In today’s briefing:
- ServiceTitan IPO: Pricing and First Trading-Day, The Stock Jumped ~42% As A Public Company
- Nvidia Asserts Commitment to Fair Competition Amid China Antitrust Probe
- OPEC Cuts Demand Forecasts for Fifth Straight Month; EIA Lowers Price Outlook on Supply Glut
- [ETP 2024/50] WTI Rebounds on Outlook of Better Demand in 2025; Henry Hub Rises but Remains Volatile
- Crypto Moves #56 – Suddenly We Are Once Again Discussing Inflation
- ELTs Undertake An Impressive ‘Sustainable March’ In The US
- Herbalife Ltd. – Uniquely Well Positioned Among Direct Sellers
- Ocean Power Technologies, Inc: Lands $3 Million Multi-Year Contract in Latin America
- Culp, Inc. – Revising Revenue/EPS Estimates
- INOD: Growth Pathway in 2025
ServiceTitan IPO: Pricing and First Trading-Day, The Stock Jumped ~42% As A Public Company
- ServiceTitan, a provider of field service management software for home service businesses, priced its IPO at $71.00/share and raised ~$625M.
- ServiceTitan IPO has seen robust demand among institutional investors. The company boosted its initial price range to $65.00 to $67.00 per share.
- The offering was priced above the price range, valuing ServiceTitan at ~$6.5B. The stock jumped ~42% on first day as a public company and closed at $101.00 on Thursday.
Nvidia Asserts Commitment to Fair Competition Amid China Antitrust Probe
- Nvidia Corp. on Tuesday asserted its commitment to fair competition, after China’s market regulators opened an antitrust investigation into the U.S. chip giant over suspected violations linked to a 2020 deal.
- The probe, announced on Monday by the State Administration for Market Regulation (SAMR), concerns Nvidia’s compliance with the country’s Anti-Monopoly Law and conditions tied to its $6.9 billion acquisition of Israeli network-equipment maker Mellanox Technologies Ltd.
- The deal — the largest acquisition Nvidia has ever made — faced intense scrutiny from Chinese regulators, who conditionally approved it after nearly a year-long process.
OPEC Cuts Demand Forecasts for Fifth Straight Month; EIA Lowers Price Outlook on Supply Glut
- OPEC cut its 2024 demand growth forecast for the fifth consecutive time this year. It lowered its 2024 and 2025 forecast 11.5% and 5.8%, respectively.
- The EIA and IEA lowered their 2024 demand projections by 10.1% and 8.7%, respectively. However, they raised their 2025 projections by 5.7% and 11.1%, respectively.
- The EIA reduced 2024 and 2025 price forecasts for WTI and Brent, citing higher non-OPEC+ production and subdued demand, which are expected to drive global inventory builds after Q1 2025.
[ETP 2024/50] WTI Rebounds on Outlook of Better Demand in 2025; Henry Hub Rises but Remains Volatile
- For the week ending 06/Dec, US crude inventories fell by 1.4m barrels, beating expectations of a 1m barrel decrease. However, gasoline and distillate stocks rose more than expected again.
- US natural gas inventories fell by 190 Bcf for the week ending 06/Dec, beating analyst expectations of a 175 Bcf drawdown. Inventories are 4.6% above the 5-year seasonal average.
- Wells Fargo raised its 12-month PT for Chevron but lowered targets for Shell and Occidental. Exxon targets a CAGR of 10% in earnings and 8% in cash flow through 2030.
Crypto Moves #56 – Suddenly We Are Once Again Discussing Inflation
- It should come as no surprise that inflation dominated headlines throughout 2022 and 2023.
- This was largely because central banks around the world, including the U.S. Federal Reserve (Fed) and the European Central Bank (ECB), had to respond to rising inflation by aggressively increasing interest rates.
- The chart below highlights these interest rate changes.
ELTs Undertake An Impressive ‘Sustainable March’ In The US
- 79% of ELTs consumed by end-use markets, up 10.5%
- Tire-derived fuel tops ELT use, followed by ground rubber
- Sumitomo Rubber USA announces closing of Buffalo plant
Herbalife Ltd. – Uniquely Well Positioned Among Direct Sellers
- The GIG economy has been viewed as a disruptor to the direct selling channel with respect to the business opportunity.
- However, GIG concepts are top-down, have a specific formula, and assign tasks to their independent contractors for a fee, while direct sellers are micro-entrepreneurs who find a way to build their own businesses.
- Herbalife has been successful in taking some of the best business models developed by distributors at a local level, and then globalizing them, such as. the Nutrition Clubs that arose in Mexico in the early 2000s.
Ocean Power Technologies, Inc: Lands $3 Million Multi-Year Contract in Latin America
- Ocean Power Technologies has secured a new partnership in Latin America with $3 million in purchase order commitments over three years.
- This new agreement adds to a previous $1.5 million order, bringing the total to $4.5 million.
- The partnership will involve the deployment of OPT’s WAM-V unmanned surface vehicles (USVs) for hydrographic applications and other diverse tasks.
Culp, Inc. – Revising Revenue/EPS Estimates
- Culp posted another tough quarter (1), as industry conditions remain challenged.
- The firm posted an adjusted EPS loss of $0.28, $0.10 below our estimate and $0.09 below the prior year on weaker-than-expected earnings.
- As we said in our update after the release, this shortfall may have been unexpected, but it’s certainly not surprising to anyone who has been following the space.
INOD: Growth Pathway in 2025
- The risk to INOD experiencing a sequential decline in spending activity in the near-term could have been alleviated from the continued spending in artificial intelligence (“A.I.”).
- AMZN and GOOGL have their internally developed processors ready for high performance deep learning. The new chips suggest A.I. training is not going anywhere and could expand in 2025.
- INOD’s revenue growth has been predominantly from one customer. This should begin to change in 2025.
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