Financials & FinTech research, Galliano’s Financials Research

Victor Galliano

Financials & FinTech research

Financials & FinTech, EM & Developed Markets

Galliano’s Financials Research

Galliano's Financials Research provides fundamental research in Emerging Markets financials, including FinTech, as well as financials in select Developed Markets.

The investment style applied is generally value oriented, although Growth At Reasonable Price (GARP) strategies can also be used where appropriate. 

Our investment research approach aim is often contrarian, looking to capitalise on overly sceptical or optimistic consensus views. In terms of valuation techniques, the focus is on PBV ratio to ROE, PE multiples and dividend yield, as well as the application of PEG ratios and, where appropriate, Sum of the Parts (SOTP) valuations.

Equity Bottom-Up

<ul>
<li>Varo bank published 4Q22 results that revealed lower quarterly cash burn through cost control, but revenue per client declined and the very high customer acquisition cost</li>
<li>SoFi’s cost reduction success in 4Q22 seems, in contrast to Varo, to have limited revenue loss, thereby bringing SoFi closer to breakeven; it trades at a premium to peers</li>
<li>These early 4Q22 results signals may provide some read across which we believe could be negative for Dave in particular, as well being a reality check for Inter’s US ambitions</li>
</ul>


Varo bank published 4Q22 results that revealed lower quarterly cash burn through cost control, but revenue per client declined and the very high customer acquisition cost
SoFi’s cost reduction success in 4Q22 seems, in contrast to Varo, to have limited revenue loss, thereby bringing SoFi closer to breakeven; it trades at a premium to peers
These early 4Q22 results signals may provide some read across which we believe could be negative for Dave in particular, as well being a reality check for Inter’s US ambitions


US Neobanks; Warning Signals from SoFi and Varo 4Q Results

<ul>
<li>Fintechs and neobanks suffered a valuations reality check in 2022, due to rising interest (and discount) rates, poor fundamental results coupled with - in certain cases - high cash burn</li>
<li>Most neobanks need to improve customer activity rates as well as product and revenue penetration; legacy banks are responding to disruptors and in developed markets megafintechs are encroaching on neobanks</li>
<li>We see 2023 neobank picks driven by bottom-up calls on focused execution; we turn constructive on Nubank, stay negative on Inter and Jago and neutral on Kakaobank and Banco PAN</li>
</ul>


Fintechs and neobanks suffered a valuations reality check in 2022, due to rising interest (and discount) rates, poor fundamental results coupled with - in certain cases - high cash burn
Most neobanks need to improve customer activity rates as well as product and revenue penetration; legacy banks are responding to disruptors and in developed markets megafintechs are encroaching on neobanks
We see 2023 neobank picks driven by bottom-up calls on focused execution; we turn constructive on Nubank, stay negative on Inter and Jago and neutral on Kakaobank and Banco PAN


EM and DM Neobanks in 2023; Selective Opportunity Driven by Bottom-Up Execution

IPOs and Catalysts/Events, Global Equity Research Ltd

Arun George

IPOs and Catalysts/Events

Uncompromised, Independent, Conflict-Free Research

Global Equity Research Ltd

Global Equity Research was started in 2017 by a group of experienced research professionals. It was founded on a passionate belief in the importance and the need for uncompromised, independent, conflict-free research. We aim to provide differentiated and actionable primary and bottom up fundamental research.

<ul>
<li>
<a href="https://www.smartkarma.com/entities/upstart-holdings-inc" target="_blank" data-smartkarma-citation="entities:29727:1" rel="noopener">Upstart Holdings Inc (UPST US)</a> is both a consumer Internet brand as well an online loan origination platform. </li>
<li>Upstart is a rare fintech that has established credibility by delivering high growth with profits and cash generation. The healthy 2022 outlook underscores the long-term potential. </li>
<li>While the ongoing market volatility is a near-term risk, the tech sell-off presents an opportunity to gain exposure to a good story at an attractive valuation. </li>
</ul>



Upstart Holdings Inc (UPST US) is both a consumer Internet brand as well an online loan origination platform. 
Upstart is a rare fintech that has established credibility by delivering high growth with profits and cash generation. The healthy 2022 outlook underscores the long-term potential. 
While the ongoing market volatility is a near-term risk, the tech sell-off presents an opportunity to gain exposure to a good story at an attractive valuation. 


Upstart Holdings: Fast-Growing, Profitable, Cash Generative with Share Buybacks

AlphaSituations-Event/Catalyst Driven Research, AlphaSituations

Robert Sassoon

AlphaSituations-Event/Catalyst Driven Research

AlphaSituations

Since its establishment, AlphaSituations has delivered a track record of outperformance with a hit rate of winners of more than 70% of its portfolio of ideas generating annualized average returns of 20%. In January 2022, AlphaSituations was contracted by Water Tower Research, an investor engagement and stakeholder communication platform to provide coverage of Special Situations

Event-Driven

<ul>
<li>Both <a href="https://www.smartkarma.com/entities/moneylion-inc" target="_blank" data-smartkarma-citation="entities:34686:1" rel="noopener">MoneyLion (ML US)</a> and <a href="https://www.smartkarma.com/entities/affirm-holdings" target="_blank" data-smartkarma-citation="entities:31038:1" rel="noopener">Affirm Holdings (AFRM US)</a> present strong growth credentials, but ML is  several steps ahead towards achieving their shared ambition of becoming a fintech super app</li>
<li>The substantial value premium at which AFRM is currently trading makes no sense given the potential headwinds from heavier regulation and increased competition likely to confront pure-play BNPL companies</li>
<li>A grossly undervalued ML and pricey AFRM offers a pair trade idea with potential to yield an outsized return that could be largely played out during the course of 2022  </li>
</ul>


