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international & segment updates plus new format +3

13:39 24-May-21


This note is intended to test an idea for an upgraded message format.  Updates like this, which document news that is not market moving, but rather, what I call "weight on the scales", can be difficult to read, especially if one is only interested in subset of the stocks involved.  To help make the services more useful, such messages would start with a header like this:

Symbols: EBIX+3, VOD?2, TU+2, DOX+1, SLB?2, RDS-1, VUZI?2, HIMX+1

Please give me feedback on the idea and whether or not the links work in your mail reader.

Ebix has announced that Grant Thornton, through its Walker Chandiok affiliate, will be its international statutory auditor for EbixCash in India.  It's good to see such steps toward the IPO being made quickly as the IPO market remains hot.  Even better is the latest pandemic news from India, which shows marked improvement from the assessment I gave a week ago.

The same goes for Europe, and that will matter to VOD, which has stabilized and rebounded slightly from its recent decline.  Vodafone's consortium has won rights to build 4G service across Ethiopia over the coming decade at a cost of $8.5b.  Ethiopia is Africa's second most populous nation, after Nigeria, with almost 115M people, less than half of whom have mobile service.  Thus, I can understand the rationale, but this is not the game-changing investment that investors would need.  I see even more reason for caution after yesterday's diversion of a commercial flight traveling through the airspace of Belarus.

By contrast, Canada has one of the best pandemic records, and my view on Telus remains much better, even with TU near all time highs after the company showcased the use of its network for infrastructure monitoring with drones.  This sort of automation actually will save costs, whereas I think the cloud migration being pushed by Amdocs will eventually lock service providers into cost increases that they can't control after they stop maintaining their own systems.

Schlumberger has been trying the same sort of thing with drillers, but I suspect it's a tough sell.  We're finally starting to see the consolidation I've expected, but the makeup and reaction tells me that majors like Shell and BP are right to be taking on transition pain now, even though Brent is up to $68.  As I've already pointed out, that's good for Golar, and I think any new supply will be from the developing gas markets that it specializes in.

Finally, in tech, Vuzix has landed an order valued at over $1M to be fulfilled over the remainder of the year.  That's about 5% of projected revenue total, so I'm not surprised it hasn't helped the inflated stock price.  The introduction of new microLED projection engines is a little more interesting and a step toward the changing of the guard from AMOLED devices.  I still vastly prefer Himax developments and stock.