TMT/Internet

• Originally, Brother Industries (6448 JP) wanted to buy Roland DG Corp (6789 JP).  Roland invited others to bid, didn’t tell Brother, then said Taiyo Pacific’s ¥5,035 bid won.
• That was low. Weeks later, Brother lobbed a ¥5,200 overbid. They are going through the approvals process but it isn’t clear Brother is negotiating.
• Taiyo has extended and extended and shown up in interviews. Now it has overbid at ¥5,370.

• Q124 revenue was $12.7 billion, down 17.5% QoQ but up 9% YoY.
• Q224 revenue forecast of just $13 billion & vague promise of full year YoY growth disappoints
• Capacity constraints on wafer level assembly limited Meteor Lake shipments. So much for a maniacal focus on execution.

• Corporations need to adapt to smarter AI as 6G, the next evolution in mobile communication, is coming soon, bringing faster speeds and advanced technology.
• Taiwan’s AI startups showcase cutting-edge B2B solutions at 2024 AI Expo, while Microsoft’s third-quarter revenue reaches a record high with the help of AI technology.
• Despite record high SiPh shipments, LMOC had a net loss in 1Q24. Taiwan’s biggest curved interactive MiniLED display, ‘Wishing Tree,’ steals the show at Touch Taiwan 2024.

• In 2Q24F, customer demand has slowed down in the traditional low season, as inventory levels normalize.  
• In summary, sales in USD are expected to grow in the mid-teens YoY in 2024F. Smartphone growth will be the strongest driver of this growth. 
• MediaTek is a leader in the Wi-Fi 7 market and aims to gain significant market share with its diverse product portfolio this year.

• Despite following Big Tech closely for the last 5 years, this sentence from today’s call still somewhat surprised me!
• The scale and the height of success of Google truly boggles my mind.
• Over the last year or so, Google has had its fair share of skeptics, including yours truly. 

• Regulatory risks could derail TikTok’s drive to become Vietnam’s No. 1 online marketplace, an industry expert said.

• The ByteDance-owned short-video app launched TikTok Shop in Vietnam in April 2022 as part of its broader ambition to control 35% of Southeast Asia’s e-commerce market.

• Since then, it has surpassed Alibaba-backed Lazada to become Vietnam’s second-largest online marketplace by gross merchandise volume — TikTok’s vendors sold about $1.3 billion worth of goods in the past six months, according to local media which cited data from local analytics firm Metric. Now, only Singapore-based Shopee stands between TikTok and the top spot.

• CMG is a small-cap company with a leading market share in the unconventional reservoir space
• They see a significant opportunity for their software and machine learning offerings to help maximize asset value and reduce costs and risks in the energy industry
• Under new leadership since mid-2022, the company has shifted towards a more commercially focused approach and is targeting clean energy opportunities such as carbon capture

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• ATNI is trading at approximately 35 percent discount to tangible book value after reporting first quarter results with negative free cash flow and reducing adjusted EBITDA guidance by 4.4 percent.
• ATNI experienced delays in securing government contracts in the quarter and slower process in growing commercial broadband accounts.
• ATNI is forecasting adjusted EBITDA of $190 million to $200 million leading to calculation of positive free cash flow. 

• WEX is a payments company trading at a discount to its historical valuation, with a P/E of 12.5x
• WEX operates in three segments including Mobility and Corporate Payments, with a market cap of $9bn
• WEX’s growth is driven by share gains, technology add-ons, and price increases, making it an attractive investment opportunity

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• Shin Etsu Chemical (4063 JP), owner of a 44% stake in Mimasu Semiconductor Industry (8155 JP), has announced a Tender Offer to take out minorities in Mimasu. 
• This is not surprising. They bought in 19 years ago, raised to 40+% 18yrs ago, then waited. Finally, we have a deal. But it’s too cheap. 
• Shin-Etsu starts with ~45%, and crossholders and the chairman get it to 52%. Then they need a bit to get them to 67% but it should be straightforward.

