Smartkarma Daily Briefs

• I got a bunch of questions about my Outsourcing comments yesterday in Outsourcing (2427) – Earnings Delay Causes Consternation. 
• This piece is intended to clarify what I know (still limited), put parameters around what it might be, and draw lines in the sand which I might later erase.
• This may be nothing. But it may not be. I will try to answer the questions I received in a kind of Q&A format, and I hope that helps.

• Two days ago, Japanese manufacturer of ubiquitous office furniture Itoki Corp (7972 JP) announced salutary earnings/presentation(J) results, new MTMP(E) outlines, new shareholder return policy(J), yutai program(J), div hike(J), and buyback(J). 
• It was a big day. The stock went limit up on 14 Feb and is +12% today. +25% in two days.
• No single holder holds that much BUT the parameters tell you how this gets done. It’s interesting, but it is important to read the fine print below!

• SSE 50 and SSE 180, respectively, aim to represent the performance of the 50 and 180 largest and most liquid A-share stocks listed on the Shanghai Stock Exchange.
• In this insight, we take a look at our expectations for potential index changes for SSE 50 and SSE 180 during the June 2024 index rebal event.
• Since my last insight, there have been a couple of changes to our expected ADDs basket and a couple of changes to our expected DELs basket for the SSE180 index.

• Base Carbon is a leading provider of high-quality carbon offsets that can be purchased by third parties to meet their carbon offset goals.
• Through a disciplined underwriting process, a strong balance sheet, and an experienced team, the company seeks to be the preferred carbon project partner for developers and buyers of carbon credits.
• Robust portfolio of existing projects. Base Carbon has invested in three successful projects that are either currently generating credits and cash or will soon be producing credits that can be sold. 

• Amaero International Ltd (ASX:3DA) is a global specialist in advanced materials manufacturing for the defence, aerospace, and other industrial sectors, developing a critical metals alloy powder manufacturing facility in Tennessee, USA.
• The company has released an executive summary outlining the key findings from the market study prepared by Fairmont Consulting Group LLC into the niobium C103 alloy and other high-value specialty alloys used in mission-critical defence and space applications.
• The executive summary together with key assumptions and financial drivers released by Amaero have formed the basis of our revised earnings estimates for Amaero’s operation. 

• Auckland Airport (AIA) will report a strong recovery in earnings, given the increase in air traffic over the past 18 months, when it reports its 1H24 result on 22 February 2024.
• However, passenger (pax) development, as outlined in its monthly operating stats, has been below the level implied by the pax guidance provided at the FY23 result.
• Consequently, FY24 NPAT guidance (NZ$260m–NZ$280m) is at risk, albeit at least partially mitigated by (1) improving retail income, and (2) AIA’s historic conservative nature when setting earnings guidance. 

• Solid earnings visibility – Q1-3 FY3/24 results were in line with recently revised company guidance, with the core earnings driver being the Profit-Generating Funeral Services segment.
• Positive trends seen in Q2 FY3/24 continued QoQ, with growth in services and high utilization rates from the newly expanded funeral halls.
• The legacy Information segment (print media) relatively underperformed, and the company is continuing cost improvement efforts.

• Our estimations for FY 2023 indicate a projected annual revenue of £959 million, with further growth expected in FY 2024, reaching approximately £988 million.
• In comparison, the company’s revenue for the fiscal year 2022 amounted to £941 million, showcasing a slight decrease from the £943 million reported in 2021.
• Notably, the operating profit surged to £4.6 million in 2022, demonstrating a substantial increase from the £2.3 million recorded in 2021. 

• Amaero International Ltd (ASX:3DA) is a global specialist in advanced materials manufacturing for the defence, aerospace, and other industrial sectors, developing a critical metals alloy powder manufacturing facility in Tennessee, USA. The company has released an executive summary outlining the key findings from the market study prepared by Fairmont Consulting Group LLC into the niobium C103 alloy and other high-value specialty alloys used in mission-critical defence and space applications.
• The executive summary together with key assumptions and financial drivers released by Amaero have formed the basis of our revised earnings estimates for Amaero’s operation.
• Key assumption changes include the addition of a fourth gas atomiser, positioning for an estimated 40% of the C103 niobium powder market longer term, higher C103 prices than previously modelled, but a 50% yield on powder bed fusion powder production.

Key points

• Copa Airlines consistently pays dividends, setting it apart from other airlines.
• The airline’s competitive advantage lies in its strategic location in Panama City and its hub-and-spoke model, facilitating efficient connections between North and South America.
• Despite the challenges of the airline industry, Copa has outperformed its competitors in generating value and is projected to have significant upside potential in both the short and long term.

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only. This article was originally published 3 months ago on Value Investors Club.