The latest Market Talks covering Technology, Media and Telecom. Published exclusively on Dow Jones Newswires at 4:20 ET, 12:20 ET and 16:50 ET.
0807 GMT - Tele2's price increases should continue to support solid topline growth in 1Q, but higher commercial related costs and tougher comparables on energy and cost savings could impact earnings development, Citi analyst Siyi He writes. The bank expects group underlying earnings before interest, taxes, depreciation, amortization and the cost of leased assets, or Ebitdaal, to grow by 0.4%. Cit anticipates a meaningful acceleration of Ebitdaal towards 4Q though, as comparables improve and benefits from the SEK600 million cost saving plan start to become visible. "The muted Ebitdaal growth has been well flagged. We continue to like the shares given the market structure, attractive yield 7.5%, and exposure in market consolidation." Citi rates Tele2 at buy with a SEK102 target price. Shares trade 0.7% lower at SEK91.18. (dominic.chopping@wsj.com)
0330 GMT - Baidu's AI business will be key to driving long-term monetization and efficiencies, Jefferies analysts say in a research note. Jefferies trims its 1Q revenue forecast for Baidu core to CNY23.6 billion from CNY24.4 billion to factor in softer advertising performance and more prudent assumptions in cloud and non-cloud performance, they say. As a result, Jefferies expects 1Q non-GAAP operating profit for Baidu core at CNY5.3 billion, down from its previous estimate of CNY5.7 billion. A key focus for the 1Q earnings call will be Baidu's generative AI model Ernie and its integration with search, cloud and other segments, monetization, and the competitive landscape in the generative AI field, Jefferies adds. It maintains a buy call on Baidu and keeps its target unchanged at HK$179.00. Shares are last at HK$100.30. (sherry.qin@wsj.com)
0307 GMT - Tencent's major shareholder Prosus selling its stake in the company isn't a cause of worry for the markets as the latter's sell-off size has been narrowing while Tencent's share buyback size is improving, Citic Securities analysts say. Tencent's share buyback scale in 2024 is likely to reach 2 to 2.5 times the share reduction size by Prosus, they reckon. Dutch tech investor Prosus had said in 2022 that it will sell its Tencent stake gradually to fund its own share repurchase program. Citic maintains a buy rating on Tencent, with a target price of HK$398. The stock is 0.5% lower at HK$303.80. (tracy.qu@wsj.com)
0239 GMT - LX Semicon faces challenges from intense market competition this year, Daiwa Capital analyst S.K. Kim says in a note. The South Korean maker of display driver integrated circuits for smartphone, tablet PC and TV screens could see its operating profit fall 44% on quarter and 4.3% on year in 1Q on weak smartphone sales, Kim reckons. Revenue from the small-sized DDI circuit business could fall 12% in 2024, as rivals expand their DDI market shares at a faster-than-expected pace. Daiwa downgrades the stock to outperform from buy and cuts its target by 5.3% to KRW90,000. Shares are 3.0% lower at KRW78,400. (kwanwoo.jun@wsj.com)
2316 GMT - U.S. investment firm K1's takeover offer for Qoria worth A$0.40/share looks too low to Shaw & Partners based on other recent deals in the tech sector. In a note, analyst Jules Cooper highlights that the initial premiums offered by bidders for Nitro Software, Elmo and Whispir averaged 67%, rising to 93% when the deals were completed. K1's proposed 27% premium to acquire Qoria looks low, given that the company is also approaching a cash profit inflection point, Shaw & Partners says. Qoria said on Monday that it rejected K1's proposal. Shaw raises its target price for Qoria by 30% to A$0.52/share to reflect the potential for a change of control. (david.winning@wsj.com; @dwinningWSJ)
1549 GMT - Industry data shows that Shopify's traffic trends have improved over the last two months from a post-Christmas holiday lull, according to a report by Todd Coupland of CIBC. The analyst says that this improvement places Shopify in a position to "at least" meet FactSet forecasts of 19% for year-over-year growth in 1Q gross merchandise volume. "Share gains and the ability of Shopify merchants to generate greater levels of GMV than peers will likely also contribute to GMV growth that outpaces that of the broader market," Coupland says. (adriano.marchese@wsj.com)
1446 GMT - Vince McMahon, the founder of modern professional wrestling who has been dogged by legal issues, continues to pare his holdings in TKO Group, the wrestling empire he long ran. McMahon, who sold 5.35 million TKO shares last month, agrees to sell another nearly 3.5 million shares at $89.01 apiece, or around $311 million. TKO is buying back about 1.85 million shares for $165 million, while Endeavor Group, already TKO's majority owner, is shelling out $146.2 million for roughly 1.64 million shares. Endeavor last week agreed to be taken private by Silver Lake, with TKO remaining publicly traded. TKO up 3% to $95.25. (colin.kellaher@wsj.com)
1417 GMT - Canadian space industry company MDA Space says it's expanding its robotics offerings for the global space industry. The company unveils its MDA Skymaker, a new suite of space robotics and services it says will support "a diverse range of missions including lunar surface rovers and landers, space stations, satellite servicing in all orbits, and in-space assembly and manufacturing." MDA Space says operational costs for its customers can be lower by having it perform mission operations from the company's new commercial mission control center, "leveraging decades of robotics space mission design and mission operations support." (adriano.marchese@wsj.com)
1328 GMT - Brazil's Supreme Court Justice Alexandre de Moraes launches an investigation on Elon Musk, local media reports, after the owner of X, formerly known as Twitter, said over the weekend that his platform would no longer comply with court orders to remove several user accounts, while calling for De Moraes' impeachment or resignation. The requirement to remove accounts are part of a broader clampdown on the use of social media to spread hate speech and false information, led by De Moraes, who has said curbing disinformation is necessary to safeguard Brazil's democracy. (paulo.trevisani@wsj.com; @ptrevisani)
(END) Dow Jones Newswires
April 09, 2024 04:20 ET (08:20 GMT)
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