United States

• On March 2 we discussed how the pullback in global equities was in full swing as Europe/UK indexes displayed 4.5-month uptrend breaks, joining the pullback in the MSCI ACWI.
• At the time, we expected this pullback in the MSCI ACWI (ACWI-US) to move down to $86-87 at minimum, and potentially $84 (December 2022 low) or $75-77 (the 2022 lows).
• ACWI-US broke below $86 and is approaching $84. $84 will be an important support level to monitor, but if it breaks, the $75-77 level is still firmly in the cards.

• Realty Income Corporation’s sustainable growth rate has stalled, resulting in an intrinsic value below its traded market price.
• Realty Income’s market-based features, including dividend growth and low volatility, are favorable.
• However, we think the REITs valuation is a significant risk.

• The leader in rental equipment industry offers attractive returns, in spite of short-term risk of recession.
• United Rentals’ well thought out growth strategy has created an important competitive advantage.
• High free cash flow allows the management to increase shareholder distributions, while also reinvesting back into the business, according to the company.

• In this insight, we take a look at the potential index changes and the resultant capping flows for the HSCEI Index in June 2023.
• According to our estimation, there could be two changes for the HSCEI in June 2023 and there could be one-way index flows of US$585mn.
• The final index changes along with indicative capping and index weights could be published in Mid/Late-May 2023.

• ZKH Group (ZKH US) is a leading MRO procurement service platform in China offering digital and fulfilment solutions for participants in the industry value chain.
• The company has filed for an IPO to list its shares in the US and plans to raise about US$200-300m through the IPO.
• Having analyzed the limited information available, we are indifferent on ZKH’s operating performance and would only recommend if shares are priced attractively

• ChatGPT-4 is here and OpenAI is betting that it’s the smartest version so far.

• GPT-4 has a broader general knowledge and problem solving abilities, the company said in a research paper that was released alongside the chatbot.

• The paper showed that the latest model beat 90% of bar exam takers.

• CEO Matt Fisch’s first earnings call announced revenue of $1.1 million in 4Q22, in line with quarterly expectations.
• CFO Bob Brown announced that he is leaving the company effective March 31.
• Fisch said the company is “in the process of developing a strategic plan and timeline that builds on [our] significant achievements made to date.”

• While the market seems to have shrugged it off, crypto – and DeFi in particular – survived an existential risk over the weekend.
• USDC was caught up in the turmoil that hit U.S. banks and depegged amidst fears it was no longer fully backed.
• We covered the reaction in centralized markets in the week’s Debrief, but given that USDC’s primary use case is in DeFi, this week we’ll examine how the depegging played out on-chain, examining trading, liquidity, and lending and borrowing, with a particular focus on the role that bots played.  

• Final funding for Project Dorothy is now secured, with energization scheduled for the first week of April, pending approval from ERCOT. 
• Soluna recently announced $7.5 million in funding from existing project investor Spring Lane Capital (SLC) that will be used to complete the final energization of Dorothy and support corporate expenses.
• SLC’s stake in the 25 MW Dorothy 1A increases to ~85% from 32%, but Soluna retains the right to 50% of 1A’s profits after SLC achieves an 18% IRR hurdle.

• Revenue grew 51.7% Y/Y to $0.7 million, compared with $0.5 million in 3Q22.
• Growth in the top-line figure was primarily driven by sales of WAM-V autonomous vehicles and better margins derived from Strategic Consulting Services. 
• A key driver of the revenue trajectory is the order activity, which is up 111% to $3.8 million YTD, with significant additional order activity in various stages of negotiation.

• SES reported an operating loss of $20.7 million, $10.6 million higher than in 4Q21, primarily due to increased personnel and lab consumables to support the development of battery cells and AI software.
• General and administrative costs ($12.5 million) and R&D costs ($8.3 million) were the primary contributors to the operating loss. 
• The company’s net loss was $9.2 million (-$0.03 per share) compared with $10.2 million (-$0.17 per share) in 4Q21.

