In today’s briefing:
- Alibaba (BABA US): 2Q25, Weak Quarter, But Waiting for Two Events to Benefit Top Line
- Anxian Yuan (922 HK)
- Fidelity Information Services: Inside FIS’s Strategic Moves in Core Banking – A Game-Changer for Financial Institutions! – Major Drivers
- Illumina Inc.: These Are The 3 Biggest Challenges In Its Path! – Major Drivers
- Vertex Pharmaceuticals: Its Efforts Towards Diversification with New Product Launches & Other Major Drivers
- Negative Trump Trade: Korean Rechargeable Battery Sector
- Why Marriott International’s Expansion in Greater China Could Be a Game-Changer for Investors! – Major Drivers
- Cardinal Health: Can Its Strategic Acquisitions & Improving Market Position Be A Sustainable Growth Accelerator? – Major Drivers
- [Atour (ATAT US, BUY, TP US$37) TP Change]: Strong 11.11 Sales Recalibrate E-Commerce Potential
- [Earnings Review] TotalEnergies’ Profitability Weighed Down by Sharp Decline in Refining Margins
Alibaba (BABA US): 2Q25, Weak Quarter, But Waiting for Two Events to Benefit Top Line
- Total revenue grew slightly as we expected in our preview note.
- The operating margin improved significantly, but this was due to the shrinks of non-cash items.
- However, we believe Alibaba will benefit from the boycott against JD.com and the disposal of Sun Art.
Anxian Yuan (922 HK)
- Chinese cemetery operator with three main assets: the Anxian Yuan cemetery in Hangzhou, the Fushouyuan cemetery in Yinchuan and the Dachenshan cemetery in Niuxin Village, Guizhou Province
- The stock is inexpensive at 6.1x trailing P/E with a 13.3% dividend yield that’s covered by cash flows. Further, net cash represents 82% of market cap with limited contract liabilities.
- Recent tomb sales has been weak for reasons that seem macro related. Other risks are historical share dilution: the 2020 rights issue was under-priced, 85% taken up by the founder.
Fidelity Information Services: Inside FIS’s Strategic Moves in Core Banking – A Game-Changer for Financial Institutions! – Major Drivers
- Fidelity National Information Services, Inc. (FIS) reported mixed results for the third quarter of 2024, demonstrating both strengths and potential challenges in their operations.
- The company experienced a steady growth in adjusted revenue, which increased by 4% year-over-year.
- This growth was primarily driven by an acceleration in recurring revenue across its segments, notably in Banking and Capital Markets, with both segments achieving margin expansion.
Illumina Inc.: These Are The 3 Biggest Challenges In Its Path! – Major Drivers
- Illumina experienced a mixed third-quarter performance for 2024, illustrating both advancements and challenges in its operational landscape.
- The company reported quarterly revenue of $1.1 billion, matching its expectations but reflecting a 2% decrease year-over-year.
- This decline was linked to reduced instrument sales due to the launch-year comparisons of the NovaSeq X series and effects of capital constraints globally.
Vertex Pharmaceuticals: Its Efforts Towards Diversification with New Product Launches & Other Major Drivers
- Vertex Pharmaceuticals recently reported its third-quarter earnings for 2024, presenting a picture of solid financial performance alongside significant advancements in its pipeline and product launches.
- Financially, Vertex Pharmaceuticals reported a 12% year-over-year increase in revenue, reaching $2.77 billion for the third quarter.
- This growth was underpinned by robust performance both in the U.S. and international markets, with U.S. revenues rising by 10% and international sales by 14%.
Negative Trump Trade: Korean Rechargeable Battery Sector
- With Trump becoming the next President of the United States, we explain why the rechargeable battery sector in Korea is likely to get further battered in the coming months.
- Trump administration could eliminate or significantly slash the $7,500 consumer tax credit for electric vehicle (EV) purchases, which is one of the key provisions of the Inflation Reduction Act (IRA).
- We expect the sell-side to further cut their earnings estimates on the key key names in the Korean rechargeable battery sector in the coming months.
Why Marriott International’s Expansion in Greater China Could Be a Game-Changer for Investors! – Major Drivers
- Marriott International’s third-quarter financial performance for 2024 indicated a mixture of growth and existing challenges within the global hospitality landscape.
- The company reported a 6% year-over-year increase in net rooms, underscoring its robust expansion efforts and strong development activities.
- Global Revenue Per Available Room (RevPAR) rose 3% for the quarter, fueled by a 2.5% increase in Average Daily Rate (ADR), with the group segment leading the charge, posting a 10% rise in RevPAR, which highlights the sustained demand in this category.
Cardinal Health: Can Its Strategic Acquisitions & Improving Market Position Be A Sustainable Growth Accelerator? – Major Drivers
- Cardinal Health, Inc. reported strong financial and operational results for the first quarter of fiscal year 2025, primarily driven by its Pharmaceutical and Specialty Solutions segment.
- CEO Jason Hollar highlighted the company’s effective management amidst a customer transition in its largest business segment, which still achieved a 16% growth in segment profit.
- The demand across various pharmaceutical categories, notably specialty and consumer health, played a significant role in this growth.
[Atour (ATAT US, BUY, TP US$37) TP Change]: Strong 11.11 Sales Recalibrate E-Commerce Potential
- Based on Atour (ATAT)’s strong pillow sales in 11.11, we raised C4Q24/2025 revenue estimate by 6.9%/7.1%. Our number is now 7.9%/15% higher than consensus;
- The outstanding performance of the retail business may draw more consumer attention to the brand, thus bring contribute to Atour’s hotel expansion.
- We raise the TP by US$1 to US$37/ADS and maintain the BUY rating.
[Earnings Review] TotalEnergies’ Profitability Weighed Down by Sharp Decline in Refining Margins
- In Q3, TotalEnergies beat revenue forecasts by 6.4% but missed EPS estimates by 3.7%. Revenue and adjusted net income fell by 2.8% YoY and 37%, respectively.
- TotalEnergies’ average liquids price realisation fell 2.4% YoY, European refining margins dropped 84.7%, while LNG price realisation rose 3.7% YoY.
- TotalEnergies’ Q3 cash flow fell 27% YoY to USD 6.8 billion. It announced USD 2 billion in Q4 buybacks and a 0.79 euro/share interim dividend.
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