TMT: Renesas Electronics, Keyence Corp, Twitter Inc, Pushpay Holdings, Advantest Corp, Mediatek Inc, United Microelectronics Corp, Wipro Ltd and more

• About 9 days I ago I wrote Renesas (6723 JP) – On Top of Peer-Beating Growth, and Valuation… Watch for Buybacks. Today with Q1 earnings, they announced a ¥200bn buyback. 
• What appears to be a quite strong Q1 in automotive in both revenues and margins, and decent incremental margins, sees a stronger Q2 forecast (but less good incremental margins).
• The Street is well behind guidance, and a buyback at the high end of potential guidance and coming earlier than expected is all to the good. 

• Renesas’ 1Q numbers blew away guidance and consensus as revenue beat by 3.4% and adjusted OP beat by 16%. 
• Revenue growth was strong for both Auto and Industrial with Industrial margins also improving noticeably vs. last Q. 
• Renesas also announced a rather large buyback which is effectively a repurchase of the INCJ’s stake.

• Another quarter another Keyence beat as revenue beat by 5.3% and OP beat by a more modest 4.7% due to high SG&A costs. 
• Sell side analysts on the conference call remain confused by the outperformance vs. peers because they fail to realise that Keyence gonna Keyence. 
• Despite this strength we remain cautious as Keyence is now a truly exceptional company that is being priced like a magical one.

• Twitter suddenly decided to accept Elon Musk’s hostile $54.20 bid (no one else was even interested).
• Now they have to sell billions in pricey & yet likely still underpriced bonds vs Twitter’s already weak ops & truly ugly pro forma credit quality & dicey prospects.
• Does that make Elon a winner or a bagholder? And will he stay or will he go? We’re going to find out.

• Church donor management tech play Pushpay Holdings (PPH NZ) said it “recently received unsolicited, non-binding and conditional expressions of interest or approaches from third parties“.
• No price was mentioned. Shares promptly gained 24% on the news. 
• Separately, Pushpay reaffirmed its EBITDA guidance for FY22. Those results will be announced on the 11 May.

• Advantest results were relatively uneventful with a marginal beat at the top line and a marginal miss at the OP level. 
• Guidance was decent however with both revenue and OP above consensus and some lowballing on margins suggesting some upside to guidance. 
• The company also said that it would no longer disclose orders because changing lead times made them less comparable because of course they do…

• The 1Q22 revenue beat the prior guidance, GM was in-line the guidance. The guidance is within our expectation in 2Q22.  
• MediaTek believes they shall be on the right track to grow revenue 20% and the GM 48-50%, and MediaTek has a 3-year target to grow mid-teens percentage from 2022.
• For shareholders, the board had approved NTD$37 for cash dividend in this year.

• UMC delivered a shining GM and outlook. The GM outlook is 45% in 2Q22, which beat our forecast.
• UMC believes 22/28 nanometer will be a long-lasting node driven by applications, such as Wi-Fi 6, 6E, networking and OLED driver IC.
• The overall business covered by LTA is close to 30%-40%.

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