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Granite Bay Capital

An innovation focussed investment company

Granite Bay Capital is an innovation focussed investment company with a deep focus on the companies at the leading edge of innovation across major themes such as AI, ubiquitous computing, sustainability, automation and longevity.

Thematic (Sector/Industry)

Headline Developments Facebook’s (FB) Reality Labs have provided a glimpse of a wrist-worn AR interface concept that would allow users to more fluidly interact with augmented environments, as in the video below.  More specifically, the device uses electromyography (EMG) sensors to interpret nerve signals and interact with the environment.

Headline Developments Facebook’s (FB) Reality Labs have provided a glimpse of a wrist-worn AR interface concept that would allow users to more fluidly interact with augmented environments, as in the video below.  More specifically, the device uses electromyography (EMG) sensors to interpret nerve signals and interact with the environment.

AlphaSituations-Event/Catalyst Driven Research, AlphaSituations

Robert Sassoon

AlphaSituations-Event/Catalyst Driven Research

AlphaSituations

Since its establishment, AlphaSituations has delivered a track record of outperformance with a hit rate of winners of more than 70% of its portfolio of ideas generating annualized average returns of 20%. In January 2022, AlphaSituations was contracted by Water Tower Research, an investor engagement and stakeholder communication platform to provide coverage of Special Situations

Event-Driven

On June 14, 2019, we published an insight - <a href="https://www.smartkarma.com/insights/mergertalk-unitedtech-raytheon-it-s-the-utx-share-price-that-needs-adjusting-not-the-terms" target="_blank" rel="noopener">https://www.smartkarma.com/insights/mergertalk-unitedtech-raytheon-it-s-the-utx-share-price-that-needs-adjusting-not-the-terms</a>- on the proposed radical corporate restructuring at <a href="https://www.smartkarma.com/entities/united-technologies-corp" target="_blank" data-smartkarma-citation="entities:12750:1" rel="noopener">United Technologies (UTX US)</a>. Amid the coronavirus inspired market swoon that is currently decimating the global financial markets, the UTX restructuring  involving the spin-off to its shareholders of two significant assets and strong brands in their operating spheres - Carrier and Otis - followed by the merger of the stub (i.e., the aerospace business) with <a href="https://www.smartkarma.com/entities/raytheon-company" target="_blank" data-smartkarma-citation="entities:6453:1" rel="noopener">Raytheon Company (RTN US)</a>, continues as planned. The distribution of Carrier and Otis shares to UTX shareholders will be completed on April 3, 2020, prior to market open when both SpinCos will commence regular-way trade obn the NYSE. The first indication of  how the market values the SpinCos will present itself when when-issued trading for Carrier and Otis start on or around  March 18, 2020 continuing up to and through the distribution date.Below, we provide our detailed valuation theses for both Carrier and Otis, and an updated SOTP assessment of UTX. While it would be reasonable to anticipate continuing share price volatility in the present environment, the current crisis is temporal, not structural. Whether this crisis passes in a few weeks or a few months, we would expect the focus to return to fundamentals within this time frame. Our assessment indicates that a value opportunity in both UTX and RTN shares currently exists for market participants driven by the pending transactions.

On June 14, 2019, we published an insight - https://www.smartkarma.com/insights/mergertalk-unitedtech-raytheon-it-s-the-utx-share-price-that-needs-adjusting-not-the-terms- on the proposed radical corporate restructuring at United Technologies (UTX US). Amid the coronavirus inspired market swoon that is currently decimating the global financial markets, the UTX restructuring  involving the spin-off to its shareholders of two significant assets and strong brands in their operating spheres - Carrier and Otis - followed by the merger of the stub (i.e., the aerospace business) with Raytheon Company (RTN US), continues as planned. The distribution of Carrier and Otis shares to UTX shareholders will be completed on April 3, 2020, prior to market open when both SpinCos will commence regular-way trade obn the NYSE. The first indication of  how the market values the SpinCos will present itself when when-issued trading for Carrier and Otis start on or around  March 18, 2020 continuing up to and through the distribution date.Below, we provide our detailed valuation theses for both Carrier and Otis, and an updated SOTP assessment of UTX. While it would be reasonable to anticipate continuing share price volatility in the present environment, the current crisis is temporal, not structural. Whether this crisis passes in a few weeks or a few months, we would expect the focus to return to fundamentals within this time frame. Our assessment indicates that a value opportunity in both UTX and RTN shares currently exists for market participants driven by the pending transactions.

