In today’s briefing:
- Meituan Tactical Slide into Our Buy Zone
- Meituan (3690 HK) Earnings Preview: Less Loss in 4Q22 and to See Profit in 2023
- China Internet Weekly (20Mar2023): Baidu, Tencent, KE
- Megvii: An Artificial Intelligence Powerhouse in China
- Potential Inclusions & Exclusions in KOSDAQ 150 Rebalance in May 2023
- Smartmore: Using AI to Implement Smart Manufacturing
- PC Industry Monitor: Signs of Inventory Improvement at PC Industry’s Leading Edge; Shares Diverged
- Cisco: It’s The Opposite Of A Dot-Com Moment
Meituan Tactical Slide into Our Buy Zone
- Macro trend remains challenging for Meituan over the summer. We see a tactical short out of triangulation and view a new low as a turn and buy signal.
- RSI bull divergence support a series of tactical rally sequences off of a new low, but macro headwinds will cap over the summer.
- Bull set up at lower expanding wedge support with wedge resistance coming in near 140.
Meituan (3690 HK) Earnings Preview: Less Loss in 4Q22 and to See Profit in 2023
- We believe total revenue grew 18% in 4Q22 and 22% in 2023.
- We believe operating losses decreased YoY in 4Q22 and the company will report an operating profit in 2023.
- We expect the stock has an upside of 47% for year end 2023.
China Internet Weekly (20Mar2023): Baidu, Tencent, KE
- Baidu launched a beta test of a ChatGTP-like function, WXYY.
- Tencent announced it will close its digital collection platform, Huanhe, in June.
- KE’s revenue decreased by 25% and new losses were RMB1.4 billion.
Megvii: An Artificial Intelligence Powerhouse in China
- Megvii is a leading artificial intelligence company in China focusing on IoT scenarios for mainly three fields including Consumer IoT, City IoT and Supply Chain IoT.
- In June 2022, Megvii’s chief scientist Sun Jian passed away due to a sudden illness. His death was one of the key reasons why the company has postponed the IPO.
- Major investors in Megvii include Ant Group, Alibaba Group (9988 HK), Lenovo (992 HK), and Abu Dhabi Investment Authority.
Potential Inclusions & Exclusions in KOSDAQ 150 Rebalance in May 2023
- In this insight, we discuss the potential inclusions and exclusions of the upcoming KOSDAQ 150 rebalance in May 2023.
- The next round of KOSDAQ 150 rebalance will be announced in May and it will be effective as of end of May 2023.
- Typically, the potential inclusions and exclusions to KOSDAQ 150 make their biggest moves in the one to three months prior to the rebalance announcements.
Smartmore: Using AI to Implement Smart Manufacturing
- Established in 2019 and headquartered in Hong Kong, Smartmore is a technology company that focuses on the use of artificial intelligence to implement smart manufacturing and ultra-high definition videos.
- The company’s intelligent manufacturing technology helps detect malfunction at manufacturing lines in numerous industries such as autos and semiconductors.
- Since the inception of the company, Smartmore has raised nearly $300 million in funding. Its major investors include Hermitage Capital, IDG Capital, Sequoia Capital China, and Lenovo Capital.
PC Industry Monitor: Signs of Inventory Improvement at PC Industry’s Leading Edge; Shares Diverged
- Asustek, Acer, and HP’s recent quarterly results indicate decreases in inventory days, highlighting potential improvement happening at the leading edge of the PC industry chain.
- Asustek (Asus) has substantially underperformed Acer YTD with one factor likely being Asus reporting worse margin performance. Asus is flat YTD after its post-results drop vs. +15% YTD for Acer.
- Long/Short: One can explore Long Asustek vs. Short Acer based on expectations of normalization of relative operational performance.
Cisco: It’s The Opposite Of A Dot-Com Moment
- The company ranks very high in terms of capital allocation prudence and this is going to serve long-term shareholders well.
- Cisco’s stock appears conservatively priced given the company’s strategic positioning and the ability to improve margins.
- Cisco appears increasingly attractive as market liquidity conditions normalize, says analyst.
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