In today’s briefing:
- Huge Change at Sekisui Jushi (4212) – 20% Buyback from Erstwhile Controlling Shareholder
- Insiders Selling at Ecopro BM and Kum Yang
- Offshore China ETFs Rebalance Preview: Two Changes in September
- 10 in 10 with SingPost – Transforming into a Global Logistics Business
- 3M Company: 4 Key Factors Driving Growth! – Financial Forecasts
- General Dynamics Corporation: Is The Bombardier Collaboration A Real Game Changer? – Key Drivers
- XP Power – Solid H123, outlook for FY23 maintained
- Old Dominion Freight Line: 5 Crucial Factors Driving Its Performance! – Financial Forecasts
- Otis Worldwide Corporation: Expanded Northeast U.S. Presence With The Bay State Elevator Acquisition To Boost Growth? – Key Drivers
- TRS: Realigned for Delivery
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Huge Change at Sekisui Jushi (4212) – 20% Buyback from Erstwhile Controlling Shareholder
- In April, Sekisui Jushi (4212 JP) announced lackluster earnings and unsurprising guidance after a year marked by higher costs. It also announced a small (2.5%) buyback, likely for cross-holdings.
- Yesterday, the company announced Q1 results, and a revision to their buyback programme (to buy 20.2% of shares out). This morning their 22+% (#1) shareholder Sekisui Chemical sold 18%.
- Forward PER dropped nearly 20%. The stock is still outrageously cash/securities-rich and if “re-levered” to zero net leverage would get a high 20s ROE. Hmmm…
Insiders Selling at Ecopro BM and Kum Yang
- Ecopro BM (247540 KS) and Kum Yang (001570 KS)’s shares are down 2.5% and 4.5%, respectively today, driven by news of insiders at these companies selling their shares.
- It is estimated that the total amount of Ecopro BM shares sold by insiders and related parties was about 20 billion won in July by more than 12 insiders/related parties.
- We are increasingly concerned about insiders selling at Ecopro BM and Kum Yang. Coupled with lofty valuations, we think there is a higher probability of downside risk on these names.
Offshore China ETFs Rebalance Preview: Two Changes in September
- As of 1 August, there could be two changes for the iShares A50 China (2823 HK)/ CSOP A50 (2822 HK) in September.
- There should be over 1x ADV to buy on NARI Technology Co Ltd A (600406 CH) and over 1x ADV to sell on Shaanxi Coal Industry (601225 CH).
- There are a few stocks bunched around similar market caps among the potential adds and there could be changes to the list over the next few weeks.
10 in 10 with SingPost – Transforming into a Global Logistics Business
10 in 10 with SingPost – Transforming into a Global Logistics Business
3M Company: 4 Key Factors Driving Growth! – Financial Forecasts
- 3M Company delivered a strong result and managed an all-around beat in the last quarter.
- Their cost management efforts and restructuring initiatives primarily drove these margin increases.
- We give 3M Company a ‘Hold’ rating with a revised target price.
General Dynamics Corporation: Is The Bombardier Collaboration A Real Game Changer? – Key Drivers
- General Dynamics delivered a positive result and managed an all-around beat in the last quarter.
- General Dynamics had a revenue increase across Defense segments and a modest increase in Aerospace.
- The revenue increase came from international vehicle programs at European Land Systems and Land Systems.
XP Power – Solid H123, outlook for FY23 maintained
XP Power reported year-on-year revenue growth of 30% in H123 as it made good progress shipping from its elevated backlog. As expected, orders declined year-on-year, but the c £250m backlog still provides at least nine months’ revenue visibility. The company continues to invest for the longer term in Malaysia (manufacturing) and the United States (R&D). With no change to management’s full year expectations, we maintain our normalised operating profit forecasts for FY23 and FY24 and nudge up our interest cost forecast for FY23.
Old Dominion Freight Line: 5 Crucial Factors Driving Its Performance! – Financial Forecasts
- Old Dominion Freight Line Inc. delivered a mixed set of results for this quarter with revenues below the analyst consensus.
- Considering the operating challenges that are associated with the domestic economy’s continued softness, and decreased volumes, the financial results were solid.
- We give Old Dominion Freight Line an ‘Underperform’ rating with a revised target price.
Otis Worldwide Corporation: Expanded Northeast U.S. Presence With The Bay State Elevator Acquisition To Boost Growth? – Key Drivers
- Otis Worldwide managed to surpass the revenue and earnings expectations of Wall Street.
- Otis also achieved significant milestones in innovation, launching the Gen3 Core elevator and securing major projects globally.
- Looking ahead, Otis’ management has raised its 2023 outlook, and with the launch of the UpLift program, the company aims to drive efficiency and sustainable growth for the future.
TRS: Realigned for Delivery
- TRS continues to grow in its two smaller business segments while the packaging segment continues to experience a moderated recovery
- Predominantly consumer staples. Inventory management has been the main culprit for the packaging segment not recovering as fast as expected
- We believe the softness in packaging has created an investment opportunity in TRS’s stock as the Company streamlines its operations