In this article, we explore the Goldman Sachs Penny Stocks: Top 12 Stock Picks.The rotation towards small and micro-cap stocks is gaining momentum. While large caps and growth stocks have dominated performance in recent years, concerns about a potential correction are prompting investors to take a closer look at much smaller plays.The S&P SmallCap 600 index, which measures the performance of the small-cap segment of the US equity market, is already up by more than 6% for the year.  The iShares Micro Cap ETF ...

Core Viewpoint - Russia is preparing to send crude oil and fuel to Cuba as the island faces a severe fuel shortage due to U.S. actions aimed at cutting off its oil supply [1] Group 1: Supply Situation - The last oil supply from Russia to Cuba occurred in February 2025, involving a delivery of 100,000 metric tons [1] - Cuba has warned international airlines that jet fuel is no longer available, indicating a critical fuel situation on the island [1] Group 2: Geopolitical Context - The U.S. has moved to block oil exports from Venezuela, which has historically been a key supplier of jet fuel to Cuba [1] - Russia has expressed solidarity with Cuba and Venezuela, criticizing U.S. attempts to "suffocate" Cuba's economy and pledging to act against any military intervention [1] Group 3: Humanitarian Aid - The Russian embassy in Cuba stated that the upcoming supply of crude and oil products would be provided as humanitarian aid [1] - Russia has announced plans to suspend flights to Cuba after the departure of Russian tourists from the island [1]

Financial Data and Key Metrics Changes - Group service revenue grew by 5.4% in Q3 2026, supported by growth in Europe and Africa, particularly in Germany, Africa, and Turkey [4][6] - Group EBITDA increased by 2.3% in Q3 and 5.3% year-to-date, aligning with expectations and guidance for FY26 [4][8] Business Line Data and Key Metrics Changes - In Germany, mobile customer numbers increased, with new customer ARPUs up 21% year-on-year, stabilizing consumer broadband revenues [5][6] - The U.K. integration and network investment plan is progressing well, with initial upgrades delivered ahead of schedule [5][6] - The acquisition of Skaylink was completed, supporting growth in digital services across cloud and security [7] Market Data and Key Metrics Changes - The company is acquiring a controlling stake in Safaricom, enhancing its position in Africa amid growing demand for digital services [6][7] - Emerging markets continue to show double-digit growth, while the U.K. faces a challenging competitive environment [30][32] Company Strategy and Development Direction - Vodafone is focused on enhancing customer experience and value strategy, particularly in Germany, where it aims to improve EBITDA through cost simplification and B2B growth [14][15] - The company is committed to a 10-year plan to invest GBP 11 billion in building the U.K.'s leading 5G network [6][7] - The strategy emphasizes value over volume, encouraging a shift in how telecom performance is evaluated [75][76] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving the upper end of FY26 guidance, with a positive outlook for multi-year growth trajectory [8][32] - The competitive landscape in Germany remains challenging, but improvements in fixed broadband and customer experience are expected to support future performance [16][24] Other Important Information - The company is optimistic about the potential for consolidation in the U.K. broadband market, which could enhance pricing power [45][46] - The EU Digital Networks Act and Cybersecurity Act are seen as potential catalysts for investment and innovation, though they also introduce uncertainties [81][84] Q&A Session Summary Question: Insights on Germany's EBITDA trajectory - Management indicated that EBITDA in Germany is expected to improve in the second half of the year, but not return to positive growth [12][14] Question: Value versus volume strategy in broadband - Management confirmed a focus on value, with fixed broadband churn below many European markets and improvements in customer satisfaction [23][24] Question: Group-wide growth prospects for 2027 - Management remains confident in multi-year growth for adjusted free cash flow and EBITDA, with expectations for cost synergies in the U.K. [32][33] Question: Opportunities in Africa post-Safaricom acquisition - The acquisition is expected to strengthen Vodafone's position in Africa, leveraging growth in population and demand for digital services [38][39] Question: Impact of potential consolidation in the U.K. broadband market - Management is pleased with Vodafone's current position and believes that consolidation could enhance market dynamics without negatively impacting their strategy [45][46] Question: Future of Fixed Wireless Access (FWA) - Management expects FWA to grow in the U.K. and sees potential for deployment in rural areas of Germany, though fiber remains the primary focus [50][52] Question: Thoughts on tower market and Vantage - Management is satisfied with Vantage's performance and is open to evaluating future opportunities in the tower market as it evolves [58][59] Question: Insights on the EU Digital Networks Act - Management views the proposed reforms as a potential positive for investment certainty, though there are concerns regarding the Cybersecurity Act [81][84]

Group 1 - TIM SA, a Brazilian telecoms operator, is negotiating to repurchase a 51% interest in a fibre-network company it previously controlled [1] - The potential deal is valued at approximately $170 million [1]

