Category

Daily Briefs

Nov 21
0

Daily Brief Industrials: CM Hi-Tech Cleanroom, Enviro Infra Engineers, CiDi Inc, Rockwell Automation, Amaero International Ltd and more

By | Daily Briefs, Industrials

In today’s briefing:

  • CM Hi-Tech (2115 HK): 12th December Shareholder Vote
  • Enviro Infra Engineers Limited IPO Analysis
  • CiDi IPO Valuation Analysis: High Valuation Is Warranted Due To Unicorn Status/Hyper Growth Profile
  • Rockwell Automation Inc.: These Are The 7 Biggest Factors Impacting Its Performance In 2025 &Beyond! – Major Drivers
  • ADDMAN Group highlights importance of 3DA partnership

CM Hi-Tech (2115 HK): 12th December Shareholder Vote

By David Blennerhassett

  • Back on the 14th October, cleanroom play CM Hi-Tech (2115 HK) announced a pre-conditional Offer by way of a Scheme from MayAir Technology (688376 CH) and CM Hi-Tech’s senior management.
  • The pre-conditional long stop for NDRC, Mofcom and SAFE was 60 days, which appeared highly optimistic. I was wrong, and the pre-cons were secured in a legendary 18 days.
  • The Scheme Doc is now out, with a Court Meeting to be held on the 12 December. Expected payment on the 15 January. The IFA says fair & reasonable.

Enviro Infra Engineers Limited IPO Analysis

By Nimish Maheshwari

  • The company is in the business of designing, construction, operation and maintenance of water and wastewater treatment plants and supply schemes with all related services.
  • It has an order book worth Rs. 1906+ cr. as of June 30, 2024 and 750Cr+ of operation & maintenance order book in their hand.
  • Company has in-house capability to build and design water plants which enhance the margins of the company vs its peers. 

CiDi IPO Valuation Analysis: High Valuation Is Warranted Due To Unicorn Status/Hyper Growth Profile

By Andrei Zakharov

  • Changsha Intelligent Driving Institute, more commonly known as CiDi, filed for an IPO in Hong Kong. The company was valued at ~RMB9B in its last private funding round.
  • CiDi was backed by HongShan Capital, Xinding Capital, Founder Hesheng Investment, Legend Holdings, Baidu Venture, and Lens Technology, among others.  
  • The terms of the IPO were not disclosed. CiDi is a category winner that is addressing a large TAM (~$10B by 2030) with room for hyper growth for years.

Rockwell Automation Inc.: These Are The 7 Biggest Factors Impacting Its Performance In 2025 &Beyond! – Major Drivers

By Baptista Research

  • Rockwell Automation’s fourth-quarter fiscal 2024 earnings call highlighted a mixed performance with several critical developments worth noting for investors.
  • The company faced headwinds with a continued softness in orders, down sequentially by low single digits, contrary to expectations for improvement.
  • However, Rockwell demonstrated some resilience by maintaining solid execution, especially in customer service and the profitable growth of its software and digital services, which helped offset channel inventory challenges.

ADDMAN Group highlights importance of 3DA partnership

By Research as a Service (RaaS)

  • RaaS Research has published a flash comment on advanced materials manufacturing group Amaero International (ASX:3DA) following comments from ADDMAN Group President and CEO Joe Calmese at an Additive and Advanced Manufacturing Symposium held earlier this week.
  • Mr. Calmese publicly called out the importance of ADDMAN Group’s partnership with Amaero in strengthening US supply chains for advanced alloys.
  • Mr. Calmese highlighted that their collaboration addressed critical gaps in the supply chain by reshoring scalable production of C103 and other specialty alloy powders and that this was important for ensuring the availability of critical materials for national security applications including hypersonic and defence application.

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Nov 21
0

Daily Brief Consumer: Seven & I Holdings, Exedy Corp, Kadokawa Dwango, Alibaba Group Holding , FineToday Holdings Co Ltd, Zomato, KT&G Corporation, Tesla , Honda Motor Co Ltd (Adr) and more

By | Consumer, Daily Briefs

In today’s briefing:

  • Seven & I Holdings (3382 JP): Evaluating the Potential MBO
  • [JAPAN ACTIVISM] Exedy (7278) – Immediate Results Reaction Was a Damp Squib, But Climbing Now
  • Even in Japan, Significant Growth Potential for Seven Eleven and Other CVS
  • Kadokawa (9468 JP): Take Profits as a Sony Privatisation Rumours Surface
  • [Alibaba (BABA US, BUY, TP US$120) Earnings Review]: Progress Made, Better Times Ahead
  • FineToday Pre-IPO – The Positives – Established Brands Across Multiple Regions
  • NIFTY200 Momentum30 Index Rebalance Preview: More Changes with New F&O Stocks
  • ₩200B Gov-Run Value-Up Fund Starts Buying Tomorrow, with Another ₩300B Set for Year-End
  • Tesla’s Big Bet: Why Trump’s Autonomous Push Could Supercharge Their Future!
  • Honda Faces Profit Crunch: Rising Costs vs. Ambitious EV Plans! – Major Drivers

