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• TSMC’s June 2024 revenue increased by 32.9% YoY, exceeding expectations with $6.42 billion. 
• It dominates with >62% of the global foundry market share, propelled by AI demand. 
• Expansion into the automotive market and new fabs in the U.S. and Japan highlight TSMC’s growth strategy. 

• Since Elliott Management emerged as a shareholder in SoftBank group last month, the share price has rallied sharply, largely driven by the further appreciation of the Arm Holding share price
• SoftBank management is currently focused on growing its Gen AI investment portfolio and appears to have shelved share buybacks for now, which is likely to disappoint minority shareholders
• Despite the above challenges and the risk of de-rating at Arm, we remain positive on Softbank shares as they trade at a historically high 54%+ discount to the estimated NAV

• Workiva’s financial results for the first quarter of 2024 showcased a generally positive trend with several robust aspects in growth and operating metrics, countered by a cautiously optimistic outlook for the rest of the year.
• The company reported a 17% increase in total revenue and a 20% rise in subscription revenue compared to the same period in the previous year, underscoring a resilient performance in the face of an uncertain economic environment.
• Baptista Research looks to evaluate the different factors that could influence the company’s price in the near future and attempts to carry out an independent valuation of the company using a Discounted Cash Flow (DCF) methodology.

• Allegro MicroSystems has recently reported their fiscal fourth quarter and full year 2024 results, providing insights into their financial health and future expectations.
• The company managed to surpass its fourth-quarter revenue and earnings per share (EPS) guidance despite facing a challenging macroeconomic environment, highlighting the dedication and efficiency of its team.
• The fiscal year 2024 demonstrated a revenue growth of 8% and an EPS growth of 5%, with notable growth in e-Mobility at 38%, signifying strong market performance and strategic execution.

• Vontier, a prominent player in the mobility infrastructure and technology space, delivered strong performance in the first quarter of 2024, achieving the upper bounds of its core growth guidance while surpassing its profitability targets.
• The company reported a 4% increase in core sales, fueled primarily by volume growth alongside positive pricing impacts.
• Notably, the company achieved a 130 basis point expansion in margins, demonstrating effective execution and financial discipline.

• Credo’s shares have surged over 180% since NVDA’s AI earnings report in May 2023
• Despite being seen as an AI “winner,” Credo’s active electrical cable is losing market position due to networking bottlenecks in data centers
• The upcoming 800G infrastructure ramp could provide opportunities for advanced interconnects, but Credo’s shares are currently priced to perfection

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.

• Power Integrations reported a robust set of financial results for the first quarter, demonstrating resilience and strategic foresight in the face of fluctuating market conditions.
• The company’s revenue for the quarter amounted to $92 million, with a non-GAAP gross margin of 53% and non-GAAP earnings standing at $0.18 per share.
• These figures reflect a stable financial status, attuned to Power Integrations’ strategic market maneuvers and operational efficiency.

• Silicon Labs’ first quarter fiscal 2024 financial results provide a mixed picture, reflecting the ongoing dynamics in the technology sector, particularly in the semiconductor industry.
• Silicon Labs reported a revenue of $106 million for the quarter, which exceeded the midpoint of the company’s guidance and marked a 23% sequential increase.
• This performance underscores some level of recovery, especially when dissected into the contributions from its two primary business units: Industrial & Commercial, and Home & Life.

• Braze, a customer engagement platform, has documented its performance for the first quarter of fiscal year 2025, which indicates mixed outcomes amidst challenging economic conditions.
• Braze reported a revenue of $135.5 million, reflecting a 33% year-over-year increase.
• When adjusted for a $750,000 hiccup due to a service outage in April, the revenue would have been about $136.3 million.

• Soluna Cloud has entered into a three-year managed services agreement with Hewlett Packard Enterprise (HPE), with $38-80 million in expected revenue over the contract, with the first 512 GPUs available today.
• Soluna will manage a hydro-powered datacenter in collaboration with its strategic OEM partner and has secured NVIDIA H100 GPUs that will allow it to offer Generative AI workloads for enterprise customers and Generative AI labs.
• The Soluna Cloud subsidiary has been funded by a non-dilutive $12.5 million credit facility, which the company expects will be the first tranche of funding for the growing business line.

