In today’s briefing:
- Why Shiseido (4911) Never Worked as a Turnaround Stock
- First AMD, Now Broadcom. How OpenAI Is Ruining NVIDIA’s Party
- SHORT ESR Kendall Square REIT: Korea Logistics Oversupply & K-REIT Funding
- Mandarin Oriental: Good Deal for Jardine, Not So Much for Mandarin Oriental Minorities
- Rio Tinto: Production in Q3/25 Robust, Metal Price Risks Remain
- Can H&M Group Balance Tariffs, Technology, & Trend Cycles to Stay on Top of Fast Fashion?
- Merit Medical Just Acquired CryoBalloon—Here’s What Wall Street Missed!
- S&P Acquires With Intelligence For $1.8 Billion—What It Means For Wall Street’s Data Wars!
- Estée Lauder Considers Offloading ‘Too Faced’—And Investors Are Watching!
- China Healthcare Weekly (Oct.19)-Bubble of HK Biotech Is Bursting, Ping An Good Doctor Is Overvalued
Why Shiseido (4911) Never Worked as a Turnaround Stock
- Shiseido’s share price dropped 70% over the past six years, compared to a 110% gain by Topix, but the stock just crossed its 200-day MAV. Time for another look?
- In our view, the stock lacks most of the required criteria for a successful turnaround, and reeks of all the important criteria for failure.
- Shiseido’s stock already prices in a 50% earnings recovery. To be compelling, the forecast needs to be 4 standard deviations above the mean, or the price needs to decline 30%.
First AMD, Now Broadcom. How OpenAI Is Ruining NVIDIA’s Party
- OpenAI just signed a deal with Broadcom to deploy ten gigawatts of OpenAI designed AI accelerators targeted to start in H2 2026, and to complete by end of 2029.
- OpenAI’s AMD & Broadcom deals undermine the credibility of the NVIDIA deal. Where exactly is all the money going to come from?
- In partnering with AMD and Broadcom, OpenAI has given huge credibility to AMD as a GPU competitor and Broadcom as a custom accelerator competitor. Two big headaches for NVIDIA. Ouch!
SHORT ESR Kendall Square REIT: Korea Logistics Oversupply & K-REIT Funding
- Despite having strong operational performances, we think ESR KS REIT is currently facing 2 headwinds, 1 structural issue and 1 cyclical issue
- Korea listed companies are generally suffering from under-valuation and excessive equity raise. The equity raises, which are done at discount to NAV, is value destructive
- In the physical market, we think the logistics market is facing oversupply issue, slow absorption and protected recovery.
Mandarin Oriental: Good Deal for Jardine, Not So Much for Mandarin Oriental Minorities
- Jardine Matheson Holdings (JM SP) has proposed to take Mandarin Oriental International (MAND SP) private
- While the deal has a high chance of success, given the 88% ownership of MAND by JM, it undervalues Mandarin Oriental significantly.
- Jardine is effectively paying for the fair value of One Causeway building and is getting global hotel operations for a bargain price.
Rio Tinto: Production in Q3/25 Robust, Metal Price Risks Remain
- The Q3/25 production update was taken well by the market, with iron ore output near flat yoy, copper jumping 10%, and moderate growth for aluminum, alumina and bauxite
- Some reorganization has started under new CEO Simon Trott, with IOC reported with the core iron ore segment, and two divisions, Borates and Iron and Titanium, placed under review
- We see risks from major iron ore market shifts and a potential cyclical downturn hitting copper and aluminum, and it could be fully valued on our below-consensus metal price estimates
Can H&M Group Balance Tariffs, Technology, & Trend Cycles to Stay on Top of Fast Fashion?
- The H&M Hennes & Mauritz AB Group’s earnings report for the third quarter of 2025 presents both promising advancements and ongoing challenges typical of the fashion retail industry in a dynamic global market.
- The company recorded a 2% sales growth in local currencies despite reducing its store count by 4% from the previous year.
- This growth was supported by improvements in their digital platform, indicating successful digital transformation efforts that are resonating well with customers worldwide.
Merit Medical Just Acquired CryoBalloon—Here’s What Wall Street Missed!
- Merit Medical Systems has made headlines with its definitive agreement to acquire the C2 CryoBalloon technology from Pentax for $22 million—$19 million in upfront cash and up to $3 million in milestone-based contingent payments.
- This move, expected to close in Q4 2025, marks a strategic push by Merit into the gastrointestinal (GI) endoscopy space, targeting patients with Barrett’s esophagus and other GI disorders.
- This asset purchase follows a broader industry trend of tuck-in acquisitions aimed at boosting specialty portfolios while maintaining capital discipline.
S&P Acquires With Intelligence For $1.8 Billion—What It Means For Wall Street’s Data Wars!
- S&P Global is making strategic waves again with its recent agreement to acquire alternative assets data provider With Intelligence for $1.8 billion.
- The transaction, announced in October 2025, marks another major step by S&P to extend its footprint beyond public markets and deepen its capabilities across private markets.
- Expected to close either later in 2025 or early 2026, the deal is subject to regulatory approvals and customary closing conditions.
Estée Lauder Considers Offloading ‘Too Faced’—And Investors Are Watching!
- Estée Lauder Companies is reportedly exploring a divestiture of its cosmetics brand Too Faced, according to a recent Axios Pro report.
- Acquired in 2016 for $1.45 billion, Too Faced was once seen as a critical pillar of Estée’s efforts to appeal to younger, trend-conscious consumers through multibrand retailers like Sephora and Ulta.
- However, performance in the color cosmetics category has lagged, especially following pandemic-related disruptions and intensifying competition from newer indie entrants.
China Healthcare Weekly (Oct.19)-Bubble of HK Biotech Is Bursting, Ping An Good Doctor Is Overvalued
- The “turning point” occurs as share price of innovative drug sector is pulling back. Many companies would see valuations halved – potentially more than once.The decline is far from over.
- The current main goal of biotech is to turn losses into profits ASAP. If it fails to make a profit, it may not be recognized by the market.
- Due to the concerns on Ping An Healthcare and Technology (1833 HK)’s business model, peak revenue scale could be just RMB8 billion. In other words, Ping An Healthcare is overvalued.
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