Seven & I Holdings (3382 JP): Evaluating the Potential MBO

By Arun George

  • Seven & I Holdings (3382 JP) did not dispute the NHK article’s claims that the founding family aims to raise buyout funds by the end of the fiscal year.
  • Since 13 November, there have been conflicting press reports on the MBO offer price. The NHK article’s implied offer price of JPY3,082 seems the most credible. 
  • The MBO’s aggressive completion timeline pressures Alimentation Couche-Tard (ATD CN) to respond by either overbidding, working with the founding family at the back-end or walking away.

[JAPAN ACTIVISM] Exedy (7278) – Immediate Results Reaction Was a Damp Squib, But Climbing Now

By Travis Lundy

  • I wrote last when Exedy was at ¥3,900 and had just announced, good earnings, a sharp div hike, and a huge buyback. The stock reacted well, but not THAT well.
  • Murakami-San had indeed lifted his stake, and the stock is now climbing again. Presumably, the company is in the market buying. At this price, it depends on what Murakami-san does.
  • Fat div. Lots of volume to buy in the next several months, but the big story is future measures.

Even in Japan, Significant Growth Potential for Seven Eleven and Other CVS

By Michael Causton

  • Seven Eleven’s future usually gets outlined as: Japan ex-growth and only growth is overseas. This is wrong. While the CVS sector is saturated, Seven Eleven itself has not reached saturation.
  • There are major areas of growth, both territorially and new offshoot businesses.  Seven is already 32% more efficient than Lawson but more to come.
  • Here we take a deep dive into the state of CVS retailing in Japan and how Seven Eleven does, and will, fit into this – and how it will grow.

Kadokawa (9468 JP): Take Profits as a Sony Privatisation Rumours Surface

By Arun George

  • Kadokawa Dwango (9468 JP) shares rose 16% after Reuters reported that Sony Corp (6758 JP) is in talks to acquire it. Kadokawa confirmed an initial letter of intent. 
  • The privatisation interest is unsurprising as Kadokawa’s publishing arm, acclaimed intellectual properties, and positioning in the anime industry would be attractive to Sony.
  • The upside is limited as the last close reflects a significant takeover premium. There is a risk if a binding proposal emerges, it could be takeunder like Bain/T-Gaia.

[Alibaba (BABA US, BUY, TP US$120) Earnings Review]: Progress Made, Better Times Ahead

By Ying Pan

  • BABA reported CY3Q24 top line, adjusted EBITA and non-GAAP net profit (1.0%), (1.6%) and in-line vs. consensus. 
  • CMR improved amid monetization changes that narrowed the growth gap with GMV, but also eliminated some low-single profit sellers from its GMV. 
  • Cloud and overseas e-commerce revenue also saw good growth and improved profitability. All of BABA’s key businesses are sputtering to life while macro tailwinds are also favorable. 

FineToday Pre-IPO – The Positives – Established Brands Across Multiple Regions

By Sumeet Singh

  • CVC Capital is aiming to raise over US$500m, via selling some of its stake in FineToday Holdings Co Ltd (289A JP) in Japan.
  • FineToday (FT) is a beauty and personal care company in Asia offering a range of products, including hair care, skin care and body care products.
  • In this note, we talk about the positive aspects of the deal.

NIFTY200 Momentum30 Index Rebalance Preview: More Changes with New F&O Stocks

By Brian Freitas

  • There could be 17 changes for the Nifty200 Momentum 30 Index that will be implemented at the close on 30 December. Some changes from earlier following 45 new F&O stocks.
  • If all changes are on expected lines, one-way turnover is estimated at 61.5% and that will result in a one-way trade of INR 63.4bn (US$752m).
  • The potential inclusions to the index have outperformed the potential deletions since the start of June. This trend could continue for a couple of weeks till the changes are announced.

₩200B Gov-Run Value-Up Fund Starts Buying Tomorrow, with Another ₩300B Set for Year-End

By Sanghyun Park

  • The larger-than-expected Value-Up fund will drive passive flows surpassing the KRX 300 in both size and speed.
  • Value-Up ETFs’ AUM is ₩636.5B, with retail dominating. Major institutions, like pensions, are on standby, but passive flows could hit ₩1.5T post-Dec 20 rebalancing.
  • Single-Stock setups may not fit, but for alpha-seeking Value-Up strategies, focus on names with higher passive impact from the boosted AUM.

