In today’s briefing:
- NVIDIA. Yikes! Have We Missed The Boat?
- Cathay Pacific (293 HK): Hard Landing
- Taiwan Dual-Listings: ADR Premiums Surge to Near All-Time Highs on ‘Nvidia-Rally’
- COLI 688 HK – Value Emerging, the Only Pure Play in China Prop to Gain Mkt Share and Back to Growth
- New Horizon Health (6606.HK) – What Makes a Really Good Story? Definitely Not Just Breakeven
- The Future of Insurance
NVIDIA. Yikes! Have We Missed The Boat?
- Q1’23 revenues of $7.19 billion, down 13% from a year ago but up 19% sequentially and ~10% higher than the guided midpoint.
- Current quarter outlook for revenues of $11 billion, a ~55% sequential increase, sparked mayhem in the markets and sent NVIDIA’s stock soaring over 24% in after hours trading
- Don’t go chasing waterfalls, there are many other ways to rise with the tide
Cathay Pacific (293 HK): Hard Landing
- The recent discrimination incident will likely affect traffic recovery pace of Cathay Pacific Airways (293 HK) negatively if it turns into a full-scale boycott by mainland passengers.
- The scenario of CX becoming majority-owned by Air China Ltd (H) (753 HK) is getting increasingly possible. This may not be totally positive to CX given CA’s weaker service ranking.
- Consensus forecasts now look somewhat bullish following the incident, and the stock’s 0.7x P/B does not stand out as attractive relative to history or ROE (7% in FY25F).
Taiwan Dual-Listings: ADR Premiums Surge to Near All-Time Highs on ‘Nvidia-Rally’
- The semiconductor stock rally in the U.S. caused by Nvidia’s monster results and guidance last week has caused multiple ADR premiums to surge to near all-time highs.
- TSMC and UMC’s ADR premiums don’t appear sustainable given their trading history.
- Telecom CHT wasn’t affected by the Nvidia rally and now has one of the lowest ADR discounts in its history.
COLI 688 HK – Value Emerging, the Only Pure Play in China Prop to Gain Mkt Share and Back to Growth
- In this insight, we explore the investment thesis and major share price drivers for 688 HK
- COLI saw share price weakness, and is trading at 0.46x P/B. Potential risks are 1) fail to meet 20% growth target 2) slower than expected land acquisition
- We see value emerging from the stock, and recommend BUY as long as the stock trades below HKD20 (as a technical indicator)
New Horizon Health (6606.HK) – What Makes a Really Good Story? Definitely Not Just Breakeven
- New Horizon Health (NHH) achieved high performance growth last year. However, we recommend investors take a calm and objective view of NHH’s current high growth rate if they see the real story.
- NHH’s dual attributes of medical+consumption means large growth potential/strong profitability. Thus, the real expectation for NHH is not just about achieving breakeven, but more about how to achieve high profitablity.
- If market education level falls short of expectations in the future, it’s difficult for NHH to achieve expected scale/profit margin. There would be greater valuation downward risk at that time.
The Future of Insurance
- SPACs are often synonymous with high-risk, cash-intensive early-stage companies making their public debut, but occasionally, a SPAC deal like CCC Intelligent Solutions emerges and shifts the narrative.
- CCC is a SaaS business with four decades of operational history in the property and casualty insurance sector that went public through a SPAC in 2021.
- Over the company’s history, it has processed over $1 trillion in transactions for 30,000 businesses.
💡 Before it’s here, it’s on Smartkarma
Sign Up for Free
The Smartkarma Preview Pass is your entry to the Independent Investment Research Network
- ✓ Unlimited Research Summaries
- ✓ Personalised Alerts
- ✓ Custom Watchlists
- ✓ Company Data and News
- ✓ Events & Webinars