• SK hynix earnings were announced, with a 10% Q/Q revenue increase driving a 734% increase in operating profit
• Although the company cited AI demand as the basis for this, its DRAM revenues, which are very AI dependent, increase very little
• NAND SSD demand increased significantly, with a 30% increase in revenues, largely attributable to price increases

• Almost every sectors are recovery since 1Q24, and auto and industrial applications sectors still need more time to digest inventory. .    
• The capex for 2024F has been increased by 10% for further investments in the testing business, targeting turnkey or testing customers. 
• All product lines expected to grow in 2H24F, with APT outperforming corporate average. UTR growth expected in 2H24F, reaching above 70%. 

• If you have been following Meta for some time, you probably are accustomed with after-hours (AH) volatility by now.
• While Meta was -20% at one point AH today, it does seem a bit overdone.
• Of all the post-earnings drop that I have experienced following Meta since 2018, this one probably made me nervous the least.

• The SE600 index is one of the most widely followed benchmark indices in Europe. This index is rebalanced on a quarterly basis.
• In this insight, we take a look at the potential index changes that could take place between now and the end of the June 2024 index rebal event.
• Currently, I see 7 ADDs and 7 DELs for the SE600 index. There are more names just outside the border requiring small price changes to get involved in index changes. 

• Intel misses 1H24 market consensus again, post market correction of over 7%. Can shifting focus away from foundry/manufacturing help?
• Is the breakdown change for future spin off/IPO of foundry/manufacturing, and non focus businesses like Altera and Mobileye positive?
• We disagree Intel foundry to breakeven in two years; we see AI product lagging behind competitors and non AI server CPU being squeezed by AI server GPU and GPU/CPU integration.

• Nextnav is a flying car company with valuable low band spectrum covering 93% of the US population
• The spectrum could be worth $18 per share within a year
• Investment in Nextnav is likely to be successful due to the valuable spectrum and experienced team

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.

Freelancer’s Q124 results were mixed. Operationally, the company is seeing rising demand for AI specialists as customers seek affordable ways to develop proprietary AI. Notably, in Enterprise, the company delivered a large-scale AI pilot for a tech giant, sourcing 20,000 freelancers in 24 hours across 52 languages. This impressive achievement could lead to a substantial multi-year contract. Major initiatives across Loadshift and Escrow with leading organisations are set to be deployed over the coming months, potentially catalysing performance and diversifying revenue streams. We revise our forecasts to account for a weaker Q1 than anticipated, though positive lead indicators, especially relating to AI, underscore long-term optimism.

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

• SK Hynix
• Vedanta Resources

• There were only 12 new listings on the Main Board of the HKEX (388 HK) in the first quarter of the year. More than half the listings were in March.
• Of those stocks, we only see Robosense Technology (2498 HK) having a chance of being added to the HSCI in June and then into Southbound Stock Connect.
• There is a big lock-up expiry for Robosense Technology (2498 HK) in July and that should keep the stock under pressure.

• UMC expects macro uncertainties and cost headwinds to linger into 2H24. 
• The P3 project has received strong support from the Singapore government with a US$5 billion Capex. 
• UMC has seen high interest from customers for its 14nm capacity. 

• TKC Corporation provides accounting and tax services to accounting firms (and client companies they advise), local governments, and others using its own computational centers, while subsidiary TLP Corp.
• In full-year FY09/23, the company reported consolidated sales of JPY71.9bn, operating profit of JPY14.3bn, recurring profit of JPY14.8bn, and net income attributable to owners of the parent of JPY10.8bn.
• TKC does not release a medium-term business plan. However, it is pursuing the following four objectives in close cooperation with TKC National Federation.

• ARLO ) changed their subscription plans at the beginning of 2024 and Q1 results are expected to show little change in consumer habits since these pricing plans were instituted
• ARLO started 2024 with new pricing for its lowest subscription tier as cloud costs for such customers were more than the monthly subscription rate
• The focus of the first quarter results should remain on subscriber growth, especially as holiday period hardware sales begin to transition to paid subscription

• ODDITY, a data-driven beauty platform, posted strong financial results, reaching two important milestones in 2023: surpassing $500 million in revenue and generating over $100 million of adjusted EBITDA. The company’s net revenue grew 57% to $509 million, while adjusted EBITDA surged 173% to $107 million.
• ODDITY’s online platform, launched only five years ago, currently has over 50 million users and is responsible for these robust financial results.
• 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.

