In today’s briefing:
- Tech Supply Chain Tracker (11-May-2024): China smartphone market, Q1 2024
- PayPal Holdings: Continued Focus On Its Omnichannel Strategy Increasing Innovation & Adoption! – Major Drivers
- Amazon.com Inc.: Prime
- TPL: Watering for the Next Phase
- South Korean Banks; Stick with Woori (316140 KS) And KB Financial (105560 KS)
- CXW: 1Q24 Beat Highlights Operating Leverage, Improving Occupancies
- Ecolab Inc.: Internal Innovation and Acquisition Potential Driving Ecolab’s Healthcare Business! – Major Drivers
- Mondelez International: A Tale Of Preserving Critical Price Points and Investing in Supply Chain Reliability! – Major Drivers
- Starbucks Corporation: A Major Disappointment But These 6 Factors That Can Help Them Recover! – Major Drivers
- Celltrion (068270 KS): 1Q24 Result- Sales Hit Quarterly High; Profit Sinks on Merger Effect
Tech Supply Chain Tracker (11-May-2024): China smartphone market, Q1 2024
- China’s smartphone market saw growth in 1Q 2024, with increased shipments of OLED panels indicating potential for LG.
- Panasonic’s battery unit received US subsidy but faces weak EV demand, potentially hurting sales.
- Concerns rise as tech giants invest in AI infrastructure, with focus on consolidation, data privacy, and potential misuse of power.
PayPal Holdings: Continued Focus On Its Omnichannel Strategy Increasing Innovation & Adoption! – Major Drivers
- PayPal Holdings Inc.’s Q1 2024 earnings showcased a solid start for the year with substantial improvements across various sectors of the business, tempered by an understanding of the need for continued retooling and operational changes.
- The company leadership is operating cohesively and the new strategies in place are evidently beginning to make a difference.
- PayPal has maintained steady progress with their three customer groups; large enterprises, small businesses, and consumers, including their subsidiary, Venmo.
Amazon.com Inc.: Prime
- Amazon.com reported robust first quarter financial results in 2024, with revenue of $143.3 billion, a 13% increase year-over-year.
- However, the result excludes the impact of foreign exchange rates, which caused an unfavorable impact that reduced revenue by roughly $700 million.
- The company delivered higher than expected operating income of $15.3 billion, which is a 221% increase from last year, driven primarily by efficiency improvements and better customer experiences.
TPL: Watering for the Next Phase
- TPL reported first quarter results with a higher than expected revenue figure from water sales to go along with the Company’s disclosure of a new desalination technology
- TPL’s quarterly results were better than we had projected due to the performance in water sales. Unlike second quarter 2023 results, TPL’s management referred to a pipeline of sales
- TPL used the first quarter results to disclose a new method of desalination of produced water
South Korean Banks; Stick with Woori (316140 KS) And KB Financial (105560 KS)
- In our latest South Korean banks screener, we keep Woori on the buy list along with KB Financial as our Korean banks picks
- Delinquency ratios continued to worsen QoQ, yet Woori is the benchmark for NPL ratio; Woori had lagged in terms of returns, but these are holding at the pre-provision level
- KB has a low PBV ratio relative to its ROE, it delivers rising post-provision returns, with cost of risk declining and it has a healthy CET1 ratio
CXW: 1Q24 Beat Highlights Operating Leverage, Improving Occupancies
- Management has indicated that the pipeline for new leases, renewals is robust as ICE & multiple government entities seek capacity.
- Company is engaged in multiple discussions.
- In addition, the recent debt issuance extended maturities & CXW was able to maintain the cost of capital despite the uncertain rate, economic outlook.
Ecolab Inc.: Internal Innovation and Acquisition Potential Driving Ecolab’s Healthcare Business! – Major Drivers
- Ecolab Inc.’s first-quarter 2024 earnings showcased strong progress with adjusted earnings per share increasing by 52%.
- This impressive outcome can be attributed to a 5% growth in organic sales and the expansion of organic operating income margin by 400 basis points.
- The company is also expected to maintain its long-term earnings growth of 12% to 15%.The CEO, Christophe Beck, expressed satisfaction with the level of dedication and the results obtained from Ecolab’s workforce.
Mondelez International: A Tale Of Preserving Critical Price Points and Investing in Supply Chain Reliability! – Major Drivers
- Mondelez International had robust Q1 2024 with solid top line results, strong earnings, and free cash flow generation.
- The performance was buoyed by momentum in emerging markets where consumer confidence is high and categories are resilient.
- The company faced challenges such as disruption with European clients and boycott of Western products in the Middle East and Southeast Asia.
Starbucks Corporation: A Major Disappointment But These 6 Factors That Can Help Them Recover! – Major Drivers
- Starbucks’ second quarter fiscal year 2024 results reflect the challenges and opportunities the company faces in a changing marketplace.
- While global comparable store sales declined by 4% year-over-year and the company’s total revenue dipped by 1% to $8.6 billion, a decline in foot traffic in North America and a hefty decline of 11% in China being a few of the contributing factors.
- The company was also affected by severe weather conditions, causing a nearly 3% impact on both US and total company comp during the quarter.
Celltrion (068270 KS): 1Q24 Result- Sales Hit Quarterly High; Profit Sinks on Merger Effect
- Celltrion Inc (068270 KS) posted revenue of KRW700B+ in 1Q24, thanks to increasing demand for Remsima in Europe. The market share of Remsima is approaching 80–90% in select European countries.
- 1Q24 profit setback is temporary as COGS ratio is expected to improve rapidly starting from 2Q24 as the inventory is digested, leading to sequentially improved profit margins in coming quarters.
- With the successful U.S. launch of Zymfentra and continued solid uptake of the existing products, the company is well-positioned to meet its 2024 revenue target of KRW3.5T (+60% YoY).
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