In today’s briefing:
- Square Enix – A Beat, A Bump and More to Come
- Daifuku (6383) To Take Out Minorities in Subsidiary Contec (6639)
- Sea Limited – Too Early To Call For The Bottom
- Crowdstrike ($CRWD) In-Depth Analysis
- Amazon 4Q21: Don’t Call It a Comeback, We’ve Been Here (Investing) For Years
- Tech Mahindra: Margins Impacted; Recovery Strategy in Place
Square Enix – A Beat, A Bump and More to Come
- We said that we expected MMO Final Fantasy XIV to drive a strong beat and FY OP towards ¥70bn rather than consensus’ ¥55bn.
- With 3Q OP of ¥21.0bn easily beating consensus at ¥14.4bn we believe we are nicely on track.
- Oh and there were some tidbits about NFTs which should get some segments of the market interested.
Daifuku (6383) To Take Out Minorities in Subsidiary Contec (6639)
- Daifuku Co Ltd (6383 JP) today (4 Feb) announced it would take out TSE-2 industrial computing/IoT subsidiary Contec Co Ltd (6639 JP) in a tender offer at 55% premium.
- That looks nice, and should have been expected at some point. But it is only half-generous.
- The shareholder structure tells you how this is likely to end up.
Sea Limited – Too Early To Call For The Bottom
- In our last update, the stock was around $250, and we called for a reality check in progress which might have led to a sharp revision in the price.
- We were right! As of 1st February 2022, the stock is trading at $150 per share and is 40% down since our last update on December 10th, 2021.
- This is a clear signal that analysts were overoptimistic, and we believe they will continue adjusting estimates over the next quarters. SE is still going through a reality check which might not be yet over.
Crowdstrike ($CRWD) In-Depth Analysis
- The rise of the internet, though astounding and world-changing, has resulted in the growth of impending tail risks, phenomena where unchecked vulnerability and fragility may result in the harm of corporations and individuals alike
- Crowdstrike provides technology that primarily protects an Enterprise’s Endpoints, with additional modules aimed at shielding Companies’ Cloud Workloads
- The main area of Cybersecurity that one should familiarize themselves with in order to gain a heightened understanding of Crowdstrike’s operations is Endpoint Security
Amazon 4Q21: Don’t Call It a Comeback, We’ve Been Here (Investing) For Years
- Prime price increased, Covid expenses starting to moderate, margins set to rise.
- Fulfillment buildout moderates, 1-day shipping can now launch more widely, share gains will ensue, revenue growth will reaccelerate.
- We reiterate Amazon as our Top 2022 long idea. We think its worth $6,000.
Tech Mahindra: Margins Impacted; Recovery Strategy in Place
- Tech Mahindra (TechM) has over 1.2 lakh employees across 90 countries serving 1000+ clients with higher exposure to telecom (40% of revenues)
- Apart from telecom, the company caters to BFSI, manufacturing & retail
- Target Price and Valuation: We value TechM at Rs 1850 i.e. 23x P/E on FY24E EPS
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