• Horizon Robotics is looking to raise US$500m in its upcoming Hong Kong IPO. The bookrunners on the deal are GS, MS and China Securities.
• Horizon Robotics (HR) is a provider of advanced driver assistance systems (ADAS) and autonomous driving (AD) solutions for passenger vehicles, empowered by its proprietary software and hardware technologies.
• In this note, we talk about the positive aspects of the deal.

• Again, Tesla reports a 1Q24 sales with 4% miss but post market share price up more than 10% for 6 reasons. 1. Gross margin was stable on 15% sales drop;
• 2. ASP was stable; 3. Affordable EV on track for 2025; 4. Factory expansion to slow; 5. Optimus to sell end of 2025; 6. 2024 EV shipment higher than 2023.
• Near term risks to remain: 1. When will margin trough? 2. Why bother to buy EV if 2nd hand market collapsing? 3. Will Robotaxi/FSD bring in meaningful sales/profits soon?

• Horizon Robotics is looking to raise US$500m in its upcoming Hong Kong IPO. The bookrunners on the deal are GS, MS and China Securities.
• Horizon Robotics (HR) is a provider of advanced driver assistance systems (ADAS) and autonomous driving (AD) solutions for passenger vehicles, empowered by its proprietary software and hardware technologies.
• In this note, we talk about the not-so-positive aspects of the deal.

• SK Square is looking to raise around US$198m via selling 2.1% of Krafton (259960 KS).
• The stock has been doing well over the past few months and its earnings and price momentum remain strong.
• In this note, we will run the deal through our ECM framework and talk about the recent updates.

• On 19 April, Taiyo Co-CEO Brian Heywood told Bloomberg and Reuters they were considering three options to Brother Industries (6448 JP)’s tender for Roland DG Corp (6789 JP). 
• Taiyo’s options are bumping its offer, walking away or tendering into the Brother’s offer if it bumps and alleviates dis-synergies concerns.
• All three options are likely a ruse. Taiyo’s primary play is to frustrate and pressure Brother to withdraw its bid if it cannot get the Board’s recommendation.

• After the market close on 22 April, it was reported that SK Square plans to sell 2.2% stake in Krafton in a block deal sale worth about 270 billion won. 
• The estimated block deal sales price range is from 243,000 won to 251,000 won, representing a 3.1% to 6.2% discount to the closing price of 259,000 won on 22 April.
• We would take the deal. The company’s valuations remain attractive and it has been successful in expanding its sales and profits. 

• A shares were up on the week, while Hs were down. BIG divergence among liquid names. 
• Net SOUTHBOUND buying was +HK32.1bn. SOUTHBOUND ended its consecutive post-CNY daily net buy streak on 25 March, then started a new one. No net sell days since.
• Little market news. More geopolitical news. SOE bank H-shares are seeing relentless net and gross buying, very very little selling.

• A nasty power struggle between ADOR CEO Min Hee-Jin and HYBE has erupted which is likely to continue to negatively impact HYBE’s share price in the next several months.
• ADOR CEO Min Hee-Jin owns an 18% stake in ADOR which was founded in 2021. HYBE owns the controlling 80% stake in ADOR.
• Given the nasty fight between ADOR and HYBE, it is likely that the two companies (including ADOR’s CEO Min Hee-Jin) are likely to part their ways.

• Taiwan Tech Shares Fell Sharply Along With Global Selling — Semiconductor and AI Names Most Exposed
• What Is TSMC Telling Us About Semi Supply Chain Stories at Its Investor Conference? 
• ASE Technology Holding (3711 TT) Wins iPhone 16 System-in-Package Order from Apple (AAPL US)

• In 1Q24, Xiaomi and Transsion shipments grew rapidly, while Samsung Electronics (005930 KS) and Apple (AAPL US) shrank.
• Tims China’s revenue expanded with new openings, which is encouraging in the competitive market.
• In China, Tesla fired salespeople who had served the company for less than six months.

