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Smartkarma Daily Briefs

Mar 05
0

Daily Brief Industrials: Japan Airlines, Golden Energy & Resources, Halcyon Agri, Hong Kong Hang Seng Index, Japan Post Holdings, Plug Power Inc and more

By | Daily Briefs, Industrials

In today’s briefing:

  • Index Rebalance & ETF Flow Recap: NKY, HSCEI, HSTECH, STAR50, MVIS, Japan Post Bank, Adani, KRX BBIG
  • Golden Energy (GER SP): The Disconnect Between the Offer and Underlying Assets
  • (Mostly) Asia-Pac Weekly Risk Arb Wrap: Slater & Gordon; SHL Japan, GK Goh, Nitro Software, Yashili
  • EQD | Volatility Update: Weekly Review of Vol Changes and Best Trades
  • ECM Weekly (5th Mar 2023) – Japan Post Bank, Kansai, Vanke, Otsuka, SBI Sumishin, Lu DaoPei, NST, JF
  • Plug Power Inc.: Major Drivers

Index Rebalance & ETF Flow Recap: NKY, HSCEI, HSTECH, STAR50, MVIS, Japan Post Bank, Adani, KRX BBIG

By Brian Freitas

Golden Energy (GER SP): The Disconnect Between the Offer and Underlying Assets

By Arun George

(Mostly) Asia-Pac Weekly Risk Arb Wrap: Slater & Gordon; SHL Japan, GK Goh, Nitro Software, Yashili

By David Blennerhassett

EQD | Volatility Update: Weekly Review of Vol Changes and Best Trades

By Simon Harris

  • Weekly summary of vol changes and moves across Global Markets
  • Analysing ATM volatility and skew changes over the last 5 days
  • We suggest a few trades to take advantage of the implied vol surfaces

ECM Weekly (5th Mar 2023) – Japan Post Bank, Kansai, Vanke, Otsuka, SBI Sumishin, Lu DaoPei, NST, JF

By Sumeet Singh

  • Aequitas Research puts out a weekly update on the deals that were covered by the team recently along with updates for upcoming IPOs.
  • On the IPO front, there were two deals launched this week.
  • For placements, Japan Post Bank (7182 JP)‘s planned selldown by Japan Post Holdings (6178 JP) came earlier than expected.

Plug Power Inc.: Major Drivers

By Baptista Research

  • Plug Power’s performance in the quarter was very disappointing as it failed to meet the revenue expectations of analysts.
  • The company reported wider than expected losses and it continues to deliver weak results adversely affecting its market sentiment.
  • Plug electrolyzers and cryogenic equipment is anticipated to be used in their operations to create and deliver liquid hydrogen via Plug trailers.

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Mar 05
0

Most Read: Mineral Resources, Li Auto, Posco Chemical Co Ltd, Swire Pacific (B), Kum Yang Co Ltd, XPeng, Adani Total Gas, Oriental Land, Japan Airlines and more

By | Daily Briefs, Most Read

In today’s briefing:

  • MVIS Global Rare Earth/​​​​​Strategic Metals Index Rebalance Preview: One Add, One Delete Possible
  • HSTECH Index Rebalance: Weibo Replaces Ming Yuan Cloud; Big Inflows on Li Auto & XPeng
  • KRX New Deal Index Rebalance Preview: Potential Flows as Announcement Looms
  • HSCI Index Rebalance: 35 Adds, 28 Deletes & Changes to Southbound Stock Connect
  • Index Rebalance & ETF Flow Recap: KOSPI200, SET50, SMM SP, HSI, HSCI
  • HSCEI Index Rebalance: Xpeng (9868) Replaces China Feihe (6186); Li Auto (2015) Biggest Gainer
  • Adani Group: GQG Bets Big; MSCI Index Impacts
  • Nikkei 225 Index Rebalance: Oriental Land, Renesas, JAL IN; Toyobo, Nippon LightMetal, Toho Zinc OUT
  • Nikkei 225 March 2023 Review – OLC, JAL, Renesas IN.
  • Index Rebalance & ETF Flow Recap: NKY, HSCEI, HSTECH, STAR50, MVIS, Japan Post Bank, Adani, KRX BBIG

