Bottom-Up EquitiesDaily Briefs

Equity Bottom-Up: Semiconductor Manufacturing International Corp (SMIC), Match Group Inc and more

In today’s briefing:

  • SMIC (SEHK: 00981; SSE Star Market: 688981): Concerns in the Price, Buy for Long-Term Growth
  • Apple’s App Store Price Cut Beneficiaries

SMIC (SEHK: 00981; SSE Star Market: 688981): Concerns in the Price, Buy for Long-Term Growth

By Scott Foster

SMIC’s share price jumped 6% to HK$23.60 on Friday, Sept. 10,  signaling that concerns over the cost of the new factory announced a week ago and other risks had been discounted. Over the previous month, the shares had declined by 19%.

On Sept. 3, the company announced plans to build a new factory in Shanghai to produce semiconductors at the 28-nanometer node. This technology is suitable for automotive ICs, which are currently in short supply.

Given common concerns over the semiconductor shortage and President Biden’s reportedly conciliatory call to President Xi, the risk of U.S. sanctions seems minimal.

Buy in anticipation of a near doubling of production capacity by 2024.


Apple’s App Store Price Cut Beneficiaries

By Aaron Gabin

Apple’s quasi loss in the Epic lawsuit regarding app store take rates makes us all the more bullish on one of our favorite longs…Match Group. And also more bullish on Roblox (another long recommendation) and ATVI (less a beneficiary, but still a good entry point. We think Spotify and Netflix’s benefits are overstated. Spotify has run too much on the news, and we think its potentially another good short entry point.


Related tickers: Semiconductor Manufacturing International Corp (SMIC) (0981.HK), Match Group Inc (MTCH.O)

Before it’s here, it’s on Smartkarma