
In today’s briefing:
- Sotetsu Holdings (9003) – Crossholders Sell Down – Big ADV Multiple, Low Earnings Multiple, Boring
- Sotetsu Placement: Low Valuation and Share Buyback Should Aid Deal Performance
- Lucror Analytics – Morning Views Asia
- MHH: Mastech Digital Starts the Year with a New CEO
- DNOW, Inc. – Expect 2025 Growth Despite Uncertain Upstream Activity
- UGRO: A New Start; Cleaning Up and Moving Forward with Realistic Expectations

Sotetsu Holdings (9003) – Crossholders Sell Down – Big ADV Multiple, Low Earnings Multiple, Boring
- Sotetsu Holdings (9003 JP) today announced a large-ish secondary equity offering – 10% of shares out and 20% of Max Real World Float.
- This is crossholders selling down roughly 30% of what they own. Sotetsu announced a buyback for a quarter of the offering over the next six months.
- The shareholder structure and distribution within Max Real World Float tells you all you need to know.
Sotetsu Placement: Low Valuation and Share Buyback Should Aid Deal Performance
- A group of shareholders are looking to raise US$135m from selling their respective stakes in Sotetsu Holdings (9003 JP) .
- While the deal shouldn’t come as a surprise, given the ongoing cross-shareholding unwind narrative in Japan, the timing of such a selldown isn’t always certain.
- In this note, we will talk about the placement and run the deal through our ECM framework.
Lucror Analytics – Morning Views Asia
- In today’s Morning Views publication we comment on developments of the following high yield issuers: Adani Ports, ReNew Energy
In the US, January 2025 housing starts fell 9.8% m-o-m (-7.3% e / 16.1% p) to an annualised pace of 1.37 mn units, as builders pulled back on construction after a surge in December 2024. Meanwhile, building permits rose 0.1% (-1.5% e / -0.7% p) in January 2025.
The minutes of the US FOMC’s January 28-29th meeting showed that Fed officials expressed readiness to hold the policy rate at a restrictive level, if the economy remains strong and inflation stays elevated.
MHH: Mastech Digital Starts the Year with a New CEO
- Mastech Digital, based outside Pittsburgh, PA is an IT staffing business with a data and analytics, consulting, and project management service serving blue-chip customers in the US.
- The company trades below its peers and we expect stock price appreciation now that the company has returned to growth and taken on a new extremely experienced CEO.
- It also plans to grow through acquisition.
DNOW, Inc. – Expect 2025 Growth Despite Uncertain Upstream Activity
- DNOW’s capacity to generate free cash flow, coupled with its strong balance sheet, position the company to capitalize on accretive growth opportunities in 2025 and continue returning cash to shareholders through its share repurchase program.
- The company generated $289 million of free cash flow during 2024 and ended the year with $256 million of cash on the balance sheet.
- fter completing an $80 million share repurchase program in 4Q24, the board authorized a new $160 million repurchase program in January 2025.
UGRO: A New Start; Cleaning Up and Moving Forward with Realistic Expectations
- We are reiterating our Buy rating on UGRO, but lowering our projections and price target (from $8 to $3) after the company regaining compliance with their financial filings after switching auditors at the end of May 2024.
- While the re-audited changes are (in our opinion) minor, the simultaneous release of results for 2Q24 and 3Q24 show urban-gro is still in transition, even while management aggressively reduces costs and focuses on profitable projects.
- As such, and given UGRO now trades near historic lows as investors lost patience with the lengthy accounting review and the expected approval of cannabis in Florida and Federal cannabis category shifts have not occurred, we believe it is appropriate for us to be less aggressive in the near term.