Tesla’s Big Bet: Why Trump’s Autonomous Push Could Supercharge Their Future!

By Baptista Research

  • During Tesla’s third quarter of 2024 financial report, several key points emerged that provide an overview of the company’s performance and strategic direction.
  • One of the prominent highlights was Tesla’s achievement of record deliveries in a market experiencing overall industry declines.
  • This emphasizes Tesla’s ability to navigate a challenging automotive landscape, an important consideration for investors assessing the company’s resilience and market positioning.

Honda Faces Profit Crunch: Rising Costs vs. Ambitious EV Plans! – Major Drivers

By Baptista Research

  • Honda Motor Co., Ltd.’s financial results for the first quarter of the fiscal year 2025 offer a complex picture of both achievements and challenges.
  • The company reported its highest-ever quarterly operating profit of JPY 484.7 billion, marking a significant year-on-year increase by JPY 90.2 billion.
  • This improvement was largely driven by increased unit sales in the motorcycle business in India and Brazil, as well as robust sales of hybrid automobile models in Japan and the United States.

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Nov 20
0

Daily Brief Quantitative Analysis: KRX Short Interest Weekly (Nov 15th): Korzinc and more

By | Daily Briefs, Quantitative Analysis

In today’s briefing:

  • KRX Short Interest Weekly (Nov 15th): Korzinc, Posco, Alteogen, Doosan Enerbility

KRX Short Interest Weekly (Nov 15th): Korzinc, Posco, Alteogen, Doosan Enerbility

By Ke Yan, CFA, FRM

  • We analyzed the changes in short interest of KRX stocks as of Nov 15th which has an aggregated short interest worth USD4.1bn.
  • We tabulate league table for top short by value and short as multiple of ADT, as well as weekly increases & decreases in short value, short as multiple of ADT.
  • We highlight short interest changes in Korzinc, Posco, Alteogen, Doosan Enerbility .

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Nov 20
0

Daily Brief ESG: Market Shakeout Should Come with Business Portfolio Restructuring Especially for Small-Cap Companies and more

By | Daily Briefs, ESG

In today’s briefing:

  • Market Shakeout Should Come with Business Portfolio Restructuring Especially for Small-Cap Companies

Market Shakeout Should Come with Business Portfolio Restructuring Especially for Small-Cap Companies

By Aki Matsumoto

  • While good for small-cap stocks to disclose stock price improvement plans, which is the minimum to be eligible for TOPIX, few global investors can invest in company of this size.
  • Since many Japanese small-cap companies have diversified businesses and compete with numerous companies for a market that is not large, forcing low profit margins, a market shakeout is necessary.
  • The key is whether small cap companes that are beyond the reach of overseas investor engagement can execute a business portfolio review on its own initiative.

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Nov 20
0

Daily Brief South Korea: Samsung Electronics, CJ Cheiljedang and more

By | Daily Briefs, South Korea

In today’s briefing:

  • A Step Closer to Samsung Life Insurance Finally Selling Its Shares in Samsung Electronics?
  • CJ Cheiljedang: Considering a Potential Sale of Its Bio Business

A Step Closer to Samsung Life Insurance Finally Selling Its Shares in Samsung Electronics?

By Douglas Kim

  • Amid Samsung Electronics announcing a huge buyback of 10 trillion won, one of the issues that has resurfaced is the potential sale of Samsung Electronics by Samsung Life Insurance.
  • The total amount of Samsung Electronics that could be sold by Samsung Life Insurance and Samsung F&M Insurance is 25.6 trillion won (at current prices). 
  • We remain Positive on Samsung Electronics. The 10 trillion won buyback program is a positive sign on the company’s willingness to provide higher shareholder returns.

CJ Cheiljedang: Considering a Potential Sale of Its Bio Business

By Douglas Kim

  • CJ Cheiljedang announced that it is considering on potentially selling its bio business for about 5-6 trillion won which could be more than its market cap. 
  • CJ Cheiljedang’s bio business is expected to have more than 4 trillion won in sales and about 700 billion won in EBITDA in 2024.
  • We are positive on the company’s efforts to sell its Bio Business and reinvest it in its food business.