• Greentree Hospitality (GHG) is a Chinese hotel franchiser and operator that trades at a large discount to other US traded peers and had some rumours floating around in 2022 that it would be taken private by its controlling shareholder who owns 88.7% economic interest in the shares.
• The controlling shareholder also indicated that the reason for its late Q1 2021 report was that they had hired capital market consultants to explore a take-private offer.
• It does have some hair on it, but let’s first focus on the positives

• Market participants are re-repricing risk, says iShares 20+ Year Treasury Bond ETF.
• Policymakers are in a tough spot where they need to combat inflation while also providing liquidity for the banking sector.
• iShares are once again in the spotlight as market participants are Re-re pricing risk.

• Despite its robust asset base, a structural break in the economy might tilt The Goldman Sachs Group, Inc.’s fortunes.
• The “bird in hand” dividend theory might phase out some of Goldman’s pro-cyclical risk.
• However, a scenario analysis paints an unsightly appearance.

• Colgate’s management seems to be making the right moves in pet food, but performance would need to improve in other segments as well.
• Upside appears limited in the short-run and I will be looking for more evidence that management could deliver higher gross margins, I am cautiously optimistic that Colgate will deliver better results in 2023.
• Performance of Colgate-Palmolive (NYSE:CL) in recent years could hardly be described as success.

• This is our first report on Advance Auto Parts, a leading provider of automotive aftermarket parts in the U.S.
• Advance Auto Parts had a difficult year in 2022 though it did manage to improve its top-line results in the fourth quarter and managed an all-around beat.
• Mid-single-digit comp sales growth in DIY multichannel dominated the fourth quarter.

• This is our first report on Rockwell Automation, a major provider of digital transformation and industrial automation solutions across the globe.
• Rockwell Automation produced an all-around beat in its last result as organic sales and earnings both exceeded market expectations and increased year over year.
• In a very dynamic supply chain environment, organic sales were 10% higher than they had been the previous year.

• This is our first report on W.W.
• Grainger, Inc., a global distributor of MRO materials and other related products and services.
• The company delivered an all-around beat for the final quarter of 2022 with a sales growth was 13.2% or 17.2% on a daily constant currency basis and solid growth in both segments.

SIGA’s FY22 results highlighted underlying revenue diversification and clinical progression during the year. Results were broadly in line with our expectations. Growth was driven by the material uptick in international orders due to the mpox (monkeypox) outbreak ($71m of $77m orders delivered in FY22), supported by orders from the US Department of Defense (DoD) and BARDA for IV TPOXX. Consistent with prior periods, variability in replenishment of government stockpiles is a key consideration in reported revenues and margins. For FY23 and FY24 we estimate replenishment of government stockpiles will continue to remain a pillar, driven by BARDA deliveries for oral ($225m in total over FY23 and FY24 for expiry replenishment) and IV TPOXX. SIGA remains well-capitalized, with net cash of $98.8m at FY22. We adjust our estimates for the Q422 results and near-term operational visibility (introducing a slower international sales ramp-up) resulting in our valuation adjusting to $17.70/share (from $19.64).

Wheaton Precious Metals (WPM) released its Q422/FY22 financial results in the context of known production and sales volumes. As a result, financial results were very close to our prior expectations for both Q422 and FY22. The main (positive) variances were in depletion (US$3.3m) and ‘other’ income (US$1.9m), to result in net earnings that were US$5.0m better than our prior forecasts for both periods (equating to a positive percentage variance of 5.1% for the quarter and 1.0% for the full year).

• This is our first report on DISH Network Corporation, a leading provider of television entertainment and technology.
• DISH’s wireless and broadband networks, as well as DISH and Sling services, are still up and running and functioning regularly.
• DISH Network further launched Samsung-supported sites for the DISH Wireless 5G network, kicking off Samsung’s participation in the operator’s nationwide rollout.

