In today’s briefing:
- Toppan Printing (7911) Accelerates Buyback Pace and Amount; But Crossholder Sales Lurk
- Innospace IPO Valuation Analysis
- Screen Holdings (7735 JP): Guiding for Lower Profits in H2
- Breton Technology Pre-IPO Tearsheet
- CBAT: Reports strong margins and improved outlook for 2024. Increasing our EPS estimates and target valuation to 2.50.
- Verisk Analytics Inc.: Capitalizing on the Catastrophe Bond Market! – Major Drivers
- Virco Mfg. Corp (VIRC) – Sunday, Feb 11, 2024
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Toppan Printing (7911) Accelerates Buyback Pace and Amount; But Crossholder Sales Lurk
- Toppan Printing (7911 JP) established a new Medium-Term Management Plan with targets in May 2023. 8% ROE, PBR >1.0x. More DX business. More management modernisation. More ESG. Mooooarrrrr!
- They also promised capital measures: ¥100bn of buybacks over three years. Total shareholder return of 50%+ over three years. More progress in selling down cross-holdings.
- Today the company reported better-than expected full-year revenues, OP, and Net Profit, added more to the buybacks, and shortened the buyback period to two years. Details matter.
Innospace IPO Valuation Analysis
- Our base case valuation of Innospace is target price of 51,481 won per share (12 month view), which is 28% higher than the midpoint of the IPO valuation range.
- We estimate Innospace to generate sales of 1.8 billion won in 2024, 28.7 billion won in 2025, and 58.3 billion won in 2026.
- Innospace is involved in the satellite launch vehicle production and launch service business.
Screen Holdings (7735 JP): Guiding for Lower Profits in H2
- FY Mar-24 results were ahead of guidance, but management’s FY Mar-25 forecast has sales flat and profits down in the second half.
- The shares have dropped back 24% from their all-time high, bringing the forward P/E ratio down to 22X.
- China and foundry remain strong while North America and memory pick up. Guidance is probably conservative. Buy into the weakness.
Breton Technology Pre-IPO Tearsheet
- Breton Technology (1884270D CH) is looking to raise up to US$200m in its upcoming HK IPO. The deal will be run by CICC and CMB International.
- Breton Technology is a clean energy solution provider in China, focusing on the design, development and commercialization of engineering machinery powered by new energy sources.
- Such engineering machinery includes battery-electric loaders and wide-body dump trucks, each offering a variety of payload and battery capacities.
CBAT: Reports strong margins and improved outlook for 2024. Increasing our EPS estimates and target valuation to 2.50.
- CBAK Energy Technology is poised to benefit from a sharp uptick in portable energy systems and home energy storage.
- Despite pricing pressures in the industry, CBAK’s strong relationships with key customers and solid safety record enabled has enabled it to retain pricing power which boosted battery margins significantly in the first quarter as raw material continued to fall.
- As investors begin to focus on the growing and profitable battery business, we believe there is substantial upside for the stock which is now trading at just over 3 times our 2024 EPS estimate.
Verisk Analytics Inc.: Capitalizing on the Catastrophe Bond Market! – Major Drivers
- In the first quarter 2024, Verisk Analytics, Inc. reported solid performance with organic constant currency revenue growth of 6.9%, driven partially by broad-based subscription growth of 7.8% across most of its businesses.
- The result was aligned with guidance for 2024 and highlighted the company’s efforts to evolve into an integrated insurance-focused enterprise.
- CEO Lee Shavel stated that Verisk is driving predictable and consistent growth by partnering with the insurance ecosystem to address their major challenges.
Virco Mfg. Corp (VIRC) – Sunday, Feb 11, 2024
- Late 90s/early 00’s had stock volatility based on undisclosed news, while recent market movements show stocks moving significantly without any news
- Example of stock Virco dropping 18% with no news and high trading volume, despite company having positive financial indicators
- Virco has small outstanding share count, manageable net debt, and attractive valuation multiples based on estimated future earnings
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.