Daily Brief TMT/Internet: Infocom Corp, SK Inc, Shift Up, Himax Technologies Inc Adr, Guangzhou Automobile Group , Legend Holdings Corp H, Crowdstrike Holdings , Arlo Technologies Inc, BILL Holdings , Soluna Holdings and more

• The entire saga here of Teijin Ltd (3401 JP)‘s disposal of its 55.1% stake in Infocom Corp (4348 JP) is being played out in the non-generally-public press. 
• There is reportedly a new piece of writing out late Thursday which suggests an approach.
• I wrote about the “meaning” of words in Infocom (4348 JP) – The Meaning of ‘Binding Bids’ and ‘¥250bn’ and now there is more nuance to parse.

• The first trial in December 2022 ordered Chey to pay 67.5 billion KRW; today’s ruling increased this to 1.38 trillion KRW plus 2 billion KRW, including splitting SK Inc. shares.
• The increased settlement and SK Inc. share split could spark a management rights battle, causing SK Inc.’s stock price to jump as investors and shareholders react.
• It may take a year for the final verdict, making a sustained stock price increase unlikely. Yet, differences between trial rulings could alter Chey’s SK Inc. stake, sustaining market interest.

• Shift Up (462870 KS) is Korea’s leading game development studio. It is seeking to raise up to US$320 million.
• We previously discussed the IPO in Shift Up IPO: The Investment Case. 
• We examine the syndicate’s valuation methodology. Our analysis suggests that Shift Up is attractively valued in the IPO price range. We would participate in the IPO.

• We hosted a conference call recently with Himax management, the global leader in automotive touch display controllers; the company is experiencing a uniquely stronger automotive supply/demand environment than some peers.
• Discussed in detail how larger or more sophisticated interior displays can drive higher dollar content of display controllers per vehicle. We examine trending new car designs with much larger displays.
• We forecast an exponential jump-up in display controller content value per vehicle as beautiful display designs are becoming key USP for auto brands; Maintain our Structural Long rating for Himax.

• Groundhog Tech focuses on expanding 5G in SE Asia to drive growth in the region’s tech industry
• Skymizer introduces ET2 LPU and LLM system platform to enter the chip IP market and enhance its offerings
• Samsung increases staff at Japan lab for chip packaging innovations, while Malaysia plans to invest in chip ecosystem development

• Legend Holdings Corp H (3396 HK) owns 31% of Lenovo (992 HK) , the number one global PC maker
• Lenovo is a leader selling AI enabled PC’s globally.  Its server business is growing rapidly through strong demand for generative AI.  Legend is the leading AI seed investor in China.
• Technical pattern strong for Lenovo reaching a 9 year high.  Legend showing increasing momentum from an historic trough valuation level

• Zscaler missed billings estimates and lowered full-year revenue guidance due to extended sales cycles and deal closures delays
• Declining performances in the cybersecurity sector indicate potential underperformance for Crowdstrike
• Author predicts potential significant miss in Crowdstrike’s upcoming earnings based on current trends in the market

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.

• Anticipate significant downward revision in Arlo Technologies’ long-term revenue guidance
• Management’s lack of transparency regarding key performance indicators may have misled investors
• Initiate a short position before Feb. 29th guidance update to benefit from potential share price decline.

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.

• BILL Holdings shares significantly underperformed in 2024 with shares down ~37% year-to-date versus a 12% gain on the Nasdaq Composite Index.  
• Shares saw sell-off post 3Q’FY24 earnings as results indicated a weak 4Q’FY24 guidance and customer churn while SMBs continue to be pressured by high inflation and interest rates.
• My bear case implies a $31 valuation (vs. prior $25 PT), based on ~2x FY25E EV/Revenue and bear case FY25E revenue of $1368M, representing ~40% downside vs. current levels.

• 214MW of new projects to more than double the existing 75MW in operation and further builds on Soluna’s impressive corporate turnaround.
• In the past year, Soluna has launched its flagship Project Dorothy with both hosting (1A) and propriety mining (1B), moved to more profitable hosting contracts at its 25MW Project Sophie, began diversifying revenue through AI hosting at Project Sophie, and launched a new AI cloud venture and the Helix AI datacenter design.
• In addition, the company has been adjusted EBITDA positive for the past two quarters, while the balance sheet has improved.