MVIS Global Rare Earth/​​​​​Strategic Metals Index Rebalance Preview: One Add, One Delete Possible

By Brian Freitas

  • The review period for the March rebalance ended yesterday. Announcement of the changes will be made on 10 March and will be implemented at the close on 17 March.
  • Mineral Resources (MIN AU) is a potential index inclusion if it is added to the index universe with lithium revenues nearing the 50% threshold.
  • ioneer Ltd (INR AU) is very close to the 98% deletion threshold and could be removed from the index at the March rebalance.

HSTECH Index Rebalance: Weibo Replaces Ming Yuan Cloud; Big Inflows on Li Auto & XPeng

By Brian Freitas

KRX New Deal Index Rebalance Preview: Potential Flows as Announcement Looms

By Brian Freitas

  • The review period for the March rebalance ended on 31 January, changes will be announced in the next few days and implemented at the close of trading on 9 March.
  • We forecast one add/delete for the Secondary Battery Index and Game Index, and a couple of adds/deletes for the BBIG Index. There will be a lot of capping changes.
  • The largest inflows are expected on Posco Chemical (003670 KS) and Douzone Bizon (012510 KS); the largest outflows are expected on SK Innovation (096770 KS) and KMW (032500 KS).

HSCI Index Rebalance: 35 Adds, 28 Deletes & Changes to Southbound Stock Connect

By Brian Freitas

  • There are 35 adds and 28 deletes for the Hang Seng Composite Index (HSCI) at the March rebalance to take the number of index constituents up to 527.
  • We expect 29 of the 35 inclusions to the HSCI will be added to Stock Connect, while 20 of the 28 HSCI deletions will be removed from Southbound Stock Connect.
  • 19 stocks could be deleted from Stock Connect only since their average market cap has dropped below HK$5bn- unless the new threshold of HK$4bn is approved in the next week.

Index Rebalance & ETF Flow Recap: KOSPI200, SET50, SMM SP, HSI, HSCI

By Brian Freitas

  • The changes to the Hang Seng family of indices and the SSE STAR50 (STAR50 INDEX) were announced post market close on Friday.
  • Busy start to the coming week with the MSCI implementation at the close on 28 February and a few announcements to other indices later in the week.
  • There were outflows from Tracker Fund of Hong Kong Ltd (2800 HK) during the week taking the YTD outflows to over US$1bn.

HSCEI Index Rebalance: Xpeng (9868) Replaces China Feihe (6186); Li Auto (2015) Biggest Gainer

By Brian Freitas

Adani Group: GQG Bets Big; MSCI Index Impacts

By Brian Freitas

Nikkei 225 Index Rebalance: Oriental Land, Renesas, JAL IN; Toyobo, Nippon LightMetal, Toho Zinc OUT

By Brian Freitas

Nikkei 225 March 2023 Review – OLC, JAL, Renesas IN.

By Travis Lundy

Index Rebalance & ETF Flow Recap: NKY, HSCEI, HSTECH, STAR50, MVIS, Japan Post Bank, Adani, KRX BBIG

By Brian Freitas

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Mar 05
0

Daily Brief Thematic (Sector/Industry): Rare Earth Stocks Plunge as Tesla Seeks Alternatives and more

By | Daily Briefs, Thematic (Sector/Industry)

In today’s briefing:

  • Rare Earth Stocks Plunge as Tesla Seeks Alternatives
  • Japan Weekly | Movers, Macro and Insights
  • GEM Weekly (3 Mar 2023): China PMI, India GDP; Naver, L&F Co, MediaTek, Foxconn
  • SPAC Talk: Crushed Warrants Still Warrant Caution

Rare Earth Stocks Plunge as Tesla Seeks Alternatives

By Caixin Global

  • Shares of Chinese rare earth suppliers plunged Thursday after Tesla Inc. said it will reduce its use of the minerals in future electric vehicles to control costs.
  • The leading electric-car maker is designing next-generation powertrain that will use a permanent magnet motor that doesn’t rely on rare earth materials, Colin Campbell, Tesla vice president for powertrain engineering, said at an investor meeting.
  • The change reflects Tesla’s efforts to control material costs and reduce its involvement in the health and environmental risks of mining the minerals, Campbell said.

