In today’s briefing:
- Alpha Generation Through Share Buybacks in Korea: Bi-Monthly (Jan and Feb 2024)
- Hidden Value in Plain Sight: Teikoku’s (3302) Potential Unlock
- Grab Holdings (GRAB US) – 2024 Set Up
- Pacific Basin (2343 HK): An Upturn in the Making
- Monthly Chinese Express Tracker | Industry ASP Fell to Record Low Last Month | (February 2024)
- Verisk Analytics: Is Its Growth Outlook Too Optimistic? What Are The Biggest Challenges? – Major Drivers
- European Airlines – FCF the Key Differentiator Between AF-KLM and IAG
Alpha Generation Through Share Buybacks in Korea: Bi-Monthly (Jan and Feb 2024)
- In this insight, we discuss the alpha generation through companies that announced share buybacks in Korea in January and February 2024.
- We provide a list of 22 stocks in the Korean stock market that have announced share buyback programs in the past two months.
- Major companies that have announced share buybacks in Korea in the past two months include Shinhan Financial, Hyundai Mobis, and Samick Musical Instruments. All three have outperformed the market.
Hidden Value in Plain Sight: Teikoku’s (3302) Potential Unlock
- Teikoku, a stable disaster equipment leader, is undervalued due to excessive cash and cross-holdings.
- Regulatory pressure, industry trends, and potential Hulic asset sales create an opportunity to unlock hidden value.
- Despite fair current pricing, potential share repurchases and improved capital allocation offer up to 40% upside.
Grab Holdings (GRAB US) – 2024 Set Up
- Grab Holdings (GRAB US) recently posted another set of positive results, with another quarter of positive adjusted EBITDA. We conducted a follow-up call to explore the outlook for 2024.
- The company announced both a US$500m Buyback and the potential for improving margins in its deliveries business plus several new initiatives to drive growth in 2024 and beyond.
- Grab Financial continue to grow its loan book through lending to drivers and merchants, which should help to improve margins plus its high-margin advertising income is becoming increasingly important.
Pacific Basin (2343 HK): An Upturn in the Making
- Pacific Basin Shipping (2343 HK) has a weaker-than-expected 2H23, but we are glad that its unit cost has come down. Also, FY24F and FY25F should be years of recovery.
- Current spot rates as indicated by BDI are significantly higher than 1H23 and YTD average, suggesting an upside for realised rates in the rest of this year.
- Supply pressure will be alleviated by the issues at Panama and Suez Canals, while China may be a factor in YoY demand improvement. Net gearing of 2% is light.
Monthly Chinese Express Tracker | Industry ASP Fell to Record Low Last Month | (February 2024)
- Industry ASP declined -15.5% Y/Y in January to just 8.36 CNY, a record low
- Despite strong volume (+85% Y/Y) some firms have likely turned unprofitable
- International parcel growth strong; SF still avoiding worst of domestic price wars
Verisk Analytics: Is Its Growth Outlook Too Optimistic? What Are The Biggest Challenges? – Major Drivers
- Verisk experienced a successful 2023 with strategic, organizational, and cultural changes, outstanding financial performance, and substantial value creation for clients and shareholders.
- The company delivered 8.7% organic constant currency revenue growth in 2023, the highest rate since its initial public offering in 2009.
- They exceeded the expectations set during the Investor Day in March.
European Airlines – FCF the Key Differentiator Between AF-KLM and IAG
- Following AF-KLM and IAG results we refresh our forecasts, and our detailed quarterly bridge analysis in 2024 suggests each can grow earnings this year.
- IAG clearly differentiates itself from AF-KLM with strong FCF generation while AF-KLM is unlikely to generate positive FCF before 2025 as it pays obligations deferred through COVID.
- Lufthansa continues to appear highest risk in 2024 given as capacity restoration catches up with peers.
💡 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
