Daily BriefsEquity Bottom-Up

Daily Brief Equity Bottom-Up: 3SBio Inc (1530 HK): Hair Product Acts as the Savior; Marginal Growth of Flagship Drug and more

In today’s briefing:

  • 3SBio Inc (1530 HK): Hair Product Acts as the Savior; Marginal Growth of Flagship Drug
  • Job Hunting App Operator’s Earnings Fall Despite End to National Security Probe
  • Liquidity Risk Short Candidates: Luminar Tech, Asana, Appian, Oak Street Health
  • Snowflake FY3Q23 Earnings: Stabilizing Growth in FY2024
  • Zoom Video Communications: Product Updates & Other Developments
  • Dell Technologies: Major Drivers
  • Foot Locker Inc: Extended Partnership With Puma & Other Drivers
  • Agilent Technologies: Key Drivers
  • Macy’s Inc: Digital Marketplace & Other Drivers
  • Applied Materials: Key Drivers

3SBio Inc (1530 HK): Hair Product Acts as the Savior; Marginal Growth of Flagship Drug

By Tina Banerjee

  • Mandi, OTC alopecia drug of 3SBio Inc (1530 HK), reported revenue growth of 42% y/y in 1H22 and gained 70bps market share over the last six months.
  • With the resurgence of COVID-19 in China interrupting the regular operations of outpatient services at medical institutions, 3SBio’s performance is expected to be affected in near-term.
  • 3SBio is preparing to launch its new drug nalfuraphine hydrochloride orally disintegrating tablets for liver and kidney disease pruritus in China.

Job Hunting App Operator’s Earnings Fall Despite End to National Security Probe

By Caixin Global

  • The operator of Chinese recruitment app Boss Zhipin reported drops in third-quarter revenue and profit after restarting new user registrations following a nearly one-year suspension as part of a national security probe. 
  • During the three months through September, Nasdaq-listed Kanzhun Ltd.logged a net profit of 211.7 million yuan ($29.8 million), representing a year-on-year drop of 26%
  • The firm generated about 99% of its revenue, or 1.16 billion yuan, from sales of recruitment services to corporate clients — a 2.7% year-on-year decrease.

Liquidity Risk Short Candidates: Luminar Tech, Asana, Appian, Oak Street Health

By Eric Fernandez, CFA

  • Liquidity shorts can be great short candidates.  The key characteristic is that the company may not be viable, economically, given their cash flows and cash requirements. 
  • Liquidity shorts have built-in catalysts, have moderate to higher betas,  and can have strong down moves if a crisis develops.  They can go bankrupt, pushing the stock price near zero.
  • Today we are flagging Luminar Tech, Asana, Appian, Oak Street Health

Snowflake FY3Q23 Earnings: Stabilizing Growth in FY2024

By Aaron Gabin

  • Snowflake guided below consensus for 4Q2023 revenue growth on a mix of macro conservatism and a quirky point that more vacation travel will reduce the amount of workloads run.
  • Margins continue to beat to the upside and management is guiding FY2024 FCF marginst to 23%, just 2pts below the LT guidance.
  • Very conservative management team also guided for a stabilization in revenue growth for FY2024 at 47%, a bit below consensus, but better than feared given the earnings reports recently.

Zoom Video Communications: Product Updates & Other Developments

By Baptista Research

  • Zoom Video Communications delivered a decent quarter and managed an all-around beat.
  • From a product perspective, the company had robust growth in Zoom Phone, along with contributions from Zoom Rooms and other products.
  • Zoom Video Communications has recently announced a wide range of updates in different business units like Zoom IQ for sales, Zoom Events, Zoom Spaces, Zoom Contact Centre, and Zoom One.

Dell Technologies: Major Drivers

By Baptista Research

  • After announcing a weak outlook in the last quarter and causing its stock price to plummet, Dell has shown a decent recovery.
  • Its stock price has continued to recover after the company delivered an all-around beat in a challenging demand environment.
  • Overall, we remain neutral on Dell and give it a ‘Hold’ rating with a revised target price.

Foot Locker Inc: Extended Partnership With Puma & Other Drivers

By Baptista Research

  • Despite operating in a turbulent market, including inflationary pressure on the consumer around the world, Foot Locker generated better-than-expected results and managed to surpass Wall Street expectations on all fronts.
  • Due to strong brand consistency across the board and successful back-to-school marketing initiatives, Kids Foot Locker had mid-single-digit growth.
  • Additionally, Foot Locker extended its partnership with Puma to connect with next-generation consumers through exclusive basketball and other high-end partnerships.

Agilent Technologies: Key Drivers

By Baptista Research

  • Agilent performed well in the fourth quarter and its revenues as well as earnings were vastly exceeding its forecasts as well as market expectations.
  • Revenue for the Agilent CrossLab Group in the fourth quarter was $381 million.
  • With each of their three business areas expanding by double digits for the year, Agilent have shown a broad-based strength.

Macy’s Inc: Digital Marketplace & Other Drivers

By Baptista Research

  • Macy’s delivered a strong set of results surpassing Wall Street expectations in terms of revenues as well as earnings.
  • Besides, they created permanent Toys “R” Us shop-in-shops within every Macy’s site, offering a unique experience not offered nationally anywhere else.
  • Macy’s also has a flexible pricing plan to change discounts and markdowns if demand materializes slowly.

Applied Materials: Key Drivers

By Baptista Research

  • Applied Materials delivered a strong quarterly performance and managed to surpass Wall Street expectations in terms of revenues as well as earnings.
  • Demand remains very high in cutting-edge foundry/logic, with customers vying for leadership and driving significant technological inflections that decide their respective competitive positions.
  • AMAT should have a strong resilience because of their substantial backlog, expanding service business, and strong customer demand for their leading technologies that support significant technological inflection points.

💡 Before it’s here, it’s on Smartkarma

Sign Up for Free

The Smartkarma Preview Pass is your entry to the Independent Investment Research Network

  • ✓ Unlimited Research Summaries
  • ✓ Personalised Alerts
  • ✓ Custom Watchlists
  • ✓ Company Data and News
  • ✓ Events & Webinars