Research Articles

[Rypieee]

Hi all,

I'm ryan, and i'd like to start a thread where i can upload my reports for the ASF community.

I have a soft spot for ASF. It was the place where I hunkered down back in 2016, as I was trying to get a start in the financial markets. Made a few connections, of which peter2 was the one i remembered the most. Learnt the ropes of technical trading etc. Overall, just good vibes, felt welcomed, never criticised etc. 8 years on, I've returned to this forum, with much more knowledge and experience of the markets. Gosh, reading through the things I used to post, bit cringey, but also somewhat find it adorable/cute of my younger-self just trying his hand at something that is frankly, can be a pretty overwhelming subject.

Yes, I have started my own venture - Alpha Insights. And yes, I will be starting to charge for those reports prior to the august reporting season. But I think, just for now, I'll continue to put up some of my reports (for free) here in this thread, when I have some spare time You guys can have it for free, and it could be our little secret.

I won't share it anywhere else, and who knows, maybe it will direct some more traffic towards ASF. Moderators of the site, feel free to remove this thread if it isn't allowed. I would probably start including branding on the reports in the near-future. If not in line with forum rulings, i could try and make two versions, one without branding. I thought to start a thread, so that my contributions are just siloed in one place, rather than being dotted all over the shop.

Anyways, i thought this was a good way to "Give back" to this commuity. Its always been the better and more engaging forum (vs the other orangey black one which can get quite spastic at times).

Ryan

 

[Rypieee]

First company APX hahaha. Cant help it, its my tip for the may competition. Gotta pump those rookie numbers up. Anyways, AGM today, shares going up. Report attached is fresh off the digital printer.

 

[Dona Ferentes]

First company APX hahaha. Cant help it, its my tip for the may competition. Gotta pump those rookie numbers up. Anyways, AGM today, shares going up. Report attached is fresh off the digital printer.

is that the same APX that's up 25 percent this morning, haha??

but was $3 not so long ago, and is now $1.50?

If a share drops 50 percent, it needs to go up 100 percent to get back to where it was.

 

[Rypieee]

is that the same APX that's up 25 percent this morning, haha??

but was $3 not so long ago, and is now $1.50?

If a share drops 50 percent, it needs to go up 100 percent to get back to where it was.

haha yeah it is. I tipped it for the may competition pool

 

[Rypieee]

Files from the week attached to this post. Pretty self explanatory. Code = company. There is a pdf called Bankerr11 or something. Thats my sector report on the banks. Enjoy - lemme know what you think. Criticise it to the ground if you must. I can take it. I'm running this whole ops on my own, any help is welcomed.

 

[Rypieee]

Hey all!! Sorry have been away from ASF. Been busy tinkering with websites etc. Spent the last 2 months rebuilding my website, as my previous workflow was still rather disjointed and too much manual-handling. Anyways... what this means however, is that the PDF reports are no longer part of the workflow, and everything is on the webpage.

My monetisation strategy works like this: If the report is outdated (~4-5months), it becomes free for free subscribers (you still need to subscribe for a free account). Otherwise, updated content will be reserved for the paid subscribers.

So... going forward, my way of contributing up-to-date content to ASF forums will be by way of copy pasting snippets from my web pages to ASF. Unless I can figure out another way to get pdf reports generating without too much hand holding from me. However, that will have to come later on - need to focus on bringing some income home now!! Piggy bank is drying up and it isnt feasible to rely on prize monies from the monthly stock picking competition

 

[Dona Ferentes]

hi Ryan. I appreciate your efforts ...

but, have you been run over by an AI bus?

"Earlier this week, analysts at Baptista Research began initiating coverage on a few ASX-listed companies. Then several more. Eventually, the self-described “independent financial research house” was covering a string of the country’s largest listed companies, from BHP to Qantas.

Fund managers have never heard of them; neither have the companies that they are covering – unusual given analysts often have deep connections to the businesses they produce research about as they try to generate better insights and, hopefully, lead their clients to make better investments. It is a remarkable effort for a firm that appears to have four employees, according to LinkedIn.

Its managing director, Ishan Majumdar, purportedly a former venture capital and private equity operator and leveraged finance analyst at BNP Paribas, did not respond to requests for comment.

