Equity Bottom-Up

• Four years ago, almost to the day, Bloomberg ran an article, “China Merchants Group Ltd. is exploring taking China Merchants Port Holdings private“. China Merchants Ports (144 HK) popped 23%.
• CMP gave back (most) of that gain a month later. Shares are up just ~10% since. 
• CMP’s implied stub is bouncing around a multi-year low; and the simple ratio (CMP/ Shanghai International Port Group (600018 CH)) is around an all-time low.

• Yamaha releases new guidance on May 8 for its fiscal year ending March 2025. The  previous Mid-term plan for OP was ¥68bn, while the consensus is looking for just ¥40.9bn.  
• We expect ¥50bn, and think the shares are as much as 30% undervalued.
• Analysts have responded to multiple downward revisions to current year guidance, driven by collapsing Piano sales to China, but haven’t responded to cost cutting or growth in other product lines.

• We initiated on the iron ore space recently with a short-term bullish call (see: Iron Ore Primer: Understanding The Drivers Of the Market, Ways To Play The Sector). 
• Check out our initiation on  Mount Gibson (MGX AU): Iron Ore Pure Play, 77% of the Mkt Cap in Cash, 0.5x EV-EBITDA With Catalysts ).
• Iron ore has a more short-term upside as it bounces off the cost curve in its three-year band (95-130 USD/ton), while China has demonstrated an abundant appetite for restocking. 

• CyberAgent Inc (4751 JP) reported 2QFY09/2024 results yesterday which shows further improvement across all three segments. Both 2Q revenue and OP beat consensus estimates, with OP by a huge margin.
• Newly released game titles have helped further recovery in Gaming business while Media segment reported its first-ever OP since the company began investing on AbemaTV.
• As we continue to reiterate, the worst is over for CyberAgent (CA) and we remain positive over the company’s growth prospects.

• SK hynix earnings were announced, with a 10% Q/Q revenue increase driving a 734% increase in operating profit
• Although the company cited AI demand as the basis for this, its DRAM revenues, which are very AI dependent, increase very little
• NAND SSD demand increased significantly, with a 30% increase in revenues, largely attributable to price increases

• RBI has barred Kotak Bank from expanding its digital business and credit card issuance
• Rather than earnings damage (max -10%) there is more reputational damage to the bank taking away premium valuations it used to command
• The way ahead lies for the bank is the path of moderate growth 

• Almost every sectors are recovery since 1Q24, and auto and industrial applications sectors still need more time to digest inventory. .    
• The capex for 2024F has been increased by 10% for further investments in the testing business, targeting turnkey or testing customers. 
• All product lines expected to grow in 2H24F, with APT outperforming corporate average. UTR growth expected in 2H24F, reaching above 70%. 

• If you have been following Meta for some time, you probably are accustomed with after-hours (AH) volatility by now.
• While Meta was -20% at one point AH today, it does seem a bit overdone.
• Of all the post-earnings drop that I have experienced following Meta since 2018, this one probably made me nervous the least.

• Daiichi Sankyo (4568 JP) announced better-than-expected Q4FY24 result, with all key parameters exceeding guidance. Q4 revenue increased 30% YoY to ¥429B, driven by 76% YoY growth in Enhertu product sales.
• For FY25, Daiichi Sankyo guided 9% increase in revenue to ¥1,750B. Core operating profit is expected to increase 8% to ¥210B, while net profit to decline 5% to ¥190B.
• In addition to the dividend of ¥60 per share for FY25, Daiichi Sankyo has announced buyback plan of 55M shares (2.87% of issued shares) for ¥200B.

• Intel misses 1H24 market consensus again, post market correction of over 7%. Can shifting focus away from foundry/manufacturing help?
• Is the breakdown change for future spin off/IPO of foundry/manufacturing, and non focus businesses like Altera and Mobileye positive?
• We disagree Intel foundry to breakeven in two years; we see AI product lagging behind competitors and non AI server CPU being squeezed by AI server GPU and GPU/CPU integration.

• Yesterday, post-close, Bloomberg reported a headline “*SILCHESTER REPORTS NIKON STAKE; MAY SEEK CAPITAL POLICY CHANGES“
• That was exciting. It was in all caps. It was activist-ish-y. Today the stock rose 10.3% and we got another article saying it was up because of Silchester’s filing.
• Beware the Bloomberg headline. Nuance is sometimes lost. They aren’t always designed to help investors invest. Often, the main purpose is clickbait.