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Nov 20
0

Daily Brief Equity Bottom-Up: Asics (7936) | Upgraded Targets on Fashion Pivot and more

By | Daily Briefs, Equity Bottom-Up

In today’s briefing:

  • Asics (7936) | Upgraded Targets on Fashion Pivot
  • Trip.com (9961.HK, TCOM): 3Q24, Still Healthy, But Stock Price Exceeded Our Last Target
  • A Step Closer to Samsung Life Insurance Finally Selling Its Shares in Samsung Electronics?
  • The Beat Ideas: EFC(I) Limited – The Indian Wework!
  • Crypto Crisp: MicroStrategy Continues Its Buying Spree
  • How Spotify Turned Critical Mass Into Massive Profits—Breaking Down the Numbers! – Major Drivers
  • NVIDIA’s AI Revolution Stalls? What Blackwell’s Overheating Issues Reveal!
  • Disney’s Secret Weapons: How Streaming
  • CJ Cheiljedang: Considering a Potential Sale of Its Bio Business
  • Warren Buffett’s Domino’s Pizza Deal: The Possible Strategy Behind The Recent $550 Million Investment! – Major Drivers

Asics (7936) | Upgraded Targets on Fashion Pivot

By Mark Chadwick

  • ASICS has demonstrated exceptional brand rejuvenation and profitability improvements, with an ambitious 2026 plan that capitalizes on high-growth lifestyle categories
  • However, the pivot toward fashion and luxury markets introduces heightened execution risk.
  • While the upgraded MTP targets are commendable, much of the good news appears to be priced in.

Trip.com (9961.HK, TCOM): 3Q24, Still Healthy, But Stock Price Exceeded Our Last Target

By Ming Lu

  • The stock has risen by 38% since our last buy rate.
  • The 3Q24 results are still healthy – both growth rate and operating margin.
  • We set a downside of 19% for the end of 2025.

A Step Closer to Samsung Life Insurance Finally Selling Its Shares in Samsung Electronics?

By Douglas Kim

  • Amid Samsung Electronics announcing a huge buyback of 10 trillion won, one of the issues that has resurfaced is the potential sale of Samsung Electronics by Samsung Life Insurance.
  • The total amount of Samsung Electronics that could be sold by Samsung Life Insurance and Samsung F&M Insurance is 25.6 trillion won (at current prices). 
  • We remain Positive on Samsung Electronics. The 10 trillion won buyback program is a positive sign on the company’s willingness to provide higher shareholder returns.

The Beat Ideas: EFC(I) Limited – The Indian Wework!

By Sudarshan Bhandari

  • EFCI Ltd (EFCIL IN) is one of few companies in the Flex Space Operator Business present in the entire value chain providing an unbeatable edge in Cost competitiveness.
  • Management target is to double revenue in FY25 capitalising on sector tailwinds driving exponential growth in all business verticals.
  • Completed Backward Integration through manufacturing furniture which will help increase margins as furniture comprise  40-50% of total fitout cost.

Crypto Crisp: MicroStrategy Continues Its Buying Spree

By Mads Eberhardt

  • It has been a relatively quiet week.
  • Bitcoin has outperformed much of the market, resulting in an increase in its dominance, as highlighted in Thursday’s Crypto Moves #52.
  • This was most likely driven by the intense buying pressure from MicroStrategy over the past week.

How Spotify Turned Critical Mass Into Massive Profits—Breaking Down the Numbers! – Major Drivers

By Baptista Research

  • Spotify Technology S.A. delivered a mixed set of results for the third quarter of 2024, showcasing both achievements and continued challenges as the company navigates through its business strategy.
  • On one hand, it marked a milestone by delivering strong growth metrics in both subscribers (net addition of 6 million to reach a total of 252 million) and monthly active users (MAU, rising by 14 million to 640 million).
  • These metrics exceeded Spotify’s guidance and reflect its dual focus on product innovation and marketing efficiency.

NVIDIA’s AI Revolution Stalls? What Blackwell’s Overheating Issues Reveal!

By Baptista Research

  • NVIDIA, the undisputed leader in AI-driven GPUs, is currently navigating turbulent waters with its latest Blackwell architecture chips.
  • While the company has been riding high on record-breaking revenues and a surging demand for AI compute power, reports of overheating issues in Blackwell chips have cast a shadow over its otherwise stellar growth trajectory.
  • According to recent disclosures, these state-of-the-art GPUs face severe thermal management challenges when configured in server racks holding up to 72 units.

Disney’s Secret Weapons: How Streaming

By Baptista Research

  • The Walt Disney Company’s recent fourth-quarter and full-year 2024 financial results provided a comprehensive overview of both the progress and challenges faced by the company.
  • CEO Bob Iger highlighted the company’s strategic positioning for growth, emphasizing their momentum as a result of specific strategies across various business segments.
  • However, the commentary also reveals nuances in their operational dynamics and future outlook.