But the emergence of Baptista – its coverage has been picked up in places like Bell Potter’s Coppo Report, a popular daily newsletter among investors – comes as the industry is on the precipice of major change, powered like many other things in 2025 by the emergence of artificial intelligence...
...
According to Grammarly, a writing platform that can check for plagiarism and the use of AI, much of that text looks like it was written by a machine.

In fact, Grammarly estimates, 90 per cent of the summary “resembles AI text”. Grammarly is not definitive, and can produce false positives depending on the author’s writing style. Baptista did not respond to questions.

 

[Rypieee]

oh wow! I havent heard of them before.

 

[Garpal Gumnut]

hi Ryan. I appreciate your efforts ...

but, have you been run over by an AI bus?

"Earlier this week, analysts at Baptista Research began initiating coverage on a few ASX-listed companies. Then several more. Eventually, the self-described “independent financial research house” was covering a string of the country’s largest listed companies, from BHP to Qantas.

Fund managers have never heard of them; neither have the companies that they are covering – unusual given analysts often have deep connections to the businesses they produce research about as they try to generate better insights and, hopefully, lead their clients to make better investments. It is a remarkable effort for a firm that appears to have four employees, according to LinkedIn.

Its managing director, Ishan Majumdar, purportedly a former venture capital and private equity operator and leveraged finance analyst at BNP Paribas, did not respond to requests for comment.

But the emergence of Baptista – its coverage has been picked up in places like Bell Potter’s Coppo Report, a popular daily newsletter among investors – comes as the industry is on the precipice of major change, powered like many other things in 2025 by the emergence of artificial intelligence...
...
According to Grammarly, a writing platform that can check for plagiarism and the use of AI, much of that text looks like it was written by a machine.

In fact, Grammarly estimates, 90 per cent of the summary “resembles AI text”. Grammarly is not definitive, and can produce false positives depending on the author’s writing style. Baptista did not respond to questions.

Their website is lacking. Links go round and round again and again. Poor Bell Potter.

gg

 

[Rypieee]

Again, been two weeks since i last checked in here... I've basically been building my own website platform to properly host the research I've got in a way that I would deem.. professional.

Actually pretty proud of what i've been able to come up with over the past two weeks
First image is like a research hub page.


Second image below is the company research page, where you can scroll through some financials, read through the company's research content in the middle, and some navigational tools and metrics on the left.



Anyways. Not here to promote the website - just proud of the work i've accomplished.

Reporting season is now underway!

A couple of companies have already kicked off with their results - and what is already available on site are:
1) Rio Tinto
2) Beach Energy
3) Reckon
4) Unibail
5) Credit Corp
6) Austal

As I don't have any input into the analysis process of these companies, i noticed a severe divergence in CCP's valuation output from AI, versus its current share price. We've also managed to pull up several key risks to the company, such as their inability to sufficiently fund dividends from operating earnings, anticipate for growth within their operating assets (i.e. PDLs, Consumer lending), with a projected deficit in FCF at around FY27-28.

 

[Rypieee]

havent had too much time to wander the halls of ASF lately - been under the pump at holding down the fort. My site has gone live now I would be curious to see if its value proposition was actually attractive to the lot of members here, but I will refrain from overstepping boundaries.

I'll have to do a dump of information here, for some of the interesting companies that have been analysed since the start of reporting season.

 

[Rypieee]

Cochlear

Executive Summary

Cochlear Limited operates as the global leader in implantable hearing solutions, commanding an exceptional 62% market share across 180+ countries with an installed base exceeding 750,000 recipients. The company's business model centres on three revenue streams: Cochlear Implants (62% of revenue), Services (26%), and Acoustics (12%), with the Services segment generating defensive recurring revenues through processor upgrades and support services at 85%+ gross margins. The recently launched Nexa System represents a technological breakthrough as the world's first smart cochlear implant with upgradeable firmware, enabling software-defined innovation cycles that create a 2-3 year competitive moat against rivals MED-EL and Advanced Bionics.

