Equity Long-Short Analyst

Pyari Menon

Equity Bottom-Up

<ul>
<li>With its <a href="https://www.smartkarma.com/entities/danaher-corp" target="_blank" data-smartkarma-citation="entities:8243:1" rel="noopener">Danaher Corp (DHR US)</a> heritage, <a href="https://www.smartkarma.com/entities/veralto-corp" target="_blank" data-smartkarma-citation="entities:40472:1" rel="noopener">Veralto (VLTO US)</a> has built a foundation based on durable and recurring sales growth, high profitability, and strong cash generation.</li>
<li>Veralto's products and services are mission-critical yet account for less than 1% of client costs, leading to high switching costs and ensuring customer retention and financial resilience through economic cycles.</li>
<li>Veralto holds market leadership in both its Water Quality (WQ) and Product Quality &amp; Innovation (PQI) segments, which positions it well for the increasing regulatory and environmental demands. .</li>
</ul>


With its Danaher Corp (DHR US) heritage, Veralto (VLTO US) has built a foundation based on durable and recurring sales growth, high profitability, and strong cash generation.
Veralto's products and services are mission-critical yet account for less than 1% of client costs, leading to high switching costs and ensuring customer retention and financial resilience through economic cycles.
Veralto holds market leadership in both its Water Quality (WQ) and Product Quality &amp; Innovation (PQI) segments, which positions it well for the increasing regulatory and environmental demands. .


Veralto: The Power of Customer Dependency and Recurring Revenue

Independent research on the U.S. markets, Baptista Research

Baptista Research

Independent research on the U.S. markets

Baptista Research is an independent financial research house focused on the U.S. markets. We provide equity research as well as credit research reports on the top-listed U.S. companies with most of our focus on technology, consumer goods and services, automobiles, industrials, oil and gas, pharma, and healthcare. Our research has served more than 3000 institutional investors including mutual funds, hedge funds, banks, family offices, and various buy-side firms. We operate a research subscription service where institutions, as well as retail investors, can have priority access to all our research. We also have a wide distribution of our research reports across some of the top global financial platforms. Apart from equity research and credit research, we also provide advisory services with respect to mergers & acquisitions (M&A), private equity/ venture capital fundraising, valuation reports, and investment management services for corporates.
Baptista Research is owned and managed by Ishan Majumdar, an ex-Venture Capitalist/ Investment Banker, a Chartered Accountant, and a Masters’ degree holder in Management from HEC Paris. Ishan has nearly a decade of experience in Mergers and Acquisitions, Leveraged Buyouts (LBOs), Venture Capital Investing, Corporate Strategy, and Valuation in front-office roles at the likes of BNP Paribas CIB, Credit Agricole CIB, Groupe Danone, and TIW Private Equity. He has worked on and closed multiple acquisition deals, leveraged buyouts, and start-up investment transactions.

<ul><li>Cognex Corporation, a leader in machine vision technologies, reported its second quarter 2024 earnings with mixed outcomes indicative of a challenging yet stable operating environment.</li><li>The quarter saw revenues slightly down year-over-year but in line with expectations.</li><li>This was primarily attributed to solid demand from consumer electronics, though offset by a general decline in other factory automation markets and uncertainties in electric vehicle (EV) project timelines.</li></ul>

Cognex Corporation, a leader in machine vision technologies, reported its second quarter 2024 earnings with mixed outcomes indicative of a challenging yet stable operating environment.The quarter saw revenues slightly down year-over-year but in line with expectations.This was primarily attributed to solid demand from consumer electronics, though offset by a general decline in other factory automation markets and uncertainties in electric vehicle (EV) project timelines.

Cognex Corporation: Initiation Of Coverage - Increased Contribution from Moritex and Semiconductor Market Strength Drives Our Optimism! - Major Drivers

Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Douglas Research Advisory

Equity Capital Markets

CMES AI Robotics / Equity Capital Markets

<ul>
<li>CMES AI Robotics is getting ready to complete its IPO on KOSDAQ in October. The expected IPO price is 20,000 won to 24,000 won. </li>
<li>CMES provides intelligent robot solutions that combine artificial intelligence (AI) and three-dimensional (3D) vision technology. CMES's core technologies include 3D vision sensors and image processing algorithms. </li>
<li>Robotics related IPOs have generated enormous interest in Korea. Although CMES is a small cap name, this robotics related IPO is also likely to garner high interest as well. </li>
</ul>


CMES AI Robotics is getting ready to complete its IPO on KOSDAQ in October. The expected IPO price is 20,000 won to 24,000 won. 
CMES provides intelligent robot solutions that combine artificial intelligence (AI) and three-dimensional (3D) vision technology. CMES's core technologies include 3D vision sensors and image processing algorithms. 
Robotics related IPOs have generated enormous interest in Korea. Although CMES is a small cap name, this robotics related IPO is also likely to garner high interest as well. 


