Daily Briefs

• Yesterday was a crazy day in FX and commodities as seen in chart 1.a. Within the span of 6 hours we had markets trading WaPo the rumour, then reacting to the pushback on the rumour from Trump and then markets calling Trump’s push back a bluff.
• We conclude a couple of things from this.
• Firstly, what we have been saying the last month ever since Trump’s first comments on Canadian tariffs, namely that this is a negotiation tactic to get what he really wants.

• Nippon Steel’s $14.9 billion acquisition bid for U.S. Steel, announced in December 2023, faced regulatory resistance and was blocked by the Biden administration over national security concerns.
• U.S. Steel’s Big River Steel 2 expansion will double capacity to 6.3 million tons by 2026, contributing over 50% of EBITDA and supporting enhanced free cash flow generation.
• Despite the failed merger, U.S. Steel’s intrinsic value, supported by a $39.75 fair value estimate, easing capex, and reshoring tailwinds, offers a ~19% upside from the $33.30 closing price.

• Lumen Technologies’ third-quarter 2024 performance outlines its strategic efforts and current challenges as it navigates a transformative phase to reposition the company within the digital networking and AI infrastructure sectors.
• The company reported a revenue decline, reflecting ongoing headwinds from legacy business sectors, even as it strives to pivot its offerings toward newer, more competitive markets.
• 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.

• Large unlocks (over 1% of circulating supply) significantly impact prices, mainly concentrated in the week before and after the unlock. A 1% token unlock triggers, on average, a 0.3% price drop over the week preceding the unlock and another 0.3% drop over the week following the unlock.
• The strongest price effects occur two days before the unlock and on the third and fourth days after the unlock. Interestingly, the actual unlock day and the day after show little price impact.
• The similar magnitude of price drops before and after the unlock suggests that market anticipation is just as influential as the actual selling pressure.

• The $ZRO token was introduced in June 2024, with planned utilities that include protocol governance, transaction fee payment, and staking for DVN security. All three utilities have strong implications for $ZRO’s value.
• We foresee that the next three years will be marked by a rapid increase in $ZRO’s circulating supply, alongside growing utilization within the protocol and its adoption as a common currency for cross-chain trades.
• We propose a valuation framework for $ZRO that leverages the Market Cap to Transaction Volume (MC-Tx) ratio, combined with projected transaction volume scenarios. This framework aims to provide readers with a perspective on the relationship between protocol growth and token value.

• Record 4Q24 production was 26.1 mbbl/d, which is in line with our expectations.
• Net cash at YE24 was US$259 mm, exceeding our forecasts by US$34 mm.
• This reflects a 0.56 mmbbl reduction in oil inventory during 4Q24 (1.2 mmbbl at the end of September versus 0.64 mmbbl at the end of December).

• Curbline is a convenience retail REIT spun-off from Site Centers in 2024, owning 78 shopping centers in attractive markets
• The company is well-capitalized with $800 million in cash and no debt, allowing for over $1.2 billion in acquisition capacity
• Convenience retail has lower capital intensity and higher NOI growth compared to traditional shopping centers, making CURB’s fundamentals attractive for investors and expected to continue growing as it scales out of its G&A load

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.

• We are reiterating our Buy rating, raising our price target to $6 (from $3) and reiterating our projections as we look forward to 2025 for Vince.
• We believe, after returning to profitability in FY24, and with “quiet luxury” remaining a key movement, Vince is poised to drive further strong results and upside in FY25, driven by a continued focus on lowering inventory exposure and driving higher pricing, the resumption of store growth (both domestically and internationally), new licensed category expansion, deeper penetration in the men’s segment, further gross margin gains, and profits from their 25% stake in the ABG Vince strategic partnership.
• We believe Vince remains one of the best positioned apparel retailers and, as such, we are comfortable raising our target price for VNCE to $6, or 15X our FY26 EPS projection.

• Rivian Automotive, Inc.’s third-quarter 2024 earnings call highlights a mixed performance narrative, reflecting progress and challenges.
• It is essential to understand these elements for a balanced investment thesis.
• Exploring the positives, Rivian made notable advancements with the introduction of Gen 2 R1 and plans for the R2 program, demonstrating a commitment to cost efficiency and product enhancement.

• Take-Two Interactive Software has demonstrated a robust performance in its second-quarter fiscal year 2025 results.
• The company reported net bookings of $1.47 billion, aligning with the higher end of its guidance range.
• This performance was notably driven by the continued success of key franchises such as Grand Theft Auto and Borderlands.