Kansas City Southern (KSU:USA) currently trades near recent averages relative to UAFRS-based (Uniform) Earnings, with a 21.6x Uniform P/E. At these levels, the market has bullish expectations for the firm, but management has concerns about revenue growth, their ability to seize business opportunities, and the business environment in Mexico

The Gap, Inc. (GPS:USA) currently trades near recent averages relative to UAFRS-based (Uniform) Earnings, with a 16.4x Uniform P/E. At these levels, markets are pricing in expectations for profitability to remain at current levels, but management is confident in their specialty channel profitability initiatives, customer experience, and ability to minimize spin-off costs

SS&C Technologies Holdings, Inc. (SSNC:USA) currently trades above historical averages relative to UAFRS-based (Uniform) Earnings, with a 19.4x Uniform P/E. Even at these levels, the market has bearish expectations for the firm, but management is confident in their focus on core margins and new business wins

Western Digital Corporation (WDC:USA) currently trades below recent averages relative to UAFRS-based (Uniform) Earnings, with a 15.5x Uniform P/E, implying bearish expectations for the firm. However, management is confident in their ability to beat hard drive sales expectations and their inventory levels

MasTec, Inc. (MTZ:USA) currently trades near recent averages relative to UAFRS-based (Uniform) Earnings, with a 16.4x Uniform P/E. At these levels, the market is pricing in bearish expectations for the firm, and while management has concerns about EBITDA margin performance, infrastructure projects, and end market expansion costs, their confidence in their backlog, along with industry tailwinds, provide significant potential for outperformance and equity upside

Each week, the Valens Research team highlights our most interesting insights from across our tools and our analysis, including individual company, industry, and macro insights. Top Highlight: CVS Health Corporation Highlights: ITW, LRCX, THRM Other Recent Analyses: AMN, DISC.A, DVA, FSLR, GILD, GRMN, IBM, NI, PTC, SCCO, SLB, SNA

Cirrus Logic, Inc. (CRUS:USA) currently trades below corporate averages relative to UAFRS-based (Uniform) Earnings, with a 16.7x Uniform P/E. At these levels, the market is pricing in bearish expectations for the firm, which may be unwarranted given management’s confidence about the progress of microphone shipments, the potential of product development, and gross margins, justifying outperformance going forward

Gentherm Incorporated (THRM:USA) currently trades below corporate averages relative to UAFRS-based (Uniform) Earnings, with a 15.3x Uniform P/E, implying bearish expectations for the firm. While management’s concerns about labor costs and automotive production suggest the potential for near-term headwinds, the firm’s leadership in its space suggest longer-term upside remains warranted

This week the Valens Research team highlights our most interesting equity insight from across our tools and our analysis. Cirrus appears to be making the right calls with strong management alignment, favorable fundamentals, smart strategic decisions, and growing management optimism, pointing to equity upside

CVS Health Corporation (CVS:USA) currently trades near historical averages relative to UAFRS-based (Uniform) Earnings, with a 16.9x Uniform P/E. At these levels, markets are pricing in bearish expectations for the firm, which is unwarranted given management’s confidence in store comp sales growth, generics performance, and the potential of HealthHUB. As such, outperformance is likely justified

Highlighted Top Ideas AMD – Advanced Micro Devices, Inc., BBY – Best Buy Co., Inc., SUM – Summit Materials, Inc.

Lam Research Corporation (LRCX:USA) currently trades well below corporate averages relative to UAFRS-based (Uniform) Earnings, with a 12.8x Uniform P/E. At these levels, the market has overly bearish expectations for the firm, and while management has concerns about equipment demand, costs, and productivity, potential macro tailwinds and competitive niches in flash storage suggest longer-term upside remains warranted

Each week, the Valens Research team highlights our most interesting insights from across our tools and our analysis, including individual company, industry, and macro insights. Top Highlight: HCA Healthcare, Inc. Highlights: BZUN, FB, SKX Other Recent Analyses: CCI, CTXS, DHR, EBAY, EXC, HON, HTZ, IBM, IONS, NKE, NLSN, RTN, URI, WBA

Illinois Tool Works Inc. (ITW:USA) trades near corporate averages relative to UAFRS-based (Uniform) Earnings, with a 20.3x Uniform P/E. At these levels, the market has bullish expectations for the firm, but management has concerns about raw material cost inflation, organic revenue declines, and the progress of restructuring efforts

Each week, Valens focuses on several companies that were analyzed in the prior week, where material distortions caused by as-reported GAAP accounting need to be corrected to understand a company’s economic fundamentals.
DexCom, Inc. (DXCM), The Hain Celestial Group, Inc.(HAIN), Acorda Therapeutics, Inc. (ACOR)

eBay Inc. (EBAY:USA) is currently trading well below corporate averages relative to UAFRS-based (Uniform) Earnings, with a 12.1x Uniform P/E, implying bearish expectations for the firm. However, this is likely unwarranted given management’s confidence in their payments platform, EPS growth, and debt financing, justifying outperformance going forward

Skechers U.S.A., Inc. (SKX:USA) currently trades near historical averages relative to UAFRS-based (Uniform) Earnings, with an 11.9x Uniform P/E, implying bearish expectations for the firm, and management has concerns about wholesale retail sales, store remodeling, and their e-commerce platform

This week the Valens Research team highlights our most interesting equity insight from across our tools and our analysis. HIG is seeing operational and macro improvements, combined with a strong management team and growing operational confidence that insure equity upside

Highlighted Top Ideas AER – AerCap Holdings N.V., JCP – J. C. Penney Company, Inc., UIS – Unisys Corporation