Daily Brief Industrials: Hainan Jinpan Smart Technology, General Electric , Grupo Aeromexico, iPower , Kbr Inc, Textron Inc, Csx Corp, United Rentals and more

• The review period for the March rebalance ended 31 January. We expect the changes to be announced 23 February with the implementation taking place after the close on 8 March.
• There are 10 stocks in inclusion zone and 11 in deletion zone. There should be 10 changes since that is the cap for the maximum changes at a single rebalance.
• The potential adds and deletes are down between 37-47% over the last 6 months and a long/short trade could provide superior risk-adjusted returns.

• General Dynamics Corporation’s quarterly and full-year results for 2023 indicate a strong performance with increased revenues and operating earnings as well as modest earnings per share growth.
• However, the growth rate for earnings per share was slower than expected due to higher net income in the previous year.
• Sequentially, the company’s results improved significantly, with increases in revenue, operating earnings, net earnings, and earnings per share.

• We raise our forecasts to reflect the strength of International revenue at Aeromexico – we expect it to beat 2023 EBITDAR targets by 26%
• Aeromexico has been outperforming domestic competitors Volaris, Viva Aerobus due to international unit revenue gains – their forced capacity cuts due to GTF issues should help Aeromexico manage 2024 margins
• Fitting with the global theme of consolidation difficulties, the US has ruled the Delta/Aeromexico JV must terminate – this could be a double digit % risk to PBT

• iPower is expected to report its 2QFY24 results in mid-February. Investors will continue to focus on the company’s progress on key initiatives.
• While continuing to grow its key Amazon relationship, iPower is also expanding its distribution channels.
• We look for an update on the growth of its TikTok Shop business as well as developments with physical retailers.

Key points (machine generated)

• KBR’s Global Solutions segment offers various services to government clients globally, making it the company’s largest business.
• The Technology Solutions segment provides proprietary technologies and engineering services primarily for the energy, chemicals, and hydrocarbons industries.
• KBR’s stock is currently undervalued compared to its peers, presenting potential for significant upside if it can reach its target valuation. 

This article is sourced from an online content aggregator through publicly available sources and is displayed below for general informational purposes only. This article was originally published 3 months ago on Value Investors Club.

• Textron Inc.’s strong performance and positive margins were highlighted in its fourth-quarter 2023 earnings call.
• The industrial conglomerate generated $3.9 billion in quarterly revenue, a rise from $3.6 billion posted in the fourth quarter of 2022.
• Textron’s segment profit was $384 million, $78 million higher than that of the fourth quarter of the previous year.

• CSX Corporation posted solid 2023 results, setting a strong precedent for 2024 due to its robust financial position and positive business momentum.
• Despite facing challenges like inclement weather, 2023 was marked by healthy volumes, favorable pricing measures, strong operating margins, and more.
• The company experienced setbacks due to higher interest rates and supply chain disruptions, but managed to mitigate these issues.

• The latest earnings from United Rentals highlight several points of growing interest for potential investors.
• The company achieved record-breaking results for the fourth quarter of the year, as noted by President and CEO Matt Flannery, through the continuation of a customer-centric approach to operational excellence and safety.
• The company’s achievements are marked by record revenue, earnings, and returns, underpinned by a strategic acquisition and the focus on integration.