Technology

Report by Off Wall Street

Bulls expect Gen 5 Vertical Power Delivery to help VICR regain share in GPU server boards and hyperscalers, while ITC-related royalty / module-purchase upside is seen as another positive driver. OWS believes both arguments are overstated. For a stock that has risen eightfold over the past nine months, the latest forward guidance and margin metrics were underwhelming. Q3 and Q4 revenue guidance was only in line with consensus because it included new licence revenue the Street had not assumed, implying weaker underlying product revenue. Product gross margin fell 170bps Q/Q despite 15% higher product revenue, which OWS attributes to low-margin CBRS revenue. Non-CBRS VPD targets were also pushed out a year to late 2027, leaving consensus estimates dependent on “heroic” CBRS growth. TP $38 (80% downside).

Consumer Staples

Report by Copley Fund Research

After a multi-year decline in investment EM Tobacco stocks are turning a corner - Steven Copley notes that no other industry group is so underowned vs. its own history whilst also capturing positive rotation among active EM fund managers. Fund level activity between 30th Apr 2022 and 28th Feb 2023 highlights the widespread nature of the allocation shift. All Style groups saw investment levels rise, with 16 funds opening exposure to Tobacco vs. 1 closing over the period. GQG Partners EM Equity, Virtus EM Opportunity and BNY Mellon EM Income were among the larger buyers. ITC and KT&G dominate the holdings picture on a stock level, owned by 14.8% and 7.8% of managers, respectively.