In today’s briefing:
- S&P/ASX Index Rebalance Preview: Potential Changes from Now to June
- Introduction: Initiation of Coverage in the Materials Sector
- OceanaGold Philippines IPO – Small yet Asking for a Lot
- Alpha Metallurgical Resources Inc.: Initiation Of Coverage – What Are The Geopolitical Factors Influencing Coal Markets? – Major Drivers
- West Fraser Timber: Initiation Of Coverage – Stability in Remodel and Repair Activity!
- ICL Group Ltd: Continuing Operational Challenges Due to Geopolitical War! – Major Drivers
- Eagle Materials: Initiation Of Coverage – A Robust Wallboard Volume Performance and Future Prospects! – Major Drivers
- Kinross Gold Corporation: Initiation Of Coverage – What Is Its Core Business Strategy? – Major Drivers
- NewMarket Corporation: Initiation Of Coverage – The Impact Of The Acquisition of AMPAC and Its Integration! – Major Drivers
- Axalta Coating Systems Ltd.: Initiation Of Coverage – Increased focus on efficiency and productivity paying off? – Major Drivers
S&P/ASX Index Rebalance Preview: Potential Changes from Now to June
- With three-quarters of the review period complete, there could be a bunch of changes across the S&P/ASX family of indices in June.
- The Red 5 Ltd (RED AU) / Silver Lake Resources (SLR AU) merger could lead to an ad hoc change prior to the implementation of the June rebalance.
- There will be 1.6-25 days of ADV to buy from passives in the inclusions while the impact on the deletions will range between 0.8-11 days of ADV.
Introduction: Initiation of Coverage in the Materials Sector
- Investics Research will initiate coverage of the materials sector in April 2024, starting with iron ore and then gold, coal, and steel in subsequent months (in that order).
- The areas of coverage on asset classes will encompass the underlying commodity and the associated equities.
- Areas of differentiation would include in-depth coverage of all equities (small/mid and large cap) and actionable tactical ideas on the commodity.
OceanaGold Philippines IPO – Small yet Asking for a Lot
- OceanaGold Philippines (OGCP000D PM) is looking to raise up to US$140m in its Philippines IPO.
- OceanaGold Philippines (OGPI) is a producer of gold and copper in the Philippines, and a subsidiary of OceanaGold Corporation, a Toronto Stock Exchange (TSX) listed gold mining and exploration company.
- In this note, we talk about the company’s historical performance and share our quick thoughts on valuation.
Alpha Metallurgical Resources Inc.: Initiation Of Coverage – What Are The Geopolitical Factors Influencing Coal Markets? – Major Drivers
- Alpha Metallurgical Resources, a supplier of metallurgical products for the steel industry, closed its fourth quarter with adjusted EBITDA of $266 million and achieved over $1 billion in adjusted EBITDA for the year.
- This is the second consecutive year in which the company attained such a milestone despite facing considerable challenges during the year.
- Alpha highlighted the robustness of its management approach which included proactive identification of issues and proactive response plans that ensured minimal impact on performance.
West Fraser Timber: Initiation Of Coverage – Stability in Remodel and Repair Activity!
- West Fraser produces lumber for the construction industry and also manufactures wood-based products such as engineered wood, panel products, and pulp and paper products.
- In the fourth quarter of 2023, the company posted mixed results across its business segments.
- Its North American engineered wood business segment displayed strength while soft demand affected its North American lumber products.
ICL Group Ltd: Continuing Operational Challenges Due to Geopolitical War! – Major Drivers
- Israel Chemicals Ltd.
- (ICL) had faced various operational challenges during the fourth quarter mostly due to the war in Israel.
- Despite these obstacles, they successfully maintained good production levels.
Eagle Materials: Initiation Of Coverage – A Robust Wallboard Volume Performance and Future Prospects! – Major Drivers
- This is our first report on Eagle Materials, a U.S.-based producer and distributor of building materials.
- The company reported record revenues in its third quarter for the fiscal year 2024, marking its robust financial performance and continuing to maintain and widen its low-cost producer strategy.
- With revenues reaching $559 million, up 9%, and adjustable earnings per share (EPS) rising 16% to $3.72, Eagle Materials marked another successful quarter.
Kinross Gold Corporation: Initiation Of Coverage – What Is Its Core Business Strategy? – Major Drivers
- Kinross Gold reported a robust fiscal year 2023, where the company met its targets and is well-positioned for the year ahead.
- Kinross Gold’s operations are performing well, as are its projects, which are aligning with budget and timing.
- The company is generating substantial free cash flow and is successfully de-levering its balance sheet.
NewMarket Corporation: Initiation Of Coverage – The Impact Of The Acquisition of AMPAC and Its Integration! – Major Drivers
- NewMarket Corporation, a petroleum additives company, recently reported their full-year and fourth-quarter results for 2023.
- The company’s net income for the fourth quarter of 2023 was $80 million, a decrease from the previous year’s fourth quarter net income of $91 million.
- This decrease in operating profit was primarily due to higher operating costs and lower shipments partially offset by lower raw material costs.
Axalta Coating Systems Ltd.: Initiation Of Coverage – Increased focus on efficiency and productivity paying off? – Major Drivers
- Axalta Coating Systems Ltd.
- reported Q4 net sales increasing by 5% year-over-year, amounting to $1.3 billion with contributions from both of its key business segments – Mobility Coatings and Performance Coatings.
- This increase is further evidence of the impressive quarterly performance that Axalta has had, which includes a seventh consecutive quarter of mobility volumes growth, indicating the recovery of the automotive industry and successful reshaping of the company’s portfolio.
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