CJ Cheiljedang: Considering a Potential Sale of Its Bio Business

By Douglas Kim

  • CJ Cheiljedang announced that it is considering on potentially selling its bio business for about 5-6 trillion won which could be more than its market cap. 
  • CJ Cheiljedang’s bio business is expected to have more than 4 trillion won in sales and about 700 billion won in EBITDA in 2024.
  • We are positive on the company’s efforts to sell its Bio Business and reinvest it in its food business.

Warren Buffett’s Domino’s Pizza Deal: The Possible Strategy Behind The Recent $550 Million Investment! – Major Drivers

By Baptista Research

  • The recent earnings call for Domino’s Pizza highlighted several key aspects of its financial performance, strategic initiatives, and market dynamics, revealing both promising areas and challenges.
  • The company’s Hungry for MORE strategy appears to be yielding positive results domestically, but international markets face significant hurdles.
  • Domestically, Domino’s Pizza has successfully leveraged its value-focused Hungry for MORE strategy.

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Nov 20
0

Daily Brief Credit: Lucror Analytics – Morning Views Asia and more

By | Credit, Daily Briefs

In today’s briefing:

  • Lucror Analytics – Morning Views Asia

Lucror Analytics – Morning Views Asia

By Tanvi Arora

  • In today’s Morning Views publication we comment on developments of the following high yield issuers: Adani Green Energy, Yankuang Energy
  • In the US, treasuries edged higher yesterday, with yields declining 2-4 bps across the curve on possible dip buying and despite a large slate of corporate bond issuances.
  • The yield on the 2Y UST fell 3 bps to 4.28%, while the 10Y declined 3 bps to 4.41%. Equities rebounded from last week’s losses, with the S&P 500 and Nasdaq up 0.4% and 0.6%, respectively.

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Nov 20
0

Daily Brief Thematic (Sector/Industry): Ohayo Japan | Nvidia’s 5% Surge and more

By | Daily Briefs, Thematic (Sector/Industry)

In today’s briefing:

  • Ohayo Japan | Nvidia’s 5% Surge
  • Nifty Below 200-DMA: A Sign of Bear Market or a Buying Opportunity?
  • [Blue Lotus Daily-TMT Update]:NTES US/JD US/BABA US/PDD US/VIPS US/3690 HK/AMZN US
  • Japan Morning Connection: Sony Eyeing Elden Ring as a PS Exclusive to Counter CoD on Xbox?
  • China Housing: “Stabilize It”
  • [Blue Lotus Daily]:300750 CH/1211 HK/JKS US/601012 CH/688599 CH/002459CH/1810HK/LI/NIO/XPEV/BEKE/ZTO

Ohayo Japan | Nvidia’s 5% Surge

By Mark Chadwick

  • US stocks rallied on Tuesday, with the Nasdaq climbing 1%, bolstered by Nvidia’s nearly 5% surge ahead of earnings
  • ASICS has significantly upgraded its medium-term management plan, raising the operating income target from ¥80 billion to ¥130 billion by December 2026
  • Elliott Management, a US activist hedge fund, has acquired over 5% of Tokyo Gas shares, signaling potential discussions about the company’s asset portfolio

Nifty Below 200-DMA: A Sign of Bear Market or a Buying Opportunity?

By Nimish Maheshwari

  • The NIFTY Index (NIFTY INDEX) has witnessed a significant decline, falling below its 200-DMA, a key technical indicator, for the first time since April 2023.
  • Historical analysis reveals that Nifty has traded below this level approximately 30% of the time since 1996, suggesting that this occurrence is not as unusual as it might initially seem.
  • While short-term market volatility is anticipated, historical data demonstrates that the Nifty has generally recovered strongly over longer timeframes following similar dips below its 200-DMA.

[Blue Lotus Daily-TMT Update]:NTES US/JD US/BABA US/PDD US/VIPS US/3690 HK/AMZN US

By Ying Pan

  • NTES US: <Eggy Party> Launches on Nintendo Switch today (+)
  • JD US/BABA US/PDD US/VIPS US/3690 HK: NBS publishes social retail consumption data for October 2024 (+/+/////-)
  • JD US:JD.com Launches “On-Demand Delivery Flagship Stores” for Its On-Demand Retail Business (+)

Japan Morning Connection: Sony Eyeing Elden Ring as a PS Exclusive to Counter CoD on Xbox?

