In today’s briefing:
- Tokyo Metro (9023 JP) IPO: The Bull Case
- Monthly Chinese Express Tracker | Price Pressures Ease | X-Border Re-Accelerates | (September 2024)
- Chart Industries Inc.: Initiation Of Coverage – A Solid Competitive Advantage Driving Our ‘Buy’ Rating! – Major Drivers
- Casella Waste Systems: Initiation Of Coverage – Expansion of Service Offering and Market Penetration! – Major Drivers
- Federal Signal Corporation: Initiation Of Coverage – Their Geographic Expansion Initiatives
- Kirby Corporation: Initiation Of Coverage – How Are They Dealing With The Energy and Fuel Market Dynamics? – Major Drivers
- Leonardo DRS Inc.: Initiation Of Coverage – Electric Power and Propulsion Systems Advancement Catalyzing Growth! – Major Drivers
- Valmont Industries Inc.: Initiation Of Coverage – Infrastructure Expansion & Innovations In Solar & Telecom Makes Us Bullish! – Major Drivers
- Allison Transmission Holdings: Initiation Of Coverage – A Robust Competitive Edge Through High Switching Costs! – Major Drivers
- Wizz Air – Fitness for 500?
Tokyo Metro (9023 JP) IPO: The Bull Case
- Tokyo Metro (TKYMETRO JP), a mass transit operator, is seeking to raise up to US$2.3 billion. Pricing is on 15 October, and the listing is on 23 October.
- Tokyo Metro is held 53.42% by the Minister of Finance and 46.58% by the Tokyo Metropolitan Government.
- The bull case rests on a core high-quality asset, future growth drivers, top-quartile profitability, high FCF generation, and peer-leading dividend payout.
Monthly Chinese Express Tracker | Price Pressures Ease | X-Border Re-Accelerates | (September 2024)
- August parcel volume growth moderated, but easing price pressure matters more
- In July & August, Chinese X-border parcel volume growth re-accelerated
- We believe easing price pressure should lead to express margin expansion
Chart Industries Inc.: Initiation Of Coverage – A Solid Competitive Advantage Driving Our ‘Buy’ Rating! – Major Drivers
- Chart Industries, Inc. reported its 2024 second quarter results, showcasing robust financial performance, marked by several all-time highs across various metrics.
- The company, renowned for its industrial and energy equipment, posted record earnings in sales, operating income, and EBITDA margins, among others, signifying superior operational execution and strategic growth initiatives.
- Baptista Research looks to evaluate the different factors that could influence the company’s price in the near future and attempts to carry out an independent valuation of the company using a Discounted Cash Flow (DCF) methodology.
Casella Waste Systems: Initiation Of Coverage – Expansion of Service Offering and Market Penetration! – Major Drivers
- Casella Waste Systems has demonstrated a trajectory of strategic execution and growth, marked by recent acquisitions and operational optimizations, as evidenced in the second quarter 2024 earnings discussion.
- The company has expanded its geographical footprint to 10 states, which underscores an aggressive growth strategy through acquisitions that align with Casella’s core operational focus.
- During the quarter, Casella added to its portfolio with the acquisition of LMR Disposal and Whitetail Disposal, marking significant strides in extending service offerings in the Mid-Atlantic region.
Federal Signal Corporation: Initiation Of Coverage – Their Geographic Expansion Initiatives
- Federal Signal Corporation has reported another strong quarter, solidifying its position with a series of financial records that underscore its robust operational and strategic execution.
- The company achieved record consolidated net sales of $490 million for the second quarter, indicating an impressive 11% year-over-year increase.
- This performance is highly commendable, particularly considering this growth was entirely organic, reflecting robust internal capabilities and market acceptance of Federal Signal’s offerings.
Kirby Corporation: Initiation Of Coverage – How Are They Dealing With The Energy and Fuel Market Dynamics? – Major Drivers
- Kirby Corporation recently disclosed its financial results for the second quarter of 2024, revealing a notable increase in earnings per share to $1.43 compared to $0.95 for the same period in the previous year.
- The company, managed by CEO David Grzebinski and a competent executive team, harbored a positive tone regarding the steady market fundamentals underpinning its Marine Transportation and Distribution and Services segments despite some navigational and supply challenges.
- Baptista Research looks to evaluate the different factors that could influence the company’s price in the near future and attempts to carry out an independent valuation of the company using a Discounted Cash Flow (DCF) methodology.
Leonardo DRS Inc.: Initiation Of Coverage – Electric Power and Propulsion Systems Advancement Catalyzing Growth! – Major Drivers
- Leonardo DRS’s performance during the second quarter of 2024 demonstrates a robust trajectory, backed by growth across several segments and strategic advancements, despite facing some industry-wide challenges.
- The company’s revenue growth of 20% year-over-year is entirely organic, driven primarily by demand in sectors related to advanced infrared sensing, electric power and propulsion, along with network computing and ground system integration.
- Moreover, Leonardo DRS’s adjusted EBITDA increased by 32%, showing a meaningful margin expansion of 100 basis points over the previous year, alongside improvements in adjusted net earnings and adjusted diluted earnings per share, which rose by 21% and 20% respectively.
Valmont Industries Inc.: Initiation Of Coverage – Infrastructure Expansion & Innovations In Solar & Telecom Makes Us Bullish! – Major Drivers
- Valmont Industries presented their second quarter 2024 earnings, reflecting both progress and challenges.
- CEO Avner Applbaum emphasized robust operational improvements and strategic adjustments that have uplifted their profitability considerably during difficult market dynamics.
- Notable was the increase in operating margins to 14.2%, marking a significant improvement.
Allison Transmission Holdings: Initiation Of Coverage – A Robust Competitive Edge Through High Switching Costs! – Major Drivers
- Allison Transmission has recently communicated its second quarter 2024 results, underscoring some significant growth and robust performance, particularly in its North American On-Highway end market primarily driven by heightened demand for Class 8 vocational vehicles.
- The company reported a record quarterly revenue of $816 million, a 4% increase over the same period last year.
- This surge was also supported by notable growth in the defense sector and markets outside North America.
Wizz Air – Fitness for 500?
- Pre-Pandemic, Wizz Air traded on an equity value or market cap €43m-€44m per aircraft. However, it currently trades on only €9m per aircraft using its March 2025 fleet.
- Key issues need to addressed to convince on the “right” to more than double fleet to 500 aircraft.
- We do not share equity issuance concerns – proper inspection illustrates leverage as a margin challenge not a balance sheet challenge.
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