Daily Brief Equity Bottom-Up: Shortlist Of High Conviction Ideas: Income and more

• We compile our selection of small and mid-cap names with our desired characteristics of high dividend yields, value, and margin of safety.
• Our top picks are Perfect Medical Health (1830 HK), Water Oasis (1161 HK), Taste Gourmet (8371 HK) , Uchi Technologies (UCHI MK) , and The Keepers Holdings (KEEPR PM).
• We recently added Ginebra San Miguel (GSMI PM) / Sai Gon Cargo Service (SCS VN) to our list of companies under coverage, along with Plover Bay Technologies (1523 HK).  

• UMC spoke at an investment bank’s recent conference, providing additional color on guidance and its collaboration with Intel for 12nm chip production.
• UMC comments imply the key synergies between the two companies, whereby each can solve the other’s key problem,
• While UMC most likely needs to remain a “Taiwanese company” in terms of optics given its history, Intel’s synergies with UMC establishes acquisition-value support for UMC shares in our view.

• Key Events: 1) Nvidia Results Coming Today in the U.S. 2) Elan & ChipMOS Tomorrow in Taiwan 3) U.S. PC Maker Results Next Week
• Why United Microelectronics Is Becoming a Great Long-Term Acquisition Target for Intel 
• Novatek a Top Gainer After Reports of Alliance with ARM to Build Neoverse V2 for AI

• We cut our SIA operating profit by 9% to S$2.6bn in FY24 and by 17% to S$1.5bn in FY25 versus consensus of S$2.1bn.
• SIA’s cost control is under-examined and we publish a deep dive on a concerning level of inflation relative to key peers, which actually escalated in 3Q24.
• Cargo broke even in peak season, and Scoot’s margins present a conundrum as it may need to be further utilization to help SIA with cost management.

• Post 35% price gain in a quarter, many good news we expected and other analysts expected already factored into the share price. We believe the risk/reward not attractive here.
• TSMC guides stronger 1Q24 and 2024, helped by Nvidia and copy cat AI GPU/ASIC orders. We see greater opportunities for alternative copy cat solutions like AMD and Alchip.
• We attribute Nvidia customers’ sales discrepancy to AI server is cannibalizing non-AI server and Nvidia is allocating more GPUs to premium price paying customers in 1H24 and reverse in 2H24.

• EV supply chain is at a nascent stage in ASEAN and EV adoption in the region lags behind developed markets despite boasting a large population with a burgeoning middle class.
• However, Governments in the region continue to introduce new initiatives and offer incentives to promote the sector, while companies continue to attract large investment to develop the EV market.
• The four companies we looked at have reported earnings and we have discussed their latest results and our investment thesis.

• January pricing momentum improved, helped by more operating days & re-routes
• Throughput growth remained strong last month, including +18% into WC ports
• Near term reality far rosier than downbeat view from industry giant Maersk

Key points

• Analysts believe R1 (RCM) presents a compelling investment opportunity despite recent challenges
• Predictions suggest profitability improvements and potential doubling of stock value over the next few years
• Long-term outlook remains strong due to industry-leading position and growth potential in healthcare IT sector

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.

• kopi-C with Lendlease REIT’s CEO The first Singapore REIT to reach net zero emissions, Lendlease Global Commercial REIT has its next target in sight: absolute zero by 2040.
• When it comes to sustainability, Lendlease Global Commercial REIT is ahead of its peers.

• Asahi Kagaku Kogyo’s Facility in Kunshan, China Asahi Kagaku Kogyo (TYO 7928) is a $12m market cap net-net industrial plastics manufacturer that over the last 10 years mostly operates around breakeven.
• The business itself isn’t interesting, but it’s a positive that they aren’t losing money.
• There also isn’t a single writeup on this company or any mentions of it on X/Twitter, so it’s definitely under the radar.