INDUSTRIALS Archives | Page 166 of 295 | Smartkarma

• In April, Sekisui Jushi (4212 JP) announced lackluster earnings and unsurprising guidance after a year marked by higher costs. It also announced a small (2.5%) buyback, likely for cross-holdings.
• Yesterday, the company announced Q1 results, and a revision to their buyback programme (to buy 20.2% of shares out). This morning their 22+% (#1) shareholder Sekisui Chemical sold 18%. 
• Forward PER dropped nearly 20%. The stock is still outrageously cash/securities-rich and if “re-levered” to zero net leverage would get a high 20s ROE. Hmmm…

• Ecopro BM (247540 KS) and Kum Yang (001570 KS)’s shares are down 2.5% and 4.5%, respectively today, driven by news of insiders at these companies selling their shares.
• It is estimated that the total amount of Ecopro BM shares sold by insiders and related parties was about 20 billion won in July by more than 12 insiders/related parties.
• We are increasingly concerned about insiders selling at Ecopro BM and Kum Yang. Coupled with lofty valuations, we think there is a higher probability of downside risk on these names. 

• As of 1 August, there could be two changes for the iShares A50 China (2823 HK)/ CSOP A50 (2822 HK) in September.
• There should be over 1x ADV to buy on NARI Technology Co Ltd A (600406 CH) and over 1x ADV to sell on Shaanxi Coal Industry (601225 CH). 
• There are a few stocks bunched around similar market caps among the potential adds and there could be changes to the list over the next few weeks.

• 3M Company delivered a strong result and managed an all-around beat in the last quarter.
• Their cost management efforts and restructuring initiatives primarily drove these margin increases.
• We give 3M Company a ‘Hold’ rating with a revised target price.

• General Dynamics delivered a positive result and managed an all-around beat in the last quarter.
• General Dynamics had a revenue increase across Defense segments and a modest increase in Aerospace.
• The revenue increase came from international vehicle programs at European Land Systems and Land Systems.

XP Power reported year-on-year revenue growth of 30% in H123 as it made good progress shipping from its elevated backlog. As expected, orders declined year-on-year, but the c £250m backlog still provides at least nine months’ revenue visibility. The company continues to invest for the longer term in Malaysia (manufacturing) and the United States (R&D). With no change to management’s full year expectations, we maintain our normalised operating profit forecasts for FY23 and FY24 and nudge up our interest cost forecast for FY23.

• Old Dominion Freight Line Inc. delivered a mixed set of results for this quarter with revenues below the analyst consensus.
• Considering the operating challenges that are associated with the domestic economy’s continued softness, and decreased volumes, the financial results were solid.
• We give Old Dominion Freight Line an ‘Underperform’ rating with a revised target price.

• Otis Worldwide managed to surpass the revenue and earnings expectations of Wall Street.
• Otis also achieved significant milestones in innovation, launching the Gen3 Core elevator and securing major projects globally.
• Looking ahead, Otis’ management has raised its 2023 outlook, and with the launch of the UpLift program, the company aims to drive efficiency and sustainable growth for the future.

• TRS continues to grow in its two smaller business segments while the packaging segment continues to experience a moderated recovery
• Predominantly consumer staples. Inventory management has been the main culprit for the packaging segment not recovering as fast as expected
• We believe the softness in packaging has created an investment opportunity in TRS’s stock as the Company streamlines its operations

• Toshiba announced on Friday that JIP’s upcoming tender offer would not make the July end deadline. 
• At this point delays for Toshiba are par for the course and we do not think anything needs to be read into this. 
• With earnings coming up next week we examine the likely trends and the possibility of a revision to guidance.

• Nihon M&A reported 1QFY03/2024 results on Friday. Both revenue and OP decreased 9.1% and 52.5% YoY to ¥8.2bn (vs consensus ¥9.8bn) and ¥1.7bn (vs consensus ¥3.6bn) respectively.
• M&A sales decreased yet again in 1Q as the company is struggling to improve revenue per transaction despite there being an increase in the no. of transactions.
• We think the company may not be able to achieve full-year target given declining per transaction revenues and falling other businesses.