Japan Weekly | Movers, Macro and Insights

By Mark Chadwick

  • The Nikkei and Topix indexes finished the week 1.73% and 1.57% higher
  • A more flexible BOJ will be a good thing…just don’t expect too much too soon
  • Mitsubishi Chem is looking to divest non-core assets….could they make use of more tax-efficient spin-offs

GEM Weekly (3 Mar 2023): China PMI, India GDP; Naver, L&F Co, MediaTek, Foxconn

By Wium Malan, CFA

SPAC Talk: Crushed Warrants Still Warrant Caution

By Water Tower Research

  • SPACs are still heading for the exits in droves.
  • While the six IPO pricings that occurred last month would ordinarily be nothing to write home about, February 2023 happened to be the most active month for SPAC IPOs since May 2022, which was the last time a month produced six IPOs.
  • However, while the six IPOs last May raised a total of $915 million in gross proceeds, last month’s IPOs raised about half that amount (~$500 million), reflecting the tougher prevailing fundraising environment.

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Mar 05
0

Daily Brief ECM: ECM Weekly (5th Mar 2023) – Japan Post Bank and more

By | Daily Briefs, ECM

In today’s briefing:

  • ECM Weekly (5th Mar 2023) – Japan Post Bank, Kansai, Vanke, Otsuka, SBI Sumishin, Lu DaoPei, NST, JF
  • Dollar Tree Inc.: Major Drivers
  • Splunk Inc.: Major Drivers

ECM Weekly (5th Mar 2023) – Japan Post Bank, Kansai, Vanke, Otsuka, SBI Sumishin, Lu DaoPei, NST, JF

By Sumeet Singh

  • Aequitas Research puts out a weekly update on the deals that were covered by the team recently along with updates for upcoming IPOs.
  • On the IPO front, there were two deals launched this week.
  • For placements, Japan Post Bank (7182 JP)‘s planned selldown by Japan Post Holdings (6178 JP) came earlier than expected.

Dollar Tree Inc.: Major Drivers

By Baptista Research

  • Dollar Tree maintained its momentum in the fourth quarter and delivered an all-around beat.
  • Operational income climbed 6.8% to $618.1 million, or 8% of total revenue, and the operating margin fell by 20 basis points.
  • Inventory increased by 24.8%, owing mostly to unit growth from early spring 2023 merchandise receipts, Family Dollar combo expansion and new store unit growth, and cost growth from product inflation.

Splunk Inc.: Major Drivers

By Baptista Research

  • Splunk completed the year on a positive note and delivered an all-around beat while exceeding its forecasted targets for revenue, total ARR, cloud ARR, operating margin, and free cash flow.
  • In Q4, they increased overall ARR by 18% year on year to $3.674 billion.
  • In Q4, Splunk secured major deals against a large enterprise competitor by demonstrating that adequate security, cloud migration, and pricing are insufficient.

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Mar 05
0

Daily Brief Private Markets: Unisound: A Chinese Unicorn Focused on AI Powered Voice and Speech Processing Technologies and more

By | Daily Briefs, Private Markets

In today’s briefing:

  • Unisound: A Chinese Unicorn Focused on AI Powered Voice and Speech Processing Technologies

Unisound: A Chinese Unicorn Focused on AI Powered Voice and Speech Processing Technologies

By Douglas Kim

  • Founded in 2012, Beijing Yunzhisheng Information Technology Co. (also known as Unisound) is a Chinese company focused on AI powered voice and speech processing technologies.
  • Unisound provides voice recognition, language processing and big data solutions to home appliances, automobile, healthcare and education companies.
  • Since the inception of the company, it has raised US$361 million in funding. 

