Eoneren/E+ via Getty Images Investment Overview I wrote about GDS Holdings ( GDS ) previously with a buy rating as orders were showing up, and I believed GDS had the capacity (financial and physical land) to deliver these orders. GDS's Q1 2026 update makes me more confident in my buy rating. The reported numbers were messy because of one-time items, but the more important point is that bookings, b...
Eoneren/E+ via Getty Images Investment Overview I wrote about GDS Holdings ( GDS ) previously with a buy rating as orders were showing up, and I believed GDS had the capacity (financial and physical land) to deliver these orders. GDS's Q1 2026 update makes me more confident in my buy rating. The reported numbers were messy because of one-time items, but the more important point is that bookings, backlog, land bank, and unit costs all moved in the right direction. In my view, the market is still focusing too much on near-term EBITDA and not enough on the long-term impact on P&L from current orders. 1Q26 Earnings GDS reported what I thought was a very solid set of results, but the share price fell by a ton, which I believed was due to the messy headline numbers due to the one-time items. As a recap, revenue saw RMB3,367.1 million, up 23.6% y/y. Excluding one-time items, revenue was RMB2,938 million, up 7.9% y/y. The operating metrics were healthy as well. Total area committed and pre-committed increased 11.7% y/y to 725,485 sqm, and area utilized increased 12.7% y/y to 520,929 sqm. Area in service increased 10.4% y/y to 674,269 sqm. Utilization improved to 77.3%, up ~160bps y/y vs. 75.7% last year. The commitment rate for the area in service was also above 90% at 92.8%, while the pre-commitment rate for the area under construction was healthy at 84.4%. Margins and profits also need to be viewed on a normalized basis. On a reported basis, gross profit was up a chunk by ~76% y/y to RMB1.13 billion. Excluding one-time items, gross profit saw RMB702.4 million, up 8.9% y/y. On an adjusted basis, gross profit saw RMB1.95 billion, up 34.1% y/y. Excluding one-time items, adj. gross profit was RMB1.52 billion, up 4.6% y/y. Adjusted GP margin was 58%, or 51.8% excluding one-time items, down from 53.4% last year. The normalized margin decline was mainly due to higher utility costs as a percentage of revenue. Finally, adj. EBITDA saw ~RMB1.95 billion, up 47.2% y/y, but excluding ...
New Zealand home-building has slumped to a 10-year low as a stagnating housing market and global uncertainty hit demand for new dwellings and alterations. The volume of residential construction fell 5% to NZ$17.6 billion ($10 billion) in the 12 months through March, Statistics New Zealand said Thursday in Wellington. That’s the lowest March-year tally since 2016 and is a 25% slump from the peak se...
New Zealand home-building has slumped to a 10-year low as a stagnating housing market and global uncertainty hit demand for new dwellings and alterations. The volume of residential construction fell 5% to NZ$17.6 billion ($10 billion) in the 12 months through March, Statistics New Zealand said Thursday in Wellington. That’s the lowest March-year tally since 2016 and is a 25% slump from the peak seen in 2023. The building industry has struggled through a period of high interest rates, followed by a mix of geopolitical concerns that hit buyer confidence and weighed on the residential property market. As house prices declined, developers became wary of committing to new projects, while home owners remained reluctant to sell their existing homes and invest in a new dwelling. Prices have stalled this year as home-loan interest rates increase and the global energy shock hits household incomes. While an increase in building consents hints at a construction recovery, the medium-term outlook is less certain. “We expect to see home building activity turn higher through the latter part of the year, with the number of new dwellings consented up 11% over the past year,” Satish Ranchhod , senior economist at Westpac in Auckland, said in an emailed note. “What’s less clear is whether that momentum will be sustained as we head into 2027, with interest rates and building costs pushing higher, while house prices remain soft. Combined with broader uncertainty about the economic outlook, developers are likely to be cautious about initiating new projects over the months ahead.” Read more: World’s Biggest Housing Bubble Pops, Roiling New Zealand Economy Today’s report showed non-residential construction volumes fell 9.9% from the previous year — the lowest in four years — while total building work fell 6.9% to a 10-year low. The contraction poses downside risks to first-quarter economic growth projections even ahead of the full impact of the global energy shock which is expected to hit t...
A number of stocks fell in the afternoon session after rising Treasury yields compressed valuations for growth-oriented names as geopolitical uncertainty dulled the advertising outlook.
A number of stocks fell in the afternoon session after rising Treasury yields compressed valuations for growth-oriented names as geopolitical uncertainty dulled the advertising outlook.
Donny DBM/iStock via Getty Images Investment Objective SGA builds high-conviction portfolios focused on quality growth businesses that are anticipated to achieve consistent mid-teens earnings growth with reduced variability, supported by predictable revenue and cash flow generation. The firm's investment goal is to convert this stable portfolio earnings growth into a return profile designed to pro...
Donny DBM/iStock via Getty Images Investment Objective SGA builds high-conviction portfolios focused on quality growth businesses that are anticipated to achieve consistent mid-teens earnings growth with reduced variability, supported by predictable revenue and cash flow generation. The firm's investment goal is to convert this stable portfolio earnings growth into a return profile designed to protect and reliably compound client wealth over time. Performance The dominant themes from 2025, which catapulted international markets to their strongest performance in years, continued through late February with the market sharply higher on the back of strength in AI Hardware stocks and other cyclicals such as Metals & Mining stocks. The outbreak of the military conflict in Iran, however, re-introduced acute geopolitical risk and put sharp downward pressure on markets over the last month of the quarter. The disruption to energy markets and spike in oil prices benefited Energy stocks, which outperformed significantly in March. With the portfolio's participation in the AI Hardware trade limited to our position in TSMC ( TSM ) and no exposure to the strongly performing energy and commodities-linked cyclical stocks, combined with broad-based weakness in the portfolio's e-commerce platform companies and software/services companies, the portfolio failed to keep pace with the index in Q1. The portfolio returned -10.3% (Gross) and -11.0% ( NET ) compared to the MSCI ( MSCI ) ACWI ex USA ((Net TR)) return of -0.7% and the MSCI ACWI ex USA Growth ((Net TR)) return of -3.6%. Highlights ■ The SGA International Growth Portfolio returned -10.3% (Gross) and -11.0% ( NET ) compared to the MSCI ACWI ex USA ((Net TR)) return of -0.7% and the MSCI ACWI ex USA Growth ((Net TR)) return of -3.6%. ■ Relative returns were negatively impacted by a continuation of AI momentum and cyclical strength dynamics through the first two months of the quarter; relative performance improved towards the end of ...