In today’s briefing:
- TSMC Chairman to Retire, + or — Impacts to Shareholders
- [Counting Beans #2] Soybean Prices Maintain Support at USc 1,300
- Russell 2000 Testing 1.5+ Year Resistance; Downgrading Communications; Steel Buys $NUE $STLD $ZEUS
- Gaia, Inc. – Good Momentum Going into 2024
- Steelcase, Inc. – Earnings After Close Today; Watching Margins, Order Trends
TSMC Chairman to Retire, + or — Impacts to Shareholders
- Chairman 69 years old Dr. Liu will retire and 70 years old CEO Dr. Wei will step up. What story do we believe? Will TSMC to regain its strong outperperformance?
- Positive impacts: we expect Arizona fab equipment move-in and ramp up might be further delayed if no subsidies are granted; two teams competing to one voice/team/direction.
- Three risks: 1. Dr. Wei at his age of 70 without a strong management backup; 2. Dr. Wei might make a wrong decision deeply; 3. absolute power corrupts.
[Counting Beans #2] Soybean Prices Maintain Support at USc 1,300
- Soybean futures maintained above USc 1,300/bushel indicating continued strong support at the level.
- Large export sales announcements continued over the last week, through November, net Soybean sales from the US were higher than their 5Y average. December pace remains strong too.
- CONAB cut production forecast for Soybean in Brazil due to unfavorable weather over November. Weather has improved recently with rains expected in key agricultural region.
Russell 2000 Testing 1.5+ Year Resistance; Downgrading Communications; Steel Buys $NUE $STLD $ZEUS
- The market remains in “lockout rally” mode, where prices continue to move higher with little-to-no pullbacks, while ignoring overbought readings.
- We have discussed this on a weekly basis since 11/21/23. Still no reason to fight this bullish trend, and we continue to expect more upside into year-end and early 2024.
- We highlight buys in Steel: NUE, STLD, RS, WOR, TMST, ZEUS, LatAm Banks: ITUB, BSBR, BBD, BAP, BCH, Industrials: ITT, FSS, SPXC, ATS, KAI, CR, BRC, SXI, and HSC
Gaia, Inc. – Good Momentum Going into 2024
- We recently caught up with management to congratulate James Colquhoun on his promotion to CEO.
- We also got a good update on the business as well as some early indications of trends and management focus for 2024.
- As indicated on the 3Q23 earnings call, new member growth is continuing at a healthy clip and management expects to close 2023 at around 800k members.
Steelcase, Inc. – Earnings After Close Today; Watching Margins, Order Trends
- Steelcase reports 3QFY24 results after market close today. We are expecting adjusted EPS of $0.25 on revenue of $804 million.
- Consensus is EPS of $0.23 on revenue of $796 million.
- Our estimate is at the high end of the revenue guidance and the midpoint of adjusted EPS guidance.
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