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Mar 05
0

Daily Brief Macro: CX Daily: China Local Governments’ Fiscal Stress May Roll Over to 2023 and more

By | Daily Briefs, Macro

In today’s briefing:

  • CX Daily: China Local Governments’ Fiscal Stress May Roll Over to 2023, Think Tank Warns
  • TPW Advisory March Monthly: Short Vs Long Term Investment Thinking

CX Daily: China Local Governments’ Fiscal Stress May Roll Over to 2023, Think Tank Warns

By Caixin Global

Fiscal /: China local governments’ fiscal stress may roll over to 2023, think tank warns

Containers /: How a global shortage turned into a shipping container glut

Corruption /: Corruption charges filed against former China Merchants Bank president

TPW Advisory March Monthly: Short Vs Long Term Investment Thinking

By TPW Advisory

  • As Narrative Speed turns investors into contortionists it seems like a good time to consider short term vs long term investment thinking.
  • Most investment money is LT: pensions, endowments, 401Ks, target date funds etc.
  • Significant amounts are managed on a short term trading basis – often by machines.

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Mar 05
0

Daily Brief Event-Driven: Nikkei 225 Sep 2023 PREVIEW – Lasertec and more

By | Daily Briefs, Event-Driven

In today’s briefing:

  • Nikkei 225 Sep 2023 PREVIEW – Lasertec, Toshiba, Nitori, Maybe Zozo
  • Index Rebalance & ETF Flow Recap: NKY, HSCEI, HSTECH, STAR50, MVIS, Japan Post Bank, Adani, KRX BBIG
  • CPSE / BHARAT22 / CNXBANK Index Rebalance Preview: Capping Changes in March
  • Golden Energy (GER SP): The Disconnect Between the Offer and Underlying Assets
  • Last Week in Event SPACE: Japan Post/Japan Post Bank, Downer, HKBN, Golden Energy
  • Korean Court Rules Against SM Entertainment From Issuing New Shares to Kakao
  • OZ Minerals (OZL AU): Scheme Meeting on 13 April
  • S&P/​​​ASX Index Rebalance (Mar 2023): Big Impact Changes as Adds Outperform Deletes
  • (Mostly) Asia-Pac Weekly Risk Arb Wrap: Slater & Gordon; SHL Japan, GK Goh, Nitro Software, Yashili
  • Quiddity Flow Expectations for DAX Mar 23 Rebal: WUW GR Vs SDAX Seems Interesting

Nikkei 225 Sep 2023 PREVIEW – Lasertec, Toshiba, Nitori, Maybe Zozo

By Travis Lundy

  • The March 2023 Nikkei 225 Review was announced Friday. Discussion is in Nikkei 225 March 2023 Review – OLC, JAL, Renesas IN. 
  • That means a Sep-2023 preview. ADDs: Lasertec (6920), Toshiba (6502), and Nitori (9843). DELETEs: Nippon Sheet Glass (5202), Mitsui E&S (7003), and Matsui Securities (8628).
  • Zozo (3092) is a possible alternate add to Toshiba on a sector balance basis if Toshiba’s disposition changes in the interim.

Index Rebalance & ETF Flow Recap: NKY, HSCEI, HSTECH, STAR50, MVIS, Japan Post Bank, Adani, KRX BBIG

By Brian Freitas

CPSE / BHARAT22 / CNXBANK Index Rebalance Preview: Capping Changes in March

By Brian Freitas

  • The BHARAT 22 ETF (ICICIB22 IN) will rebalance on 17 March while the CPSE ETF (CPSEBE IN) and Nifty Bank Index (NSEBANK INDEX) will rebalance on 29 March.
  • There are no constituent changes for the indices in March but there will be capping changes for the stocks and there is a reasonable impact on some stocks.
  • There are stocks that will have opposing flows on the two days, while there are some stocks that will have same way flows from passive trackers.