• R R Kabel (2333180Z IN) is looking to raise about US$200m in its upcoming India IPO. 
• R R Kabel is an Indian consumer electrical company, which primarily sells wires, cables and fast moving electrical goods (FMEG). 
• R R Kabel registered strong earnings growth on the back of growth in the volume of wires and cables sold. However, the lack of commodity hedging affected the firm’s margins.  

• Toshiba announced on Friday that JIP’s upcoming tender offer would not make the July end deadline. 
• At this point delays for Toshiba are par for the course and we do not think anything needs to be read into this. 
• With earnings coming up next week we examine the likely trends and the possibility of a revision to guidance.

• Nihon M&A reported 1QFY03/2024 results on Friday. Both revenue and OP decreased 9.1% and 52.5% YoY to ¥8.2bn (vs consensus ¥9.8bn) and ¥1.7bn (vs consensus ¥3.6bn) respectively.
• M&A sales decreased yet again in 1Q as the company is struggling to improve revenue per transaction despite there being an increase in the no. of transactions.
• We think the company may not be able to achieve full-year target given declining per transaction revenues and falling other businesses.

• R R Kabel (2333180Z IN) is looking to raise about US$200m in its upcoming India IPO. 
• R R Kabel is an Indian consumer electrical company, which primarily sells wires, cables and fast moving electrical goods (FMEG). 
• R R Kabel registered strong earnings growth on the back of growth in the volume of wires and cables sold. However, the lack of commodity hedging affected the firm’s margins.  

• Fanuc reported 1Q3/24 operating profit of ¥32.6 billion (-26.3% YoY), missing street expectations at around ¥43 billion
• Fanuc cut full year guidance for operating profit to ¥118 billion (-38% YoY), way below street estimates of ¥176 billion
• Turning bearish. We think the stock will essentially tread water given lack of catalysts over next 6-9 months and valuations

• Boeing delivered a mixed result in the recent quarter, with revenues above market expectations, but it failed to surpass the analyst consensus regarding earnings.
• In the quarter, Boeing booked 460 net orders and delivered 136 commercial airplanes.
• The results impacted by the continuing losses on MQ-25, the T-7A, Commercial Crew, and three fixed-price development programs hit Boeing in the quarter.

• General Electric managed to exceed Wall Street expectations in terms of revenue and earnings.
• GE Vernova is also increasing spin with significant orders, improved profitability in Renewable Energy, and continuing margin expansion in Power.
• We give General Electric a ‘Hold’ rating with a revised target price.

• Roper delivered a strong positive result in the recent quarter and exceeded the expectations of the management in terms of both revenue and earnings.
• By the end of the year, Roper hopes to close its acquisition of Replicon, a bolt-on acquisition for the company’s Deltek business.
• Aderant, the software business of Roper that’s aimed at the needs of law firms, is quite excellent.

• Fanuc reported 1Q3/24 operating profit of ¥32.6 billion (-26.3% YoY), missing street expectations at around ¥43 billion
• Fanuc cut full year guidance for operating profit to ¥118 billion (-38% YoY), way below street estimates of ¥176 billion
• Turning bearish. We think the stock will essentially tread water given lack of catalysts over next 6-9 months and valuations

• Boeing delivered a mixed result in the recent quarter, with revenues above market expectations, but it failed to surpass the analyst consensus regarding earnings.
• In the quarter, Boeing booked 460 net orders and delivered 136 commercial airplanes.
• The results impacted by the continuing losses on MQ-25, the T-7A, Commercial Crew, and three fixed-price development programs hit Boeing in the quarter.