Core Insights - NusaTrip has entered into an exclusive strategic technology partnership with Gorilla Networks to enhance its eSIM connectivity offerings within the travel sector [1][2][3] Group 1: Partnership Details - Gorilla will serve as NusaTrip's exclusive global eSIM connectivity platform, facilitating the development and operation of NusaTrip's white-label eSIM products [2][3] - The partnership aims to position eSIM connectivity as a core, monetizable layer within the travel booking experience, enhancing customer experience and creating new revenue streams [3] Group 2: Market Potential - The global travel eSIM market is projected to grow from US$1.8 billion in 2025 to US$8.7 billion by 2030, indicating a 380% revenue growth driven by increasing consumer and business travel [2] - Factors contributing to this growth include decreasing costs, improved device compatibility, and ongoing product innovation [2] Group 3: NusaTrip Overview - NusaTrip is an integrated travel technology platform with over 500 airlines and 650,000 hotels globally, and it is the first Indonesian OTA to receive IATA accreditation [9] - The company focuses on acquiring offline travel agencies to enhance its growth strategy and expand its market presence in Southeast Asia and the Asia-Pacific region [10] Group 4: Gorilla Networks Overview - Gorilla Networks specializes in providing eSIM solutions and aims to simplify connectivity for travelers by eliminating the complexities associated with traditional SIM cards [11]

Brazilian telecoms operator TIM SA is in talks to buy back a 51% stake in a fibre-network business it previously controlled under a deal that could be worth around $170 million, two people with knowle... ...

Core Viewpoint - Society Pass Incorporated has made a US$1.8 million minority investment in Gorilla Networks, marking its entry into the rapidly growing eSIM market, which is projected to grow from US$11.2 billion in 2025 to US$25.0 billion by 2033 at a CAGR of 10.5% [1][2]. Company Overview - Society Pass is an acquisition-focused holding company founded in 2018, operating in the fast-growing markets of Southeast Asia, including Vietnam, Indonesia, Philippines, Singapore, and Thailand [6]. - The company operates four interconnected verticals: digital media, travel, lifestyle, and alternative intelligence [6]. Investment Details - The investment in Gorilla Networks establishes a strategic extension of Society Pass's travel and online travel agency (OTA) strategy, allowing for the embedding of mobile connectivity into the travel purchase journey [2][5]. - Gorilla's platform provides API-driven, white-label eSIM infrastructure, enabling travel platforms to bundle connectivity with flights, hotels, and ancillary services at the moment of booking [3]. Market Dynamics - The global eSIM ecosystem is highly fragmented, with many small operators lacking distribution scale and integration capabilities. Gorilla aims to aggregate demand through large digital partners and pursue selective consolidation opportunities [4]. - Society Pass plans to integrate Gorilla's eSIM services across its travel vertical, starting with NusaTrip, to enhance customer experience and generate recurring revenue with minimal incremental cost [5]. Strategic Vision - The integration of eSIM services is seen as a logical extension of Society Pass's OTA and travel strategy, internalizing a critical travel service that is digital and globally scalable [5]. - Gorilla is positioned to evolve from an infrastructure provider into a regional connectivity platform, unlocking scale, data, and recurring demand through partnerships [4].

Core Viewpoint - Telenor has agreed to sell its 24.95% stake in True Corporation for approximately NOK 39 billion, marking a significant divestment after 25 years in Thailand [1][6]. Group 1: Transaction Details - The sale price is set at THB 11.70 per share, which represents a 36% increase from the closing price on the first trading day post-merger in March 2023, and a 4% premium to the last three months' volume-weighted average share price [7]. - Telenor will also have a mutual put/call option for the remaining 5.35% stake two years after the initial sale, priced at the higher of THB 11.70 per share or the market price at that time [1]. Group 2: Financial Implications - The proceeds from the sale of the 24.95% stake are expected to be THB 100.9 billion (approximately NOK 32.3 billion), with an additional THB 21.9 billion (approximately NOK 6.9 billion) anticipated from the option exercise [11]. - Telenor expects to recognize an accounting gain of approximately NOK 14.7 billion at the closing of the initial sale, with NOK 1.6 billion related to recycling historical currency translation differences [13]. Group 3: Strategic Context - This divestment aligns with Telenor's strategy for structural simplification and focuses on enhancing shareholder value through capital discipline and effective capital allocation [9][12]. - The sale follows Telenor's recent divestment of Telenor Pakistan, indicating a broader strategy to create structural value in Asia [8]. Group 4: Company Growth and Market Position - Telenor has established market leadership in Thailand over the past 25 years, significantly contributing to mobile connectivity for millions [4][6]. - The merger of dtac and True in 2023 created Thailand's largest telecom-tech company, positioning it for future investments in 5G, AI, and digital services [5].