• Mr. Yashish Dahiya is an impatient man. In one of the interviews with The Ken, he narrated a story of how while in college he used to run home to Noida every Friday and back to college on a Monday morning (both 30kms in one direction) as he found public buses too slow for his liking.
• Mr. Dahiya, is also persistent and doesn’t give up easy – he is one of the few people in the world who has completed the grueling Ironman triathlon – an intense race that consists of swimming, bicycle ride and a marathon all raced in that order – widely considered one of the most difficult one-day sporting events in the world.
• It’s these qualities of impatience, persistence and continuously improving oneself that can be found in the business of PolicyBazaar or PBFinTech, the name of the parent company applying for IPO.

• IRDM reported first quarter results with equipment revenue providing the necessary lift to total revenue for IRDM to beat consensus estimates
• IOT subscribers continued to rise in the quarter with IRDM disclosing it has entered into a two-year agreement with a major IOT partner that provides revenue clarity for both parties.
• IRDM reported first quarter revenue of $203.9 million compared to our estimate of $197.7 million. The reason for the outperformance was due to equipment revenue

• eBay has the potential to become a trillion-dollar AI powerhouse in e-commerce
• Offers anti-inflationary savings and eliminates fraud risks
• Seen as undervalued with high growth potential compared to Amazon

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.

• We summarise the latest spreads and newsflow of merger arb situations we cover across Hong Kong, Australia, New Zealand, Singapore, Japan, Indonesia, Malaysia, Philippines, Thailand and Chinese ADRs.
• Highest spreads: Qantm Intellectual Property (QIP AU), Southern Cross Media (SXL AU), Azure Minerals (AZS AU), QV Equities Ltd (QVE AU), Hollysys Automation Technologies (HOLI US), Shinko Electric. 
• Lowest spreads: Chilled & Frozen Logistics Holdings (9099 JP), Roland DG Corp (6789 JP), Mma Offshore (MRM AU), Pact Group Holdings (PGH AU), Newmark Property REIT (NPR AU), Lawson.

• TSMC and ASML reported 1Q24 results last week; both stocks have fallen post results, impacted by global concerns despite a strong outlook for these two leaders into 2025E.
• TSMC guided for strong growth not just in 2024E, but if one digs into management’s comments, they actually provided strong visibility into their 2028E internal revenue expectations.
• For ASML, its EUV product business is the key indicator to watch. We believe TSMC shares will continue to re-rate even through a period of global economic softness.

• TSMC: +9.2% Premium, Major Breakdown From Previous Historically Extreme High
• UMC: -1.9% Discount, Is Near Low End of Historical Range
• ASE: +10.4%; ADR Short Interest Jumps to Very High Level vs. History

• Aequitas Research puts out a weekly update on the deals that were covered by the team recently along with updates for upcoming IPOs.
• On the IPO front, Sichuan Baicha Baidao Industrial (2555 HK)‘s deal launch made it the first large HK IPO for this year.
• On the placement front, Vodafone Idea (IDEA IN) deal was live. Also there are lockup expiries in Kokusai Electric (6525 JP) and J&T Global Express (1519 HK) coming up. 

• Shift Inc (3697 JP) ’s share price has been down more than 50% YTD with the release of 1QFY08/2024 results in January 2024 which saw a drop in margins.
• The company’s aggressive investment in HR and system reinforcement led to a decline in margins, however, margins saw a QoQ improvement in 2QFY08/2024.
• Despite there being an improvement in 2Q and the company expecting the margins to bounce back in 4Q, Shift’s share price has continued to fall.

• It’s time for the main event: earnings are upon us. As is customary, let’s start with TSMC, move to ASML and Alphawave, and then discuss VAT Group.
• TSM revenue is above guidance, gross margins are a bit ahead of the midpoint, and operating margins are at the high end of guidance.
• First, while this is a good result, semiconductors are due for a correction. I wrote about this in March, and SOXX has quietly crept downwards since then.

• Q124 revenues of $18.87 billion, marginally above the high end of the guided range, up 12.9% YoY and down 3.8% QoQ. Guided Q224 +6% QoQ.  Maintained full year 2024 outlook
• Unnecessary, minor downward revisions for semi & foundry growth, combined with confusion about the reason triggered an allergic reaction on the markets. TSMC down ~8% since.
• SMCI plunged 23% by Friday close, ARM down 16.9%, NVIDIA down 10%, AMD & Micron down ~5% etc. Nice one, TSMC!