• This block deal has an unusual PSR (price swap return) contract at ₩58,200, the July 10th closing price, likely preventing Netmarble’s typical stock price correction today.
• In 2022, a similar-sized local PSR transaction involved Doosan Bobcat Inc, with 9.9 million shares and a PSR swap price of ₩37,500.
• As for Doosan Bobcat, the stock initially dropped but rebounded near the PSR swap price, prompting local brokerages, focused on PSR fee income, to sell rather than realize capital gains.

• June 2024 revenues of NT$207.87 billion, a decrease of 9.5% MoM but an increase of 32.9% YoY
• Q224 revenue of US$20.9 billion, $457 million above the high end, up 10.5% QoQ and up 33.7% YoY. It was also TSMC’s highest revenue quarter ever
• At NT$1,266,154 (around US$39 billion), TSMC’s YTD revenues are up 28% YoY, well in line with the company’s forecast for a >20% YoY increase in 2024.

• Taiwan Semiconductor (TSMC) – ADR (TSM US) could reach a growth rate of 25% YoY this year, with a very promising outlook for 2025.
• Artificial Intelligence (AI) remains the primary focus, with plans to continue expanding capacity in 2H24 and 2025.
• The demand from Apple (AAPL US) is expected to drive higher growth in 2H24.  

• Onshore Equity ETF flows in China continued to be positive for 8th week. Southbound Connect flows in July are lower than June.
• Baidu, Bilibili and GDS have had positive share price moves on the back of news flow.
• The container shipping segment has had a sharp pullback on positive Middle East news and cement maker CNBM flags a loss in the first half.

• Stable, Steady, State-owned Enterprise with upside from policy push on AI
• Lowly rated company with a new cyclical growth story in a strategic sector
• Good balance sheet with the opportunity to raise payouts and yields.

• Wolfspeed, a leading vertically integrated silicon carbide company, shared its fiscal Q3 2024 results, emphasizing accomplishments in operational performance yet acknowledging the market’s undervaluation of its potential.
• A key point of focus was their Mohawk Valley facility’s substantial progress towards increasing utilization and revenue generation.
• Facility enhancements and strategic shifts in production capacities were regularly discussed, reflecting an agile response to market demands, particularly within the electric vehicle sector.

• Fabrinet Q3 of Fiscal Year 2024 reflects a robust performance exceeding its own forecasts with a notable increase in revenue and earnings per share (EPS).
• The company reported a record revenue of $731.5 million, representing a 10% year-over-year growth and a 3% sequential increase from the previous quarter.
• Non-GAAP EPS was also impressive at $2.39, marking a significant rise from previous periods and exceeding the guidance provided by the company.

• Rambus Inc. delivered favorable results for the first quarter of fiscal year 2024, demonstrating resilience and strategic agility amid varied market conditions.
• A pivotal aspect of Rambus Inc.’s growth strategy involves diversifying its product offerings, including the expansion into DDR5 server Power Management Integrated Circuits (PMICs), which complements its existing memory interface chips.
• This development is well-timed, as the industry increases demands for enhanced memory performance driven by applications like AI.

• In FY03/24, revenue grew 15.1% YoY to JPY27.9bn, operating profit increased 19.6% YoY to JPY5.2bn, recurring profit increased 19.3% YoY to JPY5.4bn, and net income attributable to owners of the parent increased 19.0% YoY to JPY3.3bn.
• In the EC Solutions business, revenue increased 16.7% YoY to JPY15.6bn, and recurring profit rose 17.8% YoY to JPY4.0bn, mainly due to growth in revenue from e-commerce site development and e-commerce cloud services.
• In the IT Solutions business, revenue grew 12.7% YoY to JPY12.5bn and recurring profit rose 8.2% YoY to JPY2.8bn owing to higher revenue from IT cloud services and security and infrastructure construction.

