In today’s briefing:
- CanSino Biologics (6185.HK/688185.CH) – Time to Offload; the Rally May Not Last Long
- M3: Covid Related Trials and Yen Depreciation Support Earnings Beat
- Singapore Medical: TTW Bumps To S$0.40
- Bionote Pre-IPO Peer Comp – Larger Segment Leads in Margins, but Trend Could Be Reversing
- Bristol-Myers Squibb: The Turning Point Acquisition & Oncology Expansion
- Johnson & Johnson: R&D Expansion & Other Drivers
- BioMarin Corp: Key Drivers
- Breaking Estimate Short Candidates: Novavax, Micron, Generac, FormFactor
- Abbott Laboratories: Major Drivers
CanSino Biologics (6185.HK/688185.CH) – Time to Offload; the Rally May Not Last Long
- The fake news about China reopen and the COVID-19 vaccine business are the major driving force for the rally of CanSino’s share price. However, such rally would not last long.
- CanSino didn’t perform well in Q3 and 2022 would be a difficult year for CanSino. The major turning point of CanSino performance still lies in MCV4, not COVID-19 vaccines.
- CanSino’s H-share valuation has become more reasonable,but the downside risk in HKEX is hard to predict. Investors could consider offload and secure the gains. There’s better opportunity to long ahead.
M3: Covid Related Trials and Yen Depreciation Support Earnings Beat
- M3 Inc (2413 JP) reported 2QFY03/2023 results yesterday. Revenue grew 10.6% YoY to JPY56.7bn (vs consensus JPY54.7bn) while OP increased 31.5% YoY to JPY17.9bn (vs consensus JPY17.0bn).
- The company’s earnings were mainly driven by Covid-19 related trials and a weaker Yen which mainly helped the overseas business post strong results.
- M3’s growth prospects remain stagnant and the company’s valuation multiple is still expensive as earnings expectation has started to decline.
Singapore Medical: TTW Bumps To S$0.40
- I should have stuck to my guns. Singapore Medical (SMG SP)‘s original Exit Offer was low-balled. The IFA all but conceded this. I mused that TTW probably needed to bump.
- And now TTW has, bumping the Offer by 8.1% to S$0.40/share, and declaring the terms final.
- The Offer remains subject to TTW holding 90% (with 77.42% in the bag already). The Offer has been extended to the 5 December.
Bionote Pre-IPO Peer Comp – Larger Segment Leads in Margins, but Trend Could Be Reversing
- Bionote (377740 KS) is looking to raise approximately US$200m in its Korean IPO. The IPO would consist of both a primary and secondary selldown.
- Bionote is an integrated producer of diagnostics test products and biocontent products. Based on its unique recombinant antigen and antibody manufacturing technology, the firm researches and develops diagnostic reagent products.
- In this note, we look at peers and undertake a peer comparison.
Bristol-Myers Squibb: The Turning Point Acquisition & Oncology Expansion
- Bristol-Myers delivered another all-around beat as the management continued to make an effort to expand its new product range and inline franchise.
- In this quarter, the inline and new product portfolio grew by 13%, and the company managed to deliver non-GAAP EPS growth of 3%.
- Revenues in the third quarter were approximately $11.2 billion and the inline and new product portfolio grew strongly up to 13%.
Johnson & Johnson: R&D Expansion & Other Drivers
- Johnson & Johnson has shown some recovery in its stock price which was backed by a solid result across its business segments.
- Pharmaceutical growth was determined by robust commercial execution and access that enabled Johnson & Johnson to continue to deliver growth in operational growth.
- We provide the stock of Johnson & Johnson with a ‘Hold’ rating and a revised target price.
BioMarin Corp: Key Drivers
- BioMarin delivered a disappointing set of results for the third quarter with revenues and earnings well below Wall Street expectations.
- The company’s Kuvan offering continues to have a declining market share of prophylaxis exclusivity in the United States.
- Along with new patients from reported new markets, the team continues to see patient growth in European markets similar to what they saw in the prior quarter.
Breaking Estimate Short Candidates: Novavax, Micron, Generac, FormFactor
- This model finds companies facing recent sharp cuts in estimates. These shorts can have very disparate characteristics.
- The key judgement involves whether the negative revisions are temporary or if they are indications of ongoing weakness in the business.
- Breaking Estimates stocks often continue to decline after the cuts. This week we flag: Novavax, Micron, Generac, FormFactor
Abbott Laboratories: Major Drivers
- The strength of Abbott’s diversified business strategy and execution allowed it to deliver another solid quarter that greatly outperformed expectations despite the challenging environment.
- Since the beginning of last year, EPD has seen double-digit organic sales growth, driven by a consistent cadence of new product releases and great commercial execution.
- Additionally, during the quarter, they changed the leadership at their Sturgis location as well as in their previous organization.
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