• Fanuc reported a -7% decline in revenue for FY3/24 and 26% decline in operating profit. 
• The market will be disappointed by guidance for a further fall on the top line and 15% decline in profits as margins hit an all time low
• The valuation of 30x EV / EBIT suggests the market was hoping for a turnaround in profits this year. That recovery has now been pushed back

• Krung Thai is our value pick among Thai banks, having solid post-provision profitability, close to double digit ROE with a healthy balance sheet, along with undemanding PBV and PE ratios
• We maintain Kasikorn on the buy list, as its cost of risk was well contained in 1Q24, a key positive catalyst for its improving post-provision returns
• Bank of Thailand is currently accepting applications for digital banking licenses until 19 September 2024; incumbent banks and domestic big corporates are likely to form the core of applicants

• March Same-Store sales in China disappoint mainly due to diamond jewellery demand
• Overall, gold demand in China continues to rise both in the retail and the official sector
• Visitor arrivals to Hong Kong pick up but are still ~40% below pre-Covid levels.

• Advance Create Co., Ltd. is an independent insurance agent that sells insurance products mainly to individuals on behalf of multiple insurance companies, also undertaking follow-up services on their behalf.
• In FY09/23, the company reported revenue of JPY10.2bn, operating loss of JPY2.0bn, recurring loss of JPY2.2bn, and net loss attributable to owners of the parent of JPY1.8bn
• On February 20, 2024, Advance Create Co., Ltd. announced that it expects to receive dividends from its consolidated subsidiary, Advance Create Reinsurance Incorporated.

• Samsung Biologics (207940 KS) reported mixed 1Q24 result, with revenue beating and operating profit missing estimates. Despite robust revenue growth, profitability is under pressure.
• With accumulated orders exceeding $12.5B (vs $12B at the end of 2023), the outlook remains strong. A gradual increase in Plant 4 operations is expected to drive sequential revenue growth.
• On April 23, Samsung Bioepis received marketing approval from European Commission (EC) for Pyzchiva, a biosimilar of Stelara, thereby becoming an early mover in a potential €2.5B market.

• UMC expects macro uncertainties and cost headwinds to linger into 2H24. 
• The P3 project has received strong support from the Singapore government with a US$5 billion Capex. 
• UMC has seen high interest from customers for its 14nm capacity. 

• TKC Corporation provides accounting and tax services to accounting firms (and client companies they advise), local governments, and others using its own computational centers, while subsidiary TLP Corp.
• In full-year FY09/23, the company reported consolidated sales of JPY71.9bn, operating profit of JPY14.3bn, recurring profit of JPY14.8bn, and net income attributable to owners of the parent of JPY10.8bn.
• TKC does not release a medium-term business plan. However, it is pursuing the following four objectives in close cooperation with TKC National Federation.

• Mister Car Wash unveiled its financial performance for the fourth quarter and full fiscal year ending December 31, 2023.
• The annual results demonstrated solid progress driven by the company’s efforts to enhance its services, physical operations, and team.
• During Q4, sales rose 7% to $230 million, and adjusted EBITDA grew by 5% to $69.5 million.

• The Grocery Outlet management reported its full-year 2023 earnings results, which were slightly ahead of expectations.
• The company demonstrated strong customer acquisition and traffic, driven by competitive pricing and its treasure hunt shopping experience.
• The acquisition of United Grocery Outlet is one of the major highlights of the company’s performance, as it added 40 stores to the network.

• In Smartkarma Corporate Webinar | Elite Commercial REIT: Essential Assets at an Attractive Yield we conducted a fireside chat with Elite Commercial REIT.
• Elite Commercial REIT is a Singapore real estate investment trust established with the investment strategy of principally investing, directly or indirectly, in commercial real-estate related assets in the United Kingdom.
• The company has recently expanded its strategy to look at other commercial assets in the UK, beyond its existing portfolio of assets rented by the UK government.

This Insight is part of the Smartkarma Corporate Webinar series, supported by SGX through the Investor Education Fund.

• Pasona (2168.JP) is a long investment opportunity due to its ownership of a majority stake in Benefit One (2412.JP), which is the subject of a bidding war between M3 (2413.JP) and Dai-Ichi Life (8750.JP).
• Potential bids for Benefit One could result in a significant cash windfall for Pasona, estimated at around 50% more than its current enterprise value, as well as an operating business valued at an additional 50% of its current EV.
• With the founder of Pasona being 71 years old, the bidding war could lead to a management buy-out or a substantial return of capital program for the company.

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.

• Anta Sports Products (2020 HK), Li Ning (2331 HK), and Xtep International (1368 HK) have announced 1Q24 operational updates, with additional color given in post conference calls. 
• Anta: Retail sales started to accelerate in mid-March, and March were better than January and February. 
• Li Ning:  offline retail sales down low-single-digit in 1Q24, driven by wholesale down mid-single-digit, while retail grew mid-single-digit.  E-commerce grew 20-30% yoy.  