• Viavi Solutions, a prominent network testing company, recently disclosed its financial results for the third quarter of Fiscal Year 2024, revealing mixed outcomes in a challenging market environment.
• The company reported a total net revenue of $246 million, marking a modest year-over-year decline of 0.7% and a sequential drop of 3.3%.
• This revenue, although slightly above the lower end of their forecasted range, underscores the cautious spending patterns observed across several of its customer segments, particularly within enterprise solutions.

• Today post-close we got confirmation of yesterday’s Reuters scoop of a secondary selldown on Kokusai Electric (6525 JP) after the stock fell 7.2% in heavy volume.
• KKR HKE LP and KSP Kokusai LLC (Koch) will together sell 52.5mm shares plus another 7.8mm+ in the greenshoe. Split is 50/50 domestic/international. 
• This is 60+mm shares against 51mm shares held by non-passive holders ex-Capital (who has been selling). It’s a lot of stock at a high price.

• KKR and KSP Kokusai will offer 52.51m-60.38m shares (US$1.76bn-2bn) of Kokusai Electric (6525 JP) in a secondary offering that will likely be priced on 22 July.
• Kokusai Electric (6525 JP) will also buy back up to JPY 18bn of its shares. At the last close, that is 3.33m shares (1.2x ADV).
• Trackers of one global index will buy stock at the time of settlement of the shares. The (much) bigger buying will come at the end of August.

• Wiwynn Corp (6669 TT) is looking to raise around US$850m in its global depository receipts (GDRs) offering.
• Similar to previous GDR listings, the deal is a long drawn out process with the firm required to jump through a number of board/shareholder/regulatory approval loops.
• In this note, we run the deal through our ECM framework and comment on deal dynamics.

• Kokusai Electric (6525 JP) has announced a secondary offering of up to 60.4 million shares (including overallotment). At the close, the offer, including overallotment, is worth JPY326 billion (US$2.0 billion).
• The secondary offering facilitates KKR and KSP Kokusai Investments’ ability to crystallise substantial IPO gains—the shares are trading at 3.2x the IPO price of JPY1,840.
• Looking at recent large Japanese placements is instructive for understanding the potential offer price. The pricing date will fall between 22 and 24 July (likely 22 July).

• TSMC June Sales Surge Higher Than Expectations; Apple Will Be Use TSMC’s 2nm Node for Next Year’s iPhone 17
• Wiwynn GDR Offering – US$1.45bn Dilutive Offering, but Momentum Has Been Very Strong 
• Silergy (6415.TT): Trial-Run with Vanguard, and Recent Stock Drops Represent an Entry Opportunity. 

• The review cutoff date for the September rebalance of the HSIII was 28 June. The changes will be announced on 16 August and become effective after the close 6 September.
• There could be 3 changes to the index with some inclusions driven by potential addition to the Hang Seng Composite Index. That could lead to buying via Southbound Stock Connect.
• Capping will result in passives buying Kuaishou Technology (1024 HK) and JD.com (9618 HK) while selling Meituan (3690 HK) and Tencent (700 HK).

• In this insight, we discuss a trading strategy for Shift Up which starts trading on 11 July. Shift Up is one of the most anticipated IPOs in Korea this year.
• Our base case (6 months – 1 year) target price of Shift Up is 95,510 won, which is 59% higher than the IPO price.
• We recommend investors to take some profits (about 50% of invested capital) if the share price shoots higher by 100% or more from the IPO price on the first day.

• TSMC: +15.1% Premium; Will It Break Down to Lower Past Trading Levels?
• UMC: +2.4% Premium; Can Consider Shorting This Historically High Level
• ChipMOS: -3.1% Discount; Long The Spread Given Historically Extreme Discount

• KKR & Co (KKR US) and KSP Kokusai Investments are looking to raise approximately US$1.7bn through an extended secondary follow-on offering, selling approximately 52.5m shares of Kokusai Electric (6525 JP)’s stock.
• The deal is a large one to digest at 19 days of three month ADV.
• In this note, we will talk about the placement and run the deal through our ECM framework.

• Doug O’Laughlin: Today, on Fabricated Knowledge, I have the privilege of having Wes from Applied Digital on to talk about Applied Digital.
• Today, we’re gonna talk about the change in his business model. The company is experiencing a lot of changes, and there are a lot of new things in the pipeline.
• And so I just wanted to sit him down and have an opportunity to chat about that. 