• NPORE shown to be an ideal separator solution for both typical and high-temperature applications. 
• In a recently published white paper, the advantages of NPORE were validated through long-term discharge-rate and cycling testing by Japanese developer iElectrolyte Co., Ltd. using an ionic liquid-based lithium-ion battery (designed for extreme temperature applications).
• NPORE provides outstanding heat resistance compared with conventional polymer separators, which show significant shrinkage at elevated temperatures due to the melting of the polymer (see Figure 1).

Newmont’s Q4/FY22 results, released on 23 February, exhibited stronger production than we had anticipated, albeit accompanied by costs that failed to decline as much as we had hoped. Nevertheless, both production and costs for the full year met the company’s guidance to within its usual tolerance range of ±5%. In addition to its Q4/FY22 results, Newmont also provided updated medium-term guidance for production, costs and capex to FY27 to reflect recent inflationary pressures within the industry, and this note updates both our forecasts and valuation to reflect the company’s updated guidance. In the meantime, Newmont’s potential merger with Newcrest clearly remains alive, with the potential to transform the company if it is successfully brought to fruition.

• This is our first report on WestRock Company, one of the largest providers of fiber-based paper and packaging solutions in the world.
• Pension and foreign exchange rates also had a $57 million negative impact on its year-over-year consolidated adjusted EBITDA growth.
• But Corrugated Packaging improved quarter over quarter, with North American packaging shipments increasing 2% to 373 million square feet per day.

• ZKH Group (ZKH US), a leading MRO (maintenance, repair, and operations) procurement service platform in China, is pre-marketing an NYSE IPO to raise US$200-300 million.
• The ZKH platform is for enterprise customers and the GBB platform is for micro businesses. Key backers include Tencent (700 HK) and Tiger Global.
• The key elements of the bull case rest on large addressable markets, solid customer loyalty, improving gross margin, lower operating losses and a strong balance sheet.

• WWR provided an investor update for 4Q22 and FY22 results, which included a full-year net loss of $11.1 million, compared with a $16.1 million loss in 2021, driven by lower product development costs, partially offset by higher general and administrative costs, as the company continues to add to its team.
• For the year, WWR spent $52.8 million in capex on Phase I of its Kellyton, AL graphite plant and has $75 million in cash remaining on its balance sheet as of the end of 2022, with no debt.
• Agreement with Tier I battery OEM. WWR has entered into an agreement with a Tier I EV battery manufacturer that can result in a finalized offtake agreement for potentially all graphite anode material from the plant.

• This is our first report on one of the largest producers of nitrogen products in the world – CF Industries.
• CF’s overall performance was fairly good against the backdrop of a continually tight global supply-demand balance for nitrogen.
• We initiate coverage on the stock of CF Industries with an ‘Outperform’ rating.

• According to S&P Global, the renewable output by the grid operator MISO averaged 333,012 GWh in Q4.
• Despite Bonneville Power Administration’s (BPA) renewable output slipping 12% in Q4, it remained the footprint with the most renewable market share at 75.6% of its total fuel mix for Q4.
• The latest ACP data shows that the total installed solar capacity in the US grew by 17% year on year, reaching 74.126 GW in Q4.

• This is our first report on major healthcare provider, DaVita.
• DaVita produced an adjusted operating income of $317 million and adjusted profits per share from continuing operations of $1.11 for the fourth quarter, bringing the entire year squarely at the top of the revised target range it provided last quarter.
• During the previous quarter, the international adjusted operating income fell by $15 million.

• This is our first report on major pharmaceutical sourcing and distribution services provider, AmerisourceBergen.
• Among major updates, AmerisourceBergen added PharmaLex to its portfolio of specialty solutions to expand its capabilities.
• In this report, we have carried out a fundamental analysis of the historical financial statements of the company.

