fell the same day, thus we see an opportunity.
Delta Taiwan to report on October 28th. Delta Taiwan is now smaller in market cap than its subsidiary despite earning substantially higher levels of net profit.
2023E growth expectations are relatively similar for both, supporting Delta Taiwan to revert vs. Thailand. Trade opportunity into the Delta Taiwan October 28th results.

Asia Gaming: Despite Continuing Covid Headwinds, Melco Remains Too Cheap to Ignore, as Dips Prevail

By Howard J Klein

Melco Resorts & Entertainment will report 3Q22 results by November 11th. We expect sustaining recovery for its Manila and temporary Cyprus properties.
Current valuations of the shares do not yet reflect some recovery expected from increased arrivals due to the re-opening of 4 China provinces and Shanghai, Sporadic closures happen.
Threats of delisting fron last spring have significantly diminished as MLCO moved aggressively to meet NASDAQ concerns.

Alibaba ADR: Initiation of Coverage – Business Strategy & Key Drivers

This is our first report on global tech giant, Alibaba.
The company is currently trading close to its 52-week low with its results just around the corner.
Tmall GMV and Taobao experienced a percentage decline in the mid-single-digit in the last quarter.

IRDM: Orbiting Subscriber Growth

By Hamed Khorsand

IRDM put the emphasis on its quarterly report versus commentary on smartphones and drones using satellite connectivity. The third quarter results continued to show the ongoing growth in IOT subscribers
IRDM’s service revenue has been trending higher with added maritime and IOT subscribers
During the third quarter, IRDM added 7 thousand voice subscribers and 89 thousand IOT subscribers. The rate of voice customer additions can be lumpy depending on seasonality

IBM Corporation: Acquisition-Led Growth In The Cloud Market & Other Drivers

IBM delivered an all-around beat with over $14 billion in revenue and tremendous growth throughout the portfolio resulting in a sharp recovery in its stock price.
Technology continues to be a key source of competitive advantage, and there is still a healthy market for hybrid cloud and AI solutions.
Consistent double-digit revenue growth at IBM Consulting, satisfying client demand for digital transformations.

Lam Research: Major Drivers