• Today, a Reuters article came out saying that KKR would sell down half its 43% stake in Kokusai Electric (6525 JP) according to “two people familiar with the matter.”
• The article also said Kokusai Electric would buy back shares. Kokusai responded with a TDNET release saying “we did not release this info but we are considering various capital policies.
• It pays to look at the Shareholder Structure as it stands. This is bigger than it looks. 

• Reuters reported that KKR & Co (KKR US), the largest Kokusai Electric (6525 JP) shareholder, plans to sell about half of its 43% stake, worth around JPY300 billion.
• As Kokusai’s shares are trading at 3.2x the IPO price of JPY1,840, KKR would be tempted to reduce its stake further. The 180-day IPO lock-up period expired on 22 April.
• Kokusai anticipates a return to growth and margin improvement. However, Kokusai trades at a material premium to peer multiples and is fully priced. 

• Quiddity’s “Who is Ready” series of insights aims to objectively identify names listed on the Tokyo Stock Exchange that are potential additions to the TOPIX Index in future.
• In the last few days, SUNWELS Co (9229 JP) and Macbee Planet (7095 JP) have announced their moves to TSE prime which would eventually trigger a TOPIX Inclusion event.
• Macbee Planet was in our highest conviction list but SUNWELS Co was not. In this insight, we have made some modifications to our methodology to improve future hit rates.

• Micron Technology recently provided insights into their fiscal third quarter 2024 performance, shedding light on various strategic and operational aspects that investors may find critical in shaping their investment thesis.
• Amid a challenging global semiconductor landscape characterized by rapid technological advancements and fluctuating demand cycles, Micron appears cautiously optimistic about the future, driven by strategic investments and a focus on high-margin products.
• Baptista Research looks to evaluate the different factors that could influence the company’s price in the near future and attempts to carry out an independent valuation of the company using a Discounted Cash Flow (DCF) methodology.

• Shift Up (462870 KS) raised around US$320m in its South Korean IPO, after pricing at the top.
• Shift Up is a South Korean games developer, which as released three games so far for the global markets.
• We have looked at the company’s performance and valuation in our earlier notes. In this note, we talk about the trading dynamics.

• NetDragon’s stock is priced at 11.0 HKD with 531 million shares and a market cap of 5,870 HKD
• Company completed a reverse merger listing for its education business, causing some complications, but gaming business is seen as a hidden gem with growth potential
• NetDragon, operated by the Liu family, has a history of successful business incubation and has returned around 50% of its market capitalization to shareholders in the past three years

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.

• ARLO announced it had reached 4 million paid accounts approximately four months after achieving 3 million paid accounts. 
• The pace of growth is most likely the result of catch-up calculations related to Verisure. However, this should not take away from the magnitude of increase in the number.
• The higher baseline of subscriber numbers should change the annualized recurring revenue (“ARR”) for ARLO compared to the end of the first quarter.  

• Cirrus Logic has presented its financial results for the fourth quarter and the entire fiscal year 2024, revealing mixed outcomes that highlight both challenges and growth opportunities.
• The company reported a fourth-quarter revenue of $378.1 million, surpassing the upper edge of the guidance range.
• This surge was attributed to an unexpected rise in demand for smartphone components.

• Accenture’s latest financial results highlight a dynamic and multifaceted performance.
• The fiscal year has seen client spending patterns diverge from initial expectations, with a clear preference for large-scale transformations over smaller, discretionary projects.
• This shift has led to slower revenue conversion and delayed decision making, necessitating a strategic pivot by Accenture.

• BILL reported strong fiscal third quarter 2027 results, highlighting robust revenue growth and significant expansion in non-GAAP operating income.
• Revenue increased by 19% year-over-year, driven by high transaction volumes and an effective monetization strategy.
• The reception of their financial management solutions among small businesses remains vigorous, as evidenced by the processing of over 25 million transactions amounting to more than $70 billion during the quarter.