• General Electric managed to exceed Wall Street expectations in terms of revenue and earnings.
• GE Vernova is also increasing spin with significant orders, improved profitability in Renewable Energy, and continuing margin expansion in Power.
• We give General Electric a ‘Hold’ rating with a revised target price.

• Roper delivered a strong positive result in the recent quarter and exceeded the expectations of the management in terms of both revenue and earnings.
• By the end of the year, Roper hopes to close its acquisition of Replicon, a bolt-on acquisition for the company’s Deltek business.
• Aderant, the software business of Roper that’s aimed at the needs of law firms, is quite excellent.

• Lucror Analytics’ ESG Scores are based on a 3-tiered scale and are adjusted for Controversies (if applicable).
• We assess Aeropuertos Argentina 2000’s ESG as “Adequate”, in line with its Social, Environmental and Governance scores. Controversies are “Immaterial” and Disclosure is “Adequate”.
• Aeropuertos Argentina 2000 (AA2000) is Argentina’s largest airport operator. In 1998, it was granted a 30-year concession by the national government for the use, operation and management of 37 airports, out of a total of 56 in the country.

• Lucror Analytics’ ESG Scores are based on a 3-tiered scale and are adjusted for Controversies (if applicable).
• We assess EVOCA’s ESG as “Adequate”. The company has “Adequate” Governance and Social scores, but a “Weak” Environmental score. Controversies are “Immaterial” and Disclosure is “Adequate”.
• EVOCA (formerly N&W Vending) is a manufacturer of professional coffee machines, as well as machines for hot & cold beverages and snacks.

• Equifax delivered a mixed result in the recent quarter, with revenues below market expectations but managed to surpass the analyst consensus regarding earnings.
• Last quarter, the company faced a challenge, particularly in the mortgage and hiring markets.
• While the U.S. mortgage market weakened, they delivered adjusted EPS and EBITDA margins above guidance.

• United Airlines delivered an all-around beat in the most recent quarterly result.
• The strategic initiatives, including aggressive pilot hiring, fleet expansion, and route optimization, have paid off and put United on a path toward delivering impressive earnings per share.
• We give United Airlines Holdings a ‘Buy’ rating with a revised target price.

• Danaher managed to exceed the revenue and earnings expectations of Wall Street despite a more dynamic operating environment.
• Better-than-expected respiratory testing revenue and high single-digit base business core revenue growth in Life Sciences and Diagnostics helped counteract weaker base business demand in bioprocessing.
• Besides, broad-based strength throughout the Cepheid test portfolio drove another quarter of more than 30% core growth in non-respiratory testing in Molecular Diagnostics.

• Millennium Services Group Ltd (ASX:MIL) has provided an update on Q4 FY23 revenue, cash flow from operating activities, and the H2 FY23 gross margin. MIL delivered 8.0% (RaaS 9.6%) revenue growth in Q4 FY23 and 2.0% over FY23 on the back of new contract wins and wage inflation. Q4 FY23 cash flow turned positive with the group ending FY23 with just $1.2m net debt.
• The H2 FY23 GP% came in below implied guidance and RaaS estimates at 14.4% against ~15.9% forecast, attributed to wage pressure in a tight labour market.
• While most contracts have an annual contract adjustment clause for wage increases, the timing and magnitude of recent award increases is proving difficult to manage. 

• Dover delivered a disappointing set of results as the company was unable to meet the revenue expectations as well as earnings expectations of Wall Street.
• However, they faced operational challenges in their vehicle service group due to an ERP implementation, resulting in a loss of revenue and EPS.
• In this report, we have carried out a fundamental analysis of the historical financial statements of the company.

• Lucror Analytics’ ESG Scores are based on a 3-tiered scale and are adjusted for Controversies (if applicable).
• We assess Aeropuertos Argentina 2000’s ESG as “Adequate”, in line with its Social, Environmental and Governance scores. Controversies are “Immaterial” and Disclosure is “Adequate”.
• Aeropuertos Argentina 2000 (AA2000) is Argentina’s largest airport operator. In 1998, it was granted a 30-year concession by the national government for the use, operation and management of 37 airports, out of a total of 56 in the country.