Both MoneyLion (ML US) and Affirm Holdings (AFRM US) present strong growth credentials, but ML is  several steps ahead towards achieving their shared ambition of becoming a fintech super app
The substantial value premium at which AFRM is currently trading makes no sense given the potential headwinds from heavier regulation and increased competition likely to confront pure-play BNPL companies
A grossly undervalued ML and pricey AFRM offers a pair trade idea with potential to yield an outsized return that could be largely played out during the course of 2022  


SPACTalk: 2022 High Conviction Pair Trade Idea-Why Moneylion Is A Better Choice Than Affirm Holdings

<a href="https://www.smartkarma.com/entities/moneylion-inc" target="_blank" data-smartkarma-citation="entities:34686:1" rel="noopener">MoneyLion (ML US)</a>'s slogan is "Hear We Roar". Unfortunately, the post IPO stock price performance following its merger with SPAC Fusion Acquisition Corp. has amounted to a cry of pain for its shareholders. The share price has lost ~40% of its value in a little over a month. However, we believe this smacks of irrational gloom which belies current investor exuberance for anything fintech and crypto. Its recent guidance raise and move to facilitate cryptocurrency trading as it continues to expand its app's product offerings to enhance its capabilities to become a financial services disruptor in the consumer market place, suggests that SPAC worn and wary investors may not be seeing the wood for the trees on this occasion. But, this has created an opportunity for outsized returns. The stock's inflection point could come soon when ML reports its inaugural quarterly earnings point as a publicly traded company on November 10, 2021. Please Read On!

MoneyLion (ML US)'s slogan is "Hear We Roar". Unfortunately, the post IPO stock price performance following its merger with SPAC Fusion Acquisition Corp. has amounted to a cry of pain for its shareholders. The share price has lost ~40% of its value in a little over a month. However, we believe this smacks of irrational gloom which belies current investor exuberance for anything fintech and crypto. Its recent guidance raise and move to facilitate cryptocurrency trading as it continues to expand its app's product offerings to enhance its capabilities to become a financial services disruptor in the consumer market place, suggests that SPAC worn and wary investors may not be seeing the wood for the trees on this occasion. But, this has created an opportunity for outsized returns. The stock's inflection point could come soon when ML reports its inaugural quarterly earnings point as a publicly traded company on November 10, 2021. Please Read On!

SPACTalk: MoneyLion (ML US)-The Case Of The Missing Roar And Why We Believe It Will Return

United States

MoneyLion Inc. provides financial technology solutions. The Company offers full-service digital platform to deliver mobile banking, lending, and investment solutions. MoneyLion serves clients in the United States.

Price Gauge
52-week Range	0.00 - 0.00
Market Cap (USDm)	0.00
P/E	0.00
Dividend (Yield)	0.00

Moneylion (ML US)

US Neobanks; Warning Signals from SoFi and Varo 4Q Results

Varo bank's 4Q results revealed lower quarterly cash burn through cost control, but revenue per client declined; SoFi seemed to have done a bit...

Victor Galliano

EM and DM Neobanks in 2023; Selective Opportunity Driven by Bottom-Up Execution

Neobank shareholder success stories are rare, but Nubank combines high customer activation and revenue conversion, with low cost to acquire; we...

Victor Galliano

SPACTalk: 2022 High Conviction Pair Trade Idea-Why Moneylion Is A Better Choice Than Affirm Holdings

AFRM's prevailing Revenue based valuation multiple is 12X higher than ML's and makes for a potentially very lucrative pair trade idea that could...

Robert Sassoon

SPACTalk: MoneyLion (ML US)-The Case Of The Missing Roar And Why We Believe It Will Return

The share price has lost ~40% of its value in a little over a month. This smacks of irrational gloom creating an opportunity for an outsized return.

Robert Sassoon

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

US Neobanks; Warning Signals from SoFi and Varo 4Q Results

Varo bank's 4Q results revealed lower quarterly cash burn through cost control, but revenue per client declined; SoFi seemed to have done a bit...

Victor Galliano

EM and DM Neobanks in 2023; Selective Opportunity Driven by Bottom-Up Execution

Neobank shareholder success stories are rare, but Nubank combines high customer activation and revenue conversion, with low cost to acquire; we...

Victor Galliano

Upstart Holdings: Fast-Growing, Profitable, Cash Generative with Share Buybacks

Upstart is a rare fintech that has established credibility by delivering high growth with profits and cash generation. The tech sell-off is an...

Arun George

SPACTalk: 2022 High Conviction Pair Trade Idea-Why Moneylion Is A Better Choice Than Affirm Holdings

AFRM's prevailing Revenue based valuation multiple is 12X higher than ML's and makes for a potentially very lucrative pair trade idea that could...

Robert Sassoon

SPACTalk: MoneyLion (ML US)-The Case Of The Missing Roar And Why We Believe It Will Return

The share price has lost ~40% of its value in a little over a month. This smacks of irrational gloom creating an opportunity for an outsized return.

Robert Sassoon