In today’s briefing:
- Dominant US Crude Production Has Transformed the Importance and Size of Strategic Petroleum Reserve
- The Data Center is the New Compute Unit: Nvidia’s Vision for System-Level Scaling
- China to Limit Steel Output as Prices Slide and Demand Falls
- PGT Innovations Inc.: Initiation Of Coverage – Maintaining A Robust Growth Trajectory Despite Market Uncertainties! – Major Drivers
- Integral Ad Science Holding Corp.: Initiation Of Coverage – Highlighting the 4 Central Pillars of Its Growth Dynamics! – Major Drivers
- Papa John’s International Inc.: Initiation Of Coverage – Are Its Growth Prospects As Delicious As Its Pizza? – Major Drivers
- Post Holdings Inc.: Initiation Of Coverage – Is Its Resilient Supply Chain Performance Likely To Last? – Major Drivers
- Pilgrim’s Pride Corporation: Initiation Of Coverage – What Is The Core Business Strategy Of This Meat & Poultry Giant? – Major Drivers
- Ring Energy, Inc. – Scaling Business Through Acquisitions & Development
- SIGA Technologies – Positive signals abound
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Dominant US Crude Production Has Transformed the Importance and Size of Strategic Petroleum Reserve
- USA’s Strategic Petroleum Reserves (SPR) is currently at its lowest in 40 years. Should this be a source of concern? Perhaps not.
- USA is the world’s largest producer of crude oil. From being vulnerable to imported oil, US has become self-reliant.
- SPR expressed differently now, stands at 188 days of net imports compared to less than 100 days as was seen in the 1980s, 1990s, and early 2000s.
The Data Center is the New Compute Unit: Nvidia’s Vision for System-Level Scaling
- Nvidia CEO Jensen Huang has repeatedly emphasized that the data center is the new unit of compute.
- While this concept seemed straightforward at first, the deeper implications became clearer after Nvidia’s presentations at GTC and OFC 2024.
- I only recently grasped exactly what is happening, and a simple reframing of the underlying principles that drove Moore’s Law makes the entire picture clearer.
China to Limit Steel Output as Prices Slide and Demand Falls
- Chinese authorities are to limit steel production while pushing forward industrywide structural adjustments as steel mills suffer from growing losses amid sluggish demand.
- Several ministries led by the National Development and Reform Commission (NDRC) Wednesday said regulators will continue efforts to control crude steel production this year, focusing on energy conservation and carbon reduction.
- The authorities will foster industry strengths and weed out weak players to promote the structural adjustment and optimization of the steel industry.
PGT Innovations Inc.: Initiation Of Coverage – Maintaining A Robust Growth Trajectory Despite Market Uncertainties! – Major Drivers
- In the third quarter of 2023, PGT Innovations displayed a strong financial performance despite operating in an unpredictable market environment.
- The company’s balanced exposure to new construction and repair and remodeling channels has enabled them to deliver consistent record sales and impressive profits over the year.
- By combining a continued focus on operational efficiency and productivity, PGT Innovations managed to achieve a total revenue of $400 million and an adjusted EBITDA of $78 million in the third quarter.
Integral Ad Science Holding Corp.: Initiation Of Coverage – Highlighting the 4 Central Pillars of Its Growth Dynamics! – Major Drivers
- IAS 2023 fourth quarter and full year results depict a robust performance that exceeded expectations, noting an increase of 14% in quarter four revenue to reach $134.3 million and a year growth of 16% to reach $474.4 million.
- This growth marks a path for IAS’s strong commitment toward advancing the industry with its AI-driven measurement systems and optimization solutions.
- 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.
Papa John’s International Inc.: Initiation Of Coverage – Are Its Growth Prospects As Delicious As Its Pizza? – Major Drivers
- Papa John’s International, Inc. reported another year of record global system-wide sales for the fourth consecutive year of positive North America comps in 2023.
- The company’s success is attributed to the dedication and focus of its team, franchisees, and the restructuring efforts, especially the foundation improvements to restaurant operations, menu amelioration with novel products, the digital advancements of their operations platforms, and the expansion of the restaurant footprint.
- 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.
Post Holdings Inc.: Initiation Of Coverage – Is Its Resilient Supply Chain Performance Likely To Last? – Major Drivers
- Post Holdings began fiscal 2024 with a strong first quarter, with manufacturing performance, pricing and cost management aiding in growth momentum.
- Diverse channel, product, and price point offerings have allowed the company to weather various volume fluctuations.
- Although volume decreases were observed in branded retail businesses, Foodservice remained strong with shifts toward value offerings and positive momentum in their Refrigerated Retail business.
Pilgrim’s Pride Corporation: Initiation Of Coverage – What Is The Core Business Strategy Of This Meat & Poultry Giant? – Major Drivers
- The Pilgrim’s Pride Corporation has encountered several ups and downs in the fiscal year 2023.
- The company possessed an impressive net revenue of $4.5 billion in Q4 2023, with an adjusted EBITDA of $310 million and an adjusted EBITDA margin of 6.8%.
- Their revenue for the fiscal year was $17.4 billion, marking an EBITDA of $1 billion and margins of 6%.
Ring Energy, Inc. – Scaling Business Through Acquisitions & Development
- Acquisitions are expected to remain a centerpiece of management’s three-pronged strategy to increase scale in the asset base, reduce outstanding debt, and ultimately position the company to return cash to shareholders.
- The Stronghold acquisition in 3Q22, followed by the Founders acquisition in 3Q23, added operational scale and inventory depth on the southern portion of the Central Basin Platform (CBP).
- Together with Ring’s Northwest Shelf (NWS) assets, the inventory provides a diverse set of horizontal and vertical development opportunities.
SIGA Technologies – Positive signals abound
SIGA Technologies announced a strategic step in fortifying its distribution partner, Meridian, allowing greater control over planning and executing its international development efforts, a key growth pillar. The amended terms allow the company to actively manage future promotion activities outside the US (effective 1 June 2024). While Meridian will continue to administer existing international contracts, we expect the renegotiated terms to benefit the bottom line in the medium term as SIGA gains traction internationally. In a separate development, and one that could have a positive read-across for SIGA’s TPOXX, Bavarian Nordic, a key vaccine peer, has commenced the commercial launch of its mpox vaccine Jynneos in the US, which has only been available through the strategic national stockpile to date. We view this as a positive milestone for this therapeutic group and SIGA as TPOXX is the only approved anti-viral treatment for a range of orthopox viruses (including mpox) in Europe and is currently undergoing clinical trials in the US for expansion into mpox (presently approved for smallpox).