Golden Energy (GER SP): The Disconnect Between the Offer and Underlying Assets

By Arun George

Last Week in Event SPACE: Japan Post/Japan Post Bank, Downer, HKBN, Golden Energy

By David Blennerhassett

  • Big picture: Japan Post (6178 JP) selling 29% of Japan Post Bank (7182 JP) is a Very Big Offering at ¥1.236trln. 80/20 dom/international. A TOUGH sell. 1.089bn shares is 4x float. 
  • Downer EDI (DOW AU)‘s CEO resigned ahead of announcing accounting irregularities last December. The CFO resigned this week after Downer announced another profit downgrade. Now the chairman is exiting. 
  • Hong Kong broadband play HKBN Ltd (1310 HK)said it has been approached by I Squares’ HGC. No pricing announced, but talks continue. 

Korean Court Rules Against SM Entertainment From Issuing New Shares to Kakao

By Douglas Kim

  • On 3 March, it was announced that a Korean court has ruled against SM Entertainment from issuing new shares and CB to Kakao Corp (035720 KS).
  • HYBE’s tender offer period ended on 1 March. It is highly unlikely for HYBE to have successfully completed the tender offer reaching the entire 25% of outstanding shares.
  • We maintain our position of a high probability of Kakao initiating its own tender offer of SM Entertainment shares in the coming weeks at about 140,000/150,000 won or more.

OZ Minerals (OZL AU): Scheme Meeting on 13 April

By Arun George

  • The IE considers BHP Group Ltd (BHP AU)’s A$28.25 offer for OZ Minerals Ltd (OZL AU) to be fair and reasonable as it is within its valuation range of A$27.37-30.47. 
  • Copper prices and peers’ share prices have risen since the deal announcement. The IFA address perky copper prices by using reasonable long-term copper prices to value the assets.
  • This is done with no hint of a competing bid. At last close price and for the 2 May payment, the gross and annualised spread is 0.9% and 6.1%, respectively.

S&P/​​​ASX Index Rebalance (Mar 2023): Big Impact Changes as Adds Outperform Deletes

By Brian Freitas

  • There is one change for the ASX20, two for the ASX100, four for the S&P/ASX 200 INDEX and 12 adds/ 9 deletes for the ASX300 Index at the March rebalance.
  • There will be between 7-20 days of ADV to trade on the ASX100 and ASX200 adds while the impact on the deletions is between 1-11 days of ADV.
  • The adds have outperformed the deletes on all indices over the last few months. Short interest has jumped on a lot of the large deletes.

(Mostly) Asia-Pac Weekly Risk Arb Wrap: Slater & Gordon; SHL Japan, GK Goh, Nitro Software, Yashili

By David Blennerhassett

Quiddity Flow Expectations for DAX Mar 23 Rebal: WUW GR Vs SDAX Seems Interesting

By Janaghan Jeyakumar, CFA

  • The March 2023 index changes for the DAX index family were confirmed after the close on Friday 3rd March 2023.
  • There will be one change for DAX, two for MDAX, and two for SDAX mostly in line with our expectations. Separately, there is also a change in TecDAX.
  • In this insight, we take a closer look at our expectations for index flows and the recent price and volume performance of the names involved in the index rebalance event.

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Mar 05
0

Daily Brief Equity Bottom-Up: Whitehaven Coal – 35% of Mkt Cap Cash/ Aggressive Capital Allocation The Key and more

By | Daily Briefs, Equity Bottom-Up

In today’s briefing:

  • Whitehaven Coal – 35% of Mkt Cap Cash/ Aggressive Capital Allocation The Key
  • China Healthcare Weekly (March.3) – TCM New Policy, Pfizer to Acquire Seagen, Haohai Biological
  • Broadcom’s Strong Quarterly Results In The Light Of Its Acquisition-Led Strategy
  • Abbott Laboratories: Major Drivers
  • Plug Power Inc.: Major Drivers
  • Veeva Systems Inc.: Major Drivers
  • Las Vegas Sands Corp: Major Drivers
  • Lowe’s Companies Inc.: Collaboration With Klein Tools & Other Drivers
  • Merck & Co. Inc.: Licensing Agreement With Kelun Biotech & Other Drivers
  • Okta Inc.: Major Drivers

