Founder at Stock Spin-off Investing, Stock Spin-Off Investing

Richard Howe

Founder at Stock Spin-off Investing

Stock Spin-Off Investing

Generate attractive returns by taking advantage of inefficiencies in the stock spin-off market.

Stock Spin-offs

Event-Driven

<ul><li>This week we had a busy week of earnings (WDC, AAF, LBTYA), and it will continue next week.</li><li>Honeywell (HON)  spun off 100% of its Advanced Materials business, Solstice (SOLS), on October 30, 2025.</li><li><p>Solstice was added to the S&amp;P 500 and performed well on its first day of trading before selling off on Friday.</p><figure class="editor-figure mceNonEditable"></figure></li></ul>

This week we had a busy week of earnings (WDC, AAF, LBTYA), and it will continue next week.Honeywell (HON)  spun off 100% of its Advanced Materials business, Solstice (SOLS), on October 30, 2025.Solstice was added to the S&amp;P 500 and performed well on its first day of trading before selling off on Friday.

Global Materials | Industrials | Commodities

Rahul Jain

Thematic (Sector/Industry)

<ul>
<li>Asia mirrors the U.S. “boring tech” rally: storage, memory, and components once seen as cyclical are being re-rated as AI infrastructure enablers.</li>
<li>Valuation gaps present opportunities: Kioxia and SK Hynix trade at meaningful discounts vs Seagate/WDC/Micron, while Murata and TSMC command premiums; Chinese names appear expensive.</li>
<li>Key risks remain: cyclicality in DRAM/NAND, potential subsidy overbuild, and currency volatility could pressure valuations if AI demand slows.</li>
</ul>


Asia mirrors the U.S. “boring tech” rally: storage, memory, and components once seen as cyclical are being re-rated as AI infrastructure enablers.
Valuation gaps present opportunities: Kioxia and SK Hynix trade at meaningful discounts vs Seagate/WDC/Micron, while Murata and TSMC command premiums; Chinese names appear expensive.
Key risks remain: cyclicality in DRAM/NAND, potential subsidy overbuild, and currency volatility could pressure valuations if AI demand slows.


Asia’s “Boring Tech” Rerating: Memory, Components & AI Infrastructure

Technical Analyst, Vermilion Research

Joe Jasper

Technical Analyst

Technical and Quantitative Research

Vermilion Research

Vermilion’s objective is to deliver timely, actionable, and unique technical research to professional investors through the application of our various technical indicators.

Our research strategists seek to highlight securities which we believe are at major inflection points, based on our various technical and quantitative indicators, and offer asymmetric risk/return profiles. Our unique research methodology, centered on relative strength, enables our strategists to deliver superior investment recommendations.

Our process begins by organizing the universe of actively traded stocks into discrete sectors, then into industry groups. We then apply our technical and quantitative tools to identify developing price trends. Once attractive trends are identified within a selected sector or group, we screen for individual stocks which we believe offer the best risk/reward profile. We provide a historical perspective that often reveals, through our long-term charts, how price patterns often repeat themselves over time.

Technical Analysis

<ul>
<li>We remain bullish since our 4/22/25 Compass, and we will maintain our bullish outlook as long as market dynamics remain healthy and the S&amp;P 500 (SPX) is above 6028-6059.</li>
<li>Short-Term supports on SPX include 6480-6520, 6450, 6400-6410, 6340-6360, 6200, 6100-6150, and 6028-6059; buy pullbacks</li>
<li>The list of areas re-emerging as leadership has meaningfully expanded to include ARKK, ARKW, uranium (URA), hydrogen (HYDR), quantum computing (IONQ, RGTI, QUBT, QBTS), and other themes including IPOs/A.I./nuclear/robotics/drones/autonomous driving/bitcoin</li>
</ul>


We remain bullish since our 4/22/25 Compass, and we will maintain our bullish outlook as long as market dynamics remain healthy and the S&amp;P 500 (SPX) is above 6028-6059.
Short-Term supports on SPX include 6480-6520, 6450, 6400-6410, 6340-6360, 6200, 6100-6150, and 6028-6059; buy pullbacks
The list of areas re-emerging as leadership has meaningfully expanded to include ARKK, ARKW, uranium (URA), hydrogen (HYDR), quantum computing (IONQ, RGTI, QUBT, QBTS), and other themes including IPOs/A.I./nuclear/robotics/drones/autonomous driving/bitcoin


High Growth Areas Re-Emerging as Leadership; Remain Overweight Growth; Bullish Outlook Intact

Equity Bottom-Up

<ul>
<li>Q1 FY25 revenue fell 20% YoY, but enterprise SSD strength kept EBITDA positive and margins above trough levels.</li>
<li>Management guides for a strong sequential rebound in Q2–Q3 on AI-driven enterprise demand and normalized PC/smartphone inventories.</li>
<li>Kioxia trades at ~3–4× EV/EBITDA vs peers on 9–12×, despite higher NAND margins, with the gap driven by cyclicality, tech lag, and shareholder overhang.</li>
</ul>


Q1 FY25 revenue fell 20% YoY, but enterprise SSD strength kept EBITDA positive and margins above trough levels.
Management guides for a strong sequential rebound in Q2–Q3 on AI-driven enterprise demand and normalized PC/smartphone inventories.
Kioxia trades at ~3–4× EV/EBITDA vs peers on 9–12×, despite higher NAND margins, with the gap driven by cyclicality, tech lag, and shareholder overhang.