• This is our first report on Parker-Hannifin Corporation, a global leader in motion and control technologies.
• Parker-Hannifin delivered strong operating performance throughout the second quarter of the current fiscal and delivered an all-around beat.
• We initiate coverage on the stock of Parker-Hannifin Corporation with a ‘Hold’ rating.

• Sprott Physical Platinum & Palladium Trust has a nearly equally-weighted portfolio of physical Platinum and Palladium.
• The closed-ended trust has an expense ratio of only 0.5% and is trading below its short and long-term moving averages.
• Platinum Group Metal (“PGM”) prices offer researchers an exciting topic, given the velocity of the recent shift in supply and demand-side variables that influence PGM prices.

• In the hours following Sillicon Valley Bank’s collapse, news emerged that Circle, issuer of the USDC stablecoin, held $3.3bn of reserves in SVB, triggering panic that the stablecoin was no longer fully backed.
• As of Sunday night, we know that Circle’s reserves are safe, but over the weekend both centralized and decentralized markets descended into chaos.
• Today, we’ll walk you through what exactly happened.

• This is our first report on FMC Corporation, a major agricultural sciences company in the U.S.
• FMC achieved significant results in the quarter because of high volume growth and aggressive pricing and it managed to deliver an all-around beat.
• Its new product sales are growing quickly, nearly doubling year over year, accounting for 11% of overall sales in the quarter.

• The upcoming rebalance of the MVIS US Listed Semiconductor 25 Index will be implemented on 17 March. There are no constituent changes, but there are float and capping changes.
• The VanEck Vectors Semiconductor (SMH US) ETF tracks the index and has an AUM of US$7.2bn.
• Estimated one-way turnover is 4.8% resulting in a one-way trade of US$356m. The stocks are extremely liquid, the impact on the stocks in terms of ADV to trade is small.

• The heavy equipment dealership industry, known for its lucrative opportunities, has consolidated significantly in recent years, with major players acquiring smaller dealerships.
• Alta Equipment, based in Michigan, has emerged as a beneficiary of this trend, expanding its geographic reach and gaining access to trained technicians, giving it a competitive advantage over smaller players.
• However, as the industry continues to consolidate, will Alta be able to maintain its momentum, or will it face challenges from larger rivals?

• Opportunity in any market exists in anything that causes the perception of the investor to take on a new shape.
• For many years, the Fat Protocol Thesis popularised by Placeholder VC has dominated the perception of the digital asset market.
• But as the market and, more importantly, those who have come to use this new technology platform change, so too does the perception of where value will be captured.

• Bearish from SPX 4,060-80. Near resistance at 4,020 was used to add to shorts. Downside surprise due this week on break of 3.900.
• Key support breaks amid systemic risk saw us raise our net short going into this more turbulent period that should wrap up near the 20th. Started shorting in Feb.
• Added Japan to our short list being a laggard. Once laggards buckle we will be closer to a short term low.

• Tesla’s sales growth is yet to revert to a linear distribution, given Tesla’s market share and the exponential growth attached to the EV space.
• Rumors of a lithium mine acquisition and an additional Gigafactory indicate that Tesla is working toward a lower cost base.
• It has been a rollercoaster ride for Tesla, Inc. (NASDAQ:TSLA) stock recently, as various market-based and idiosyncratic features coalesced to ramp up the asset’s volatility.

• 2022 was a challenging year for web3. We witnessed the collapse of TerraLUNA, the fall of FTX, and several notable insolvencies including Three Arrows Capital, Voyager, Celsius and BlockFi.
• These events deeply impacted the sector, with the crypto market losing over $2 trillion in market cap in 2022 and public perception of web3 turning sour.
• Many suspect we have yet to feel the full magnitude of the contagion effect of these events, as they are still ongoing (e.g. the FTX trial), and we could reach new lows.