Whitehaven Coal – 35% of Mkt Cap Cash/ Aggressive Capital Allocation The Key

By Sameer Taneja

  • Whitehaven Coal (WHC AU) underwhelming capital allocation in H1 2023 may have disappointed investors, but armed with a war chest of 2.47 bn AUD (35% mkt cap), we remain optimistic.
  • The company aims to purchase 240 mn shares ( or about 25% of outstanding shares ) over and above the 10% it completed from last year’s buyback phase. 
  • Trading at 2.2x/3.2x  FY23e/FY24e, the stock is extremely cheap with a conservative dividend yield of 9.1%/6.3% FY23e/FY24e ( assuming a 20% dividend-only payout ratio). 

China Healthcare Weekly (March.3) – TCM New Policy, Pfizer to Acquire Seagen, Haohai Biological

By Xinyao (Criss) Wang

  • The General Office of the State Council issued favorable policy for TCM industry. However, TCM still has to face VBP, therefore Zhangzhou Pientzehuang Pharmaceutical Co. (600436 CH) and Gushengtang are our top picks..
  • Pfizer is in talks to acquire Seagen in a deal worth over US$30 billion, but we remain conservative about whether this transaction would ultimately bring expected contributions to Pfizer.
  • Haohai’s business model fails to bring ideal performance. Increasing competition/declining gross margin cast doubts on the outlook of medical aesthetics business. We’re not optimistic about its potential valuation upside.

Broadcom’s Strong Quarterly Results In The Light Of Its Acquisition-Led Strategy

By Vladimir Dimitrov, CFA

  • Broadcom remains as one of the best-positioned semiconductors stocks, but lower topline growth is to be expected going forward.
  • Broadcom has so far done a great job at expanding its product and service offerings through M&A deals.
  • Broadcom Inc. (NASDAQ:AVGO) has just reported yet another strong fiscal Q1 2023 quarter, marked by high top and bottom line growth.

Abbott Laboratories: Major Drivers

By Baptista Research

  • Abbott saw another highly successful quarter and managed an all-around beat as routine testing trends and hospital-based procedures continued to improve progressively in several areas.
  • In the quarter, the sales growth was impacted negatively by a year-over-year decline in the Covid test sales.
  • With the recovery of the manufacturing brand, production of its non-WIC brands has increased.

Plug Power Inc.: Major Drivers

By Baptista Research

  • Plug Power’s performance in the quarter was very disappointing as it failed to meet the revenue expectations of analysts.
  • The company reported wider than expected losses and it continues to deliver weak results adversely affecting its market sentiment.
  • Plug electrolyzers and cryogenic equipment is anticipated to be used in their operations to create and deliver liquid hydrogen via Plug trailers.

Veeva Systems Inc.: Major Drivers

By Baptista Research

  • Veeva Systems finished the year on a strong note with both, its revenues as well as earnings exceeding the expectations of analysts as well as the management.
  • The management claims that it was a watershed year for clinical data management, with significant momentum in emergent areas like Safety, Link, and Compass.
  • We give Veeva Systems a ‘Hold’ rating with a revised target price.

Las Vegas Sands Corp: Major Drivers

By Baptista Research

  • Las Vegas Sands delivered a highly disappointing result as it failed to meet Wall Street expectations in terms of revenues as well as earnings.
  • The track record in the non-gaming, scale, and diversity makes Las Vegas Sands uniquely position to cater to all the segments of the market.
  • We provide the stock of Las Vegas Sands with a ‘Hold’ rating with a revision in the target price.

