Daily Brief Financials: Ethereum, Shui On Land, Compass, LXI REIT , StoneCo , Triple Point Social Housing REIT and more

• Last Wednesday, on March 13th, Ethereum launched its biggest upgrade in the past 18 months, marking a significant milestone since the Ethereum Merge on September 15, 2022.
• Dubbed Dencun or Cancun-Deneb, this upgrade introduced the eagerly awaited Proto-Danksharding feature, aimed at dramatically enhancing the scalability of Ethereum’s Layer 2, also known as rollups, and slashing the costs associated with rollup transactions, while making them less volatile.
• Proto-Danksharding brought to the table so-called ‘blobs’.

Shui On Land’s (SOL) FY 2023 results were slightly weak, in our view. Positively, the company’s rental income increased moderately, supported by contributions from new commercial assets and China’s re-opening from the pandemic. Recurring operating income from rentals and property management covered 0.8x of interest expense. In addition, the gross margin remained very strong, even as revenue from the property development segment was halved on account of lower sales and deliveries.

Negatively, SOL’s net debt climbed 14% from FYE 2022, owing to lower cash collections and its acquisition of a Shanghai project in April 2023. Moreover, the company’s increased asset encumbrance would reduce its financial flexibility. Liquidity is weak, considering the thin unrestricted cash balance and substantial refinancing needs over the next 12 months. That said, the company might be able to pledge or dispose of more assets to raise cash.

• COMP is a residential real estate brokerage firm with a market cap of around $1.7B founded to disrupt the low-tech residential market.
• Despite a decline in share value due to high mortgage rates, COMP has shifted focus to profitability and cost-cutting measures.
• With interest rates expected to decrease and potential for a rebound in the residential market, COMP is well-positioned for growth and has potential for significant upside in share price.

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.

Edison Investment Research is terminating coverage on LXi REIT (LXI). Please note you should no longer rely on any previous research or estimates for this company. All forecasts should now be considered redundant. Previously published reports can still be accessed via our website.

• StoneCo had a successful year with substantial strategic advancements, impressive financial performance, as well as strategic milestones that bolstered the company’s market position while paving the way for future growth.
• The year saw the implementation of strategic adjustments that aimed to better position the business for the future.
• As such, the company reorganized itself to effectively deliver solutions across different client segments, from micro to medium businesses.

Triple Point Social Housing REIT (SOHO) reported a robust FY23 financial performance. Benefiting from inflation-linked rental growth and improving rent collection, DPS is once again covered on a run-rate basis, and we expect further progress. Operational initiatives included the roll-out of the new lease clause and launch of the eco-retrofit pilot project.