Daily Brief Equity Bottom-Up: NVIDIA @ CES 2025. Forget The AIPC and more

• Project Digits is a supercomputer on everybody’s desk for $3000. Seems crazy but feels like 1977 Ken Olson moment “no reason anyone would want a computer in their home”
• Lack of data center revenue growth predictions likely spooked investors and triggered a ~10% pullback. Just buy the dip, you know you want to…
• Micron and MediaTek both jumped on news of their further involvement in NVIDIA’s AI acceleration hardware supply chain. 

• Mainland investors continue their record southbound purchases during 2024 and into 2025. 
• GDS Holdings (9698 HK) , GDS Holdings (ADR) (GDS US) had a break out from its triangle formation in its continuation pattern.  The company may list its China REIT assets.
• Tencent (700 HK) had a symmetrical pattern breakdown after the announcement that the US pentagon had placed the company on its blacklist.  The company began a large share buyback.

• Veren has reported its third quarter results for 2024, shedding light on both its operational successes and the challenges it faces.
• The company generated excess cash flow of $114 million, with $85 million returned to shareholders.
• A strategic infrastructure transaction was completed for $400 million, and total net debt is expected to be reduced by $1.3 billion by the end of 2024.

• On the All Thoughts podcast, Tracy Alloway and Joe discuss Tracy’s new solar panel and energy challenges during a snowstorm.
• Duke Energy’s Senior VP of Pricing and Customer Solutions discusses the complexities of energy pricing, renewable energy, and the future of the grid.

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• HCA Healthcare recently held its third-quarter earnings call, and the insights provided offer a complex view of the company’s current position and future outlook.
• The financial results reflected strong performance despite notable challenges, particularly from recent hurricanes.
• Positively, HCA Healthcare reported substantial year-over-year growth in several key financial metrics.

• Hisamitsu Pharmaceutical Co (4530 JP) reported single-digit revenue growth and net profit growth in low-teens during 9MFY25, on the back of 13% YoY growth in Salonpas focused OTC segment.
• Rx business revenue grew 4% YoY as new products such as Zicthoru, Apohide, Combipatch, Vivelle-Dot etc clocked healthy numbers.
• Hisamitsu raised its FY25 guidance for revenue by 1% to ¥154B, operating profit by 24% to ¥18B, and net profit by 24% to ¥20.5B.

• Gordon Tang increases buyout offer for Suntec REIT in response to investor dissatisfaction with original bid.
• Texas teachers ramp up real estate investments, committing 61% more funds totaling $1.6 billion by 2024.
• The Cheng family of Hong Kong faces challenges as an Australian casino operator experiences a cash shortage, impacting their holdings.

• Perfect Corp. provides an AI and machine learning based B2B SaaS platform for virtual try on and marketing of beauty and fashion products as well as six mobile apps sold B2C for makeup suggestions, try-on, tutorials, photo and video editing and most recently, Gen AI creation and editing.
• It is expanding its offering to new verticals and has strong IP as well as the largest database for AI training in the industry.
• It has a dominant market share and serves almost all the major beauty brands worldwide.

Baillie Gifford US Growth Trust (USA) invests in exceptional US businesses with the potential to grow substantially faster than the market and deliver above-market returns. Such businesses tend to operate at the cutting edge of technology-led change and USA has exposure to companies focused on AI, space travel and online services. This note reiterates USA’s unique investment proposition and scrutinises a recent proposal from Saba, a US hedge fund manager, aimed at ousting USA’s board and replacing its investment managers. Saba currently owns less than 28% of USA shares in issue. The trust’s board has urged shareholders to reject Saba’s hostile takeover at the general meeting scheduled for 3 February 2025 and we agree with this recommendation, for reasons discussed below.

• Intel’s Panther Lake chip set to drive growth in AI PC market and spark resurgence in semiconductor foundry industry by second half of 2025.
• Rapidus to provide 2nm chip samples to Broadcom, highlighting advancements in semiconductor technology and potential for increased performance.
• Taiwanese companies eye opportunities in expanding renewable energy market in the Philippines, showcasing interest in sustainable business practices. CES 2025 sees Nvidia unveiling robot collaborations while concerns emerge over South Korea’s absence. Honda and Sony face uncertainty as Afeela 1 debuts, while Tata Elxsi and Qualcomm team up to develop virtual models of Snapdragon Digital Chassis solutions. UK-Taiwan tech partnerships strengthen as British Representative to Taiwan concludes term, reflecting deepening alliance between the two countries.