By Andrew Jackson

  • SMCI +32% as it staves off delisting continues to set a positive tone for Nidec
  • Sony reportedly looking to fully acquire Kadokawa points to more downside for Bandai Namco
  • Highlights relative cheapness for Japanese game stocks as take-over targets

China Housing: “Stabilize It”

By Robert Ciemniak

  • There are more ‘less negative’ signs in the latest data for October/November sales, especially in the weekly data
  • The policy measures for property, perceived broadly as rather underwhelming, suggest the goal of ‘stabilizing it’ remains clear, with caution about the excessive support for the sector 
  • In this note, we summarize where things stand with China housing – looking at home sales, prices, inventory, land, major cities, and the policy over the past few months

[Blue Lotus Daily]:300750 CH/1211 HK/JKS US/601012 CH/688599 CH/002459CH/1810HK/LI/NIO/XPEV/BEKE/ZTO

By Eric Wen

  • 300750 CH/1211 HK/ JKS US/601012 CH/688599 CH/002459 CH:China cancels and reduces export tax rebate for certain China’s advantageous products, forcing production capacity to be rationalize and export prices to rise.(///////////)
  • 1810 HK/LI US/NIO US/XPEV US: It is said that Geely Group is preparing to merge its hybrid and pure electric brands under Zeekr（///////）
  • BEKE US:Mid-November Home Transaction Growth Remains Strong in First-Tier Cities, While Growth in Second- and Third-Tier Cities Slows Down (+)

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Nov 20
0

Daily Brief United States: Microstrategy Inc Cl A, Tesla , NVIDIA Corp, The Walt Disney Co, Domino’s Pizza, Compass Minerals International, Inc, AST SpaceMobile Inc, Intuitive Machines , Symbotic and more

By | Daily Briefs, United States

In today’s briefing:

  • Crypto Crisp: MicroStrategy Continues Its Buying Spree
  • Buy the Pullback Again; S&P 500, Nasdaq 100, Russell 2000 Testing Confluence of Support
  • NVIDIA’s AI Revolution Stalls? What Blackwell’s Overheating Issues Reveal!
  • Disney’s Secret Weapons: How Streaming
  • Warren Buffett’s Domino’s Pizza Deal: The Possible Strategy Behind The Recent $550 Million Investment! – Major Drivers
  • Inside the Buyout Buzz: Why Compass Minerals is Turning Heads on Wall Street!
  • Is AST SpaceMobile Losing Its Shine? Reddit’s Darling Faces Tough Questions After Losses! – Major Drivers
  • Intuitive Machines’ Lunar Empire Takes Shape: Record Revenues and NASA Milestones! – Major Drivers
  • Intuitive Machines’ Lunar Empire Takes Shape: Record Revenues and NASA Milestones! – Major Drivers
  • SYM: Celebrating an Accounting Nightmare

Crypto Crisp: MicroStrategy Continues Its Buying Spree

By Mads Eberhardt

  • It has been a relatively quiet week.
  • Bitcoin has outperformed much of the market, resulting in an increase in its dominance, as highlighted in Thursday’s Crypto Moves #52.
  • This was most likely driven by the intense buying pressure from MicroStrategy over the past week.

Buy the Pullback Again; S&P 500, Nasdaq 100, Russell 2000 Testing Confluence of Support

By Joe Jasper

  • Our outlook remains bullish following the S&P 500’s multi-month base breakout above 5670, alongside healthy market dynamics which have continued to improve.
  • Two weeks ago, our election day report (11/5/24) was titled “Buy the Pullback,” and with the SPX/QQQ/IWM pulling back to their 20-day MAs, it’s time to buy the pullback again.
  • We continue to expect significant upside into year-end and early 2025, and we expect support at the 20-day MAs on the aforementioned indexes (though support at 50-day MAs is possible).

NVIDIA’s AI Revolution Stalls? What Blackwell’s Overheating Issues Reveal!

By Baptista Research

  • NVIDIA, the undisputed leader in AI-driven GPUs, is currently navigating turbulent waters with its latest Blackwell architecture chips.
  • While the company has been riding high on record-breaking revenues and a surging demand for AI compute power, reports of overheating issues in Blackwell chips have cast a shadow over its otherwise stellar growth trajectory.
  • According to recent disclosures, these state-of-the-art GPUs face severe thermal management challenges when configured in server racks holding up to 72 units.

Disney’s Secret Weapons: How Streaming

By Baptista Research

  • The Walt Disney Company’s recent fourth-quarter and full-year 2024 financial results provided a comprehensive overview of both the progress and challenges faced by the company.
  • CEO Bob Iger highlighted the company’s strategic positioning for growth, emphasizing their momentum as a result of specific strategies across various business segments.
  • However, the commentary also reveals nuances in their operational dynamics and future outlook.