• Lucror Analytics’ ESG Scores are based on a 3-tiered scale and are adjusted for Controversies (if applicable).
• We assess EVOCA’s ESG as “Adequate”. The company has “Adequate” Governance and Social scores, but a “Weak” Environmental score. Controversies are “Immaterial” and Disclosure is “Adequate”.
• EVOCA (formerly N&W Vending) is a manufacturer of professional coffee machines, as well as machines for hot & cold beverages and snacks.

• Equifax delivered a mixed result in the recent quarter, with revenues below market expectations but managed to surpass the analyst consensus regarding earnings.
• Last quarter, the company faced a challenge, particularly in the mortgage and hiring markets.
• While the U.S. mortgage market weakened, they delivered adjusted EPS and EBITDA margins above guidance.

• United Airlines delivered an all-around beat in the most recent quarterly result.
• The strategic initiatives, including aggressive pilot hiring, fleet expansion, and route optimization, have paid off and put United on a path toward delivering impressive earnings per share.
• We give United Airlines Holdings a ‘Buy’ rating with a revised target price.

• Danaher managed to exceed the revenue and earnings expectations of Wall Street despite a more dynamic operating environment.
• Better-than-expected respiratory testing revenue and high single-digit base business core revenue growth in Life Sciences and Diagnostics helped counteract weaker base business demand in bioprocessing.
• Besides, broad-based strength throughout the Cepheid test portfolio drove another quarter of more than 30% core growth in non-respiratory testing in Molecular Diagnostics.

• Millennium Services Group Ltd (ASX:MIL) has provided an update on Q4 FY23 revenue, cash flow from operating activities, and the H2 FY23 gross margin. MIL delivered 8.0% (RaaS 9.6%) revenue growth in Q4 FY23 and 2.0% over FY23 on the back of new contract wins and wage inflation. Q4 FY23 cash flow turned positive with the group ending FY23 with just $1.2m net debt.
• The H2 FY23 GP% came in below implied guidance and RaaS estimates at 14.4% against ~15.9% forecast, attributed to wage pressure in a tight labour market.
• While most contracts have an annual contract adjustment clause for wage increases, the timing and magnitude of recent award increases is proving difficult to manage. 

• Dover delivered a disappointing set of results as the company was unable to meet the revenue expectations as well as earnings expectations of Wall Street.
• However, they faced operational challenges in their vehicle service group due to an ERP implementation, resulting in a loss of revenue and EPS.
• In this report, we have carried out a fundamental analysis of the historical financial statements of the company.

• It has been four months since JIP officially announced their intention to launch a Tender Offer for Toshiba Corp (6502 JP) by end-July. 7 weeks since Toshiba’s Board supported it.
• There’s been no material public griping. Peers are sharply higher. There have been news stories suggesting a Western Digital/Kioxia deal is close. That’s now extended. The Toshiba deal possibly too. 
• But huge outperformance by peers, and possible clarity from Kioxia deal terms are unlikely to move the Toshiba Board to demand more. 

• AKR Corporindo (AKRA IJ) booked solid set of numbers despite a less favourable pricing environment with the additional boost from a ramp up of sakes at JIIPE.
• JIIPE will become a more important contributor for AKR Corporindo, as it builds a critical mass of EV-battery-related tenants plus it benefits from increasing demand from smelters for chemicals
• AKR Corporindo remains a core industrial holding in Indonesia, through both its petroleum and chemicals business plus its industrial estate, which is a multi-year growth story. Valuations remain attractive. 

• Lianlian DigiTech (2104619D CH), a digital payment services provider in China, has filed for an HKEx IPO to raise US$500 million, according to press reports.  
• In LianLian DigiTech IPO: The Bull Case, we highlighted the key elements of the bull case. In this note, we outline the bear case.
• The key elements of the bear case rest on margin pressure on the fastest-growing business, operating losses, an unconvincing path to profitability, FCF burn with a weak balance sheet.