Recent financial performance reveals concerning divergence between headline growth and underlying operational health. FY25 revenue of $2,356 million grew 4.3% year-on-year, substantially below management's 10-12% guidance range and marking the fifth consecutive year of guidance misses. The Services segment's 9% decline to $609 million signals potential structural breakdown in the lifetime value model, as recipients extend processor replacement cycles beyond historical norms. EBITDA margins of 25.6% remain robust but sit 60 basis points below prior year, with gross margins compressing despite price increases as geographic mix shifts toward lower-margin emerging markets.

The company's competitive position remains formidable with switching costs creating essentially permanent customer relationships post-implantation, evidenced by 95%+ retention rates. Scale advantages manifest through R&D investment of 12% of revenue versus 8% for peers, totalling over $292 million annually and supporting a patent portfolio exceeding 2,300 filings. Network effects within the installed base strengthen as surgeons, audiologists, and recipients become invested in proprietary fitting software and clinical protocols specific to Cochlear's technology platform. However, Chinese manufacturer Nurotron's international expansion with 30% cost advantages threatens pricing power in emerging markets, which represent the primary growth driver.

Strategic initiatives centre on the Nexa System rollout across developed markets, with early adoption in Germany and Australia showing promising uptake among key opinion leaders. Management's $250 million digital transformation programme aims to enhance operational efficiency and customer engagement, though tangible benefits remain elusive with cash conversion collapsing to 20% from historical 48% averages. The drug-eluting electrode programme in pivotal trials represents a $813 million risk-adjusted opportunity, potentially extending the company's technological leadership by preventing fibrous tissue growth that degrades sound quality over time.

Financial health remains exceptional with a debt-free balance sheet, $276 million net cash position, and consistent free cash flow generation despite working capital pressures. The company maintains a progressive dividend policy with 72% payout ratio, though the 1.4% yield provides minimal income support at current valuations. Capital allocation priorities include organic R&D investment, selective bolt-on acquisitions in adjacent technologies, and modest share buybacks, with management eschewing transformational M&A given integration complexity in the specialised medical device sector.

Investment Outlook

The investment outlook for Cochlear hinges critically on management's ability to execute multiple strategic initiatives simultaneously while navigating intensifying competitive pressures and structural market changes. The Nexa System's success requires achieving 60% penetration in developed markets by FY30, necessitating comprehensive surgeon training programmes, clinical evidence generation, and overcoming conservative medical adoption patterns that historically limit new technology uptake to 40% within initial launch periods. Management targets revenue growth acceleration to 10.1% CAGR through FY32, requiring flawless execution across Nexa adoption, Services recovery, and emerging market expansion—a combination with less than 35% probability based on historical achievement rates. The Services segment recovery represents the most critical near-term challenge, requiring reversal of structural shifts in replacement behaviour through enhanced marketing, subscription pricing models, and technological superiority that compels upgrades despite recipient satisfaction with legacy processors.

Key catalysts over the next 12-24 months will determine whether the extreme valuation premium can be sustained or triggers mean reversion toward fundamental value. Q1 FY26 Nexa System adoption metrics (December 2025) provide the first concrete evidence of market acceptance, with penetration below 40% likely triggering immediate repricing given consensus expectations for rapid uptake. H1 FY26 Services revenue trajectory (February 2026) represents a binary event where continued decline confirms structural breakdown worth $555 million in risk-adjusted value destruction, while recovery above 10% growth could temporarily support premium multiples. FY26 margin guidance will reveal whether management acknowledges compression pressures from geographic mix shifts and competitive dynamics, with any reduction from peak 27.2% levels catalysing multiple contraction toward sector medians.

Competitive dynamics are evolving unfavourably as the stable three-player oligopoly faces disruption from emerging market entrants and potential technology convergence. MED-EL's natural hearing preservation focus and Advanced Bionics' integration with Sonova's hearing aid ecosystem create differentiation that erodes Cochlear's premium pricing power, while Nurotron's government-backed expansion threatens market share in China and India where volume growth concentrates. The probability of maintaining 60%+ global market share through FY30 stands at only 45%, with each percentage point of share loss worth approximately $18 per share in valuation impact. Technology disruption from gene therapy and regenerative medicine, while 10-15 years distant, creates investment hesitancy that could compress multiples as breakthrough developments emerge from clinical trials.