• A weekly summary of key developments across ECM and Event-Driven names tracked by us across Hong Kong, Australia, New Zealand, Singapore, Japan, Indonesia, Malaysia, Thailand, Korea, India and Chinese ADRs.
• ECM developments: Kokusai Electric (6525 JP) and J&T Global Express (1519 HK) lock-ups. HD Hyundai Marine Solution (443060 KS), ZEEKR (ZK US) and Sichuan Baicha Baidao Industrial (2555 HK) IPOs.
• Event-Driven developments: Hollysys Automation Technologies (HOLI US), Shinko Electric Industries (6967 JP), Inageya Co Ltd (8182 JP), Hang Lung Properties (101 HK), Tietto Minerals Ltd (TIE AU). 

• ASML reported Q124 revenues of €5.3 billion, in line with expectations, down 27% QoQ and down 21% YoY.
• Guided Q224 for €5.95 billion, down ~23% YoY. This implies H224 will have to be much stronger than H124 in order to maintain full year 2024 guidance of flat YoY
• New order intake was €3.6 billion, down significantly from the €9.2 billion in the prior quarter, and challenging the narrative of a strong growth year in 2025

• Braze Inc. had a productive Q4 for the fiscal year 2024, reporting robust revenue growth and notable leaps in operational efficiency.
• The company generated $131 million in revenue, up 33% year-over-year and 6% quarter over-quarter.
• It is important to mention that these figures were achieved despite macroeconomic headwinds and tight scrutiny of budgets, reflecting the high ROI and enduring value of Braze’s customer engagement platform.

• Arrow Electronics had a decent performance in 2023 despite the challenging macroeconomic conditions and inventory-related issues.
• Arrow Electronics managed to post a full-year revenue of $33.1 billion and a non-GAAP operating margin of 4.8%.
• The company also reported strong cash flow from operations, enabling the repurchase of approximately $750 million in shares over the year.

• Teradata Corporation, a leading hybrid multi-cloud analytics and data platform company, recently held its fourth quarter and full year 2023 earnings call, which indicates the company’s progress and future outlook in its sector.
• The company emphasizes its focus on customer satisfaction by delivering solutions for complex data and analytics problems.
• 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.

• Varonis Systems Inc. showcased strong performance in the fourth quarter and full year 2023 as they continued their transition towards Software-as-a-Service (SaaS).
• The successful transition of their offerings led to an incredible growth of the SaaS Annual Recurring Revenue (ARR) from several million dollars in 2022 to approximately $125 million by the end of 2023.
• This growth in SaaS ARR represented approximately 23% of the total company ARR at year-end.

discoverIE anticipates reporting FY24 underlying EPS in line with board expectations. After a period in mid-FY24 of working down inventory, customers appear to be reverting to normal ordering patterns, with Q424 organic revenue growth of 2% y-o-y and 11% q-o-q and a strong pipeline of design wins at year-end. We have revised our forecasts to reflect lower revenue, partly due to a disposal, but maintain our profit forecasts, which results in operating margin expansion in FY24 and FY25.

• Workiva ended 2023 with solid Q4 results, delivering an 18% growth in subscription revenue and a non-GAAP operating profit that exceeded its guidance.
• For the total of 2023, the firm overshot its earlier set guidance in February and Q3 2023, with a 20% growth in subscription revenue and 17% in total revenue.
• This marks Workiva as a growth player.

• FYBR had a strong performance in Q4, achieving key milestones and demonstrating the effectiveness of their fiber-first strategy.
• The company reported EBITDA growth for the first time in over a decade, marked by the company’s hard operational execution and sustainable strategy.
• Furthermore, the company ended the year with 6.5 million fiber passings, representing 65% progress towards its target of building 10 million fiber locations, making it the largest pure-play fiber provider in the country.

• Iridium Communications Inc.’s fourth-quarter 2023 earnings indicated strong performance with impressive service revenue and operational EBITDA. The company reported more than $300 million in pro-forma free cash flow for the full year, emphasizing growing cash flow as its primary narrative.
• The satellite communications provider has generated about $1 billion in free cash flow since turning cash flow positive in late 2019 after completing its second-generation constellation.
• 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.

