In today’s briefing:
- Allied Telesis (6835) – Small Cap Windfall
- Keyence – Strong as We Suggested
- GlobalWafers (6488.TT): Maintain Target Price at NT$880-960 for Siltronic Mergence Failed
- Hoya: Life Care Exceeds Pre-Covid Levels; Slight Upgrade to Forecasts with a Small Buyback
- Enovix (ENVX) Is a Speculative Company with a Big Amount of Stock that Recently Unlocked.
- KRX K-New Deal Index Screening Period Ended: Rebalancing Changes & Passive Impacts Update
- Intellect Design
Arena - Globalwafers/Siltronic: There Is Still Value in Siltronic
Allied Telesis (6835) – Small Cap Windfall
- Allied Telesis is a Japan-listed business with a long US history making networking equipment and solutions for corporate customers.
- The company received a legal settlement today which is worth a fair bit to them.
- The company had already had the best 12 months earnings history in years, while the stock is trading at long-time lows. This could get exciting.
Keyence – Strong as We Suggested
- Keyence’s 3Q numbers were noticeably stronger than consensus with revenue at ¥190bn (just below our estimate of ¥192bn+) vs. consensus at ¥182bn.
- OP also beat by 4.2% but was held back slightly by high SG&A.
- Nevertheless, this should move the outlook for 4Q up significantly setting up a reasonable full year beat and better prospects for next year.
GlobalWafers (6488.TT): Maintain Target Price at NT$880-960 for Siltronic Mergence Failed
- The GlobalWafers announced the deal to merge Siltronic did not get the approval by Germany government this morning. We maintain our Target Price for GlobalWafers doesn’t change at NT$880~960.
- The GlobalWafers points out that the results will not influence business activities, and the European market remains the importance for GlobalWafers.
- Comparing to 20s years ago, we think the semiconductor market has experienced a dramatic changes already.
Hoya: Life Care Exceeds Pre-Covid Levels; Slight Upgrade to Forecasts with a Small Buyback
- Hoya Corp (7741 JP) reported 3QFY03/2022 results today. Revenue grew 16.6% YoY to JPY171.3bn (vs. consensus JPY162.1bn) and OP grew 17.0% YoY to JPY53.5bn (vs. consensus JPY51bn).
- Life Care revenue which was severely impacted due to Covid-19, exceeded pre-Covid levels with a 11.7% YoY increase. IT revenue continued to maintain its momentum during the quarter.
- Hoya has slightly upgraded its full-year forecasts and also has announced a share buyback program for JPY60bn.
Enovix (ENVX) Is a Speculative Company with a Big Amount of Stock that Recently Unlocked.
- There is lots of competition for Li-Ion batteries and also for silicon anode Li-Ion batteries
- Enovix is a going concern and has a material internal control weakness
- With facilities that need to be built, lacking firm contracts with customers/suppliers, and unfinished products, lots of things need to go perfectly.
KRX K-New Deal Index Screening Period Ended: Rebalancing Changes & Passive Impacts Update
- For this March rebalancing, the screening base date is January 28, which is the last trading day of January. So, the 3-month rebalancing review period is now done.
- Other than LG Energy (+₩146,2B), we should pay the most attention to AfreecaTV (+1.70x), Chunbo (+0.36x), Douzone Bizon (-4.82x), and SoulBrain (-0.99x).
- In addition, large-cap stocks such as SKIET (+0.25x), Ecopro BM (+0.10x), LG Chem (-0.62x), and Posco Chemical (-0.30x) will likely draw much attention.
Intellect Design
Arena
- Intellect Design Arena (Intellect) provides software products to retail, corporate banking, insurance & treasury.
- The company is a transition from a product company to a platform company
- Intellect generates 55% of revenues from developed markets and rest from emerging markets Recently, it saw a turnaround in margins (from 5% in FY20 to 23% in FY21)
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Globalwafers/Siltronic: There Is Still Value in Siltronic
- On 1 February, Siltronic announced that the public tender offer by GlobalWafers will not be completed as offer conditions have not been fulfilled within the applicable deadline.
- Germany’s Economy Ministry could not complete all the necessary review steps. The deal rationale was compelling. Wacker Chemie still intends to sell its remaining 30.83%. GlobalWafers may bid again.
- As the industry deals with overcapacity, Siltronic could be worth more as a standalone business. Longer term, TP is €162.64/share (comparables based), 12% above Siltronic’s offer
Before it’s here, it’s on Smartkarma
