Weekly Top Ten Tech Hardware and Semiconductor – Oct 6, 2024

1. Taiwan Dual-Listings Monitor: TSMC Premium Back Below 15%; ASE Short Interest Surging

By Vincent Fernando, CFA, Zero One

• TSMC: +14.2% Premium; Can Consider Going Long at Current Level
• UMC: +1.8% Premium; The ADR Headroom Has Decreased Yet Again
• ASE: +5.4% Premium; Short Interest Surging for The Local Shares

2. Ibiden (4062 JP): Once Again a Long-Term Buy

By Scott Foster, LightStream Research

• Sales, profits and the share price are bottoming out and good 1Q results make FY Mar-25 guidance look conservative.
• Demand for advanced packaging should drive recovery, with the operating margin regaining its previous peak in three or four years.
• Management’s long-term guidance implies a decline in the projected P/E ratio from 26x to 10X by FY Mar-28, but even 15x would make the shares an attractive investment.

3. The Cerebras IPO Stucture Sucks

By Douglas O’Laughlin, Fabricated Knowledge

• I’m not going to write about the technical side at all, as I expect Dylan Patel’s team at SemiAnalysis to do a much better job than I can do alone.
• However, I want to note some of the funniest aspects because landmines are everywhere for this IPO. Of course, it’s driven by G42, but it’s much worse than you think. Here’s the prelim S-1.
• G42 is pretty much the only customer.

4. Apple Supply Chain Monitor: Key IPhone Suppliers Didn’t Rally With Apple; Opportunity for Rebound?

By Vincent Fernando, CFA, Zero One

• Key iPhone components suppliers’ share prices have substantially underperformed Apple, particularly Largan Precision, Genius Electronic Optical, and Zhen Ding.
• There are reasons for iPhone 16 upgrade optimism. We also note that key suppliers failed to rally with Apple shares post-Fed rate cut.
• Apple suppliers’ 2025E forecasts haven’t fallen much so far, despite the negative stock market reaction. If negative iPhone 16 reports prove exaggerated, Largan, Genius, and Zhen Ding could rebound.

5. Taiwan Tech Weekly: Apple Shifting AR Strategy After Meta Orion Showcase; Apple Supply Chain Monitor

By Vincent Fernando, CFA, Zero One

• Apple Set to Launch iPhone SE 4 and Updated iPad Air in Early 2025: Key Developments to Watch
• META’s Orion AR Glasses: Next Major Computing Platform After the Smartphone?
• Apple Supply Chain Monitor: Key IPhone Suppliers Didn’t Rally With Apple; Opportunity for Rebound?

6. GlobalFoundries. Share Price Down 17% Below IPO Price & Down 30% Since July. But Why?

By William Keating, Ingenuity

• Tier 2 foundry revenue recovery is taking far longer than most expected. 
• Globalfoundries 2024 CapEx is less than one tenth of what SMIC is spending. Even Hua Hong is spending more. This makes investors nervous.
• Globalfoundries CapEx strategy is a pragmatic one and will pay dividends in the years to come