Daily Brief United States: OpenAI, Smithfield Foods, Natural Gas, Exxon Mobil, Beta Bionic, Infinity Natural Resources, Venture Global LNG, Blend Labs , Geo Group, Noodles & Co and more

• President Donald Trump announced the Stargate Project, a new company which intends to invest $500 billion over four years building new AI infrastructure for OpenAI in the United States.
• Elon Musk is miffed, Microsoft says they “approved” the project and have a new Right of First Refusal agreement in place with OpenAI. 
• Stargate is exclusively for OpenAI and the press release states that its mission is to provide a strategic capability to protect the national security of America and its allies.

• The company is seeking a market cap of $9.1b-$10.7b based on the $23-$27 range. 
• A high end pricing for Smithfield values the company at roughly 13.5x this year’s earnings, a sizable discount to comps Hormel Foods (about 21x) and Tyson Foods (26x).
• It is our opinion that the business model is well-rounded, resilient and stable with multiple-organic growth levers.

• For the week ending 17/Jan, U.S. crude inventories fell by 1m barrels, missing expectations of a 2.1m barrel decrease. Gasoline stockpiles rose less than expected.
• U.S. natural gas inventories fell by 223 Bcf for the week ending 17/Jan, missing analyst expectations of a 270 Bcf drawdown. Inventories are 0.7% above the 5-year seasonal average.
• J.P. Morgan, HSBC, TD Cowen, Barclays, and Citigroup raised their 12-month PTs on SLB post its Q4 earnings. Halliburton reported a YoY decline in Q4 revenue and EPS.

• ExxonMobil’s Q4 revenue is expected to rise 2.5% YoY while its EPS is anticipated to fall 36.3%. Annual revenue and EPS are expected to fall by 1.9% YoY and 18.1%.
• Exxon expects Q4 2024 upstream earnings to drop USD 500–900 million QoQ due to lower crude prices, with refining margins further reducing earnings by USD 300–700 million.
• ExxonMobil plans to invest up to USD 30 billion in low-emission projects by 2030, with its Low Carbon Solutions business expected to contribute an additional USD 2 billion in earnings.

• The company has jumped from just eight sales territories in Q2 2023 to 43 sales to end 2024 with more than 15,000 units installed.
• An existing shareholder is on the cover of the prospectus with a concurrent private placement
• Medical Device IPOs have a strong history of success as many are poised for growth

• With an unlevered balance sheet, Infinity Natural Resources is set to for both organic and M&A growth post-IPO.
• The company is coming public at a discount to peers Diversified Energy, Gulfport Energy and Magnolia Oil & Gas.
• Early channel check of this offering revealed that the deal is oversubscribed with a high-quality schedule across different regions. 

• Venture Global priced 70 million shares at $25 and the stock closed 4% below issue in its opening session.
• The underwriting lineup grossly mispriced the IPO from the start and needed to drastically reduce the price range of the transaction.
• The impact to the greater IPO market will be felt on the next large transaction.

• BLND’s stock price has decreased, resembling CVNA’s past struggles
• BLND has been restructuring its cost base and balance sheet to prepare for future growth
• The company, led by a young CEO, is poised for potential recovery and positive earnings revisions, drawing parallels to CVNA’s path to success

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only. This article was originally published 3 months ago on Value Investors Club.

• The GEO Group is a potential investment opportunity with an asymmetric Trump trade, with a price target of $77 in a 2-year time horizon and a blue sky upside target of $103
• The company’s market cap is $2.1 billion with an enterprise value of $3.9 billion
• The thesis is based on the potential increase in funding for ICE monitoring under the next administration, potentially leading to the eventual spin-off of the monitoring business, resulting in GEO’s EBITDA potentially more than doubling from the current $500 million through various growth opportunities

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only. This article was originally published 3 months ago on Value Investors Club.

• Noodles & Co is currently undervalued, presenting an opportunity for turnaround
• Despite past challenges, the restaurant chain is statistically cheap and attracting activist investors
• With potential catalysts and a focus on value, Noodles & Co may be poised for success in the current economic landscape

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only. This article was originally published 3 months ago on Value Investors Club.