Execution requirements for value creation appear increasingly demanding given recent operational challenges and management's systematic overestimation of growth potential. Working capital deterioration to 30% of sales from 23% historical averages signals operational stress precisely when efficiency improvements are critical for margin defence. The $250 million digital transformation investment has yet to demonstrate measurable returns, while R&D productivity metrics show declining efficiency with innovation ROI falling to 185% from peak 220% levels. Management's 85% historical guidance achievement rate on revenue suggests either poor visibility into demand dynamics or deliberate stretch targeting that undermines credibility, particularly concerning given the Services revenue surprise and inventory build issues.

The growth trajectory implied by consensus forecasts requires multiple low-probability events occurring simultaneously: Nexa System achieving unprecedented 75% adoption rates, Services revenue recovering to 20% growth despite structural headwinds, emerging market expansion without margin dilution, and no meaningful competitive response despite supernormal returns. Scenario analysis reveals 75% probability of negative returns from current levels, with even the bull case showing 45% downside as perfect execution cannot overcome extreme starting valuation. The base case forecast of 10.1% revenue CAGR and margin compression to 23% by FY32 implies fair value of $127.71, representing 59% downside that could materialise rapidly as catalysts disappoint elevated expectations.

Major uncertainties centre on the sustainability of the Services model, true Nexa System differentiation, and management's ability to defend margins while pursuing volume growth in price-sensitive emerging markets. The Services segment's lifetime value proposition faces structural challenges as technological improvements extend processor lifespans, insurance pressures limit upgrade frequency, and recipient satisfaction with legacy devices reduces replacement urgency. Resolution of these uncertainties through upcoming reporting periods will determine whether Cochlear can justify any premium to sector valuations or faces inevitable convergence toward peer multiples that imply 40-50% downside from current levels.

 

[Rypieee]

Bluescope Steel (ASX:BSL)

BlueScope Steel operates as a diversified steel manufacturer with integrated operations spanning raw material processing through to branded building products, generating A$16.3 billion in revenue across 15 countries. The company's business model centres on a multi-domestic strategy where production facilities serve local markets, providing natural hedging against currency fluctuations and trade disruptions while capturing regional growth dynamics. This approach has enabled BlueScope to maintain market-leading positions in Australia with 60%+ share in coated steel products and strong presence in North American non-residential construction markets, differentiating it from global commodity steel producers exposed to volatile international trade flows.

Recent financial performance reflects the challenging steel market environment, with FY25 revenue declining 4.4% to A$16.3 billion as steel spreads compressed to decade lows of $630 per tonne, well below the mid-cycle range of $680-750 per tonne. EBITDA margins contracted to 8.9% from 10.6% in the prior year, driven by weaker demand in Australian residential construction, ongoing losses at BlueScope Coated Products (BCP) in North America, and elevated raw material costs relative to steel prices. The company recorded a significant A$439 million impairment charge related to BCP, acknowledging execution challenges in the turnaround of this acquired business, though early operational improvements in safety, quality, and customer service provide tentative signs of stabilisation.

The company's competitive position remains robust despite cyclical headwinds, with business quality scoring 6.3/10 compared to peer average of 6.9/10, reflecting strong brand assets and geographic diversification offset by capital efficiency challenges. The COLORBOND® brand portfolio commands premium pricing power rare in commodity steel markets, with 95% customer retention rates and demonstrated ability to pass through cost increases. Geographic diversification across Australia (41% of revenue), North America (43%), and Asia (12%) provides earnings stability through regional cycles, while the company's focus on downstream value-added products generates higher margins than upstream steel production alone.

Strategic initiatives underway include a A$200 million cost productivity program targeting operational excellence across manufacturing facilities, with 65% of savings already delivered. The company is advancing its decarbonisation strategy through the New Zealand electric arc furnace conversion and participation in Project NeoSmelt, positioning for potential green steel premiums as carbon pricing mechanisms proliferate globally. Working capital optimisation remains a key focus area, with management targeting reduction from current 17.8% of sales to 15% by 2030, which would release approximately A$400 million in cash flow.

Financial health remains strong with a net cash position and debt-to-EBITDA ratio of just 0.02x, providing significant strategic flexibility to navigate the cycle and pursue growth opportunities. The investment-grade credit rating and A$2.8 billion in available liquidity enable counter-cyclical capital deployment when competitors face constraints, while the disciplined capital allocation framework balances growth investment with shareholder returns through a 50% free cash flow distribution policy. This balance sheet strength provides crucial downside protection, with liquidation value estimated at A$18.02 per share establishing a floor approximately 25% below current trading levels.