• KD highlights several milestones on its Fiscal Third Quarter 2024 Earnings.
• The company reported strong execution and accelerated progress as a leader in mission-critical IT infrastructure services.
• Its strategy surrounds the creation of alliances, advanced delivery, account initiatives, KD Consult and KD Bridge, contributing to expectations of profitable growth and an increased full-year earnings outlook.

• TSMC reiterates 2024 sales y/y growth of 20-25% but revises down 2024 global semiconductor y/y sales from over 10% to 10% and global foundry sales growth from 20% to 15-19%.
• No more Moore’s Law: After 3 years ramp up gap between N5-N3, TSMC confirms 10-11 quarters of ramp up gap between N3 and N2 due to longer production cycle.
• Driven by stronger digital consumer (33% q/q), HPC (3% q/q), IoT (5% q/q) sales but weaker smartphone IC (-16% q/q), TSMC reports 1Q24 sales decline of only 5% q/q.

• Shinko Electric Industries (6967 JP)‘s pre-conditional tender offer from the JIC alliance is JPY5,920 per share. The gross spread widened from a low of 3.1% on 14 March to 7.0%. 
• The widening spread can be attributed to China SAMR approval timing, earnings risk, Ibiden Co Ltd (4062 JP)’s material underperformance lowering the break price and a large fund liquidating positions. 
• The deal break risks remain low with the timing remaining the key risk. The current 7.0% spread is an attractive opportunity to add. 

• Arm – which we estimate accounts for 45% of SoftBank group’s equity value – is experiencing limits to its “growth at any price” stock status; the shares fell 12% yesterday
• The JPY’s depreciation is supportive of the group NAV, but with the Fed’s hawkish stance well known and BoJ expected to raise interest rates, JPY weakness may be largely done
• SoftBank shares trade at a wide 53%+ discount to the estimated NAV; yet we see downside risks to Arm’s valuation, along with the potential for JPY weakness to reverse

• Mobvoi, an emerging AIGC market player in China, set terms for an IPO and plans to raise ~HK$330M (~$42M) in Hong Kong. CICC and CMB International are leading the offering.
• The initial public offering is expected to be between HK$3.70 and HK$4.10. At the midpoint of the range, Mobvoi has a market value of ~HK$5.8B based on 1491.5M outstanding shares.
• In my insight, I discuss valuation framework for comparable company analysis and outline revenue growth scenarios for each business segment under my base case.

• Declaring a slower recovery for mature nodes was an outlier, indicating that Vanguard’s recovery progress might be slower. 
• Apple’s iPhone is expected to be the focus for N2 production in 4Q15F.  
• TSMC’s long-term gross margin is set at 53%, signifying a few key points. 

• The discounts of both Naspers and Prosus have widened during the last 5 trading sessions.
• We see current levels as attractive entry points for trading the rump.
• In our view, there are a number of fundamental factors that could act as positive catalysts to a further structural narrowing of the discount.

• Interview with Scott Miller, CIO at Greenhaven discussing Par technologies and recent developments
• Par technologies is a stable point of sale software company focused on food services industry
• Company has shown strong progress in organic growth and acquisitions, with potential for further upside in the stock market

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

• IMMR is using the gains from Q124 to make an investment in BNED. IMMR intends to invest $45 million to purchase new shares at $0.05 per share.
• IMMR’s stock continues to trade at a slight premium to cash even though the operating business has continued to expand in auto
• IMMR disclosed it ended the first quarter of 2024 with approximately $200 million in shareholder equity. This would equate to a sequential increase of approximately $17 million

• Wix reported strong Q4 2023 earnings underpinned by its pivot to AI innovation.
• 2023 was a year of significant progress for the firm as it demonstrated robust growth, reaching record profitability levels.
• With the focus on AI, Wix introduced an array of AI-powered features that would help users create web content more efficiently, resulting in improved monetization and heightened user conversion rates.

• Zhubajie Co Ltd (ZHUHKZ HK) is looking to raise at least US$100m in its upcoming Hong Kong IPO.
• Zhubajie (ZBJ) is a customized enterprise services e-commerce platform in China. The firm focuses on matching and facilitating the transactions between enterprise clients and service providers through its ZBJ platform.
• In this note, we talk about the firm’s historical performance.

