Smartkarma Daily Briefs

• Earlier expectation on Micron will have rooms to raise becoming a reality, largely driven by over 30% q/q NAND bit price jump for storage business in 1Q24.
• 10ppts stronger 2Q24 sales guidance and 3-6ppts higher gross margin guidance are driving free cash flow improvement.
• AI server, PC, and smartphone driving DRAM bit demand and HBM3e/HBM4 and 1-gamma EUV DRAM slowing bit supply growth both are positive except MOI remains 15% above 5 years average. 

• Reddit (RDDT US) is looking to raise up to US$750m in its US IPO.
• Reddit is an online social media platform where users are able to join communities, engage in conversations, research, exchange goods and services as well as create new communities.
• In our previous note, we talked about the company’s historical performance. In this note, we share our quick thoughts on valuation.

• Micron Technology reported very positive revenues this quarter and a return to profitability
• A large part of this stems from the impact that HBM demand is constraining production of standard DDR5 DRAM, driving it into a shortage
• This is good news for Micron and its DRAM competitors Samsung and SK hynix

• Sunpower is facing a severe liquidity problem and may need to raise $100-300 million before January to avoid bankruptcy
• The company operates as a wholesaler of residential retail solar panel systems, providing equipment to third-party developers or selling directly to residential customers
• Trade credit tightening terms and potential customer hesitation due to financial instability are contributing to Sunpower’s uncertain future

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.

Boku’s strategy to widen its offering within the local payment method (LPM) market accelerated FY23 revenue growth to 30%, with 15% growth from the core direct carrier billing (DCB) business and supplemented by 153% growth from eWallets and real-time payments. EBITDA grew 27% y o y as the company continued to invest in building out its LPM network from a technological and regulatory perspective. With all major merchants using or planning to use Boku’s wider portfolio of payment methods, the company should benefit from faster growth in the non-card payment market and be able to leverage the investment it has made in its mobile-first platform to drive growth in earnings and cash generation.

• Debt buyers like ECPG can accelerate growth during times of increased charge offs by credit card issuers
• Growth is impacted by tough collections environment with an abundance of cheap charged off paper
• Investors must consider buying these stocks when growth prospects are high and expectations have factored in collection challenges, as industry may soon enter a favorable cycle for debt buyers

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.

• This is our first report on Tempur Sealy International Inc., a global bedding company.
• The company released its Q4 2023 earnings recently.
• The company emphasized its strong business model, highlighting significant cash flow and a robust balance sheet.