In today’s briefing:
- Nintendo (7974) | Delayed…Or Just Fashionably Late
- Tencent (0700.HK): Revisiting Wechat Channels
- AMAT. Post Earnings Surge For No Good Reason
- REIT Watch – 10 S-Reits that top retail net inflows in the year to date
- Singapore-listed Manufacturers Book Mixed Returns in Early 2024
- WeBull In Discussions With Financial Authorities to Enter the Korean Retail Stock Brokerage Market
- MicroStrategy: Is Its Bitcoin Strategy Changing The Game? – Major Drivers
- Ralph Lauren Corporation: Direct-to-Consumer (DTC) Business & Store Growth & Other Major Drivers
- Dynatrace Inc: Demand For Observability & Application Security Can Push Their Revenues In 2024? – Major Drivers
- CyberArk Software: Is Their New Secure Cloud Access Product A Game Changer? – Major Drivers
Nintendo (7974) | Delayed…Or Just Fashionably Late
- Nintendo’s share price fell ~6% on rumours of Switch 2 delay, wiping around $4 billion of the market cap
- We do not believe that a one quarter delay will have any impact on the console’s long-term sell-through or the stock’s valuation
- With Sony’s PS5 faltering, Nintendo is launching at an opportune time. We turn bullish on the stock with ~25% upside from here
Tencent (0700.HK): Revisiting Wechat Channels
- One year ago, we published a note valuing Wechat Channels at US$29 billion by applying 25xPE to RMB8 billion net profit out of RMB37 billion revenue by 2024.
- Fast forward to today, the platform’s priority has been further elevated by Tencent management in its attempt to pursue high quality growth.
- We review our thesis on Wechat Channels based on recent channel checks and now believe that the platform could represent ~35% of Tencent’s total incremental profit from 2024 to 2026.
AMAT. Post Earnings Surge For No Good Reason
- Q124 revenues of $6.71 billion, at the high end of the guided range and essentially flat sequentially both QoQ and YoY
- Q224 revenue $6.5 billion at the midpoint, a modest downward movement of 3% QoQ and in line with what we saw from peers KLAC and LRCX
- Still a great company with excellent growth prospects, just not in 2024
REIT Watch – 10 S-Reits that top retail net inflows in the year to date
- THE iEdge S-Reit Index declined 5.6 per cent on a total return basis in the year to date, with declines also recorded in the FTSE EPRA Nareit Index series which track global Reits.
- The 10 S-Reits which recorded largest net retail inflows in the year to date were Mapletree Logistics Trust, Keppel DC Reit, CapitaLand Ascendas Reit, Mapletree Pan Asia Commercial Trust, CapitaLand China Trust, CapitaLand Ascott Trust, CapitaLand Integrated Commercial Trust, Frasers Logistics & Commercial Trust, CDL Hospitality Trusts, and ParkwayLife Reit.
- These 10 S-Reits contribute S$250 million in net retail inflows, or nearly 90 per cent of the combined net retail inflows in the year to date.
Singapore-listed Manufacturers Book Mixed Returns in Early 2024
- Over the first seven weeks of 2024, the 25 largest weights of the Manufacturing Index saw varied performances from a 31% decline for NIO to a 24% gain for Food Empire.
- The largest Manufacturing Index weight is currently ST Engineering, which has consolidated on its 2023 gains over the past 7 weeks and scheduled to report its FY23 results on 29 Feb before the market open.
- Venture has booked the most net institutional inflow over the past seven weeks within the Manufacturing Index with S$43 million of net inflow.
WeBull In Discussions With Financial Authorities to Enter the Korean Retail Stock Brokerage Market
- It has been reported in numerous local media outlets that WeBull is discussing with the local financial authorities to enter the Korean retail stock brokerage market.
- If the Korean financial authorities provide a license to WeBull to directly provide stock brokerage services to the Korean retail market, this would be the first case ever.
- If FSC grants a full license to WeBull to operate stock brokerage services to retail investors in Korea, this could result in the local brokerages losing market shares to WeBull
MicroStrategy: Is Its Bitcoin Strategy Changing The Game? – Major Drivers
- MicroStrategy Inc’s fourth quarter 2023 earnings point towards a strong performance from being the world’s largest corporate holder of bitcoin, possessing 190,000 bitcoins with a market value of $8.1 billion.
- Over 2023, the company added another 56,650 bitcoins to its portfolio costing $1.9 billion, making the company’s bitcoin strategy a long-term focus.
- 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.
Ralph Lauren Corporation: Direct-to-Consumer (DTC) Business & Store Growth & Other Major Drivers
- Ralph Lauren has yielded strong financial performance for Q3, reportedly exceeding the company’s top and bottom-line expectations, while driving significant EPS growth.
- Such advancement comes despite a reportedly dynamic global environment, thanks to considerable focus on areas such as the brand.
- Immersing people in Ralph Lauren’s world of elegance and sophistication, the brand is resonating globally, allowing overall pricing power in the market.
Dynatrace Inc: Demand For Observability & Application Security Can Push Their Revenues In 2024? – Major Drivers
- According to Dynatrace’s fiscal third quarter 2024 earnings, the company delivered solid results driven by its ability to successfully navigate a continually changing market.
- Annual recurring revenue (ARR) grew by 21% year over year, while subscription revenue increased by 23% over the same period.
- Non-GAAP operating income steadily increased to $105 million representing 29% of revenue and robust free cash flow margin was delivered at 25% on a trailing 12-month basis.
CyberArk Software: Is Their New Secure Cloud Access Product A Game Changer? – Major Drivers
- Underpinned by an urgent need for a more secure digital landscape, CyberArk Software has emerged with a wholesome performance in the fourth quarter of the fiscal year 2023.
- An impressive 60% YoY growth of Subscription ARR has led CyberArk to become an exclusively recurring revenue company, with an astounding 95% of total bookings coming via subscriptions.
- CyberArk marked the close of 2023 by bolstering its market leadership in the realm of Identity Security Platforms with a robust growth quarter.
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