• Telecom companies are traditionally “easy” to value. They have assets, debt, depreciation, earnings, cashflow. Lots of people like to use EV/EBITDA to measure.
• In comparing Japan’s telcos, I believe when Softbank Corp (9434 JP) is in the mix, one has to use forward PERs. EV/EBITDA is too fraught with complications.
• Softbank is currently at its most expensive multiple since listing on a Price to Forward Earnings basis, and relative to its major Peers. And KDDI has a big buyback now.

• Kakao has begun talks with potential buyers for Kakao Games, with Krafton leading discussions directly using its own investment team.
• Despite official denials, it’s viewed as procedural. Local markets anticipate the deal due to no direct refutation beyond formal announcements.
• A three-month compliance period from disclosure makes this quarter challenging, but completion announcement potential exists by Q4 this year.

• The review period for the LQ45 Index July rebalance ended 30 June. The changes should be announced the last week of July, becoming effective after the close on 31 July.
• Based on the index methodology, there could be up to 5 changes at the rebalance. Plus there will be capping changes for Bank Rakyat (BBRI) and Bank Central Asia (BBCA).
• For a change, the impact on the potential inclusions will be higher since they will join the index with higher weights compared to the potential deletions.

• After hitting a low point in Q4 2023, Research on Hong Kong companies has been slow to pick up reflecting the ongoing skepticism from investors. 
• Reports on the large China tech companies dominated the top ten companies covered over the last couple of years and in the first half of 2024.
• As China continues to dominate and make news in the global EV market, research in that sector has picked up.

• This writeup was inspired by David Orr’s tweet about the U.S. listed Chinese company DouYu (Nasdaq: DOYU) paying out a $9.76 special dividend.
• The stock closed at $12.59 the day before and was $6.59 earlier in the year.
• Among Chinese ADRs with significant cash balances, SOHU is my favorite. 

• The company’s annual revenue was $35,820 million in 2023 compared to $44,200 million in 2022, seeing a decrease of 18.96%.
• We estimate that for FY2024 the annual revenue will range at around $37,671 million and for 2025 at around $39,934 million.
• Gross profit for FY2023 was $19,951 million, decreased by 21.96% compared to $25,565 million for the corresponding period of 2022. 

• Rapid7, under the leadership of CEO Corey Thomas and CFO Tim Adams, remains at the forefront of cybersecurity solutions focused on delivering integrated risk and security operations.
• The company concluded the first quarter of 2024 with $807 million in Annual Recurring Revenue (ARR), which indicates an 11% year-over year growth.
• The quarter saw steady performance in its Direct Complete offerings but noted a shortfall in ARR expectations primarily due to slower transitions in the vulnerability management (VM) base to its integrated Cloud Risk Complete offering.

• A series of new product introductions earlier this year should contribute to Ubiquiti  experiencing follow through sales momentum in the June quarter. 
• In the June quarter we are anticipating both enterprise and service provider revenue to increase sequentially.
• The March 2024 quarter included a charge. We are not expecting Ubiquiti to incur a similar expense in the June quarter. 

• Cumulative Q3 FY08/24 results: Revenue JPY235.5bn (+16.5% YoY), Operating profit JPY23.5bn (+51.2% YoY), Recurring profit JPY23.0bn (+56.9% YoY).
• Segment performance: Communications revenue up 10.2% YoY, Business Systems revenue up 48.0% YoY, Energy revenue down 7.0% YoY.
• Subscriber growth: U-NEXT service subscribers at 4.34mn, ARR JPY101.2bn (+22.0% YoY), advertising expenses JPY9.3bn (+32.1% YoY).

• Flex Ltd. reported solid performance for fiscal Q3, demonstrating strong execution across its operations.
• The company, which provides a wide array of manufacturing services, generated $7.1 billion in revenue, achieving an adjusted operating margin of 6.7% and an adjusted EPS of $0.71.
• When excluding Nextracker, Core Flex revenue was $6.4 billion with a record operating margin of 4.9%, delivering $0.54 of EPS.

• We are surprised that Silergy Corp (6415 TT) is using Vanguard Intl Semiconductor (5347 TT) to trial-run products.
• The outlook for 2024 remains unchanged at over 20% YoY, and we still see a path to recovery ahead.
• We consider the recent drop from NTD$526 on June 14th to NTD$429 on July 5th as an opportunity to consider entering the stock.