Lowe’s Companies Inc.: Collaboration With Klein Tools & Other Drivers

By Baptista Research

  • Lowe’s Companies delivered a mixed set of results in the fourth quarter.
  • Another notable category, Paint, saw strong pro-growth driven by its MVPs Pro Paint Rewards and Pro JobSIGHT delivery.
  • Among other updates, Lowe’s collaborated with Klein Tools to give Klein Tools a strong presence in the electrical and tool departments of Lowe’s.

Merck & Co. Inc.: Licensing Agreement With Kelun Biotech & Other Drivers

By Baptista Research

  • Merck has delivered a strong quarterly result to end 2022 and surpassed the analyst consensus estimates in terms of revenues as well as earnings.
  • The top-line performance was driven by strength across the company’s key pillars, hospitals, vaccines, and oncology, and a significant contribution from LAGEVRIO.
  • The animal health business of Merck delivered strong operational growth.

Okta Inc.: Major Drivers

By Baptista Research

  • Okta delivered a strong fourth-quarter performance which was highlighted by an all-around beat as well as a significant improvement in profitability and cash flow.
  • The end of the 2023 fiscal was strong, with sustained improvement in its go-to-market business performance.
  • In this report, we have carried out a fundamental analysis of the historical financial statements of the company.

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Mar 04
0

Daily Brief South Korea: EcoPro Materials, Celltrion Inc and more

By | Daily Briefs, South Korea

In today’s briefing:

  • Initial Thoughts on the Ecopro Materials IPO
  • Celltrion (068270 KS): Disappointing 4Q22 Result; No Immediate Respite Is Seen

Initial Thoughts on the Ecopro Materials IPO

By Douglas Kim

  • Ecopro Materials, an affiliate of Ecopro, is getting ready to complete its IPO in 2H 2023. Ecopro Co has a 52.8% stake in Ecopro Materials. 
  • Ecopro Materials’ core products are lithium cell core materials called precursors, which are used as part of the rechargeable batteries. 
  • The expected market value of Ecopro Materials is about 3 trillion won to 4 trillion won (US$2.3 billion to US$3.0 billion).

Celltrion (068270 KS): Disappointing 4Q22 Result; No Immediate Respite Is Seen

By Tina Banerjee

  • Celltrion Inc (068270 KS) reported Q4 results, with revenue, operating profit, and net profit declined YoY and QoQ. Absence of COVID-related products dragged revenue, while non-recurring expenses impacted margins.
  • Pricing pressure in biosimilar products and elevated R&D expenses are negatively impacting bottom line. With pipeline progress and upcoming product launches, R&D expenses are expected to remain elevated.
  • Celltrion expects to launch Humira biosimilar in the US in July 2023. This year, 8 players are expected to launch Humira biosimilar.

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Mar 04
0

Daily Brief United States: Occidental Petroleum, Salesforce.Com Inc, Viatris, Bitcoin, Domino’s Pizza, HEICO Corp, Inter Parfums, AdTheorent, Workday Inc Class A, Assertio Holdings and more

By | Daily Briefs, United States

In today’s briefing:

  • Occidental Petroleum Corporation: Major Drivers
  • Salesforce Inc.: Major Drivers
  • Viatris Inc.: Major Drivers
  • When Bond Yields Exceed 4%, UK Governments Fall
  • Domino’s Pizza Inc.: Major Drivers
  • HEICO Corporation: Precise Engineering Acquisition & Other Drivers
  • IPAR: 2024 in the Spotlight, Target Now $172
  • 4Q22 Outperformance in a Tough Ad Market; Guides Growth in 2023
  • Workday Inc.: Major Drivers
  • ASRT: ASEG Guideline a Significant Positive, PT to $8

Occidental Petroleum Corporation: Major Drivers

By Baptista Research

  • Occidental Petroleum had a weak financial performance in the last quarter and failed to meet Wall Street expectations with respect to revenues as well as earnings.
  • Storm effects in the Permian and Rockies were largely countered by superior performance in the Gulf of Mexico and the Al Hosn.
  • While Midstream and marketing earnings were within projections, OxyChem’s performance exceeded expectations due to stronger-than-anticipated market dynamics.