• Nidec reported a solid set of quarterly numbers, except for another huge structural loss in its EV business. 
• Nidec saw sales growth and operating profitability improvements in all other segments
• We continue to think that Nidec is attractively priced at under 20x EV/ EBIT given structural growth drivers

• At the end of 2023, Chokwang Leather owned 190.3 billion won worth of Berkshire Hathaway shares, which represents 56% of Chokwang Leather’s market cap. 
• Chokwang Leather also has 3.1 million treasury shares (46.6% of outstanding shares). It has the highest levels of treasury shares as a percentage of outstanding shares among Korean stocks.
• Chokwang Leather is likely to be one of the key companies to be targeted to improve its corporate governance as part of the Corporate Value Up program. 

• Lasertec has dropped more than 20% in the past week and a half, but is still selling at more than 60x EPS guidance for FY Jun-24.
• Weak orders at ASML, disappointing guidance from TSMC and doubts about Intel’s equipment purchases cast doubt on Lasertec’s growth potential.
• Between December 2021 and June 2022, Lasertec’s share price dropped by more than 50%. Wait for Q3 results before reaching for a falling knife. 

• Plunging sales & growing losses, severe price cuts & layoffs, failed FSD, M2 dropped for Robotaxi, and more, confirm that Elon Musk won’t fix Tesla’s most serious problems—which he created.
• He still demands his “unfathomable” pay package be restored, and his feckless, captured Tesla Board is doing exactly what he wants.
• But what Tesla’s Board should do, what it should have done years ago, is fire Elon Musk, the single greatest risk to Tesla’s future.

• Shimano continues to reel from a slowdown in bike and fishing tackle sales post Covid
• 1Q operating profit beat the analyst consensus, but the upward revision to full year is minor and falls short of street estimates
• The stock has priced in an improving outlook. However, valuations are now looking full compared to historical levels. 

• Again, Tesla reports a 1Q24 sales with 4% miss but post market share price up more than 10% for 6 reasons. 1. Gross margin was stable on 15% sales drop;
• 2. ASP was stable; 3. Affordable EV on track for 2025; 4. Factory expansion to slow; 5. Optimus to sell end of 2025; 6. 2024 EV shipment higher than 2023.
• Near term risks to remain: 1. When will margin trough? 2. Why bother to buy EV if 2nd hand market collapsing? 3. Will Robotaxi/FSD bring in meaningful sales/profits soon?

• On March 21st, Lululemon reported FY23 results. All things considered, the results were good. Guidance, however, caused some upset. Lululemon shares are down ~29% this year; after being down just 6% before the report, and is currently the 8th worst-performing stock in the S&P 500.
• Lululemon’s implied 11.5% revenue growth for 2024 is a notable deceleration from years prior; having averaged an annual revenue growth rate of 24.4% over the last 5 years.
• This year’s revenue guidance is closer to, but still behind, the 5 years before that; where Lululemon averaged 15.7% annual revenue growth.

• We believe the revenue growth will be slow in 1Q24, but it will still be rapid for the full year 2024.
• We also believe the operating margin will hit the historical high in 1Q24, but it will be just stable for the year 2024.
• We conclude the stock has an upside of 60% for the year end 2024. Buy.

• A nasty power struggle between ADOR CEO Min Hee-Jin and HYBE has erupted which is likely to continue to negatively impact HYBE’s share price in the next several months.
• ADOR CEO Min Hee-Jin owns an 18% stake in ADOR which was founded in 2021. HYBE owns the controlling 80% stake in ADOR.
• Given the nasty fight between ADOR and HYBE, it is likely that the two companies (including ADOR’s CEO Min Hee-Jin) are likely to part their ways.

• Taiwan Tech Shares Fell Sharply Along With Global Selling — Semiconductor and AI Names Most Exposed
• What Is TSMC Telling Us About Semi Supply Chain Stories at Its Investor Conference? 
• ASE Technology Holding (3711 TT) Wins iPhone 16 System-in-Package Order from Apple (AAPL US)

• In 1Q24, Xiaomi and Transsion shipments grew rapidly, while Samsung Electronics (005930 KS) and Apple (AAPL US) shrank.
• Tims China’s revenue expanded with new openings, which is encouraging in the competitive market.
• In China, Tesla fired salespeople who had served the company for less than six months.

• The story of Hero is the story of persistence, collaboration and achieving goals that many would have regarded as impossible.
• From its humble roots of selling bicycles in 1956 Ludhiana Punjab, to becoming the world’s largest two wheeler company is an extraordinary feat.

• Maintaining the momentum, protecting its market share and setting sights towards ‘Future of Mobility’ is something special.