Japan Specialist

Mark Chadwick

<ul>
<li>The stock has been hit by rising inflation and interest rates. Now is the time to buy</li>
<li>Keyence is well placed to weather the storm given it has pricing power, high margins, and low capital intensity</li>
<li>The P/B valuation of 6x is now back to a normalised range and the stock trades at a discount to global peers. </li>
</ul>


The stock has been hit by rising inflation and interest rates. Now is the time to buy
Keyence is well placed to weather the storm given it has pricing power, high margins, and low capital intensity
The P/B valuation of 6x is now back to a normalised range and the stock trades at a discount to global peers. 


Keyence (6861 JP) | 3 Reasons to Ignore Inflation and Rising Rates

Senior Technology Analyst, Japanese Equities, LightStream Research

Scott Foster

Senior Technology Analyst, Japanese Equities

ja research

ja research is an independent research platform focused exclusively on Japanese equities. Leveraging data and graphic analysis provided by Japan Analytics, we provide insights on small and medium-sized companies that have been ignored by the sell-side as well as challenging conventional wisdom on larger companies. We also offer analyst and corporate access, the latter with translation if required. 

1Q results confirmed the first decline in Keyence's sales and profits in a decade. Caused by cyclical weakness in major user industries followed by the U.S.-China trade war, the resulting pall of uncertainty cast over corporate investment plans, and the appreciation of the yen, it has brought a long period of high growth and rising margins to an end.The duration and severity of the downturn remain unclear, but demand for factory automation products from the electronics, auto, and metal &amp; machine tool industries, which together account for more than 60% of the company's sales, is unlikely to rebound quickly. There is no sign of recovery in demand for semiconductors, cell phones, autos or the equipment used to make them. Weakening regional economies and the quarterly data point to difficult year-on-year comparisons for the rest of this fiscal year and the possibility of further sales and profit declines in FY Mar-21. Nevertheless, valuations remain high. At ¥61,400 (Wednesday, August 28 closing price), the shares are selling at 39x our EPS estimate for FY Mar-20, 40x our estimate for FY Mar-21 and 37x our estimate for FY Mar-22. We expect successively weak quarterly results to undermine expectations of a quick return to double-digit growth, with potential downside risk on the order of 20%.

1Q results confirmed the first decline in Keyence's sales and profits in a decade. Caused by cyclical weakness in major user industries followed by the U.S.-China trade war, the resulting pall of uncertainty cast over corporate investment plans, and the appreciation of the yen, it has brought a long period of high growth and rising margins to an end.The duration and severity of the downturn remain unclear, but demand for factory automation products from the electronics, auto, and metal &amp; machine tool industries, which together account for more than 60% of the company's sales, is unlikely to rebound quickly. There is no sign of recovery in demand for semiconductors, cell phones, autos or the equipment used to make them. Weakening regional economies and the quarterly data point to difficult year-on-year comparisons for the rest of this fiscal year and the possibility of further sales and profit declines in FY Mar-21. Nevertheless, valuations remain high. At ¥61,400 (Wednesday, August 28 closing price), the shares are selling at 39x our EPS estimate for FY Mar-20, 40x our estimate for FY Mar-21 and 37x our estimate for FY Mar-22. We expect successively weak quarterly results to undermine expectations of a quick return to double-digit growth, with potential downside risk on the order of 20%.

Keyence (6861 JP): Undermined by Weak Demand and Uncertainty

United States

Cognex Corporation designs, develops, manufactures, and markets machine vision systems.  The Company's systems are used to automate the manufacture of a variety of discrete items and to assure their quality.  Cognex has regional offices located throughout North America, Japan, Europe, and Southeast Asia.

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Cognex Corp (CGNX US)

Veralto: The Power of Customer Dependency and Recurring Revenue

Veralto's products and services are typically low cost but critical leading to high recurring sales, solid profitability and a leadership position...

Pyari Menon

Cognex Corporation: Initiation Of Coverage - Increased Contribution from Moritex and Semiconductor Market Strength Drives Our Optimism! - Major Drivers

Cognex Corporation, a leader in machine vision technologies, reported its second quarter 2024 earnings with mixed outcomes indicative of a...

Baptista Research

CMES AI Robotics IPO Preview

CMES AI Robotics is getting ready to complete its IPO on KOSDAQ in October. CMES provides intelligent robot solutions that combine AI and three...

Douglas Kim

Keyence (6861 JP) | 3 Reasons to Ignore Inflation and Rising Rates

Keyence,, the global leader in industrial automation equipment, has lost 25% YTD on rising inflation and interest rates. Keyence is a good hedge...

Mark Chadwick

Keyence (6861 JP): Undermined by Weak Demand and Uncertainty

1Q results confirmed the first decline in Keyence's sales and profits in a decade. Caused by cyclical weakness in major user industries followed by...

Scott Foster

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