In today’s briefing:
- TOPIX Index Upweights: Final Expectations For “The Big April Basket” 2025
- Shenzhen Intl (152 HK): Good News from Positive Profit Alert
- Fluor Corporation: Why Energy Transition & Infrastructure Spending Are Supercharging Growth!
- Franklin Electric: Will Its Focus on Energy Systems Pay Off?
- Hirano Tecseed Co., Ltd. (6245 JP): Research Update
- Buybacks Surge as Earnings Season Nears End
- Valmont Industries: 6 Major Game-Changers Impacting Its 2025 Performance & Beyond!
- Flowserve Corporation: Mogas Acquisition & Integration to Strengthen Competitive Position & Boost Long-Term Growth Objectives!
TOPIX Index Upweights: Final Expectations For “The Big April Basket” 2025
- In the TOPIX Index, some “low liquidity” names carry a liquidity factor of 0.75x resulting in their actual index weights being smaller than their default weights.
- These names are reviewed every April and if the liquidity factor of a stock gets removed, the stock will see index inflows from passive trackers of TOPIX.
- In this insight, we take a look at Quiddity’s final predictions for the names that are likely to see their Liquidity Factors removed in April 2025 and their flow implications.
Shenzhen Intl (152 HK): Good News from Positive Profit Alert
- Shenzhen International (152 HK)‘s FY24 net profit will range at HK$2.8-3.1bn (53-63% growth YoY), boosted by a HK$2.3bn gain from South China Logistics Park Transformation.
- Extrapolating this gain to the whole land plot will generate a profit of HK$11.4bn, or 66% of the current market capitalisation. The stock is significantly undervalued at 0.49x P/B.
- At an assumed 50% payout ratio, SZI’s yield is at 9%. Moreover, with stable profit expected for FY25 and FY26, the yield will be maintained for the next two years.
Fluor Corporation: Why Energy Transition & Infrastructure Spending Are Supercharging Growth!
- Fluor Corporation’s recent earnings announcement reflects a mix of positive financial results and ongoing strategic restructuring.
- The company reported a revenue of $16.3 billion for the year, marking a 5.4% increase from 2023, alongside a net income of $2.1 billion, largely influenced by the deconsolidation of its investment in NuScale Power and subsequent administrative accounting adjustments.
- This shows Fluor’s capacity to stabilize its financial footing while adapting to dynamic market conditions.
Franklin Electric: Will Its Focus on Energy Systems Pay Off?
- Franklin Electric delivered a mixed performance for the fourth quarter and full year of 2024 against a backdrop of challenging macroeconomic conditions.
- The company reported a modest year-over-year increase of 3% in consolidated sales for the fourth quarter, driven primarily by growth in the Distribution and newly renamed Energy Systems segments, while sales in the Water Systems segment were flat.
- Despite achieving higher volumes across segments, the company faced diverse challenges that impacted its overall performance.
Hirano Tecseed Co., Ltd. (6245 JP): Research Update
- HT has maintained its FY24 guidance of OP of ¥2,900mil (-10.4% YoY) on sales of ¥44,000mil (-6.3% YoY).
- Management commits to pay out the higher of a DOE of 3.5% or a dividend pay-out ratio of 60% during the current medium-term plan (FY24~FY27).
- HT has not changed the view on the medium to long-term growth potential in the EV market, however, for the time being, it remains cautious.
Buybacks Surge as Earnings Season Nears End
- Institutions were net sellers of Singapore stocks, with a net outflow of S$265 million from Feb 21-27, 2025.
- DBS Group Holdings led share buybacks with 350,000 shares at S$46.73 each; total buybacks amounted to S$31,062,634.
- Wilmar International’s FY24 core net profit declined 26% to US$1.16 billion, with sales volume growth in most divisions.
Valmont Industries: 6 Major Game-Changers Impacting Its 2025 Performance & Beyond!
- Valmont Industries, Inc. reported its fourth quarter and full-year 2024 financial results, citing a strong performance that aligned with expectations despite facing headwinds.
- The company noted significant achievements in operational and commercial areas, which aided in delivering solid outcomes.
- Key highlights included a focus on infrastructure and agricultural growth, as well as enhancements in operational flexibility and customer-driven innovation.
Flowserve Corporation: Mogas Acquisition & Integration to Strengthen Competitive Position & Boost Long-Term Growth Objectives!
- Flowserve Corporation presented its fourth-quarter and year-end 2024 financial update, highlighting significant improvements and achievements throughout the year.
- The company reported robust growth with bookings reaching nearly $1.2 billion for the quarter, showing strong growth momentum in both original equipment and aftermarket segments.
- Their backlog closed near a record $2.8 billion, supported by strong cash flow generation of $197 million for the quarter, attributed to effective working capital management.
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