• CapitaLand is a real estate investment manager with funds under management of c.S$100b and core markets being Singapore, China and India
• They reported solid FY2023 results earlier this year.  Singapore and India are showing strong market outlook while China struggles.
• Valuation is attractive with >50% upside and we view there are multiple catalysts ahead

• Mr. Yashish Dahiya is an impatient man. In one of the interviews with The Ken, he narrated a story of how while in college he used to run home to Noida every Friday and back to college on a Monday morning (both 30kms in one direction) as he found public buses too slow for his liking.
• Mr. Dahiya, is also persistent and doesn’t give up easy – he is one of the few people in the world who has completed the grueling Ironman triathlon – an intense race that consists of swimming, bicycle ride and a marathon all raced in that order – widely considered one of the most difficult one-day sporting events in the world.
• It’s these qualities of impatience, persistence and continuously improving oneself that can be found in the business of PolicyBazaar or PBFinTech, the name of the parent company applying for IPO.

Key points

• VFC is a large apparel company with iconic brands such as The North Face and Vans
• Shares are currently undervalued following a disappointing FY23, with estimated fair value of $40/share
• Strong brands and opportunities for portfolio rationalization and margin improvement make VFC a potential growth opportunity with new management in place.

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.

• Multiple tests over multiple zones in multiple horizons were run at the Mopane-1X exploration well.
• The flows achieved during the well test reached the maximum allowed limits of 14 mboe/d.
• The flow rate was constrained by the size of the available surface facilities.

• eBay has the potential to become a trillion-dollar AI powerhouse in e-commerce
• Offers anti-inflationary savings and eliminates fraud risks
• Seen as undervalued with high growth potential compared to Amazon

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.

• TSMC and ASML reported 1Q24 results last week; both stocks have fallen post results, impacted by global concerns despite a strong outlook for these two leaders into 2025E.
• TSMC guided for strong growth not just in 2024E, but if one digs into management’s comments, they actually provided strong visibility into their 2028E internal revenue expectations.
• For ASML, its EUV product business is the key indicator to watch. We believe TSMC shares will continue to re-rate even through a period of global economic softness.

• JD.com (9618 HK) announced this week that it has repurchased 2.8% of the outstanding shares of the company in the first quarter of 2024. 
• Improved shareholder returns is a key thesis for the stock, given that there is little market expectation on such given limited track record.
• A positive catalyst on full year performance could be the government’s announced stimulus policy for home appliance in April this year (trading old for new).

• TSMC: +9.2% Premium, Major Breakdown From Previous Historically Extreme High
• UMC: -1.9% Discount, Is Near Low End of Historical Range
• ASE: +10.4%; ADR Short Interest Jumps to Very High Level vs. History

• Innovent is most well-known as the developer of mazdutide in China, however this is overshadowing a strong portfolio of oncology drugs in a very high growth market.
• China’s approach to healthcare is being defined by having the biggest diabetic population, over 4 million new cancer cases per year, and over 100 million living with obesity.
• We expect the valuation gap between the two first-to-market GLP-1 drugs, and competition to close. Oncology drug sales and valuations will continue its growth trajectory.

• We have seen four transactions of MNC acquiring Chinese Biotech companies. However, this does not mean that domestic big pharmaceutical companies will also participate in the acquisition of small Biotech.
• The underlying investment logic of innovative drug is undergoing changes. Non-oncology fields, such as autoimmunity, CNS, endocrine metabolism, and ophthalmology will be the main hot directions of investment and R&D.
• Shanghai Tofflon Science A (300171 CH) is still in downward trend. We’re not optimistic about its 2023 results. We don’t recommend bottom-fish this stock unless there is a major catalyst.

• ASPs remain under pressure as STO, J&T gain volume share in ground segment
• March showed a surprising slowdown in pace of international volume growth
• We believe Q423 and Q124 company-level profitability will mostly disappoint

• Shift Inc (3697 JP) ’s share price has been down more than 50% YTD with the release of 1QFY08/2024 results in January 2024 which saw a drop in margins.
• The company’s aggressive investment in HR and system reinforcement led to a decline in margins, however, margins saw a QoQ improvement in 2QFY08/2024.
• Despite there being an improvement in 2Q and the company expecting the margins to bounce back in 4Q, Shift’s share price has continued to fall.

• It’s time for the main event: earnings are upon us. As is customary, let’s start with TSMC, move to ASML and Alphawave, and then discuss VAT Group.
• TSM revenue is above guidance, gross margins are a bit ahead of the midpoint, and operating margins are at the high end of guidance.
• First, while this is a good result, semiconductors are due for a correction. I wrote about this in March, and SOXX has quietly crept downwards since then.

