In today’s briefing:
- NVIDIA. Another Beat & Raise, Yet Shares Slide. But Why?
- Hollysys (HOLI US): Progress as a Binding Proposal Targeted for Mid-December
- A Turnaround Story for Intel by Accelerating 3nm Outsourcing to TSMC?
- EIA and OPEC Watch: Depending on Nigeria and Iran
- Cirrus Aircraft Pre-IPO – PHIP Updates – Increased Customer Demand Continues to Drive Growth
NVIDIA. Another Beat & Raise, Yet Shares Slide. But Why?
- Q3FY24 revenues of 18.1 billion, up 34% QoQ and up a staggering 206% from the year ago period. It was also ~$2 billion higher than the guided number
- NVIDIA’s current quarter forecast was for a further revenue raise of almost $2 billion with gross margins staying roughly flat at 74.5%
- Share price reaction was negative, closing down 2.5% the following day. But why?
Hollysys (HOLI US): Progress as a Binding Proposal Targeted for Mid-December
- The Hollysys Automation Technologies (HOLI US) Board has finally succumbed to shareholder pressure by targeting a special meeting of shareholders in the week commencing 22 January 2024.
- The special meeting is a side event as the Board targets a binding proposal by mid-December, with some bidders proceeding to the confirmatory due diligence stage.
- The BVI takeover structure and Hollysys’ undemanding valuation facilitate a competitive bidding process. A 10% uplift to the current highest offer (Recco’s US$26.50 offer) is possible.
A Turnaround Story for Intel by Accelerating 3nm Outsourcing to TSMC?
- By offering 15k and 30k/m 3nm capacity by 4Q24/4Q25 to Intel, TSMC will see Intel becoming one of its top 3 customers by accounting for 12% of TSMC 2025 sales
- By leveraging 3nm outsourcing, Intel will have incremental sales/capacity growth of 19-20% per year by accounting for 28%/44% of sales in 2024/2025, beating consensus’ 14%/9% y/y sales growth for 2024/2025.
- We estimate 30-35% 5 years EPS CAGR for Intel, driven by TSMC’s 2/3nm foundry support, lower cost and process R&D, lower capex and depreciation cost, and AI PC CPU launch.
EIA and OPEC Watch: Depending on Nigeria and Iran
- Welcome to our weekly EIA watch paired with a few remarks on the postponed OPEC meeting.
- We have had a look at OPEC production and export numbers, and it seems like production is much more price bullish than actual net exports (meaning a draw on local OPEC inventories)
- Interestingly, the US, Nigeria, Iran, UAE (among others) have managed to fill a lot of the production gap left open by left open by Saudi Arabia.
Cirrus Aircraft Pre-IPO – PHIP Updates – Increased Customer Demand Continues to Drive Growth
- Cirrus Aircraft (0153126D US) is looking to raise up to US$200m in its upcoming HK IPO.
- Cirrus Aircraft designs, develops, manufactures, and sells premium aircrafts. Its two aircraft product lines, the SR2X Series and the Vision Jet, are currently certified and validated in over 60 countries.
- We had covered the company’s performance in our earlier notes. In this note, we talk about its PHIP updates.
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