Investment Outlook​

The investment outlook for BlueScope hinges critically on the convergence of three key value drivers over the next 18-24 months: steel spread normalisation from current trough levels, successful execution of operational improvement initiatives, and stabilisation of the troubled North American coated products business. Steel spreads recovering from $630 per tonne to mid-cycle levels of $680-750 per tonne would drive approximately 35% of projected value creation, with each $100 per tonne improvement contributing roughly A$3.50 per share to valuation. The timing of this recovery depends on supply discipline emerging in global markets, particularly from Chinese producers who currently operate at 73% capacity utilisation with potential to flood export markets if domestic demand weakens further.

Critical execution milestones over the coming quarters include achieving BCP monthly EBIT breakeven by June 2026, a significant improvement from current losses of A$15 million per month. Early operational improvements in safety metrics, product quality, and on-time delivery rates suggest management's turnaround plan is gaining traction, though three years of underperformance since acquisition raise legitimate concerns about execution capability. The Q1 FY2026 results in November 2025 represent a crucial near-term catalyst, with management guiding to EBITDA above A$550 million providing the first major test of recovery momentum. Achievement of this guidance would validate the earnings trajectory toward A$2.1-2.2 billion EBITDA by FY2028, while disappointment could trigger reassessment of the turnaround timeline.

Competitive dynamics are evolving favourably in several key markets, with North American capacity utilisation rates improving and Section 232 tariffs maintaining pricing floors that support 200-300 basis points higher margins versus unprotected markets. The Australian market benefits from natural protection through logistics costs and local content requirements, while brand strength in COLORBOND® products creates switching costs that insulate against pure commodity competition. However, the sustainability of these advantages faces medium-term challenges from potential trade policy changes, particularly if political pressure leads to removal of US steel tariffs or relaxation of Australian anti-dumping measures.

The growth trajectory outlined in management's strategic plan targets revenue CAGR of 5% through FY2029, driven by modest market share gains in fragmented Asian markets, recovery in Australian construction activity, and continued penetration of value-added product categories. This appears achievable given GDP-plus pricing power in branded products and capacity expansion opportunities in growing markets, though historical achievement rates of 75% against guidance suggest some conservatism is warranted. The margin recovery path from current 8.9% EBITDA margins to 11.5% by FY2028 relies on operating leverage from higher volumes, completion of the A$200 million cost program, and working capital efficiency improvements that collectively support 220 basis points of margin expansion.

Key uncertainties that could alter the investment trajectory include the pace of Chinese economic recovery and its impact on domestic steel consumption versus exports, the durability of current trade protection regimes in an evolving geopolitical landscape, and the speed of construction technology changes that could reduce steel intensity in building applications. Scenario analysis suggests a probability-weighted expected return of 14.2% annually over a 2-3 year horizon, with upside potential to A$38.45 per share (58% return) in a bull case where steel markets tighten and BCP achieves targeted profitability. Conversely, the bear case of A$19.85 per share reflects risks of extended market weakness and integration challenges, though strong balance sheet fundamentals and asset backing provide downside protection.

The decarbonisation transition presents both risks and opportunities, with BlueScope's early investments in electric arc furnace technology and participation in breakthrough ironmaking research positioning the company to capture green steel premiums estimated at A$2.04 per share in option value. However, the capital requirements for full decarbonisation could reach A$800 million over the next decade, potentially constraining returns if carbon pricing mechanisms develop more slowly than anticipated. Management's balanced approach of pursuing no-regrets investments while maintaining flexibility for technology evolution appears prudent given the uncertainty around optimal pathways to net-zero steel production.

 

[ShareSuccess]

Sorry for my curiosity But The Perfect paragraphs suggests to me that this information is AI Generated?

 

[Rypieee]

Sorry for my curiosity But The Perfect paragraphs suggests to me that this information is AI Generated?

Yup, i used to work as an equity research analyst - left my job in Oct last year after 7 years, to pursue my own vision of providing stock market research. The entirety of my research process is AI-generated, prior to me reviewing each report before release.