Core Insights - Singapore Telecommunications Limited (Singtel) is undergoing transformative initiatives that may positively impact its market perception and financial performance [1][2] Financial Performance - Headline turnover decreased by 1% YoY to S$6.91 billion, but revenue increased by 2% YoY on a constant currency basis [3] - Operating earnings before interest and taxes (EBIT) rose 13% YoY to S$0.83 billion, indicating effective cost management [3] - Underlying net profit increased by 14% YoY to S$1.35 billion, driven by strong contributions from regional associates [4] Growth Drivers - The non-telecom technology arm NCS generated revenue of S$1.5 billion, up 6% YoY, with EBIT rising 41% YoY to S$184 million [5] - Optus, Singtel's core telecom business, saw EBIT grow by 27% YoY to AUD$283 million, supported by mobile growth [7] Regional Associates - Contributions from regional associates, particularly Airtel, significantly boosted underlying net profit, with profit after tax rising to S$915 million, up 12% YoY [9][10] Dividend and Cash Flow - Singtel raised its interim dividend to S$0.082 per share, a 17% YoY increase, supported by an 11% rise in free cash flow to S$1.45 billion [11][12] Balance Sheet Strength - Net debt decreased from S$8.9 billion to S$8.0 billion, improving the net debt gearing ratio from 26.7% to 24.3% [13][14] Future Outlook - Sustained profit growth in NCS and Optus, along with contributions from regional associates, could lead to share price appreciation [15][16] - Management anticipates softer growth in operating profit for FY2026 due to operational disruptions at Optus Australia [17][18]

Summary of J.P. Morgan's 2026 Investment Grade TMT Outlook Industry Overview - **Industry Focus**: Technology, Media, and Telecommunications (TMT) in Europe - **Key Themes**: The report outlines expectations for European TMT spreads in 2026, emphasizing trade ideas and sector evaluations [1] Core Insights Sector and Issuer Views - **Telecommunications**: - **Rating**: Overweight - **Performance**: Strong earnings and improving free cash flow as fiber capital expenditures peak - **M&A Activity**: Ongoing mergers and acquisitions, particularly in France, Germany, Spain, and Italy, are expected to enhance market conditions - **Valuation**: Tower companies maintain high asset valuations due to robust contracts and proactive management [4][10][13] - **Technology**: - **Rating**: Neutral - **Challenges**: Facing headwinds from increased AI and data center capital expenditures, with major players like Alphabet and Microsoft impacting euro supply - **Market Conditions**: Equipment manufacturers and semiconductor firms are dealing with mature markets and macroeconomic pressures [4][15] - **Media**: - **Rating**: Neutral - **Adaptation**: Advertising agencies and publishers are adjusting to AI disruptions and shifting client demands - **Long-term Demand**: The satellite segment is supported by ongoing demand for secure connectivity and C-band monetization potential despite near-term credit challenges [4][14] Rating Changes - **Upgrades**: ASML, Nokia, Proximus, Telia, T-Mobile US, and WPP to Overweight - **Downgrades**: Inwit, KPN, Pearson, Publicis Groupe, Swisscom, and Verizon to Neutral - **New Coverage**: Initiated Euro coverage on Alphabet (Neutral) and Microsoft (Underweight) [4] Important Data Points - **Investment Grade Spreads**: - Current Euro Investment Grade spread forecast is flat at 90bps, indicating a tight spread environment [10] - TMT sector spreads as of January 7, 2026: Telecommunications at 90bps, Technology at 87bps, Media at 85bps [17] - **Supply Outlook**: - **Telecom**: Expected issuance of ~€38.4 billion in 2026, down from ~€46.4 billion in 2025 - **Media**: Anticipated increase to ~€12.9 billion in 2026 from ~€6.5 billion in 2025 - **Technology**: Expected issuance to rise to ~€31.8 billion in 2026 from ~€26.7 billion in 2025, driven by major players [18][27] Additional Insights - **Macroeconomic Environment**: - European macro backdrop remains supportive, with fiscal stimulus in Germany and improving sovereign ratings in Southern Europe - Corporate fundamentals are strong, with limited fallen angel risk forecasted for 2026 [10][12] - **Regulatory Trends**: - A shift towards supporting infrastructure investment rather than consumer protection is noted, which may benefit telecom operators [13][35] - **Consolidation Prospects**: - Ongoing discussions about consolidation in four-player markets, with potential for significant cost synergies and improved market structures [35][41] - **Investor Sentiment**: - Investors are showing "recession fatigue," indicating a reluctance to price in economic risks until a downturn is confirmed [10] This comprehensive overview captures the key themes, sector evaluations, and important data points from J.P. Morgan's 2026 Investment Grade TMT Outlook, providing insights into the current and future landscape of the TMT industry in Europe.