Covering IPOs, Healthcare and Technology Stocks

Andrei Zakharov

Algosun Global

Equity Bottom-Up

<p><a href="https://www.smartkarma.com/entities/sumo-logic-inc" target="_blank" data-smartkarma-citation="entities:29265:1" rel="noopener">Sumo Logic Inc (SUMO US)</a>  shares underperformed the Nasdaq Composite and fell ~31% year to date. Shares of key competitors <a href="https://www.smartkarma.com/entities/splunk-inc" target="_blank" data-smartkarma-citation="entities:12849:1" rel="noopener">Splunk Inc (SPLK US)</a> and <a href="https://www.smartkarma.com/entities/elastic-nv" target="_blank" data-smartkarma-citation="entities:27526:1" rel="noopener">Elastic NV (ESTC US)</a>  also dropped ~21% and ~24% YTD, respectively. Rising Treasury bond yields across the board and weak revenue guidance for FY’22 announced by Sumo Logic drove <a href="https://www.smartkarma.com/entities/sumo-logic-inc" target="_blank" data-smartkarma-citation="entities:29265:1" rel="noopener">Sumo Logic Inc (SUMO US)</a> stock price below IPO price of $22 per share. In our insight we will focus on major bullish catalysts for <a href="https://www.smartkarma.com/entities/sumo-logic-inc" target="_blank" data-smartkarma-citation="entities:29265:1" rel="noopener">Sumo Logic Inc (SUMO US)</a>  stock and set a new 12-month price target.</p>

Sumo Logic Inc (SUMO US)  shares underperformed the Nasdaq Composite and fell ~31% year to date. Shares of key competitors Splunk Inc (SPLK US) and Elastic NV (ESTC US)  also dropped ~21% and ~24% YTD, respectively. Rising Treasury bond yields across the board and weak revenue guidance for FY’22 announced by Sumo Logic drove Sumo Logic Inc (SUMO US) stock price below IPO price of $22 per share. In our insight we will focus on major bullish catalysts for Sumo Logic Inc (SUMO US)  stock and set a new 12-month price target.

Sumo Logic. A Turning Point May Be Reached In 2H 2021

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.

Equity Capital Markets

<div><p><a href="https://www.smartkarma.com/entities/bairong" target="_blank" data-smartkarma-citation="entities:31486:1" rel="noopener">Bairong (1569395D CH)</a> is a leading independent AI-powered technology platform in China serving the financial services industry. It is the largest independent financial big data analytics solutions provider in China with a 9.0% revenue market share in 2020, according to Frost &amp; Sullivan. </p></div><div><p>At the proposed IPO price range of HK$26.50-31.80 per share, Bairong will have a market cap of HK$13,125.2-15,750.2 million ($1.7-2.0 billion). At the mid-point of the IPO price range, the net proceeds are HK$3,440.7 million ($443 million). Three cornerstone investors will purchase $220 million worth of the offer shares (47.29% of the offer shares at the mid-point of the IPO price range). The cornerstone investors are Cederberg (a London-based fund manager), China Structural Reform Fund and Franchise Fund. </p></div><div><div><div class="content-highlight"><p>In <a href="https://www.smartkarma.com/insights/bairong-ipo-initiation-creditworthy" target="_blank" data-smartkarma-citation="insights:49249" rel="noopener">Bairong IPO Initiation: Creditworthy</a>, we opined that the good 4Q20 revenue growth exit rate points to recovery. We noted that Bairong has the potential to combine solid growth with profitability and cash generation. We concluded that Bairong is worth a closer look. Our valuation analysis suggests that the IPO price range is attractive. Overall, we would participate in the IPO. </p></div></div></div>

Bairong (1569395D CH) is a leading independent AI-powered technology platform in China serving the financial services industry. It is the largest independent financial big data analytics solutions provider in China with a 9.0% revenue market share in 2020, according to Frost &amp; Sullivan. At the proposed IPO price range of HK$26.50-31.80 per share, Bairong will have a market cap of HK$13,125.2-15,750.2 million ($1.7-2.0 billion). At the mid-point of the IPO price range, the net proceeds are HK$3,440.7 million ($443 million). Three cornerstone investors will purchase $220 million worth of the offer shares (47.29% of the offer shares at the mid-point of the IPO price range). The cornerstone investors are Cederberg (a London-based fund manager), China Structural Reform Fund and Franchise Fund. In Bairong IPO Initiation: Creditworthy, we opined that the good 4Q20 revenue growth exit rate points to recovery. We noted that Bairong has the potential to combine solid growth with profitability and cash generation. We concluded that Bairong is worth a closer look. Our valuation analysis suggests that the IPO price range is attractive. Overall, we would participate in the IPO. 

<div><p><a href="https://www.smartkarma.com/entities/bairong" target="_blank" data-smartkarma-citation="entities:31486:1" rel="noopener">Bairong (1569395D CH)</a> is a leading independent AI-powered technology platform in China serving the financial services industry. It is the largest independent financial big data analytics solutions provider in China with a 9.0% revenue market share in 2020, according to Frost &amp; Sullivan. Bairong is aiming to launch its $300-500 million HKEx IPO as soon as this Friday, according to press reports. </p></div><div><div><div class="content-highlight"><p>In <a href="https://www.smartkarma.com/insights/bairong-ipo-initiation-creditworthy" target="_blank" data-smartkarma-citation="insights:49249" rel="noopener">Bairong IPO Initiation: Creditworthy</a>, we opined that the good 4Q20 revenue growth exit rate points to recovery. We noted that Bairong has the potential to combine solid growth with profitability and cash generation. We concluded that Bairong is worth a closer look. In this note, we present our forecasts and take the first look at Bairong's potential valuation. </p></div></div></div>

Bairong (1569395D CH) is a leading independent AI-powered technology platform in China serving the financial services industry. It is the largest independent financial big data analytics solutions provider in China with a 9.0% revenue market share in 2020, according to Frost &amp; Sullivan. Bairong is aiming to launch its $300-500 million HKEx IPO as soon as this Friday, according to press reports. In Bairong IPO Initiation: Creditworthy, we opined that the good 4Q20 revenue growth exit rate points to recovery. We noted that Bairong has the potential to combine solid growth with profitability and cash generation. We concluded that Bairong is worth a closer look. In this note, we present our forecasts and take the first look at Bairong's potential valuation. 