• We would see CanSino’s performance pick up obviously in 2024 – Revenue of meningococcal vaccines would up about 50% YoY. Both R&D and SG&A expenses would show a declining trend.
• Starting from 2025, CanSino’s product matrix will become more diverse.Its financial performance will enter a virtuous cycle. Revenue in 2025 may exceed expectations, depending on the approval time of PCV13i.
• CanSino is one of the few domestic vaccine companies that has ability to explore the international market. Mispricing/expectation differences in the market will give investors the opportunity for excess returns.

• Bell Financial Group Ltd (ASX:BFG) is a diversified provider of financial products and software solutions within, and increasingly outside, its traditional full-service stockbroking business.
• A Q1 FY24 trading update provided at the group’s AGM on 19 April points to revenue growth of 17% and PBT growth of 60% to $9.3m, with all divisions said to be profitable.
• This compares to a RaaS H1 FY24 PBT growth estimate of 69%, placing the group on track to achieve our H1 estimates.

• Q124 revenues of $18.87 billion, marginally above the high end of the guided range, up 12.9% YoY and down 3.8% QoQ. Guided Q224 +6% QoQ.  Maintained full year 2024 outlook
• Unnecessary, minor downward revisions for semi & foundry growth, combined with confusion about the reason triggered an allergic reaction on the markets. TSMC down ~8% since.
• SMCI plunged 23% by Friday close, ARM down 16.9%, NVIDIA down 10%, AMD & Micron down ~5% etc. Nice one, TSMC!

• Marksans Pharma (MRKS IN) has done well in recent years, growing at 15.2% on a 5Y CAGR.  
• The company has a good balance sheet, strong cash generation and also witnessed a recent uptick on the margins side. UK business especially has been the cash cow.
• However, there are few impairment indicators; few subsidiaries are not audited while bad debts have appeared in the books lately. Company also has few disclosure issues.

• Medikaloka Hermina (HEAL IJ) booked a strong recovery in revenues and profits in FY2023 driven by rapidly rising inpatient and outpatient volume growth with JKN patient share rising. 
• The company also saw significant improvements in working capital in 2023 and will step up its capex and hospital expansion in FY2024E helping to drive growth. 
• Medikaloka Hermina is differentiated by its women & children specialisation, higher JKN exposure, and its doctor partnership model. It trades at a discount to peers with higher growth expectations. 

• Our analysis suggests container rate momentum remained +ive in March
• Despite higher fuel expense, core container margins likely rose Y/Y in Q124
• Our L/S pair trade? It’s worked, a little, but Evergreen shares have stayed firm

• USDJPY is breaking 154, almost 20-year high.  In general, weaker Yen is positive for investment in real estate as properties look cheaper from a foreign investor perspective
• Yen weakness is also positive to tourism in Japan, as weak currency will drive tourist arrival and boost tourism
• We like Japan Hotel REIT on the back of attractive valuation and weaker Yen.  We also like other Japan RE names like 8801 and 8802

• In 1Q24, Intuitive Surgical (ISRG US) reported 11% YoY revenue growth to $1.89B, driven by growth in da Vinci procedure volume and an increase in the installed base of systems.
• Worldwide da Vinci procedures grew 16%, matching the higher end of prior guidance range. The company placed 313 da Vinci surgical systems, including eight newly approved da Vinci 5.
• Even after considering blip in bariatric surgery, delayed tender in China, and no benefit of patient backlog, the company has raised 2024 worldwide da Vinci procedure growth guidance to 14–17%.

• ASML reported Q124 revenues of €5.3 billion, in line with expectations, down 27% QoQ and down 21% YoY.
• Guided Q224 for €5.95 billion, down ~23% YoY. This implies H224 will have to be much stronger than H124 in order to maintain full year 2024 guidance of flat YoY
• New order intake was €3.6 billion, down significantly from the €9.2 billion in the prior quarter, and challenging the narrative of a strong growth year in 2025

• Since my previous insight on China Tourism Group Duty Free (1880 HK) in October 2023, the stock has declined 33%, and year-to-date, the stock has declined 13%.
• The company faces headwinds from continued overall weakness in Hainan duty free sales and potentially increased competition in Hainan.
• The company already announced preliminary 1Q24 results, with sales down 9% yoy and net profit flat.  The company is trading at 18x 2024 earnings.

• Vinfast (VFS US) released 1Q2023 results, with its revenues increasing three-fold YoY but falling QoQ due to the seasonal impact of Lunar New Year on both EVs and EV motorbikes.
• The company saw a significant pick up in its sales to the US and continued to increase its dealer network which should drive future sales along with new models.
• More than half of Vinfast sales were to related parties, which is an overhang in terms of the sustainability of its business models, whilst valuations remain above peers.

