Daily Brief Equity Bottom-Up: Mercari and more

• Mercari is a Japanese e-commerce company known for operating the leading online used goods marketplace in Japan with over 23 million monthly active users and significant annual GMV.
• The company’s strong network effects moat and growth prospects in Japan’s second-hand goods market suggest substantial potential value, despite investor frustration with loss-making initiatives like Mercari US and its Fintech segment.
• Analysts believe that Mercari Japan alone is worth nearly double the company’s current market cap, highlighting potential for significant upside.

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.

• September 2024 revenues of NT$251.87 billion, an increase of 0.4% MoM and an increase of 39.6% YoY.
• Year to date revenue through September 2024 now totals NT$2,025.85 billion, an increase of 31.9% YoY.
• Anticipating Q4 revenue forecast of $25.7 billion, up 10% QoQ. This would mean full year 2024 revenues of $88.8 billion, a 28.3% YoY increase

• Ligand Pharmaceuticals holds a portfolio of revenue, royalty and milestone generating assets that have been vetted by its internal investment team.
• Ligand considers individual biopharmaceutical products, platforms, companies & income streams in its opportunity set.
• It targets late-stage and commercial income-producing assets when making investments.

• Q3 revenue is expected to reach $22.4-23.2 billion, reflecting strong demand for TSMC’s 3nm and AI-driven technologies. This marks a significant 14.4% increase from Q2’s $20.82 billion, despite global headwinds.
• Operating profit margins are forecasted to be between 42.5% and 44.5%, highlighting TSMC’s efforts to maintain profitability. However, pressures from rising operational costs and competitive advancements remain a challenge.
• EPS is projected at $1.76, up 40% YoY, driven by robust AI chip demand. Despite this, TSMC faces slowing consumer electronics demand, particularly in smartphones, which could affect future growth.

• TRS has three operating segments where the smallest has already been going through a sales restructuring period and we are now expecting a slowdown in TRS’s aerospace business.  
• Aerospace had been growing at double-digit rates in recent years, but in recent months the two largest aerospace customers have been going through their own ordeals
• TRS’s current valuation gives little value for what each segment could be worth. There have been two aerospace IPOs with similar businesses to TRS’s aerospace business. 

• Oisix is planning to double its sales by 2030 and looks set to reach this targets early through both organic expansion and M&A.
• The recent acquisition of several B2B and other companies will help sales grow 72% this year alone.
• But the longer-term consumer-facing business continues to look positive thanks to continued demand for convenience meal kits and home delivery of quality foods. Profit though remains anaemic.

• Bukalapak (BUKA IJ) has seen a sharp share price rebound recently with speculation over a tie up with Temu, which appears ill-founded, with the only newsflow being a Director resigning.
• The company swung back into a slight negative adjusted EBITDA in 2Q2024, mainly due to the seasonal impact of Lebaran on its O2O business and increased competition in virtual products.
• Bukalapak remains a differentiated player in Indonesian e-commerce with a focus on serving MSMEs through its marketplace, with increasing take rates ahead. Dealing with excess cash is a potential catalyst. 

• Vishnu Chemicals (VCL IN)  is now backward integrated with the soda ash, CO2 Gas plant and ore requirement to overcome the challenge of raw material price volatility. 
• Company operated in niche & specialty chemical segment and will launch detailed  capex plan in Q2 for forward integration. 
• Management aims to consolidate EBITDA margins around 17.5%-18% by year-end, with a target of achieving consistent margins at 20% over the next 2-3 years.

• Playtika Holding Corp. conducted its Q2 2024 earnings call outlining both advancements and some challenges faced during the quarter.
• With Robert Antokol, Co-Founder and CEO, and Craig Abrahams, CFO, leading the discussion, the company detailed various aspects of its operational and strategic performance which will be crucial for stakeholders evaluating Playtika’s investment potential.
• 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.

• Arrow distributes semiconductors, electronic components, and IT hardware/software to value-added resellers globally
• With 600 suppliers and 210,000 customers, Arrow simplifies the supply chain process for both parties
• Focus on cheap electronic components with some high-value semiconductors like GPUs; plays a crucial role in aggregating customer demand

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.