• When this deal was announced, it was light. But the timing, JSR influence, large-ish float, ensured FUD would make this trade wide. It traded wider. 
• 12wks ago, Shinko had much-underperformed peer Ibiden, meaning downside gap risk from undisturbed was negative as spreads were wide. I reco’d a buy. Then 5wks ago, reco’d trimming.
• Shinko had outperformed Ibiden, and gross spreads had come in 5+% on JSR’s approval. Spreads are now 3% wider than their narrowest, but gap risk has widened as Shinko outperforms.

• On the 8th February 2024, 85% of Hollysys Automation (HOLI US) shareholders present and via proxy, voted for Ascendent Capital’s Offer. After three-plus years, the end was finally in sight.
• Then crickets. The merger was to complete in the 1Q. On the 15th April, HOLI released an accountant resignation notice. No word on dissenters or regulatory approvals. Shares sold off. 
• The accountant resignation is a nothing burger. HOLI should lift their game and provide more transparency on the outstanding merger conditions. Still, the spread is attractive. This is a buy. 

• In this insight, we take a look at the potential index changes for ASX 200, 100, 50, and 20 in the run-up to the June 2024 index rebal event.
• There are up to two intra-review changes possible between now and the June 2024 review which could triggered by the Silver Lake (SLR AU) and Boral (BLD AU) deals.
• Separately, I see one ASX 20 change and two ASX 100 changes for the regular rebalance in June 2024.

• Nexon is a leader in the video game virtual worlds industry with an enterprise value of $11.4 billion
• The company has consistently high EBIT margins and a robust portfolio of popular franchises that have generated billions in revenue
• Despite being undervalued by the market compared to its peers, Nexon is poised for significant growth and offers potential for future success for 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.

• Cloudchain (CC CH) is looking to raise up to US$200m in its upcoming HK IPO. 
• Cloudchain is an independent industry digital finance platform in China, serving anchor enterprises, chain-related enterprises, and financial institutions.
• In this note, we will talk about the not-so-positive aspects of the deal.

• Lumen Technologies’ Fourth Quarter 2023 Earnings revealed significant progress in the company’s business transformation.
• Led by the efforts of the new executive team under CEO Kathleen Johnson, Lumen indicated that it had met its 2023 EBITDA and free cash flow guidance and had made material progress in its strategic priorities.
• To strengthen its balance sheet, Lumen entered into an agreement with a majority of its creditors that extends most debt maturities to 2029.

• Pegasystems Inc. has noted robust cash flow growth and value delivered to its clients in Q4 of 2023.
• The company has adopted a new go-to-market strategy that has been received well by the team, leading to strong customer relationships.
• The company has focused on AI utilization to introduce industry-changing technologies, which has resulted in increased growth and cash flow.

• SolarEdge deemed its Q4 2023 and full-year results as clouded by adverse market dynamics and high inventory levels.
• For Q4, SolarEdge reported revenues of about $316 million, split between $282 million in their solar business and $33 million in non-solar activities.
• The company shipped 2.2 million power optimizers and 74,000 inverters during the quarter, along with 133-megawatt hours of batteries.

Next 15 Group’s net revenues grew 2.5% in the year to January, despite difficult markets. Adjusted operating margin rose from 20.2% to 21.0%, helped by head office cost savings. In common with much of the sector, spending by tech clients was soft, down 17% like-for-like. The group did well, though, in growing spend from non-tech clients, up 11%, making for a strong overall performance in a market beset by ongoing macro uncertainty. Next 15 has been building its AI capabilities for some time and this is now starting to show in efficiency and margin. It has the balance sheet strength to keep investing here, internally and through M&A, which should stand it in good stead as client confidence improves.

• Paychex, in its third quarter, reported a total revenue growth of 4%, which was dampened by a lower contribution from its Employee Retention Tax Credit (ERTC) service, compared to the previous year.
• However, the company stated that by eliminating this impact, the total revenue grew by 7% during the quarter.
• Factors such as the winding down of the ERTC program, moderated employment growth within Paychex’s client base, and marginally lower realized rates resulted in stronger headwinds during this quarter than the company had anticipated.