SpinTalk:  United Tech Restructuring Update:Value Check For UTX, RTN Shareholders Amid Market Swoon

Index Rebal Trades & Special Situations, Quiddity Advisors

Janaghan Jeyakumar, CFA

Index Rebal Trades & Special Situations

Quiddity Advisors

Pan-Asia Catalysts/Events

In my previous insight, <a href="https://www.smartkarma.com/insights/hexcel-woodward-another-aircraft-supplier-merger" target="_blank" data-smartkarma-citation="insights:35769" rel="noopener">Hexcel-Woodward: Another Aircraft Supplier Merger</a>, I mentioned that some Hexcel shareholders might be unhappy with the weak/non-existent premium offered in the Deal. Although both companies' shares have dropped slightly from post-announcement highs, the spread remains positive implying a low probability of a bump. However, in this insight, we take a closer look at the fundamentals to see if a bump is justified. The Deal which will see US-based aircraft component suppliers <a href="https://www.smartkarma.com/entities/hexcel-corp" target="_blank" data-smartkarma-citation="entities:6699:1" rel="noopener">Hexcel Corp (HXL US)</a> and <a href="https://www.smartkarma.com/entities/woodward-inc" target="_blank" data-smartkarma-citation="entities:11464:1" rel="noopener">Woodward Inc (WWD US)</a> combine in a US$6.4Bn all-stock merger of equals was <a href="https://investors.hexcel.com/investor-news/news-details/2020/Woodward-and-Hexcel-Announce-Merger-of-Equals-to-Create-a-Premier-Integrated-Systems-Provider-Propelling-the-Future-of-Flight-and-Energy-Efficiency/default.aspx" target="_blank" rel="noopener">announced</a> on Sunday 12th January. The transaction is expected to close in the third calendar quarter of 2020 and requires regulatory approvals and shareholder approvals from both companies. The grounding of the Boeing 737 Max has added more pressure to the industry of aircraft component suppliers who were already consolidating in preparation to meet future R&amp;D spending requirements. Despite this rush to consolidate, the Deal feels light considering the magnitude of benefits expected post-completion. So is a bump in terms justified?We think so... for a multiple reasons explained below.

In my previous insight, Hexcel-Woodward: Another Aircraft Supplier Merger, I mentioned that some Hexcel shareholders might be unhappy with the weak/non-existent premium offered in the Deal. Although both companies' shares have dropped slightly from post-announcement highs, the spread remains positive implying a low probability of a bump. However, in this insight, we take a closer look at the fundamentals to see if a bump is justified. The Deal which will see US-based aircraft component suppliers Hexcel Corp (HXL US) and Woodward Inc (WWD US) combine in a US$6.4Bn all-stock merger of equals was announced on Sunday 12th January. The transaction is expected to close in the third calendar quarter of 2020 and requires regulatory approvals and shareholder approvals from both companies. The grounding of the Boeing 737 Max has added more pressure to the industry of aircraft component suppliers who were already consolidating in preparation to meet future R&amp;D spending requirements. Despite this rush to consolidate, the Deal feels light considering the magnitude of benefits expected post-completion. So is a bump in terms justified?We think so... for a multiple reasons explained below.

