In today’s briefing:
- Grab(GRAB.US) 4Q22 Preview: Tailwinds from Share Gain and Rebound in Mobility
- Pushpay Holdings: 3rd March Scheme Meeting. IA Says Fair
- Pushpay (PPH NZ): Scheme Vote on 3 March but Deal Risks Are Emerging
- Softbank Corp (Buy) – Q3 22 Results Reaction: Modest Mobile Improvement, on Track to Meet Targets
- Intel Corp: Launch Of 13th Generation Lineup & Other Drivers
- Amazon: Recent Quarter Is A Reminder That Red Flags Should Not Be Ignored
- Amazon 4Q22: When Does AWS Trough?
- SAP SE ADR: Launch Of SAP Build & Other Drivers
- Snap Inc: New Promotional Campaign & Other Developments
Grab(GRAB.US) 4Q22 Preview: Tailwinds from Share Gain and Rebound in Mobility
- In C4Q22, We expect Grab to report total revenue 2% higher than cons., and non-IFRS net loss narrower than cons..
- With competitors cutting back on heavy incentives, Grab has gained share under easing competitive environment in food delivery market in 2022. We expect this trend to sustain in 2023.
- Mobility is expected to benefit from rebound of tourism and generate stable margin. Pullbacks from off-platform financial services continue to support improvement. Maintain BUY and raise TP to US$ 4.0.
Pushpay Holdings: 3rd March Scheme Meeting. IA Says Fair
- Back on the 28 October, church donor management play Pushpay Holdings (PPH NZ/PPH AU) announced a Scheme with BGH/Sixth Street at NZ$1.34/share, a 30.1% premium to undisturbed.
- The Scheme Booklet is now out. The shareholder meeting will take place on the 3 March. The independent advisor concluded the Offer price is within its valuation range.
- Assuming 11 April payment, this is trading at a gross/annualised spread of 3.0%/18.0%.
Pushpay (PPH NZ): Scheme Vote on 3 March but Deal Risks Are Emerging
- Pushpay Holdings (PPH NZ)’s NZ$1.34 offer from Sixth Street/BGH is barely within the IE’s valuation range of NZ$1.33-1.53 per share. There is no “fair and reasonable” statement from the IE.
- Astonishingly, Sixth Street/BGH wrote to the Takeovers Panel to raise concerns about the IE’s report. The Takeovers Panel concluded that the IE report is not misleading or deceptive.
- A relatively concentrated register poses a risk, particularly considering the IE’s valuation range and the re-rating of a key peer. While possible, the probability of a bump is low.
Softbank Corp (Buy) – Q3 22 Results Reaction: Modest Mobile Improvement, on Track to Meet Targets
- Consumer mobile revenue fell 7% but that partly reflects how sales were reported a year ago. Reported ARPU was down 5% whilst price cut erosion narrowed
- Operating income YTD is 94% of full-year targets leaving room for Softbank to achieve its goal even with increased investment spending
- This was a relatively uneventful quarter and we remain at Buy
Intel Corp: Launch Of 13th Generation Lineup & Other Drivers
- Intel delivered a weak result, failing to meet Wall Street expectations in terms of revenues as well as earnings given the persisting macroeconomic headwinds in the semiconductor industry.
- Intel continues to integrate AXG into CCG and DCAI to deliver a more effective go-to-market capability, accelerating the scale of these businesses while further cutting costs.
- The management believes their first EUV-deploying modes, Intel 4 and 3, will significantly improve transistor performance per watt and density.
Amazon: Recent Quarter Is A Reminder That Red Flags Should Not Be Ignored
- Amazon’s share price has fallen 25% since April of last year, sparking a fear of missing out.
- The pressure for cost-cutting measures will likely increase as profitability and free cash flow remain elusive, according to Amazon.
- Amazon has seen a 25% drop in its share price in January.
Amazon 4Q22: When Does AWS Trough?
- AWS revenue grew 20% YoY to $21.3B, about $400M or ~2% below consensus…and a 700bp deceleration.
- AWS margins of 24% were down 200bps QoQ / 600bps YoY as continued optimization of customer contracts continues to weigh on margins.
- Amazon advertising continues to dramatically outpace all other online platforms, highlighting the moat of first party data at the point of purchase, unimpacted by Apple.
SAP SE ADR: Launch Of SAP Build & Other Drivers
- SAP delivered a mixed set of results in the final quarter of 2022 as it surpassed the revenue expectations of Wall Street but missed out on earnings.
- This year, cloud revenue also surpassed support revenue to become SAP’s single-largest revenue stream.
- Their overall SaaS and PaaS portfolio grew significantly, with SaaS cloud revenue increasing by 25% and PaaS cloud revenue increasing by 45%.
Snap Inc: New Promotional Campaign & Other Developments
- Snap continued to encounter massive challenges due to increased competition and macroeconomic headwinds.
- In the quarter, the company released communities to expand its content offerings and onboarded several new media partners.
- The company has also launched new Snapchat+ features to increase audience engagement on the platform in the quarter.
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