In today’s briefing:
- Oriental Land: The 33.5x FY27 Consensus OP Bubble
- Mercedes-Benz: Luxury Brand With Strong Pricing Power
- JD.com Inc: Proposed Acquisition of Deppon Logistics Co & Other Drivers
- Kroger Co: A ‘Fresh’ & Friendly Strategy For Growth – Key Drivers
Oriental Land: The 33.5x FY27 Consensus OP Bubble
- Oriental Land (4661 JP)’s revenue in 4QFY23 could miss consensus by around 12%, but its profitability could exceed consensus expectations by around 20%.
- The shares did not react to beating consensus and revising up its guidance in the last quarter. This suggests limited upside risk for the company’s shares following 4QFY23 earnings.
- Despite consensus medium-term OP estimates, Oriental Land appears to be significantly overpriced, with shares trading at a consensus FY27 EV/OP multiple of 33.4x.
Mercedes-Benz: Luxury Brand With Strong Pricing Power
- Mercedes is a luxury brand with strong pricing power, well positioned to capture growth in EV as it invests significantly to transition into an all-electric, software-driven world
- The launch of several models in the next few years will drive growth, as we believe the desirability remains very strong.
- We like the direct sales model and believe the operational focus and discipline of the Company are still to pay off. The valuation remains appealing at a P/E below 6x.
JD.com Inc: Proposed Acquisition of Deppon Logistics Co & Other Drivers
- JD.com had a successful year in 2022, achieving high-quality growth and surpassing 1 trillion RMB in full-year revenues for the first time.
- Despite external challenges, the company was able to maintain high-quality operations and record the highest-ever profitability for the year.
- In this report, we have carried out a fundamental analysis of the historical financial statements of the company.
Kroger Co: A ‘Fresh’ & Friendly Strategy For Growth – Key Drivers
- Kroger had a mixed Q4 and failed to meet the revenue expectations of Wall Street given the shifting customer preferences due to inflation and macroeconomic uncertainty.
- The company observed total household growth and improved customer loyalty, with higher-income households growing by 1.1 million.
- The company’s end-to-end fresh initiative led to noticeable growth in both fresh and total store sales, and Kroger will continue innovating to enhance the fresh experience and drive customer satisfaction.
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