Kioxia (285A JP): Undervalued NAND Pure-Play Levered to AI-Driven Enterprise SSD Growth

Seagate Technology Holdings PL / Technical Analysis

<ul>
<li>We remain bullish since our 4/22/25 Compass, and we will maintain our bullish outlook as long as market dynamics remain healthy and the S&amp;P 500 (SPX) is above 6028-6059.</li>
<li>Shorter-Term, the SPX violated its 3.5-month uptrend yesterday, but managed to rally back to the breakdown level by yesterday's close. </li>
<li>We would not yet call this a decisive breakdown, and we are on the lookout for a potential reclaim back above this uptrend at the 6425-3430 level. Or consolidation?</li>
</ul>


We remain bullish since our 4/22/25 Compass, and we will maintain our bullish outlook as long as market dynamics remain healthy and the S&amp;P 500 (SPX) is above 6028-6059.
Shorter-Term, the SPX violated its 3.5-month uptrend yesterday, but managed to rally back to the breakdown level by yesterday's close. 
We would not yet call this a decisive breakdown, and we are on the lookout for a potential reclaim back above this uptrend at the 6425-3430 level. Or consolidation?


Downgrading Staples to Underweight; New Leaders Still Leading As Prior Leaders Consolidate

United States

Western Digital Corporation is a global provider of solutions for the collection, storage, management, protection and use of digital content, including audio and video. The Company's products include hard drives, solid-state drives, and home entertainment and networking products.

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Western Digital (WDC US)

Weekly Update (WDC, AAF, LBTYA, LEN)

This week we had a busy week of earnings (WDC, AAF, LBTYA), and it will continue next week. Honeywell (HON) spun off 100% of its Advanced Materials...

Richard Howe

Asia’s “Boring Tech” Rerating: Memory, Components & AI Infrastructure

Asia's tech rally focuses on storage, memory, and components as AI infrastructure enablers, with valuation gaps offering opportunities but risks...

Rahul Jain

High Growth Areas Re-Emerging as Leadership; Remain Overweight Growth; Bullish Outlook Intact

High Growth Areas Re-Emerging as Leadership; Remain Overweight Growth; Bullish Outlook Intact on $SPX $QQQ $IWM. $ARKK $URA $HYDR $IONQ $OKLO $BBAI...

Vermilion Research

Kioxia (285A JP): Undervalued NAND Pure-Play Levered to AI-Driven Enterprise SSD Growth

Management anticipates a rebound in Q2–Q3 due to AI-driven demand and normalized inventories, but the stock trades at a discount to peers due to...

Rahul Jain

Downgrading Staples to Underweight; New Leaders Still Leading As Prior Leaders Consolidate

Downgrading Staples $XLP to Underweight; New Leaders Still Leading While Prior Leaders Consolidate; $SMH Above $280, 10-yr Treasury yield below key...

Vermilion Research

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Weekly Update (WDC, AAF, LBTYA, LEN)

This week we had a busy week of earnings (WDC, AAF, LBTYA), and it will continue next week. Honeywell (HON) spun off 100% of its Advanced Materials...

Richard Howe

Asia’s “Boring Tech” Rerating: Memory, Components & AI Infrastructure

​Asia's tech rally focuses on storage, memory, and components as AI infrastructure enablers, with valuation gaps offering opportunities but risks...

Rahul Jain

High Growth Areas Re-Emerging as Leadership; Remain Overweight Growth; Bullish Outlook Intact

High Growth Areas Re-Emerging as Leadership; Remain Overweight Growth; Bullish Outlook Intact on $SPX $QQQ $IWM. $ARKK $URA $HYDR $IONQ $OKLO $BBAI...

Vermilion Research

Kioxia (285A JP): Undervalued NAND Pure-Play Levered to AI-Driven Enterprise SSD Growth

Management anticipates a rebound in Q2–Q3 due to AI-driven demand and normalized inventories, but the stock trades at a discount to peers due to...

Rahul Jain

Downgrading Staples to Underweight; New Leaders Still Leading As Prior Leaders Consolidate

Downgrading Staples $XLP to Underweight; New Leaders Still Leading While Prior Leaders Consolidate; $SMH Above $280, 10-yr Treasury yield below key...

Vermilion Research

Asia's tech rally focuses on storage, memory, and components as AI infrastructure enablers, with valuation gaps offering opportunities but risks...