Daily Brief TMT/Internet: Canon Inc, Alibaba Group Holding , Nanya Technology, Baidu, Millicom International Cellula, Western Digital, Globopar, Zebra Technologies Corp, Broadcom , Pure Storage Inc and more

• Canon Inc (7751 JP) announced a second buyback this fiscal year on 15 June. As discussed here previously, Canon buybacks are short, sharp, and sweet. 
• The recent one should be done imminently (15 May start ended 13 July). 16 June start? (Note: Canon reports buyback results at 3pm local time, and did not report today).
• This time we have a double-setup with buyback ending and a large TOPIX sell on Canon on 28 July. 

• Ant’s buyback valuation of $79bn is in line with market expectation
• While 40% loss is deep for the latest round investors, earlier investors are still in the money
• Alibaba is expected to record a profit of $18bn if it decided to join the buyback

• Nanya Tech management extrapolated on their recent results call that they believe 2Q23 was the bottom for the DRAM cycle.
• We’ve updated our Nanya Tech financial model and estimates; we still see a short-term trade back to Nanya Tech’s mid-June high. However, Elan Microelectronics is a Long with more edge.
• While Nanya’s comments indicated a more delayed recovery for Memory than Micron’s recent guidance, overall the industry for Micron, SK Hynix, and Samsung appears to be turning a corner.

• We estimate Baidu’s ads revenue growth in 2Q23 will be 10.8% YoY. We largely cut our forecast of 3Q23’s ads revenue growth from 14.7% to 7.1%.
• We lower Baidu’s core other revenue growth in 2Q23 from 18.0% to 9.0% YoY. Baidu’s smart transportation AI cloud business has been affected by the contraction in local government expenses.
• We expect Baidu’s 2Q23’s rev./non-GAAP net income to be (2.3%)/ (1.9%) vs cons, also cut the TP to $162, which implies 16.5X PE in 2023.

Lucror Analytics’ ESG Scores are based on a 3-tiered scale and are adjusted for Controversies (if applicable).
We view Millicom’s ESG as “Adequate”, with a “Strong” score for Governance, but “Adequate” scores for the Social and Environmental pillars. Controversies are “Immaterial” and Disclosure is “Strong”.

• Peloton Interactive delivered a mixed set of results in its most recent result, with revenues above Wall Street expectations but below-par earnings.
• Their management believes they are in a considerably better situation from the cost structure standpoint.
• We give Peloton Interactive, Inc. a ‘Hold’ rating with a revised target price.

• Lucror Analytics’ ESG Scores are based on a 3-tiered scale and are adjusted for Controversies (if applicable).
• We view Globo’s ESG as “Weak”, despite its “Adequate” score in quantitative terms. The Social and Governance scores are “Weak”, while the Environmental score is “Adequate”. Controversies are “Immaterial” and Disclosure is “Weak”.
• Globo Comunicacao e Participacoes SA (Globo), privately owned and controlled by the Marinho family, is the largest media group in Brazil. It controls the country’s leading broadcast TV network and its pay-TV programmer, as well as a diversified group of publishing companies and Internet content providers.

• Zebra delivered a solid result and managed an all-around beat in the last quarter.
• Zebra adjusted its sales outlook due to softer demand in certain markets while remaining financially strong and actively managing its supply chain.
• Zebra observed cautious spending behavior among enterprise customers, resulting in a shift from large orders to smaller ones.

• Broadcom remains as one of the best-positioned semiconductors stocks.
• The recent rally, however, is factoring too optimistic scenario for the future and creates a downward risk for the share price.
• Profitability would continue to experience strong tailwinds, but this is unlikely to bring significant rewards for shareholders.

• Pure Storage managed to surpass the revenue expectations as well as the earnings expectations of Wall Street.
• Q1 operating earnings of approximately $20 million exceeded expectations, despite higher-than-expected salary expenditures and their first sales kickoff event since 2020.
• Besides, despite the positive initial reception to FlashBlade//E, Pure Storage expects a modest revenue increase in the second half of the year.