• PT Avia Avian (AVIA IJ) saw a pronounced pick up in sales in 4Q2023 and the ongoing benefit of lower raw material prices boosted margins to 5-year highs. 
• The company expanded its distribution in 2023 and will continue in 2024, which coupled with new product launches, especially of economic products, should help to drive higher growth in 2024. 
• PT Avia Avian continues to drive its express service, which also helps to push new product growth. Its market leadership and track record justify valuations with further support from dividends.

• Braze Inc. had a productive Q4 for the fiscal year 2024, reporting robust revenue growth and notable leaps in operational efficiency.
• The company generated $131 million in revenue, up 33% year-over-year and 6% quarter over-quarter.
• It is important to mention that these figures were achieved despite macroeconomic headwinds and tight scrutiny of budgets, reflecting the high ROI and enduring value of Braze’s customer engagement platform.

• In the Q3 2024 earnings, NIKE, Inc. outlined how it is driving growth despite not performing to its potential.
• The company is focusing on four key areas: a sharpened focus on sport, continuous product innovation, bolder and more distinctive brand marketing, and collaboration with wholesale partners to expand the marketplace.
• A significant measure of progress is the alignment of the organization to focus on the consumer and sport.

• Arrow Electronics had a decent performance in 2023 despite the challenging macroeconomic conditions and inventory-related issues.
• Arrow Electronics managed to post a full-year revenue of $33.1 billion and a non-GAAP operating margin of 4.8%.
• The company also reported strong cash flow from operations, enabling the repurchase of approximately $750 million in shares over the year.

• Teradata Corporation, a leading hybrid multi-cloud analytics and data platform company, recently held its fourth quarter and full year 2023 earnings call, which indicates the company’s progress and future outlook in its sector.
• The company emphasizes its focus on customer satisfaction by delivering solutions for complex data and analytics problems.
• Baptista Research looks to evaluate the different factors that could influence the company’s price in the near future and attempts to carry out an independent valuation of the company using a Discounted Cash Flow (DCF) methodology.

• The Financial System Report published on April 18th focuses on the key Japanese bank issues, including the prospect of domestic rate hikes
• We focus primarily on the key take-aways from the BoJ report, in particular with relation to potential rate hikes; our key picks appear to be better geared than the average
• We highlight Resona, Mizuho and Concordia in the bigger caps, with positive views on Suruga, Gunma and Tokyo Kiraboshi in the regional banks

• Low-Cost producer of copper and zinc with two of the biggest  ten mines in the world.
• Recent mine acquisition and increased production at existing mines will grow earnings.
• The supply and demand imbalance in copper will lead to higher prices.

• Perfect Medical Health (1830 HK), post a correction of consumer discretionary stocks in HK, now trades at a yield of 11.5%, with cash&investments representing 24% of the market cap.
• HK is experiencing a dip in consumer sentiment, and the company isn’t immune to it, but flat sales/profitability, a 24% net margin, and >40% ROE provide great margin of safety.
• The stock trades at 9.3x FY24 PE and 11.5% yield (assuming a 110% payout average across company history) with a growth option once the HK economy kickstarts.

• TSMC reiterates 2024 sales y/y growth of 20-25% but revises down 2024 global semiconductor y/y sales from over 10% to 10% and global foundry sales growth from 20% to 15-19%.
• No more Moore’s Law: After 3 years ramp up gap between N5-N3, TSMC confirms 10-11 quarters of ramp up gap between N3 and N2 due to longer production cycle.
• Driven by stronger digital consumer (33% q/q), HPC (3% q/q), IoT (5% q/q) sales but weaker smartphone IC (-16% q/q), TSMC reports 1Q24 sales decline of only 5% q/q.

• Declaring a slower recovery for mature nodes was an outlier, indicating that Vanguard’s recovery progress might be slower. 
• Apple’s iPhone is expected to be the focus for N2 production in 4Q15F.  
• TSMC’s long-term gross margin is set at 53%, signifying a few key points. 

• Interview with Scott Miller, CIO at Greenhaven discussing Par technologies and recent developments
• Par technologies is a stable point of sale software company focused on food services industry
• Company has shown strong progress in organic growth and acquisitions, with potential for further upside in the stock market

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only.

• IMMR is using the gains from Q124 to make an investment in BNED. IMMR intends to invest $45 million to purchase new shares at $0.05 per share.
• IMMR’s stock continues to trade at a slight premium to cash even though the operating business has continued to expand in auto
• IMMR disclosed it ended the first quarter of 2024 with approximately $200 million in shareholder equity. This would equate to a sequential increase of approximately $17 million

• Wix reported strong Q4 2023 earnings underpinned by its pivot to AI innovation.
• 2023 was a year of significant progress for the firm as it demonstrated robust growth, reaching record profitability levels.
• With the focus on AI, Wix introduced an array of AI-powered features that would help users create web content more efficiently, resulting in improved monetization and heightened user conversion rates.

