Archived by alpha
Ericsson is a global market leader in telecommunication equipment. But its technology leadership has not resulted in positive returns for long-term investors. The share price declined 50% in the past decade (apart from temporary highs), and is only 1/10 compared to its all-time high during the dot-com bubble in the late 1990s. In the past years the company has been involved in multiple bribery crises across the globe (incl. with ISIS). Ericsson now has headwind from the tougher economic climate that also impacts 5G spend. The company recently announced to cut 8.500 headcount (8%) globally. And looking at recent earnings the company has mostly missed analysts expectations.
Monitor by Jocke
Air Liquide is the 2nd largest gas company in Europe. Air Liquide operations consist, among other things, of manufacturing and selling gases to areas such as industry, chemistry, electronics, food, environmental care and healthcare. The company operates on a global level. Air Liquide was founded in 1902 and has its headquarters in Paris Europe needs to switch from Russian Gas to other suppliers and that will be beneficial for Air Liquide. If you look at the que figures, the revenue is increasing, and they also have a good cashflow. Since start, Air Liquide has increased its turnover and is still growing. So I see no problem with the P/E being just over 28.
Buy by micke
Hexatronic (HTRO) is a leading fiber optics company. The sales and profits have increased organically and via acquisitions, the share price had a fantastic rise from ~14SEK December 2020 to ~160SEK December 2022, where after the share price has crashed down to ~17SEK (21 Nov 2023), after several disappointing figures during 2023, market overall reevaluating growth, and short sellers (Viceroy Research) describing Hexatronic as uninvestable. On 21 Nov HTRO announced lower expectations on short term ebita margin of 12-14%, the share price dropped 36% that day. The presented numbers are only a part of the problem, investors and analysts lost confidence in the company and it's ability to see the market trends and communicate. HTRO announced that they will lay off 160 FTE. For an opportunistic investor this seems like a good time to do a review of Hexatronic. My guess is EPS25=3SEK, PE25=6 on today's share price of 18 SEK. I think there is good upside potential but with high uncertainty.
- 30.00 +49.85% by 22/11/2024
Buy by micke
A profitable bank that has high dividend, probably share buy backs and, in my opinion too low valuation PE23=5. The main drag on valuation is that most banks have low P/E due to market fear of macro and real estate defaults. If ABN can show that it can deliver on or over targets over time there could be a long term potential of 100% if banks in general get higher valuations. ABN has 50% dividend policy =10% dividend, and since CET1 ratio is already above target I expect additional share buy backs. RoE target is 10%, which is lower than current level 13.6%.
- 16.00 +30.03% by 17/11/2024
Buy by alpha
ABN is a Dutch bank with Retail banking, Wealth management and Corporate banking services in North-West Europe. Income comes mostly from NII, of which 90% in the Netherlands. A market cap of €10B and €2.5B net income gives a valuation of 4x 2023e. My expectation is that market conditions with higher interest margins will prevail in 2024. Given a cost level of €5B the earnings potential is €2-3B before tax. 10% annual dividend yield with an extra 10% from an expected shares buyback (2024-2026) are good returns with limited down-side risk at PE 4-5 (€12.50). The key earnings risk is in the development of the Net Interest Margin that drives NII.
- 16.75 +36.12% by 26/09/2024
Hold by alpha
Centrus is a US based uranium supplier of LEU (>$225M) and technical services ($50M) with customer in the US, Asia and Europe. It is the only company licensed by the US Department of Energy to produce HALEU (20% U-235) required for Small Modular Reactors (SMRs). SMR's are factory produced nuclear power facilities. The CO2 foot-print is similar to other green energy sources (11-12gCO2e/kWh vs Hydro 24g, Solar 40-50g). Market expectations are that SMR's will come into production after 2030. The company is valued at <20x PE TTM after Q3'23. With the HALUE contract and higher uranium prices I estimate $5 earnings per share in 2024 (10x PE '24). Earnings are volatile and the investment is a high risk bet on a trend for the next 25 years supported by US National Security policy to turn the clock back 40 years! My thesis is that demand for HALUE and the general momentum in the nuclear energy market will support the share price going forward.
- 75.00 +45.35% by 01/06/2024
Buy by alpha
BioArctic is the first company that gained full commercial approval for an Alzheimer disease (modification) treatment (in the US). Together with partner Eisai it will commercialize the large global AD market with approvals pending around the globe. Revenue in 2023 is mainly driven by milestone payments. In 2024 revenue will be driven by patents enrollment at $26.5k/year. With the uncertainty of the roll-out and higher operational costs the earnings for 2023 and 2024 are estimated around break-even. In the coming 12 months continued high volatility can be expected; with buying opportunities (<250kr).
- 400.00 +67.64% by 01/06/2025
Monitor by alpha
Nordic Semiconductors is a semiconductor supplier for ultra-low power communication electronics. Its target markets; IoT, smart-home and short range communication, are interesting for future growth. Current valuation is relative high, 35x PE TTM, as earnings declined with 65% in 2023. The share price has not fully adjusted and I expect a further decline. A company to keep on the watch-list for 2024.
- 65.00 -34.28% by 01/04/2024
Sell by alpha
Upstart runs a Cloud-platform for retail loans with AI technology based credit scoring. The platform connects consumers that apply for loans with banks and other credit providers. Upstart's partner network funds the retail loans. The company did an IPO in December 2020 at $20 and reached $390 in Oct'21. It fell below $15 before rising to $72 in 2023 (+400% YTD). The 2023 run was caused by a (expected) short squeeze from a short interest of 35% in July '23 combined with the ongoing AI-hype. The company targets a traditional market with modern technology and can potentially win a large share of the loans market with TAM >$1 trillion. Sounds like a strategic interesting market, but management does not deliver (yet?)!
- 15.00 -54.60% by 01/06/2024
Short-list by alpha
Nordic Paper is a paper producer for Kraft paper (60%) and grease paper (40%) where Kraft paper delivers most of EBITDA. The company has a well diversified product portfolio and customer mix which adds to the quality of earnings. In 2022 strong market conditions resulted in 8.5kr earnings per share (PE 4x). The market expects an earnings decline for the sector given the low PE multiple. The dividend policy, 50-70 payout, should result in >10% dividend yield. TTM Q3'23 earnings per share are above 8kr. The company is a buy with 30% margin-of-safety compared to the PE multiple 7x. The stock price momentum is good, although this could change when earnings diminish in an economic downturn.
- 50.00 +17.92% by 29/05/2024