Financial Briefing - Tuesday, January 30th 2024
From All Articles on Seeking Alpha
Intel: Don't Bet On It Catching Up To TSMC
The author of this article is bearish on Intel for three key reasons. First, they believe that Intel may struggle to catch up with Taiwan Semiconductor Manufacturing Company (TSMC) in foundry technology, which is crucial for producing smaller, faster, and more advanced chips. TSMC's CEO has stated that their upcoming chip, N3P, will be more advanced than Intel's 18A chip. Second, there are several business headwinds facing Intel, including a material inventory correction in the Data Center and AI segment and weak demand in the Network and Edge segment. These challenges could lead to market share loss and impact Intel's outlook. Finally, the author believes that Intel's valuations are steep and do not offer a sufficient margin of safety. Intel is currently trading 74% above its longer-term median EV/EBITDA ratio. In conclusion, the author sees more downside potential for Intel and is not optimistic about its ability to close the technological gap with TSMC.
Ramelius Resources Limited (RMLRF) December 2023 Quarterly Conference Call Transcript
Ramelius Resources Limited recently held its December 2023 quarterly conference call, providing an update on its operations and financials. The company reported a quarterly gold production of 68,524 ounces, which is at the upper end of its quarterly guidance range. The increase in production was primarily due to a greater contribution from the Penny underground mine and ramping up of mining operations at the Symes' open-pit operation. The company also reported strong cash flow, with operating cash flow of AUD 68 million and underlying free cash flow of AUD 45.7 million. Ramelius upgraded its second-half guidance to 140,000 to 155,000 ounces, resulting in an increased full-year guidance of 265,000 to 280,000 ounces. The company expects strong cash flows to continue over the rest of the financial year. In terms of costs, the company reported all-in sustaining costs for the December quarter of AUD 1,837 per ounce.
10 Investment Themes To Kick Off 2024
As we enter 2024, there are several key investment themes that will impact portfolios in the year ahead. Uncertainty remains a certainty, with the Federal Reserve's rate expectations swinging from cuts to hikes and back again. Economic indicators such as inflation, unemployment, and liquidity conditions should be monitored to preempt any reactive policy shifts. The debate over the U.S. economic trajectory is ongoing, with a focus on the stubbornness of the Fed in its inflation battle. Positioning, profits, and policy indicators could signal a shift back to risk assets, and areas such as corporate credit and emerging markets should be considered. Bond market volatility is anticipated to give way to equity volatility in 2024, driven by uncertainties around growth, inflation, and corporate earnings. A strategic pivot towards high-quality assets with moderate duration is advised as interest rates flatten. BB-rated bonds in the high yield space present an opportunity for measured exposure due to historically high yields and rising quality. While large-cap stocks have dominated returns, small and mid-cap stocks should not be overlooked, particularly in an economic recovery. Digital assets are maturing, and the launch of Spot Bitcoin ETFs in 2024 could integrate them into traditional investment portfolios. Global elections and geopolitical conflicts could influence market impacts, but they have historically had more temporary than lasting impacts on asset prices. A softening U.S. dollar could present opportunities for emerging markets and select G10 currencies. Investor sentiment towards China is bearish, but the current valuations of Chinese stocks present potential opportunities. In the commodities market, active real asset allocations are favored over passive allocations due to continued divergence in fundamentals, momentum, and trend.
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From Business & Finance Archives | Reuters News Agency
Choice Hotels nominates board directors in hostile Wyndham bid
Choice Hotels International has moved forward with its $8 billion hostile bid for Wyndham Hotels & Resorts by nominating a slate of directors to replace Wyndham's current board. Choice Hotels is confident it will obtain antitrust clearance for the deal, as the combined companies only account for about 10% of U.S. room revenue. The proposed merger is expected to generate approximately $1 billion of free cash flow in 2024, enabling Choice Hotels to quickly pay off debt and make strategic investments. The move comes as Choice Hotels seeks to expand its presence in the hospitality industry by acquiring Wyndham, a major player in the market.
Worldline taps advisers for defence strategy amid share slump 
French payments company, Worldline, has appointed bankers to seek advice on a defence strategy in order to prevent a hostile takeover attempt and ease concerns among shareholders following a decline in its share price. Reuters initially reported the news, revealing that the company aims to protect itself against any potential unsolicited bids. Worldline, which provides payment and transactional services, has enlisted the support of bankers to formulate a plan and reassure shareholders. The move comes after the company's share price experienced a significant drop. Worldline has been expanding its business through acquisitions in recent years and has become one of the largest payment processors in Europe. With this latest step, the company aims to safeguard its existing position and maintain control over its strategic direction.
ECB sounds out lenders on exposure to Spanish drugmaker Grifols 
The European Central Bank (ECB) has requested banks to disclose their exposure to Spanish pharmaceutical company Grifols and its affiliated companies. This comes following allegations made by short-seller Gotham City Research that Grifols manipulated its financial accounts. The ECB's concern arises from the significant drop in Grifols' share price, potentially necessitating additional margin requirements for companies linked to the founding family. Grifols has vehemently denied all the allegations. The news, originally reported by Reuters, was subsequently picked up by other major media outlets such as Bloomberg, Spain's state-owned news agency EFE, and several national newspapers including Expansion, El Mundo, and Cinco Dias. The request from the ECB for detailed exposure to Grifols highlights the potential risks associated with the ongoing controversy surrounding the pharmaceutical company.
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