• AppFolio, Inc. has shown a steady growth pattern in its fourth quarter of 2023, which according to the results, has been due to a sharp expansion in innovation alongside profitable growth.
• In the final quarter, the revenue of the company increased by 39% year over year reaching $172 million.
• This steady surge has contributed to an annual increase of 31%, pushing the total to $620 million.

• KBR, Inc. achieved solid results in the Q4 and FY 2023, meeting or exceeding expectations on all key metrics.
• Revenue grew by 11%, and adjusted EBITDA by 12% year-on-year, with margins increasing to 10.7%.
• Cash management was a highlight, with the company settling both the convert and warrants in cash, reducing share count while avoiding dilution, and management described it as ‘delivering on its commitment to maximise shareholder return.’ The company ended the year with a good order backlog, providing visibility of future earnings potential.

• Telix Pharmaceuticals (TLX AU) reported 18% QoQ revenue growth in 1Q24. The U.S. revenue growth accelerated to 18% QoQ in 1Q24, compared to 11% in 4Q23 and 13% in 3Q23.
• Telix reaffirmed guidance and expects 2024 revenue of $445–465M, representing 35–40% YoY increase. The current quarterly U.S. revenue run-rate of Illuccix matches the lower end of the guidance.
• Telix is on track to launch three products in U.S. this year. Two of them have an estimated initial market opportunity of $600–640M, with upside potential from indication expansions.

• SentinelOne closed the year with stellar performance, surpassing its fourth-quarter expectations across all metrics, including revenue, gross margin, and operating margin.
• Moreover, the company reported its annual recurring revenue (ARR) grew by 39% year-over-year to $724 million, primarily due to new customer acquisitions and strong expansion rates.
• The growing interest in AI-powered security solutions, driven by the rising incidence of cyberattacks, is resulting in robust demand for SentinelOne’s offerings.

• In this insight, we explore Mitsubishi Estate, who is the second largest real estate company in terms of market cap
• Mitsubishi Estate major business is in office (Tokyo CBD), residential/condo, as well as some retail and hotel
• Japan stock market is upbeat and saw the largest inflow among Asia YTD.  8802 valuation is not demanding.

• We expect Miniso’s revenue for C1Q/2Q24 to be 1.0%/2.7% higher than consensus due to adequate inventory and strong sales of the Chiikawa series. 
• We believe Miniso has found a new competency in quickly turning around IP sales through economies of scale in supply chain and store network.
• We maintain the stock as BUY and raise our TP by US$3 to US$34/ADS.

• Nexon is a leader in the video game virtual worlds industry with an enterprise value of $11.4 billion
• The company has consistently high EBIT margins and a robust portfolio of popular franchises that have generated billions in revenue
• Despite being undervalued by the market compared to its peers, Nexon is poised for significant growth and offers potential for future success for investors

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.

• Canara Bank has seen stunning profit expansion over the past several years
• Lower NPLs can drive lower credit costs to support profit expansion further
• ROE moved from 11.7% to 17.3% over the past several years

• Regeneron Pharmaceuticals Inc.’s latest earnings highlighted several critical developments and financial performance data that shape its investment appeal.
• Among the company’s accomplishments in 2023 were the FDA approval and successful launch of its EYLEA HD, a promising treatment for patients with wet age-related macular degeneration and diabetic eye diseases, which had strong start despite initial delays.
• Additionally, the company won a notable legal battle to preserve its intellectual property related to EYLEA, which deterred infringements from a biosimilar manufacturer, potentially deterring future biosimilar launches.

• Pegasystems Inc. has noted robust cash flow growth and value delivered to its clients in Q4 of 2023.
• The company has adopted a new go-to-market strategy that has been received well by the team, leading to strong customer relationships.
• The company has focused on AI utilization to introduce industry-changing technologies, which has resulted in increased growth and cash flow.

• Las Vegas Sands Corp.
• reported that Macao delivered $654 million of EBITDA for the quarter, a significant enhancement since the coronavirus pandemic’s end.
• According to them, robust growth in both gaming and non-gaming revenues is anticipated, propelled by their substantial share in non rolling table win, rolling table win, and slot ETG win.

• Lumen Technologies’ Fourth Quarter 2023 Earnings revealed significant progress in the company’s business transformation.
• Led by the efforts of the new executive team under CEO Kathleen Johnson, Lumen indicated that it had met its 2023 EBITDA and free cash flow guidance and had made material progress in its strategic priorities.
• To strengthen its balance sheet, Lumen entered into an agreement with a majority of its creditors that extends most debt maturities to 2029.