• We expect Vanguard’s utilization to improve from around 65% in 2Q24 to over 70% in 3Q24.  
• Qualcomm Inc (QCOM US) and Monolithic Power Systems, Inc (MPWR US) are gradually increasing demand volume in 2Q24 and 3Q24.  
• Currently, Vanguard is experiencing a correction from above NTD$142 on July 2nd.  

• The HSTECH Index tracks the performance of the top 30 technology companies listed in Hong Kong that have high business exposure to certain technology themes.
• The reference period for the September 2024 index rebal event is now complete. In this insight, we take a look at our final expectations for index changes.
• Our current estimates suggest one-way flows due to index changes and capping could be around US$733mn but that could change by early September 2024.

• Notably, local hedge funds receive significant allocation, nearly 10%, unusual for KOSPI IPOs this size, differing from HD Hyundai Marine Solution.
• KOSPI 200’s initial float rate is 14%, rising to 58% in six months. MSCI starts at 8%, reaching 12% in six months and 25% in a year.
• Differences from HD Hyundai Marine Solution include high short-term strategies among institutions. Unlike before, local pension funds receive substantial allocation, potentially affecting stock price post-listing.

• In the Q1 2024 earnings, Wix.com Ltd.’s management shared a very positive outlook based on the company’s recent financial results, strategic initiatives, and product advancements.
• Key achievements included stronger-than-expected Q1 growth, with booking growing to over $457 million and revenue reaching $420 million, exceeding the company’s previous guidance.
• This performance led to free cash flow growth to more than $111 million.

• Credo’s fiscal 2024 earnings presented a blend of robust achievements and markers for future growth, tied along with inherent business risks associated with developing and scaling high-speed connectivity solutions.
• The company highlighted record annual revenue alongside a notable uplift in revenue derived from AI-powered workloads, indicating successful alignment with leading-edge technological demands.
• Revenue for fiscal year 2024 stood at $193 million, up by 5% year-over-year, with a marked improvement in non GAAP gross margins to 62.5%.

• Ambarella Inc. recently reported a first quarter fiscal year 2025 earnings.
• The company stated their first quarter revenue was 1% above estimated figures with an increase of 6% on a sequential basis.
• Artificial Intelligence (AI) products constituted two-thirds of this revenue.

Nano Dimension has entered into a definitive agreement to acquire Desktop Metal (DM) in an all-cash deal worth $185m ($5.50 per DM share), with potential adjustments that could reduce it to $135m ($4.07 per share). The deal is subject to regulatory approvals and DM shareholder approval and is expected to close in Q424. With complementary product lines, the combined entity will offer a broad range of additive manufacturing solutions covering multiple verticals and materials, supporting the entire value chain from prototyping through to mass manufacturing.

• Lions Gate’s recent business developments and strategic outlook present a mixture of opportunities and challenges.
• Over the past decade, Lions Gate has transitioned from primarily a Hollywood Studio, heavily reliant on theatrical releases like ‘Twilight’ and ‘Hunger Games’, to being a major player in the streaming space through its acquisition of STARZ in 2016.
• This pivot has expanded its revenue streams and fortified its position against industry shifts toward digital consumption.

• IHRT is expected to experience positive growth in the upcoming quarters, driven by its podcasting business
• CEO and CFO have been buying stocks, indicating confidence in the company’s future prospects
• Potential debt restructuring and positive growth could lead to a significant increase in IHRT’s equity value by the end of 2025.

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.

• Xerox is considered a short position due to being in a declining industry and losing market share, having a leveraged capital structure with rising costs, and facing hidden liabilities
• The company’s free cash flow is believed to be overstated from receivables financing, making it more expensive than it appears
• Xerox has been criticized for poor capital allocation, corporate governance issues, and an Icahn greenmail exit, making it a risky investment in a struggling market.

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.