<p>Sumo Logic set IPO price at $22 per share and successfully raised ~$340 million from the sale of 14.8 million shares of common stock in September. Underwriters have exercised in full their option to purchase ~2.2 million shares at IPO price. Moreover, entities affiliated with Tiger Global Management have agreed to purchase ~1.8 million shares at IPO price too. Therefore, we believe IPO was oversubscribed and Sumo could sell shares to investors at above the initial price range. Despite this fact, shares of Sumo Logic closed at ~$27 a share and climbed 22% on its first trading day.</p><p>However, rally was shortlived and later Sumo Logic shares fell ~37% from all time-high and could find the bottom near $17 a share. Investors were disappointed by slowing revenue growth rates next year, high cash burn rates and increased customer churn for customers with ARR&lt;$100K. </p>

Sumo Logic set IPO price at $22 per share and successfully raised ~$340 million from the sale of 14.8 million shares of common stock in September. Underwriters have exercised in full their option to purchase ~2.2 million shares at IPO price. Moreover, entities affiliated with Tiger Global Management have agreed to purchase ~1.8 million shares at IPO price too. Therefore, we believe IPO was oversubscribed and Sumo could sell shares to investors at above the initial price range. Despite this fact, shares of Sumo Logic closed at ~$27 a share and climbed 22% on its first trading day.However, rally was shortlived and later Sumo Logic shares fell ~37% from all time-high and could find the bottom near $17 a share. Investors were disappointed by slowing revenue growth rates next year, high cash burn rates and increased customer churn for customers with ARR&lt;$100K. 

Sumo Logic. One of the Most Undervalued Unicorns in Our SaaS/Cloud Coverage Universe

Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Palantir Technologies  / Equity Capital Markets

<p>Palantir is ready to complete its Direct Public Listing on September 23rd. </p>
<p>Our valuation analysis suggests an implied market cap of $29.7 billion and a target price of $13.7 per share for Palantir (49% higher than the base price of $9.2 per share). The IPO price range is from $11.1 (low) to $16.6 per share (high). Assuming Direct Public Listing (DPL) market cap of $20 billion and diluted shares of 2.17 billion, this suggests $9.2 per share. Given the solid upside, we have a positive view of this DPL.</p>
<p>There are three key positives with Palantir which we believe are likely to outweigh its negatives, leading many investors to value this company at nearly $30 billion.</p>
<ul>
<li>First, we believe the <strong>company's accelerating sales growth</strong> since the launch of its Foundry product in 2017 is likely to be valued highly. The company's sales growth is clearly much higher than its peers in 2020. </li>
<li>
<div class="content-highlight">Second, Palantir has picked a <strong>great time</strong> to complete its public offering with great investors demand high-quality software-related stocks this year.</div>
</li>
</ul>
<ul>
<li>Third, Palantir has been enjoying a noticeable improvement in its operating margins and the company possesses a strong balance sheet. </li>
</ul>

Palantir is ready to complete its Direct Public Listing on September 23rd. 
Our valuation analysis suggests an implied market cap of $29.7 billion and a target price of $13.7 per share for Palantir (49% higher than the base price of $9.2 per share). The IPO price range is from $11.1 (low) to $16.6 per share (high). Assuming Direct Public Listing (DPL) market cap of $20 billion and diluted shares of 2.17 billion, this suggests $9.2 per share. Given the solid upside, we have a positive view of this DPL.
There are three key positives with Palantir which we believe are likely to outweigh its negatives, leading many investors to value this company at nearly $30 billion.

First, we believe the company's accelerating sales growth since the launch of its Foundry product in 2017 is likely to be valued highly. The company's sales growth is clearly much higher than its peers in 2020. 

Second, Palantir has picked a great time to complete its public offering with great investors demand high-quality software-related stocks this year.



Third, Palantir has been enjoying a noticeable improvement in its operating margins and the company possesses a strong balance sheet. 


United States

Splunk Inc. develops web based application software. The Company provides software that collects and analyzes machine data generated by websites, applications, servers, networks, and mobile devices. Splunk serves customers worldwide.

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

Splunk Inc (SPLK US)

Sumo Logic. A Turning Point May Be Reached In 2H 2021

Sumo Logic valuations look attractive and we expect a relief rally into the area of $25-$30 per share as tech stocks selloff may be close to an end

Andrei Zakharov

Bairong IPO: Valuation Insights

Bairong has launched its IPO to raise net proceeds of $443m at the mid-point of the IPO price range of HK$26.50-31.80 per share. Our valuation...

Arun George

Bairong IPO: Valuation First Look

Bairong is aiming to launch its $300-500m HKEx IPO as soon as this Friday, according to press reports. In this note, we present our forecasts and...

Arun George

Sumo Logic. One of the Most Undervalued Unicorns in Our SaaS/Cloud Coverage Universe

Investors should pay attention to attractive valuations of Sumo Logic and positive catalyst - forthcoming 3Q FY20 earnings, what may drive stock...

Andrei Zakharov

Palantir DPL Valuation Analysis

Our valuation analysis suggests an implied market cap of $29.7 billion and a target price of $13.7 per share for Palantir (49% higher than the base...

Douglas Kim

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)