• ASRT is not including the recent guideline change at American Society for Gastrointestinal Endoscopy (“ASEG”) for using indomethacin as part of their 2023 outlook allows ample room to the upside.
• ASRT had previously provided preliminary fourth quarter results. The official numbers were not much different
• Indocin has been the core of ASRT’s revenue and free cash flow. The new guidelines could become a game changing event for the drug and ASRT

• 4Q22 revenue grew 14% Y/Y in a tough market. Transacting accounts grew 11% Y/Y and digital asset conversion volumes were up 19%.
• Opex, excluding goodwill and intangible assts impairments, was $73.2 million.
• While 2022 was a difficult year for crypto, President and CEO Gavin Michael highlighted the company “delivered on our product roadmap, worked closely with our partners to go-to-market, added leading industry players to our partner network, and announced our acquisition of Apex Crypto.”

• Corteva had a strong fourth quarter and managed to deliver an all-around beat.
• Strong organic sales led to $370 million in profitability for the quarter, an increase in the margin of more than 200 basis points.
• Strong demand for new products was the primary factor in the 9% annual increase in crop protection volume.

• Digital Turbine’s Q3 results were a major disappointment as the company failed to meet the revenue expectations as well as the earnings expectations of Wall Street.
• In the quarter, revenue decreased by 25% from the prior year to $162.3 million which was unexpected.
• Regarding ad placement kinds, the company has kept a portfolio that is evenly distributed among banner, interstitial, and video ads.

• Fidelity National Information Services achieved its financial targets for the fourth quarter and delivered an all-around beat.
• In the fourth quarter, merchants increased by 2% on a constant currency basis.
• We give Fidelity National Information Services a ‘Buy’ rating with a revised target price.

• General Mills delivered a decent result for the previous quarter, surpassing the market expectations with respect to revenues and earnings.
• In the recent scenario, North America is the first priority of General Mills and they are focused on growth in its core market.
• Despite the post-pandemic situation and hurdles, the company has witnessed a decent growth in cash flow and revenue.

Immix Biopharma has expanded both its clinical and technology portfolio with the in-licensing of its first CAR-T cell therapy, NXC-201. The treatment is being investigated in a Phase Ib/II open-label study for multiple myeloma (MM) and light chain amyloidosis (ALA). The trial intends to recruit up to 100 patients and management believes positive results may potentially support early regulatory approval. In our view, NXC-201 may provide Immix with the scope to expand into new indications within oncology, particularly among hematological malignancies. NXC-201’s clinical development is being independently financed under a subsidiary of Immix (Nexcella, of which Immix owns 98%). Our valuation of Immix is US$61.5m or US$4.4 per share (previously US$55.4m or US$4.0 per share). We await further NXC-201 clinical data and communication on its development plan before including it in our valuation.

• LKQ Corporation delivered a significantly below part result in the year’s final quarter.
• Revenue declined in the quarter as compared to the last year, driven by the divestiture of PGW and FX translation.
• Organic revenue of parts and services increased but the overall top-line was below analyst expectations.

• SS&C delivered a decent result in the last quarter of 2022 despite a challenging operating environment for SS&C Technologies.
• Adjusted organic revenue was flat in line.
• In the quarter, SS&C Technologies acquired a specialized Colorado-based fund administrator, Complete Financial Ops, that focuses on private equity as well as family offices.

• Vertex Pharmaceuticals ended the year on a strong note, with full-year global CF product revenue rising 18% from 2021.
• Their mid- and late-stage clinical pipeline holds the opportunity to provide patients across 8 disease areas with potentially transformative impact.
• The management forecast for product revenue for the entire 2023 fiscal year is $9.55 billion to $9.7 billion, which, after factoring in an estimated 1.5% FX headwind, represents 7% to 9% growth year over year.

• Following the massive drop in Adobe’s share price, more investors are looking favourably at the business.
• In my view, capital allocation decisions within the company raise some red flags that are hard to overlook.
• As a long-term shareholder, I still have a hard time rating Adobe as a buy.

