In today’s briefing:
- Advantest (6857) – Strong SoC Sales, Record Profits, Bullish Guidance, and a Buyback (+ Index Flow)
- Defining US Risk Inflection
- Softbank Group – BABA Pressure Has Didi Read Across but a 41% NAV Discount Provides Cushion
- End of Mandatory Lock-Up Periods for 49 Companies in Korea in August 2022
- Dailyhunt Tearsheet – News For “Bharat”
- KDDI (Buy) – Q1 22 Results Reaction: Mixed Quarter as Consumer Predictably Weak
- MongoDB Inc.: Initiation of Coverage – Business Model & The Database Industry Boom
- Dropbox Inc.: Initiation of Coverage – The DocSend Acquisition & Other Drivers
- Akamai Technologies Inc.: Initiation of Coverage – Business Strategy
- Akamai Technologies Inc.: Detailed Credit Analysis & Financial Strength Evaluation Report
Advantest (6857) – Strong SoC Sales, Record Profits, Bullish Guidance, and a Buyback (+ Index Flow)
- Advantest Corp (6857 JP) yesterday announced Q1 results, with Revenues/OP/NP at record levels, a H1 div hike of 30%, guidance well ahead of consensus, and a buyback.
- They also announced a Mid-Term Plan revision which shows forward guidance better than consensus.
- The buyback is smaller than the last one BUT float is not what you think it is. Understanding float dynamics here is key.
Defining US Risk Inflection
- Russell and NDX are knocking on resistance levels that have capped previous rally attempts as we enter the early August cycle timeline.
- Tech rally reacting to backward earnings. E’s will buckle into a recession. The July risk on rally cycle is closing.
- NDX 13k and RTY 1,930 are key inflection levels that will drive the global risk cycle ahead of a more turbulent late August to October period.
Softbank Group – BABA Pressure Has Didi Read Across but a 41% NAV Discount Provides Cushion
- Alibaba is under pressure again with a direct read-across to Softbank
- Worries on China regulation are bad news for another Softbank holding DIdi Global as it stands alongside Alibaba as a high-profile regulatory target
- Alibaba weakness could drive risk pricing (CDS) and the discount to NAV higher. A silver lining is that discount makes Softbank attractive for investors looking for indirect China exposure
End of Mandatory Lock-Up Periods for 49 Companies in Korea in August 2022
- We discuss end of the mandatory lock-up periods for 49 stocks in Korea in August 2022, among which 3 are in KOSPI and 46 are in KOSDAQ.
- These 49 stocks on average could be subject to further selling pressures in August and could underperform relative to the market.
- Among these 49 stocks, the top five market cap stocks include Wemade, HPSP, Sungeel Hitech, Wemade Max, and Eoflow. These companies could be exposed to greater selling pressures in August.
Dailyhunt Tearsheet – News For “Bharat”
- DailyHunt (1449267D IN) is one of India’s leading vernacular content curation and engagement platforms and also one of the most funded content startups.
- Channel interactions indicate a challenging competitive position that requires constant cash burn.
- In terms of financials, there is no sight of profitability in the near term. Unless that changes, it is best to remain cautious.
KDDI (Buy) – Q1 22 Results Reaction: Mixed Quarter as Consumer Predictably Weak
- Results for the quarter were mixed with a slight miss for profitability despite one-time gains for financial services taken in the quarter
- Revenue erosion from a reduction in the Rakuten roaming service area was relatively modest whilst there are signs of improvement in erosion from mobile price cuts
- KDDI will reimburse users ¥7bn (v Redex forecast of ¥10bn) for its network outage earlier this month; the operational impact won’t be clear until Q2 churn is reported
MongoDB Inc.: Initiation of Coverage – Business Model & The Database Industry Boom
- This is our first report on database major, MongoDB.
- The company delivered yet another all round beat in the previous result with a staggering 57% growth year over year.
- The revenue generated by Atlas alone increased by 82% year over year and accounted for 60% of MongoDB’s total revenue.
Dropbox Inc.: Initiation of Coverage – The DocSend Acquisition & Other Drivers
- This is our first report on Dropbox, a major player within the cloud storage, file transfer, and e-signature domain.
- Dropbox is continuing to evolve its core FSS business to drive monetization and improve attention.
- This quarter, Dropbox has launched its newest version of Dropbox backup that has upgraded management settings and restoration flow.
Akamai Technologies Inc.: Initiation of Coverage – Business Strategy
- This is our first report on Akamai Technologies, a renowned content delivery network and cloud service provider. the growth in security and computing has been the main driver of revenues for Akamai in the past years but it has been adversely impacted by the U.S. dollar’s sharp increase in value and the slowing of traffic growth in the company’s delivery business.
- The consistent double-digit growth in security revenue has been driven by Guardicore’s continued outstanding performance and rapid growth in their application security business.
Akamai Technologies Inc.: Detailed Credit Analysis & Financial Strength Evaluation Report
- Akamai Technologies is a well-known cybersecurity company, content delivery network, and cloud service provider.
- The growth in security and computing has been the main driver of revenues for Akamai in the past years but it has been adversely impacted by the U.S. dollar’s sharp increase in value and the slowing of traffic growth in the company’s delivery business.
- With pandemic-related restrictions being lifted globally and the related tailwinds receding, the company has seen a slower growth rate of traffic on its network in the gaming and OTT verticals.
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