15

April2021

Vitarka

ANTYA’s views on investing markets, economy, and more

Latest Insights

Bristol Myers Squib & Celgene–Starboard Objections Addressed Today- Successful Deal Closure Probable

The proposed Bristol Myers Squibb Co (BMY US) & Celgene Corp (CELG US) transaction announced in the first week of 2019, garnered many sceptical comments. Starboard Value jumped in the fray by writing a letter denouncing the transaction while one of the largest holders of BMY, Wellington Management Group, holding about 7.7% of the stock expressed a desire to vote against the transaction. BMY’s response to Starboard’s half-baked objections…

Facebook Inc. – Is Consensus Overly Cautious?

Facebook Inc A (FB US) is a bellwether stock for the equity markets. Although the market capitalisation is approaching $475 billion, the Company is still considered a growth stock. In our view, 2019 could be a pivotal year for the Company after a lack lustre 2018, when FB, although volatile, underperformed the NASDAQ. We believe that investors are underestimating revenue growth for 2019 and that FB is likely to…

Meituan Dianping – Is a One Billion U.S. Dollar Impairment Forthcoming?

Since initiating coverage prior to Meituan Dianping’s (3690 HK) IPO, we have been bearish with respect to both its valuation and its business prospects given escalating competition in China in the food delivery segment, courtesy Alibaba Group Holding (BABA US). Moreover, with a slowing Chinese economy putting downward pressure on outbound tourism from China, as witnessed in recent data from Macau, the Company’s travel business is also likely to…

Tesla Motors – Gaining Industrial Strength

Tesla Motors (TSLA US) continues to power ahead of the competition in electric vehicles with an 80% market share of all electric vehicles sold in the United States in 2018. With approximately 140,000 Model 3 cars sold in the U.S., Tesla outsold every marquee sedan brand. Model 3 outsold mid-size SUVs including BMW X3, Acura MDX, Audi Qs, Lexus RX and even the Mercedes C-Class.

Bristol Myers Squib – Reaffirming Its View on Celgene Corp

The management of Bristol Myers Squibb Co (BMY US) reiterated its optimistic view regarding the acquisition of Celgene Corp (CELG US) on its Q4-18 earnings conference call today. Unlike most acquisitions that succeed based on cost cuts or revenue synergies, Celgene’s distressed valuation allowed BMY to swoop in and buy a leading bio-tech at a bargain price: if the pipeline succeeds. We are betting it will. If not, the…

Celgene and Bristol-Myers Squibb – Undervalued and Underappreciated

A dismal 2018 for the pharmaceutical and bio-tech stocks seems far in the rear view mirror. 2019 began with a bang with two blockbuster deals in the pharmaceutical space within days. In this note, we discuss Bristol Myers Squibb’s Co (BMY US) acquisition of Celgene Corp (CELG US) and outline our view that investors should go long BMY.

Tesla Motors Inc: Come Hell or High Water

It is our view, that come hell or high-water, in 2019, Tesla Motors (TSLA US) will establish itself as the pre-eminent large-cap growth stock. Those that are short would cover the position at a loss and those that are long are looking at another Apple Inc (AAPL US) or Amazon.com Inc (AMZN US) in the making. The ride may be volatile, but will be worth it.

Tencent Music Entertainment Group – Back in the Groove with an Unjustified Valuation Multiple

The proposed IPO of Tencent Music Entertainment (TME US) although highly anticipated is no slam dunk for investors. China’s online social entertainment market is hyper -competitive with multiple players vying for attention. Online music streaming is no less competitive with Baidu Inc (ADR) (BIDU US) and Netease Inc (Adr) (NTES US) joining forces to compete head-on with TME. We remain on the sidelines and suspect that a better entry…

Tesla Motors Inc. — For Whom the Bell Tolls

An eventful November 2018 continues for Tesla Motors (TSLA US). The Company surpassed market expectations for gross margins and free cash flow generation, appears to have stabilised its Model 3 production, is no longer expected to default on convertible debt due in March 2019, and most recently reduced pricing in China to maintain momentum. All of these are good signs which point to a break-out year for Tesla in…

Meituan Dianping – Is the Impressive Growth Sustainable?

Meituan Dianping (3690 HK) appears to have side stepped the slowdown in the Chinese economy by posting a robust set of numbers. While on a YoY basis the trends are unambiguously positive, QoQ numbers suggest a challenging 2019 is in store. Ultimately it will be a trade-off between user incentive spending and transaction growth. MD users are currently transacting at a rate that is 2.8x that of Just Eat…

Xiaomi Corporation – Running Harder to Stay Still

By focusing investor attention on gross profit, Xiaomi Corp’s (1810 HK) Q3-18 results deftly side-stepped the YoY EBITDA decline of 14.3%. To us it is evident that economies of scale are absent in the business, and with an ever increasing emphasis on extending generous credit to boost sales overseas, Xiaomi is playing with fire. We advise investors to exercise caution. In our view, there is better value elsewhere in…

Xiaomi Corporation — Running

By focusing investor attention on gross profit, Xiaomi Corp’s (1810 HK) Q3-18 results deftly side-stepped the YoY EBITDA decline of 14.3%. To us it is evident that economies of scale are absent in the business, and with an ever increasing emphasis on extending generous credit to boost sales overseas, Xiaomi is playing with fire. We advise investors to exercise caution. In our view, there is better value elsewhere in…
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