Daily Brief United States: Applied Materials, Bitcoin, Microstrategy Inc Cl A, Dynatrace , Ralph Lauren, Hilton Worldwide Holdings , Tapestry Inc, Arthur J Gallagher & Co, Performance Food Group Co, Soybean Meal and more

• Q124 revenues of $6.71 billion, at the high end of the guided range and essentially flat sequentially both QoQ and YoY
• Q224 revenue $6.5 billion at the midpoint, a modest downward movement of 3% QoQ and in line with what we saw from peers KLAC and LRCX
• Still a great company with excellent growth prospects, just not in 2024

• Today, we are launching our new weekly cryptocurrency note called ‘Crypto Crisp’.
• In ‘Crypto Crisp’, every Monday, we will explore the upcoming week in crypto, reflecting on the previous week’s developments.
• The aim of ‘Crypto Crisp’ is to efficiently and precisely bring you up to date with the crypto industry in just a few minute’s worth of reading time.

• MicroStrategy Inc’s fourth quarter 2023 earnings point towards a strong performance from being the world’s largest corporate holder of bitcoin, possessing 190,000 bitcoins with a market value of $8.1 billion.
• Over 2023, the company added another 56,650 bitcoins to its portfolio costing $1.9 billion, making the company’s bitcoin strategy a long-term focus.
• 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.

• According to Dynatrace’s fiscal third quarter 2024 earnings, the company delivered solid results driven by its ability to successfully navigate a continually changing market.
• Annual recurring revenue (ARR) grew by 21% year over year, while subscription revenue increased by 23% over the same period.
• Non-GAAP operating income steadily increased to $105 million representing 29% of revenue and robust free cash flow margin was delivered at 25% on a trailing 12-month basis.

• Ralph Lauren has yielded strong financial performance for Q3, reportedly exceeding the company’s top and bottom-line expectations, while driving significant EPS growth.
• Such advancement comes despite a reportedly dynamic global environment, thanks to considerable focus on areas such as the brand.
• Immersing people in Ralph Lauren’s world of elegance and sophistication, the brand is resonating globally, allowing overall pricing power in the market.

• Hilton Worldwide Holdings Inc.
• reported its Q4 and full-year 2023 earnings, during which the company made several significant achievements.
• For 2023, Hilton’s system-wide RevPAR grew by 12.6% compared to 2022 due to strong growth across every major region and chain scale.

• Tapestry Inc.’s Q2 FY2022 earnings were particularly solid and it achieved a 3% sales gain driven by a 12% growth at constant currency internationally, reflecting the benefits of its diversified business model.
• The firm saw a notable 19% sales increase in Greater China, as well as increases in Japan, Europe, and other parts of Asia.
• Impressively, the company maintained its revenue standing in North America, which was better than it had previously expected.

Key points

• Arthur J Gallagher is a strong player in the U.S. SME broking market with fair value shares trading at $245 and 16.0x EV/2024E EBITDA
• Expected 5-year returns of around 10% IRR / 1.5x MOIC with 7.5% EBITDA growth rate, potential for higher returns with 15% IRR / 2.0x MOIC
• Insurance brokers like Arthur J Gallagher are benefiting from firm P&C pricing cycle, inflation protection, and tight labor market, providing stability and growth opportunities with focus on sustainable organic growth trends.

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.

• Performance Food Group (PFG) hosted its Q2 2024 earnings call where they discussed results and future outlook, with performance metrics showing strong results for the quarter.
• The company generated total net sales of $14.3 billion, a 2.9% increase from last year, with the result at the top end of the guidance range.
• PFG’s sales performance was led by a 2.1% rise in total case volume growth, helped by an 8.7% surge in independent restaurant case growth.

• In his presentation Thursday morning at the Agricultural Outlook Forum USDA Chief Economist Seth Meyer said input prices are not falling with commodity prices, squeezing margins.

• “When commodity prices normalize and readjust, those input prices tend to be sticky, which shrinks producer margins,” Meyer says. “…It was maybe easier to make a little bit of money in ’22, ’23.

• It’s going to be a little bit tougher in the next crop year.”