ponravin phom-in/iStock via Getty Images Introduction In the past couple of weeks, the stock market went from extreme fear to greed very quickly, as investors started to price ongoing tensions in Iran and around the Strait of Hormuz as just another headline risk. While not an issue by itself, stock picking seems to have become fashionable again, and sentiment has heated up, especially around indiv...
ponravin phom-in/iStock via Getty Images Introduction In the past couple of weeks, the stock market went from extreme fear to greed very quickly, as investors started to price ongoing tensions in Iran and around the Strait of Hormuz as just another headline risk. While not an issue by itself, stock picking seems to have become fashionable again, and sentiment has heated up, especially around individual small-cap names on X that are getting pushed. AI, memory and photonics names are the main drivers. Sivers Semiconductors AB ( SIVEF ), Applied Optoelectronics ( AAOI ), and Tower Semiconductor ( TSEM ) fit into that environment as well. I already covered each at a Buy rating, and all three have performed well since. I now see them more as Holds and do not think the risk/reward is as good as before. LPKF Laser & Electronics ( LPKFF ) is a German laser-processing equipment company that has been gaining traction amid this runup as well. Data by YCharts I believe LPKF is still a cautious Buy, but not the same kind of opportunity it was at previous, lower valuations. There is continued upside potential if LIDE gains traction in advanced packaging. The qualitative story The advanced packaging thesis starts with the end customer. Hyperscalers are still raising AI capex as this earnings season has shown yet again. Larger chips and more complex packages need substrates with better dimensional stability, lower warpage and higher interconnect density. That is why glass is becoming relevant in advanced packaging. Organic substrates can remain important, but glass has properties that become more valuable as package size and routing complexity increase. LPKF sells the equipment needed to process glass for advanced packaging. That makes the company an upstream enabler. If glass substrates gain share, manufacturers need tools that can form through glass vias, structure surfaces and bond glass with high precision. LPKF's LIDE process is built for exactly that. The company describes NE...
FabrikaCr/iStock via Getty Images Welcome to another installment of our BDC Market Weekly Review, where we discuss market activity in the Business Development Company [BDC] sector from both the bottom-up, highlighting individual news and events, as well as the top-down, providing an overview of the broader market. We also try to add some historical context as well as relevant themes that look to b...
FabrikaCr/iStock via Getty Images Welcome to another installment of our BDC Market Weekly Review, where we discuss market activity in the Business Development Company [BDC] sector from both the bottom-up, highlighting individual news and events, as well as the top-down, providing an overview of the broader market. We also try to add some historical context as well as relevant themes that look to be driving the market or that investors ought to be mindful of. This update covers the period through the first week of May. Market Action BDCs had a strong week with a 5% average return. Year-to-date, the average company is flat on a total return basis. Systematic Income Prices are up around 13% on average since their trough a few weeks ago. Systematic Income Valuations have retraced, though they are still at depressed levels. The aggregate valuation remains slightly overstated (i.e., discounts will be reduced once anticipated NAV drops come in). Systematic Income Market Themes Redemptions from private BDCs have been a key sentiment headwind for the sector. An important factor that is driving outflows, however, is savvy investors getting out at the NAV from private BDCs and reinvesting the capital into public BDCs that trade at a discount to NAV. Many BDC managers have both private and public BDCs, including Ares, Blackstone, Barings, Blackrock, Goldman, Blue Owl, Monroe, Oaktree, Apollo, Morgan Stanley, and others, and it’s fair to say there is significant overlap in portfolios, which means that investors can own much the same portfolio in a public BDC but at a huge discount. Investors should note, however, something that can justify a discount for public BDCs relative to private BDCs is if a public BDC has a higher fee structure than the private BDC. However, some of the more recently launched public BDCs, such as BXSL, MSDL, and others, have very shareholder-friendly fees on par with private BDCs, which means the discount isn’t at all justified. And even if a public BDC ...
Hongkongers packed the aisles of supermarkets with carts full of daily necessities as the city’s major grocery chains engaged in what some were calling a “price war” ahead of Mother’s Day. Hong Kong’s two major supermarket chains, CK Hutchison Holdings-backed ParknShop and Jardine Matheson’s Wellcome, each offered 12 per cent off everything in their stores for those who bought a certain amount of ...
Hongkongers packed the aisles of supermarkets with carts full of daily necessities as the city’s major grocery chains engaged in what some were calling a “price war” ahead of Mother’s Day. Hong Kong’s two major supermarket chains, CK Hutchison Holdings-backed ParknShop and Jardine Matheson’s Wellcome, each offered 12 per cent off everything in their stores for those who bought a certain amount of goods on Saturday. HKTVmall, the city’s popular online shopping platform, entered the fray and...