Salesforce Inc.: Major Drivers

By Baptista Research

  • Salesforce had another strong quarter and delivered an all-around beat.
  • Besides, the Data cloud became their most crucial cloud, enhancing each Salesforce cloud and enhancing the automation, intelligence, and real-time of every aspect of their Customer 360.
  • With native integration of Tableau and Data Cloud, they recently released Tableau plus Data Cloud.

Viatris Inc.: Major Drivers

By Baptista Research

  • Viatris delivered a mixed set of results as it failed to meet the revenue expectations of Wall Street but managed an earnings beat.
  • They dealt with intense competition for important products like Wixela and the loss of exclusivity for Miacalcin and Perforomist.
  • In addition, they acquired Oyster Point Pharma and Famy Life Sciences in January to create their new Viatris Eye Care division.

When Bond Yields Exceed 4%, UK Governments Fall

By Kaiko

  • In 2020 and 2021, investors opted for TIPS over conventional bonds, yet over the past year, they have moved the other way.
  • The TIPS ETF has fallen from $40bn of assets to $20bn, while the long bond ETF has doubled from $15bn to $30bn.
  • The loud and clear message from this shift is that investors are woefully unprepared for an inflation shock.

Domino’s Pizza Inc.: Major Drivers

By Baptista Research

  • Domino’s gave a mixed performance in the last quarter as its revenues were below par after facing significant challenges in the U.S.
  • The carryout business of the company continues to be its core strength.
  • In light of the permitting as well as store construction supply challenges it faced, a deceleration in growth was expected.

HEICO Corporation: Precise Engineering Acquisition & Other Drivers

By Baptista Research

  • Heico delivered a mixed quarter with a decent organic growth in revenues that reflects higher demand for the bulk of its commercial aircraft products and services given the ongoing recovery in commercial air travel.
  • Operating income for the Flight Support Group climbed by 60% to $83.6 million in the first quarter of fiscal 2023.
  • This acquisition is anticipated to drive the company’s growth prospects.

IPAR: 2024 in the Spotlight, Target Now $172

By Hamed Khorsand

  • IPAR disclosing the sales benefit from the Lacoste license was the most notable item from the Company’s fourth quarter earnings call
  • IPAR had previously reported preliminary Q4 sales results making it less of a surprise as to how well the business was doing. Consumer demand for fragrances has yet to wane
  • In 2022 IPAR experienced growth from all regions and all its major brands. Montblanc, Jimmy Choo, Coach, and Guess grew by double-digits

4Q22 Outperformance in a Tough Ad Market; Guides Growth in 2023

By Water Tower Research

  • 4Q22 revenue of $51.8 million above high end of guidance of $50.7 million. 
  • Despite the challenging market conditions, AdTheorent was able to keep adjusted gross profit roughly flat at 65%, down less than 1%.
  • The company (which has no debt) generated more cash, as a percentage of AGP, than in 2021.

Workday Inc.: Major Drivers

By Baptista Research

  • Workday produced strong Q4 results and delivered an all-around beat with a decent performance in key operating measures and a 22% increase in subscription revenue for the quarter and the entire fiscal year.
  • While Talent Optimization is Workday’s fastest-growing SKU with an attach rate on new transactions of more than 85% in fiscal year 2023, approximately 50% of all active Workday HCM customers currently use Workday Skills Cloud.
  • The company intends to boost margin expansion in fiscal 2024 while returning to a 20% plus subscription revenue growth when the environment recovers.

ASRT: ASEG Guideline a Significant Positive, PT to $8

By Hamed Khorsand

  • ASRT could significantly benefit from a new guideline set by American Society for Gastrointestinal Endoscopy (“ASEG”) this week related to the use of indomethacin (Indocin) post ERCP surgery.
  • Indocin is ASRT’s largest source of revenue and nearly all the revenue from off-line use related to post ERCP surgery.
  • We updated our earnings model when ASRT issued preliminary fourth quarter results. We believe the ASEG guidance could lead to accelerated market expansion in coming months

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