• Crypto optimists have said for the last few months that the worst is behind us.
• Just in the last year we’ve seen the collapse of crypto hedge funds, lenders and exchanges.
• They say the bad actors have been removed from the space and there’s only good news from here

• Digital Turbine, Inc.’s misfortunes are about to pivot, providing ad spending reverts to its average growth trajectory.
• The company has a novel business model, and constant expansion by integrating growth ideas such as a Shopify-esque platform could yield substantial financial benefits, according to the company.
• Digital Turbine, Inc. (NASDAQ:APPS) stock has suffered from a trying time during the past year, conveyed by its more than 70% year-over-year drawdown.

• Oracle’s strategy is being acknowledged by one of its major peers – Salesforce.
• Oracle does not appear among the top three cloud infrastructure players, but it doesn’t need to.
• Oracle is expected to deliver another strong quarter, investors should remain focused on the long-term positioning of the business.

• Gaia reported 4Q22 revenues of $19.6 million versus $20.8 million in 4Q21, and 2022 revenues of $82.0 million versus $79.6 million in 2021.
• Given the small Yoga International acquisition in December 2021, this implies some revenue contraction in the core business for 2022.
• Despite the top-line challenge, net income was slightly positive for the year after adjusting for one-time legal fees and the anticipated SEC settlement accrual, which confirms the resilience of Gaia’s financial model.

• Before market open on March 8, HNI announced the acquisition of Kimball International (NASDAQ: KBAL), a smaller competitor of HNI’s Workplace Furnishings segment.
• HNI will pay about $485 million, consisting of cash ($9/KBAL share), stock (0.1301 HNI/KBAL share), and ~$46 million in KBAL net debt.
• We see the deal as an excellent fit on strategic and cultural levels. 

• Zebra Technologies had a strong finish to the year, with profitability and sales near the high end of the outlook of the company and an all-around beat in the fourth quarter.
• Latin America sales increased with strong growth in Mexico and Brazil.
• However, due to an uncertain microenvironment, Zebra Technologies continue to see elongated sales cycles and softening of demand.

• Multiple solutions for the growing problem of battery safety. 
• META is developing two technologies that can make lithium-ion batteries safer and reduce material needs to lower weight and increase range.
• We highlight META’s NPORE® and NCORE™ technologies on the following pages.

• DistributionNOW is reaping the rewards of the steps management began taking a couple of years ago to transform its fulfillment model.
• A client-focused global technical sales force aims to make DistributionNOW a strategic partner with customers to help them manage their energy supply chain.
• The fulfillment model, if built around Supercenters, combines multiple business lines into a single location, making it easier to work with both suppliers and customers.

• Perpetua Resources Corp. (Nasdaq: PPTA; TSX: PPTA) is an Idaho based (Stibnite jurisdiction), gold-antimony-silver (Au-Sb-Ag) junior explorer/producer.   
• ACF is releasing a aluation increase for PPTA based on milestones achieved since our initiation note. ACF identifies PPTA as a US national strategic asset (Sb) and best-in-class gold asset. 
• PPTA is an ESG leader amongst junior miners. PPTA holds a unique antimony (Sb) reserve in the US and is positioned to be the only domestically mined source of Sb.

• Guidewire Software is delivered a mixed set of results in the recent quarter with revenues above Wall Street expectations.
• Both ARR and subscription revenue and particularly subscription and support gross margin, finished ahead of the expectations of the management.
• In the quarter, Guidewire Software executed several new InsuranceSuite production deployments on the Guidewire Cloud Platform, including DEFINITY Insurance.

• ARLO initiated a new marketing strategy based on price and it seems consumers have responded well in an otherwise tough market backdrop.
• The sell through led to ARLO growing the number of paid subscribers more than we were expecting, and on pace to surpass 2 million paid subscribers in first quarter 2023
• The revenue achieved in the fourth quarter was approximately $3 million higher than the top end of the guidance range ARLO had previously provided