• In a particularly altruistic move, live-streaming game platform play Douyu International Holdings (DOYU US)  announced a special cash dividend of US$9.76/share, vs. a last price of US$12.59.
• The cash outlay is roughly US$308mn, and Douyu had cash (as at 1Q24) of US$936.6mn. And no debt.  Founder/chairman/CEO Shaojie Chen (17.2% shareholder) will pocket a tidy ~US$53mn.
• An outlier; or should we expect more of the same for other cash-rich US-listed China plays?

• Index Committee’s discretion decreases the predictability of index changes. Even when a company passes all eligibility criteria and thresholds, it might still not be selected.
• Understanding triggers for index changes, types of additions/deletions and selection patterns, narrows down the pool of candidates and increases conviction of forecasts.
• Dell Technologies (DELL US) is currently the main candidate to be added by transition to the S&P 500 in September 2024 Quarterly Rebalance.

• Digital Arts (2326 JP) , based in Japan offers internet security software and appliances  globally. The company also provides consulting services related to information security.
• The company’s share price has moved up by more than 30% over the last 30-days driven by DA’s decision to deconsolidate its DAC business.
• Given the high-cost nature, we welcome Digital Arts’ move to deconsolidate the DAC business as it should help improve the company’s profitability.

• South Korea is prioritizing enhancing its EDA competitiveness to stay ahead in the technological race.
• China is focusing on consolidating promising chip firms while doubling the terminations of IPOs to control the market.
• Commodity DRAM and NAND chip prices are stalling due to slow demand recovery, affecting Taiwanese companies and PanelSemi’s development of mini LEDs. Vietnam PM strengthens South Korea relations and secures investments in display production and clean energy. Taiwan is aiming to lead in floating wind technology with a projected global investment of EUR250 billion by 2035.

• When this deal was announced, it was light. But the timing, JSR influence, large-ish float, ensured FUD would make this trade wide. It traded wider.
• Nearly 6mos ago, Shinko had much-underperformed peer Ibiden, meaning downside gap risk from undisturbed was negative as spreads were wide. I reco’d a buy. Then 16+wks ago, recommended taking profits.
• Shinko had outperformed Ibiden, gross spreads had narrowed 5+% on JSR approval. Gross spread is now 4.6% but time is shorter so annualised is 10+% even out to December launch.

• Apple Increasing Chip Orders with TSMC — Expecting iPhone 16 Sales to be Much Stronger Than iPhone 15 Thanks to AI
• Google Said to be Shifting to TSMC from Samsung for Next Generation AI Mobile Phone Chips
• This June 28th piece appears to be timely — Memory Monitor: Micron’s Shares May Be Falling But Results’ Industry Implications Are Positive

• Taiwan plans to release offshore wind regulations by 3Q24, boosting the renewable energy sector’s growth and investment opportunities.
• Chinese investment in 8.6G OLED technology is boosting the South Korean display equipment industry, leading to potential economic growth.
• VinFast’s Indian factory may open earlier than expected, while mobile device suppliers show interest in using edge AI to enhance the market.

• Taiwan set to release offshore wind regulations by 3Q24, opening doors for growth and innovation in the industry.
• China’s significant investment in OLED technology boosts South Korean display equipment sector, creating opportunities for growth.
• Telecoms facing challenges with slow 5G adoption, pushing them to adapt and transform strategies to overcome obstacles.

• On 3 July, PUSU deadline, Bidco and Keywords Studios (KWS LN) have agreed to an acquisition to be carried out through a scheme of arrangement. 
• Shareholders will receive 2,450p/share in cash, cum dividend, 66.7% premium, for 22.4x Fwd P/E. There’s a minimal number of irrevocables and just 7.57% of capital in letters of intent. 
• I think the price is reasonable considering the recent challenges affecting the value of the stock, and deal will close. Spread is 2.45%/6.3% (gross/annualised, assuming settlement by 29 November). Long.

• Soundthinking (SSTI) is a SaaS company providing technology to law enforcement agencies for enhanced effectiveness
• Market cap of $200 million and trading at 2x sales, considered cheap compared to growth potential
• Company has history of 15% annual growth, 60% gross margins expected to increase with expansion, projected revenue growth of 15% over next three years, EBITDA margins expected to reach 32% by 2026, stock predicted to trade at $74 per share with 360% upside from current prices

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.