• Braille Battery will be expanding its product offering for motorcycles, ATV/UTVs, and personal watercrafts.
• This morning, Braille Energy Systems (BES:TSXV) provided an operational update on its three divisions, Braille Battery, Electrafy, and Firebulb.
• Braille Battery BES announced that it will be expanding its product range of “Made in USA” Power Sports Batteries to provide additional ultra-high cranking and high-capacity lithium batteries for its Motorcycle V-Twin segment, ATV/UTVs, and personal watercrafts.

• It has been four months since JIP officially announced their intention to launch a Tender Offer for Toshiba Corp (6502 JP) by end-July. 7 weeks since Toshiba’s Board supported it.
• There’s been no material public griping. Peers are sharply higher. There have been news stories suggesting a Western Digital/Kioxia deal is close. That’s now extended. The Toshiba deal possibly too. 
• But huge outperformance by peers, and possible clarity from Kioxia deal terms are unlikely to move the Toshiba Board to demand more. 

• AKR Corporindo (AKRA IJ) booked solid set of numbers despite a less favourable pricing environment with the additional boost from a ramp up of sakes at JIIPE.
• JIIPE will become a more important contributor for AKR Corporindo, as it builds a critical mass of EV-battery-related tenants plus it benefits from increasing demand from smelters for chemicals
• AKR Corporindo remains a core industrial holding in Indonesia, through both its petroleum and chemicals business plus its industrial estate, which is a multi-year growth story. Valuations remain attractive. 

• Lianlian DigiTech (2104619D CH), a digital payment services provider in China, has filed for an HKEx IPO to raise US$500 million, according to press reports.  
• In LianLian DigiTech IPO: The Bull Case, we highlighted the key elements of the bull case. In this note, we outline the bear case.
• The key elements of the bear case rest on margin pressure on the fastest-growing business, operating losses, an unconvincing path to profitability, FCF burn with a weak balance sheet.

• Braille Battery will be expanding its product offering for motorcycles, ATV/UTVs, and personal watercrafts.
• This morning, Braille Energy Systems (BES:TSXV) provided an operational update on its three divisions, Braille Battery, Electrafy, and Firebulb.
• Braille Battery BES announced that it will be expanding its product range of “Made in USA” Power Sports Batteries to provide additional ultra-high cranking and high-capacity lithium batteries for its Motorcycle V-Twin segment, ATV/UTVs, and personal watercrafts.

• In June, mainstream parcel pricing declined by over 10% Y/Y, but SF Holding saw ASPs rise
• We believe J&T Global Express’ planned IPO could negatively impact the industry in H2
• Pricing pressure has increased, in our view, and we expect margins to decline in H2 23

• Grab recently announced the acquisition of Trans-cab in Singapore, the 3rd largest taxi operator there. This will help to solve driver shortage issues and improve cost efficiencies.
• Taxis pay the lowest COE prices plus Grab can improve the productivity of taxi drivers through access to the Grab app. Trans-cab gives Grab access to street hailing. 
• Grab‘s Singapore digital bank recently raised new capital but has also seen its deposit cap lifted significantly, which is helping to significantly boost deposit growth.

• American Airlines Group managed to surpass the revenue expectations as well as the earnings expectations of analysts.
• While overseas unit revenue increased, domestic unit revenue decreased.
• In the first half of the year, American Airlines received 13 deliveries, and by the end of the year, it anticipates receiving 10 more planes.

• CSX Corporation’s performance in the second quarter was largely disappointing with revenues below par and earnings in line with expectations.
• The only silver lining was the successful performance of its merchandise sector.
• In the second quarter, CSX moved more than 1.5 million carloads, driven by a 3% volume increase in merchandise and a 4% volume increase in coal.