In today’s briefing:
- Dividend Tax Cut Decision Scheduled for 25th, Next Monday: Watch Sammy Prefs
- Cuscal IPO Trading – Valuation Appears Reasonable
- NVIDIA: Waiting on Blackwell, and the Networking Question
- TUYA: Is The King of White Label IOT Ready to Charter a Different Course?
- Globalstar Inc.: Expanding Market Opportunities & Service Offerings To Redefine the Industry! – Major Drivers
- Tech Supply Chain Tracker (23-Nov-2024): IC design firms optimistic for 2025, cautious about 1Q25.
- TUYA (TUYA.US): Depressed Valuation, $1B+ In Cash, Is Turnaround Story Ahead?
- Monolithic Power Systems: Expansion in Diversified Markets Driving Our ‘Buy’ Rating! – Major Drivers
- Synaptics Incorporated: Can Its Core IoT Growth & Pipeline Expansion Give Them A Competitive Edge? – Major Drivers
- RingCentral Inc.: Strategic Partnerships & Market Penetration Driving Our ‘Outperform’ Rating! – Major Drivers
Dividend Tax Cut Decision Scheduled for 25th, Next Monday: Watch Sammy Prefs
- The opposition’s pushing a Commercial Act amendment, and to gain ruling party support, they might strategically ease up on the dividend tax issue—classic quid pro quo.
- The Samsung family’s collateral risk eased with a 10 trillion won buyback, but local markets are still cautious. Local traders now eye another 10 trillion won shareholder return.
- The timing of the special dividend and tax deadlines may cause mismatches, but we should watch for earlier price moves in Samsung Electronics preferred shares.
Cuscal IPO Trading – Valuation Appears Reasonable
- Cuscal (1229Z AU) raised around A$337m (US$218m) in its Australia IPO.
- Cuscal is an authorized deposit-taking institution (ADI) in Australia that primarily provides financial infrastructure and payment services in Australia.
- We have looked at the company’s performance and valuation in our past notes. In this note, we talk about the trading dynamics.
NVIDIA: Waiting on Blackwell, and the Networking Question
- Nvidia posted earnings yesterday, and guidance was light of buy-side bogeys. I’m not going to step into the mind game of bogeys here, but there are some finer points to focus on.
- NVIDIA reports Q3 EPS $0.81 ex-items vs FactSet $0.75. Reports Q3: Revenue $35.08B vs FactSet $33.17B (2 billion beat like clockwork)
- Q4 Guidance: Revenue $37.5B +/- 2% vs FactSet $37.09B (a bit light). GAAP and non-GAAP gross margins are expected to be 73.0% and 73.5%, respectively, +/- 50 bps. (also light)
TUYA: Is The King of White Label IOT Ready to Charter a Different Course?
- On November 18th, 2024, Temasek-affiliated investment fund 65Equity bought 13% of TUYA, an IOT hardware company and planned to bring the company to list on the Singapore Stock Exchange;
- TUYA is trading at US$901mn market cap, equivalent to 3.2x 12TTM sales. This isn’t cheap. Xiaomi, a high flying stock, now trades at 2.0x 12TTM sales. TUYA is not profitable;
- TUYA is a good and real company but in a bad business. Electronics inventory cycle and advanced stocking for Trump’s Tariff Hike shall support earnings in the next few quarters.
Globalstar Inc.: Expanding Market Opportunities & Service Offerings To Redefine the Industry! – Major Drivers
- Globalstar reported strong results for the third quarter of 2024, with notable growth in both revenue and adjusted EBITDA.
- Total revenue grew by 25% from the previous year, reaching a record $72 million.
- Service revenue increased by 28%, primarily driven by wholesale capacity revenue and the recognition of performance bonuses for 2023 and part of 2024.
Tech Supply Chain Tracker (23-Nov-2024): IC design firms optimistic for 2025, cautious about 1Q25.
- IC design firms remain positive about 2025 outlook despite uncertainties for 1Q25, showing resilience in the industry.
- Taiwan evaluates consequences of Trump’s potential revocation of China’s trade status, highlighting potential geopolitical impacts.
- JSR’s construction of new EUV photoresist plant in S. Korea demonstrates commitment to meeting semiconductor demand in the region and globally.
TUYA (TUYA.US): Depressed Valuation, $1B+ In Cash, Is Turnaround Story Ahead?
- 65 Equity Partners, a Temasek-backed global investment firm with $3B+ in AUM, took a ~13% stake in Tuya for ~$100M.
- Jerry Wang, Tuya’s CEO and Founder, assumed that Tuya would consider a potential secondary listing in Singapore to strengthen company’s presence in the global capital markets.
- With $1B+ in cash, revenue growth re-acceleration, non-GAAP op margin break-even and turnaround plan, I have a positive view on the stock longer-term.
Monolithic Power Systems: Expansion in Diversified Markets Driving Our ‘Buy’ Rating! – Major Drivers
- Monolithic Power Systems (MPS) recently reported a robust performance for the third quarter of 2024, epitomizing significant revenue growth and diversification across its product portfolio.
- The company attained a record quarterly revenue of $620.1 million, marking a 22% increase from the previous quarter and an impressive 30% growth year-over-year.
- This growth trajectory is attributed to MPS’s advancing market strategy diversity and the beneficial onset of revenue steams from past design wins.
Synaptics Incorporated: Can Its Core IoT Growth & Pipeline Expansion Give Them A Competitive Edge? – Major Drivers
- Synaptics Incorporated’s recent earnings call provided a detailed overview of their first-quarter fiscal year 2025 performance, highlighting both positive and challenging aspects of their operations.
- A positive takeaway from the call is the company’s solid financial performance in the quarter.
- Revenue increased by 8% year-over-year to $257.7 million, surpassing the midpoint of guidance.
RingCentral Inc.: Strategic Partnerships & Market Penetration Driving Our ‘Outperform’ Rating! – Major Drivers
- RingCentral’s third quarter 2024 results reflected a solid performance, demonstrating strength both in traditional business segments and new product areas.
- The revenue exceeded guidance, supported by continued growth in the Unified Communications as a Service (UCaaS) sector and strong contributions from new products like RingCX.
- This performance aligns with RingCentral’s strategic focus: further solidifying its UCaaS leadership, expanding total addressable market (TAM) through new AI-powered offerings, and enhancing reach through partnerships and geographic expansion.
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