• SolarEdge deemed its Q4 2023 and full-year results as clouded by adverse market dynamics and high inventory levels.
• For Q4, SolarEdge reported revenues of about $316 million, split between $282 million in their solar business and $33 million in non-solar activities.
• The company shipped 2.2 million power optimizers and 74,000 inverters during the quarter, along with 133-megawatt hours of batteries.

• Sherwin-Williams Company, a global leader in the paint and coatings industry, reported a promising review of their fourth quarter 2023 results and outlook for the first quarter and full year of 2024.
• The company has experienced positive growth, with sales growing 4.1% to $23.1 billion and adjusted earnings per share growing 18.6% to $10.35 a share.
• Sherwin-Williams demonstrated robust financial performance during the fourth quarter that has resulted in a record year for the company.

• Apple supply chain names are falling due concerns about weak iPhone shipments. Global PC shipments returned to growth as per IDC data.
• TSMC and ASML results this week and will be cruical for the market. Can TSMC rally again to achieve new highs or will it continue trading lower?
• Nanya Technology sees DRAM Industry pricing rising through 2024E; but is underperforming financially.

• Company recently demerged from Ghcl Ltd (GHCL IN) and guiding for 30% revenue growth and double margins from here onwards with cotton prices being stable.
• A Debt Free Textile company available at 0.56x Price to Book with growth plan in progress and adding Value added products in its portfolio.
• Due to Forced selling from DII, FII company remained undervalued, now with changing margin profile, the Company will be available at a cheap valuation compared to peers.

• Nidec’s share price rose by 7% on the largest volume day of the year and on a day where the Nikkei declined by 2%.
• The move followed an announcement that Nidec will enhance its CDUs production line in Thailand by 10x by June 2024. CDUs are used to cool AI servers in data centres
• The market impact of 250 billion yen implies a sales impact of 69 billion yen, which is far too high for 24,000 units per year

• Given events in the Middle East and associated risks for oil prices, we publish a quick guide to the 2024 earnings sensitivity to fuel price increases for the European airlines.
• Rising fuel prices pose starkest risk to Lufthansa earnings, and it has just profit warned due to strike costs, which leave it needing a record 2H to meet guidance.
• Ryanair is comfortably most insulated given margin and balance sheet strength.

• A few weeks ago, Alibaba announced it would not seek IPO for CaiNiao
• The change of plans could force BABA/CaiNiao to re-focus on profitability
• BABA will reportedly buy rest of CaiNiao at US$10.2 bn valuation — cheap!

• CATL announced its 1Q24 net profit of CNY9.2B (+19% YoY), which straight out blew past market expectations 
• The fear of ever-declining battery prices is overstated, as CATL has clearly shown it can take lower margins and boost ROEs via higher inventory turnover and high utilisation rates  
• Our fair value of CNY253 (+27% UPSIDE) is derived by 23x 2024 PE ratio, which is 1SD below its historical mean. CATL is currently trading at exceptionally low valuations 

• Shakey’s Pizza (PIZZA PM) had a disappointing end to FY23 despite the 32% YoY systemwide sales and 23% YoY profit growth. 4Q FY23 sales/profits were +15% YoY/-21% YoY.
• Network expansion was a solid 369 outlets (base of 1772 outlets), primarily led by Potato Corner (359 outlets). Expansion in FY24 was guided at over 400+ outlets (1+ bn Pesos). 
• Stock trades at 15.6x FY23 earnings and 13x FY24e with mid-teens growth on the top/bottom line guided by the company for FY24

• Novatek Microelectronics Corp (3034 TT)‘s sales in 1Q24 showed a 6.2% YoY growth, implying a positive growth outlook for 2024F compared to 2023.
• Looking ahead to 2Q24F forecasts, the anticipated orders from United Microelectronics Corp (2303 TT) could have a positive impact on Novatek’s 1Q24 sales.
• A significant growth is expected after 2Q24, particularly following Novatek’s qualification for the Apple (AAPL US) iPhone 16.

• Our flash checks across a couple of dealers indicate pressure on margins across the industry. Voltas Ltd (VOLT IN) is trying hard to gain market share.
• Other names discussed include PNB Housing Finance Ltd (PNBHOUSI IN), Vedant Fashions (MANYAVAR IN) and Bandhan Bank Ltd (BANDHAN IN). 
• Varun Beverages (VBL IN) and Schaeffler India (SCHFL IN) show up as interesting ARs to read. 

• Leading furniture retailer Nitori recently announced it would work with French platform developer Mirakl to build an online marketplace. The site will be available late 2024 or early 2025. 
• Nitori wants the mall to contribute 20% of revenues by 2032 within a sales target of ¥3 trillion, when overseas store numbers are expected to be double those in Japan.
• But, founder Akio Nitori says he wants to see overseas sales much higher than official targets and may well get there through close targeting of the rising Asian middle class.