Warren Buffett’s Domino’s Pizza Deal: The Possible Strategy Behind The Recent $550 Million Investment! – Major Drivers

By Baptista Research

  • The recent earnings call for Domino’s Pizza highlighted several key aspects of its financial performance, strategic initiatives, and market dynamics, revealing both promising areas and challenges.
  • The company’s Hungry for MORE strategy appears to be yielding positive results domestically, but international markets face significant hurdles.
  • Domestically, Domino’s Pizza has successfully leveraged its value-focused Hungry for MORE strategy.

Inside the Buyout Buzz: Why Compass Minerals is Turning Heads on Wall Street!

By Baptista Research

  • Compass Minerals Inc. recently reported its second-quarter fiscal 2024 results.
  • The quarter demonstrated significant challenges, primarily attributable to unseasonably mild winter weather conditions across North America.
  • The Salt segment, a core part of the company’s operations, was notably affected by these conditions, leading to a substantial decrease in deicing salt sales volumes, ultimately reflecting a 14% decline in segment revenue and a 7% drop in adjusted EBITDA compared to the previous year.

Is AST SpaceMobile Losing Its Shine? Reddit’s Darling Faces Tough Questions After Losses! – Major Drivers

By Baptista Research

  • AST SpaceMobile recently reported a challenging Q3, with widened losses overshadowing its operational progress.
  • The company, which is transitioning from research and development (R&D) to commercial operations, highlighted key advancements such as the successful launch and activation of five Block 1 BlueBird satellites.
  • These satellites are integral to AST SpaceMobile’s mission of creating a space-based cellular broadband network that directly connects with mobile phones without modification, addressing global connectivity gaps.

Intuitive Machines’ Lunar Empire Takes Shape: Record Revenues and NASA Milestones! – Major Drivers

By Baptista Research

  • Intuitive Machines presented a positive third-quarter 2024 performance with considerable revenue growth and strategic achievements.
  • The company reported revenue of $58.5 million, marking more than a fourfold increase compared to the same quarter last year.
  • This increase was driven by their core service pillars of delivery, data transmission, and infrastructure as services, coupled with key contract awards such as the Near Space Network Services (NSNS), valued up to $4.82 billion over a decade.

Intuitive Machines’ Lunar Empire Takes Shape: Record Revenues and NASA Milestones! – Major Drivers

By Baptista Research

  • Intuitive Machines presented a positive third-quarter 2024 performance with considerable revenue growth and strategic achievements.
  • The company reported revenue of $58.5 million, marking more than a fourfold increase compared to the same quarter last year.
  • This increase was driven by their core service pillars of delivery, data transmission, and infrastructure as services, coupled with key contract awards such as the Near Space Network Services (NSNS), valued up to $4.82 billion over a decade.

SYM: Celebrating an Accounting Nightmare

By Hamed Khorsand

  • SYM reported fiscal fourth quarter results that at first glance were better than expected, but really included several accounting events that seem to hide how SYM had a poor quarter.
  • Along with the quarterly results, SYM disclosed a restatement of prior quarterly results where $39.1 million of high-margin revenue was transferred to the fourth quarter. 
  • When we initiated coverage of SYM we were worried about the timing of revenue associated with Walmart (WMT) and not anticipating an accounting mess.

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Nov 20
0

Daily Brief Event-Driven: 7&I (3382) Ito Family MBO – New Urgency for ACT and more

By | Daily Briefs, Event-Driven

In today’s briefing:

  • 7&I (3382) Ito Family MBO – New Urgency for ACT
  • HKBN (1310 HK): China Mobile Comes Knocking. Again.
  • S&P/ASX Index Rebalance Preview (Dec 2024): Dexus and Spark NZ with Double Deletions
  • Hang Seng Index (HSI) Rebalance Preview: Inclusion Candidates for December
  • Integrated Design & Engineering (9161 JP): Tokio Marine (8766 JP) Tender Offer at JPY6,500
  • Sayona (SYA AU)/Piedmont (PLL AU)’s Merger Of Equals
  • Quiddity Leaderboard HSCEI Dec 24: Time for a LONG-SHORT Trade
  • I D & E Holdings (9161 JP) Gets a TOB Offer from Tokio Marine at +63% (¥6,500) – Probably Done
  • Quiddity Leaderboard HSTECH Dec 24: Large Flow Expectations Although No Index Changes Expected
  • Nagarro SE: Potential Takeover Amidst Financial Growth

7&I (3382) Ito Family MBO – New Urgency for ACT

By Travis Lundy

  • Days ago we got a dramatic headline about Ito family scion ITO Junro and his family company Ito Kogyo making a bid for Seven & I Holdings (3382 JP). 
  • The stock popped, then fell. Details were not clear. Was the ¥9trln an EV number? A market cap? Was he serious? How would he get funding. Skepticism was rife. 
  • Today we get more headlines from NHK. who says the family wants to raise ¥8trln to take 7&i private by end-Feb 2025.

