In today’s briefing:
- News Corp (NWS AU)’s Proposed Merger With Fox Corp. Again.
- SPX Pullback near Target with RTY Buy In
- Meta Platforms: Is The Hyper Growth Story Over? (11/22)
- Bristol-Myers Squibb: The Turning Point Acquisition & Oncology Expansion
- Microsoft Inc: The Designer Visual Design App & Other Developments
- Johnson & Johnson: R&D Expansion & Other Drivers
- Match Group 3Q22: Turnaround Brewing?
- Breaking Estimate Short Candidates: Novavax, Micron, Generac, FormFactor
- ATEN: Steady Growth, PT to $24
- VF Corporation: Major Drivers
News Corp (NWS AU)’s Proposed Merger With Fox Corp. Again.
- Back on the 17 October, News Corp (NWS AU) announced it had begun exploring a potential combination with Fox Corporation (FOXA US).
- A merger of two parts of Rupert Murdoch’s media empire would combine Fox News and TMZ assets with NWS’ newspaper and online news operations.
- Murdoch split his empire in 2013, placing the print business in a newly created NWS, and the TV and entertainment under Fox,
SPX Pullback near Target with RTY Buy In
- SPX dual top at 3,928 rolled just under the 3,950 top target. Break of wedge support was the touted trigger to add to our short group. 10yr 4.20% PT met.
- SPX 3,700/650 is our pullback target add to risk but we must get past the NFP report first. RTY is our top long pick in the US at trendline.
- Asia shorts (HSI and Taiwan) and Asia longs to layer into (NKY and ASX). Levels to coordinate with SPX 3,660 support.
Meta Platforms: Is The Hyper Growth Story Over? (11/22)
- Meta Platforms delivered a highly disappointing set of results with a huge earnings miss.
- The company’s ballooning costs to fund its virtual reality vision have resulted in a drop in profitability.
- We provide the stock of Meta Platforms with a ‘Hold’ rating and a revision in the target price.
Bristol-Myers Squibb: The Turning Point Acquisition & Oncology Expansion
- Bristol-Myers delivered another all-around beat as the management continued to make an effort to expand its new product range and inline franchise.
- In this quarter, the inline and new product portfolio grew by 13%, and the company managed to deliver non-GAAP EPS growth of 3%.
- Revenues in the third quarter were approximately $11.2 billion and the inline and new product portfolio grew strongly up to 13%.
Microsoft Inc: The Designer Visual Design App & Other Developments
- Microsoft delivered a good result in the last quarter surpassing Wall Street expectations on all counts.
- Microsoft Cloud revenue surpassed $25 billion, increasing by 24% and 31% in constant currency.
- Microsoft is getting more customers that want to grow and innovate with its existing infrastructure.
Johnson & Johnson: R&D Expansion & Other Drivers
- Johnson & Johnson has shown some recovery in its stock price which was backed by a solid result across its business segments.
- Pharmaceutical growth was determined by robust commercial execution and access that enabled Johnson & Johnson to continue to deliver growth in operational growth.
- We provide the stock of Johnson & Johnson with a ‘Hold’ rating and a revised target price.
Match Group 3Q22: Turnaround Brewing?
- After a massive guidedown last quarter, Match is beginning to show stability in the business, and offered a cautiously optimistic return to growth guide for 2023.
- Tinder rebuild underway, 16% FX-Neutral growth was 2% ahead of consensus and drove the quarter’s beat.
- 5-Pronged plan by new CEO Kim seems well thought out for what ails Match.
Breaking Estimate Short Candidates: Novavax, Micron, Generac, FormFactor
- This model finds companies facing recent sharp cuts in estimates. These shorts can have very disparate characteristics.
- The key judgement involves whether the negative revisions are temporary or if they are indications of ongoing weakness in the business.
- Breaking Estimates stocks often continue to decline after the cuts. This week we flag: Novavax, Micron, Generac, FormFactor
ATEN: Steady Growth, PT to $24
- ATEN continues to demonstrate its growth ability by focusing on its security first approach. ATEN reported third quarter revenue slightly more than we were projecting
- The steady growth ATEN has experienced this year has come through the diversification of its customer base
- ATEN’s management asserted demand has been consistent and dependent on performance. ATEN has added more customers throughout the year, which should serve as a baseline for incremental revenue in 2023
VF Corporation: Major Drivers
- VF Corporation is operating in a challenging macro-economic backdrop and delivered a disappointing quarterly result.
- The company barely managed to meet revenue expectations given a weak performance in China and also missed out on earnings expectations.
- Apart from China, VF Corporation has witnessed an improvement across the rest of Asia, led by Japan and Korea.
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