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.
0814 GMT - SMIC and Hua Hong Grace's upbeat results indicate "an increasingly constructive recovery" for legacy and specialty semiconductors, Citi analysts say in a research note. AI is not only driving demand for advanced nodes but also increasing demand for mature-node chips used for power management, connectivity and peripheral logic, the analysts say. Both companies have negotiated wafer price hikes with clients, which created meaningful operating leverage despite rising depreciation from new capacity. Citi expects trailing-edge foundries to have better pricing leverage than they had over the past two years thanks to the AI boom. The bank raises SMIC's target price to HK$100.00 from HK$90.00 and Hua Hong's to HK$175 from HK$160.00. SMIC's shares were last 6.2% higher at Hua Hong Grace rose 7.5%. (sherry.qin@wsj.com)
0738 GMT - Universal Music Group continues to benefit from higher minimum per-subscriber payments, Citi analysts write in a note. The world's largest music company shows sustainable growth driven by increases in minimum per-subscriber payments from online music streaming platforms, they say. The group also has growth potential related to AI-generated playlists, given the potential launch of this service by Spotify in the second half of the year or early 2027, they add. The U.S. bank resumes its coverage with a buy rating and a target price of 20 euros on the stock. Shares are up 0.9% at 15.08 euros. (najat.kantouar@wsj.com)
0728 GMT - Citic Telecom's mobile services and international telecommunications services are likely to remain key growth drivers, says DBS Group Research's Tsz Wang Tam in a note. The company's 1H earnings were largely stable, buoyed by its resilient mobile and international segments, the analyst says. The company is also budgeting a higher capital expenditure of 145 million Hong Kong dollars to support its artificial-intelligence infrastructure investments, he adds. The completion of its Hutchison Telecom Macau acquisition is likely to strengthen Citic Telecom's market leadership in Macau. DBS projects 4.3% and 5.2% earnings growth for 2026 and 2027, respectively. The bank retains its buy rating and HK$3.30 target price. The stock is up 3.3% at HK$2.515. (megan.cheah@wsj.com)
0650 GMT - Liquid cooling penetration among AI chips is projected to approach 60% by 2027, as next-generation AI hardware continues to push power and thermal requirements higher, according to research firm TrendForce. The firm says adoption is expected to rise from approximately 33% in 2025 to 53% in 2026, driven by continued investment in AI infrastructure and the rollout of new high-performance AI chips from Nvidia, AMD and Google. AMD is expanding its AI platform strategy with the Helios rack-scale solution, which is expected to enter large-scale shipments in 2027, while the next-generation MI500 platform is being developed to compete with Nvidia's Rubin Ultra, TrendForce says. (jie.yang@wsj.com)
0642 GMT - UMS Integration could benefit from the artificial-intelligence capital expenditure cycle, as its new and existing customers have robust demand for next 2-3 years, Maybank Research's Jarick Seet says in a research report. In 2025, the high-precision components manufacturer's new customer contributed 35 million Singapore dollars of revenue, says the analyst who expects this contribution to double in 2026. This is expected to persist into 2H as major clients have projected strong demand in 2026 and 2027. Maybank Research lifts its 2026 and 2027 earnings forecasts for UMS Integration by 7.6% and 6.8%, respectively. It raises the stock's target price to S$3.43 from S$3.21 with unchanged buy rating. Shares are 2.9% higher at S$2.80. (ronnie.harui@wsj.com)
0222 GMT - Riverstone Holdings is likely to benefit from artificial-intelligence driven demand, UOB Kay Hian analysts say in a report. They point to management commentary highlighting demand from data center and memory-storage applications, reinforcing the company's cleanroom segment as a key earnings driver. The company is also renewing ageing production lines and shifting away from low-margin generic output toward higher-value products. The brokerage lifts its earnings estimates for Riverstone by 20% for 2026, 15% for 2027, and 10% for 2028. It raises the stock's target price to 1.21 Singapore dollars from 1.10 Singapore dollars, with an unchanged buy rating. Shares are 1.2% lower at 0.83 Singapore dollar. (ronnie.harui@wsj.com)
0119 GMT - CelcomDigi could see margins improve in 2H, supported by tighter cost controls and continued operational efficiencies, Hong Leong IB analyst Toh Woo Kim says in a note. Toh is constructive on management's focus on cost discipline, which should support further margin improvement by end-2026. With the stock down significantly over the past year and underperforming the KLCI, he believes the market has more than priced in uncertainties surrounding Malaysia's state-backed 5G infrastructure firm Digital Nasional. At 17.7X forecast 2027 earnings and a 5.3% net dividend yield, he sees an attractive risk-reward profile. Hong Leong maintains a buy rating on CelcomDigi and keeps its target at 3.70 ringgit. Shares are 1.4% higher at 2.88 ringgit. (yingxian.wong@wsj.com)
0109 GMT - Maxis' 3Q core earnings per share could grow sequentially, driven by higher revenue and continued cost containment, says CIMB Securities analyst Choong Chen Foong in a note. For 2026, core net profit is expected to rise 4% on year, supported by 2% service revenue growth and a 0.3 percentage-point improvement in Ebitda margin amid cost savings initiatives, he reckons. However, 2027 core earnings could fall 3% due to the full-year impact of its stake in Malaysia's state-backed 5G infrastructure firm Digital Nasional, he adds. CIMB maintains a buy rating on Maxis and keeps target price at 4.35 ringgit. Shares are unchanged at 3.70 ringgit.
Comments