On Sunday 12th January, US-based aircraft component suppliers Hexcel Corp and Woodward Inc <a href="https://investors.hexcel.com/investor-news/news-details/2020/Woodward-and-Hexcel-Announce-Merger-of-Equals-to-Create-a-Premier-Integrated-Systems-Provider-Propelling-the-Future-of-Flight-and-Energy-Efficiency/default.aspx" target="_blank" rel="noopener">announced</a> they would combine in a US$6.4Bn all-stock merger of equals to form "a premier integrated systems provider serving the aerospace and industrial sectors".Under the terms of this Offer, Hexcel shareholders will receive 0.625 Woodward shares per Hexcel share. On a fully diluted basis, the existing shareholders of Woodward and Hexcel will own 55% and 45%, respectively, of the combined entity. The deal is conditional on the receipt of antitrust clearance and approvals from the shareholders of both Hexcel and Woodward. The transaction is expected to be completed in the third calendar quarter of 2020.At the time of writing, the Deal is trading close to terms with a view to complete. That obviously includes a high likelihood of deal completion as-is, a small probability of dealbreak, and some probability of a deal bump.

On Sunday 12th January, US-based aircraft component suppliers Hexcel Corp and Woodward Inc announced they would combine in a US$6.4Bn all-stock merger of equals to form "a premier integrated systems provider serving the aerospace and industrial sectors".Under the terms of this Offer, Hexcel shareholders will receive 0.625 Woodward shares per Hexcel share. On a fully diluted basis, the existing shareholders of Woodward and Hexcel will own 55% and 45%, respectively, of the combined entity. The deal is conditional on the receipt of antitrust clearance and approvals from the shareholders of both Hexcel and Woodward. The transaction is expected to be completed in the third calendar quarter of 2020.At the time of writing, the Deal is trading close to terms with a view to complete. That obviously includes a high likelihood of deal completion as-is, a small probability of dealbreak, and some probability of a deal bump.

Hexcel-Woodward: Another Aircraft Supplier Merger

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

Amid rising Middle East tensions, investors have moved to safe-havens including Treasuries and gold, all while having a muted effect on the US equity market. At this point in time, the rising tensions have done virtually no damage to the bullish trends and indicators that continue to dominate the market. In today’s report we highlight attractive Groups and stocks within Manufacturing, Services, Technology, and Transportation: Aero Defense, Large-Cap, HR &amp; Employment Svcs, Large-Cap, Optical Equipment, and Shipping, Energy

Amid rising Middle East tensions, investors have moved to safe-havens including Treasuries and gold, all while having a muted effect on the US equity market. At this point in time, the rising tensions have done virtually no damage to the bullish trends and indicators that continue to dominate the market. In today’s report we highlight attractive Groups and stocks within Manufacturing, Services, Technology, and Transportation: Aero Defense, Large-Cap, HR &amp; Employment Svcs, Large-Cap, Optical Equipment, and Shipping, Energy

U.S. Equity Strategy: Bullish Outlook Intact

United States

Raytheon Technologies Corporation operates as an aircraft manufacturing company. The Company focuses on technology offerings and engineering teams to deliver innovative solutions such as aero structures, avionics, interiors, mechanical systems, mission systems, aircraft engines, power and control systems, radars, software, and other products.

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Raytheon Technologies (RTX US)

Weekly Innovation Review (WIRE) #23

Headline Developments Facebook’s (FB) Reality Labs have provided a glimpse of a wrist-worn AR interface concept that would allow users to more...

Granite Bay Capital

SpinTalk: United Tech Restructuring Update:Value Check For UTX, RTN Shareholders Amid Market Swoon

On June 14, 2019, we published an insight -...

Robert Sassoon

Hexcel-Woodward: Is the Offer Fair?

In my previous insight, Hexcel-Woodward: Another Aircraft Supplier Merger, I mentioned that some Hexcel shareholders might be unhappy with the...

Janaghan Jeyakumar, CFA

Hexcel-Woodward: Another Aircraft Supplier Merger

On Sunday 12th January, US-based aircraft component suppliers Hexcel Corp and Woodward Inc announced they would combine in a US$6.4Bn all-stock...

Janaghan Jeyakumar, CFA

U.S. Equity Strategy: Bullish Outlook Intact

Amid rising Middle East tensions, investors have moved to safe-havens including Treasuries and gold, all while having a muted effect on the US...

Vermilion Research

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