HKBN (1310 HK): China Mobile Comes Knocking. Again.

By David Blennerhassett

  • HKBN Ltd (1310 HK), a Hong Kong broadband play, is never short on privatisation rumours. China Mobile (941 HK) is reportedly (again) holding talks with HKBN’s major shareholders. 
  • China Mobile is a logical suitor. I highly doubt a non-PRC (government-affiliated) corporation would be permitted to take HKBN private.
  • Previous takeover rumours over the years came to nought. It may be different this time. HKBN was suspended this morning pursuant to the Takeovers Code.

S&P/ASX Index Rebalance Preview (Dec 2024): Dexus and Spark NZ with Double Deletions

By Brian Freitas

  • With the review period nearly complete, there could be one change for the S&P/ASX 50 Index and one change for the S&P/ASX 200 (AS51 INDEX) in December.
  • Both deletes are also deletions from a global index next week and there could be short-term buying/covering opportunities on a drop in the stock price.
  • There has been a buildup of cumulative excess volume in all stocks over the last few months. There has been no increase in positioning in CAR Group (CAR AU) recently.

Hang Seng Index (HSI) Rebalance Preview: Inclusion Candidates for December

By Brian Freitas

  • Post market close on Friday, Hang Seng Indexes will announce the changes for the Hang Seng Index (HSI INDEX) that will be implemented at the close on 6 December.
  • With no increase in the number of index constituents this calendar year, there could be inclusions in December. The process of getting to 100 index constituents could drag into 2026.
  • Short interest is especially large in Sinotruk, Giant Biogene, Kuaishou Technology, ASMPT and JD Logistics and inclusion could set off some short covering.

Integrated Design & Engineering (9161 JP): Tokio Marine (8766 JP) Tender Offer at JPY6,500

By Arun George

  • Integrated Design & Engineering Holdings (9161 JP) has recommended Tokio Marine Holdings (8766 JP)’s tender offer at JPY6,500 per share, a 63.3% premium to the last close.
  • The offer is attractive as it represents an all-time high, above NAV (including latent real estate gains) and above the midpoint of the IFA DCF valuation range. 
  • Despite the high required minority acceptance rate, an attractive offer facilitates deal completion. The tender runs from 20 November to 15 January 2025 (35 business days).

Sayona (SYA AU)/Piedmont (PLL AU)’s Merger Of Equals

By David Blennerhassett

  • North American hard-rock lithium plays Piedmont Lithium (PLL AU) and Sayona Mining (SYA AU) are to combine in all-stock merger with a ~50%/50% ownership split on a fully diluted basis.
  • Sayona will be the ultimate/surviving parent, via issuing 5.27 Sayona ordinary shares for each Piedmont share. Various equity raisings will also take place, before and after the merger.
  • EGMs for both Sayona and Piedmont shareholders are expected to be held in 1H25, with expected completion also in the 1H25. 

Quiddity Leaderboard HSCEI Dec 24: Time for a LONG-SHORT Trade

By Janaghan Jeyakumar, CFA

  • The HSCEI serves as a benchmark to reflect the overall performance of the top 50 “Mainland China” securities listed in Hong Kong.
  • The official index changes will be confirmed later this week on Friday 22nd November 2024.
  • In this insight, we take a look at our final index change expectations and updated flow estimates for the upcoming index rebal event.

I D & E Holdings (9161 JP) Gets a TOB Offer from Tokio Marine at +63% (¥6,500) – Probably Done

By Travis Lundy

Quiddity Leaderboard HSTECH Dec 24: Large Flow Expectations Although No Index Changes Expected

By Janaghan Jeyakumar, CFA

  • The HSTECH Index tracks the performance of the top 30 technology companies listed in Hong Kong that have high business exposure to certain technology themes.
  • The official index changes and indicative weights for the December 2024 index rebal event will be announced later this week on Friday 22nd November 2024.
  • In this insight, we take a look at our updated flow expectations.

Nagarro SE: Potential Takeover Amidst Financial Growth

By Jesus Rodriguez Aguilar

  • Nagarro SE (NA9 GR) is in discussions for a potential delisting and takeover, with private equity firm Warburg Pincus reportedly considering a buyout.
  • Strong Financial Growth: Q3 2024 revenue rose by 3.7% to €242.9M, with a 5.6% constant currency growth, adjusted EBITDA improving to €34.6M (14.3% of revenue).
  • Nagarro trades at a P/E ratio below peers, suggesting undervaluation despite financial resilience, strong liquid assets, and 14% stock price growth over the last eight trading days.

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