YB new stock pitches (Fri, May 23)

CE Holdings (4320.T) is an electronic medical record (EMR) integrator for Japan's small-to-mid-sized hospitals, targeting the government's Medical DX Reiwa Vision 2030 mandate. With nearly 1,000 institutions using its MI·RA·Is platform and only 55% EMR adoption in clinics nationwide, CE benefits from legislated market growth. Recent performance shows momentum with Q2 FY25 revenue up 14% YoY, operating profit surging 66%, and backlog increasing 10.9%. The company is transitioning from a systems integrator to a SaaS platform through cloud migration and its Doctor Connect PHR overlay, which improves margins and recurring revenue. Trading at ¥625 (~12x FY25E P/E), CE has a ¥1.5B warrant facility (strike: ¥600) for targeted M&A and targets ¥30B revenue with ¥6B operating profit by 2030 (20% margins, up from 10% today). The bull case price target of ¥5,180 represents a 48% CAGR through FY2030, while even the bear case offers 8% annual returns. Risks include execution challenges in SaaS transition, warrant-related dilution (up to 16.3%), and competitive pressure from larger vendors like Fujitsu and NEC.

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SofWave Medical (TASE:SOFW), an Israeli medtech company with a $220 million market cap trading at $6.2 per share, specializes in facial rejuvenation, under-chin lifting, and cellulite reduction using targeted ultrasound technology instead of invasive alternatives like RF microneedling. This non-invasive approach stimulates collagen at the ideal depth without damaging skin, delivering superior results with no downtime. The company boasts impressive 70%+ gross margins, 49% year-over-year growth in recurring pulse revenue, and has reached break-even with over 500,000 treatments completed. Momentum is building following Kim Kardashian's Q1 endorsement, with clinics adopting the technology for Ozempic-related laxity, post-filler corrections, and even as a potential Botox replacement. Currently trading at just 3.3x EV/Sales, the stock appears significantly undervalued given its operating leverage and growth potential, with management hinting at a potential U.S. listing that could trigger a major rerating. Despite geopolitical concerns and unfamiliarity with Tel Aviv-listed companies limiting position size, this stock has 10x potential over the next 3-5 years, though investors should note the limited trading volume (approximately 50,000 shares daily) and need to place orders through broker international trading desks.

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Samsung Electronics (005930.KS), a memory chip giant with 39% DRAM and 29% NAND market share, is significantly undervalued at 8.2x normal earnings despite projected 15% annual growth. The company is navigating a cyclical memory downturn but is well-positioned for recovery with its diversified business: roughly two-thirds of earnings come from memory chips while the remainder derives from its leading display panel business (50% global market share), mobile unit (second only to Apple in smartphone sales), semiconductor foundry (second largest globally behind TSMC), and dominant consumer electronics division (world's largest TV maker for 19 consecutive years). Although Samsung has fallen behind competitors SK Hynix and Micron in high-bandwidth memory (HBM) technology crucial for AI applications, this gap appears temporary rather than structural. The company's $63 billion net cash position supports significant shareholder returns, with 34% of net income distributed through dividends and buybacks since 2018. Samsung's strategy shift toward node migration and HBM capacity, reduced wafer expansion capex, and strong position in the concentrated memory oligopoly should enable it to benefit from increasing memory content in devices, particularly AI servers.

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