In today’s briefing:
- Grab: Earnings Beat Estimates but No Meaningful Improvement Yet
- Softbank Group – Back Where We Started
- Advanced Micro Devices: The New Ryzen Embedded R-Series Launch & Other Drivers
- Model Solution IPO Preview
- PayPal Holdings Inc: Venmo & Other Innovations
- Verizon Communications Inc: Navigating Through A Challenging Business Environment
Grab: Earnings Beat Estimates but No Meaningful Improvement Yet
- Grab (GRAB US) reported 2Q2022 results today. Revenue grew 79% YoY to $321m (vs consensus $273.5m) and reported an adjusted EBITDA (negative) of $233m (vs consensus $256.5m).
- Demand for food deliveries has started softening with opening of economies in the SEA region and the segment’s 2Q earnings were driven by the integration of Jaya Grocers.
- Grab has downgraded its GMV forecast for 2022E due to softening of food deliveries and the launch of digital bank is postponed to the second half of the year.
Softbank Group – Back Where We Started
- The Softbank share price and discount to NAV are largely back to where they were before the Q1 report earlier this month
- The early settlement of Alibaba derivative contracts has eased leverage worries although that may be less obvious within Softbank’s net calculation of that measure
- But worries about tech valuations, particularly in the private portfolio, remain robust. We have updated our main tables below
Advanced Micro Devices: The New Ryzen Embedded R-Series Launch & Other Drivers
- Advanced Micro Devices continued its strong execution across the board and delivered an all-around beat in the recent result driven by its premier product line, and diverse business strategy.
- The management also observed a significant year-over-year rise for their networking and FPGA solutions, which are the best in the business, with cloud and financial customers.
- During the quarter, they also launched Ryzen Embedded R-Series system-on-chips processors in order to broaden their product line and target emerging markets.
Model Solution IPO Preview
- Model Solution makes prototypes to mainly check design and function in the product development stage, which is before the mass production stage of new products such as IT devices.
- The IPO price range is from 24,000 won to 27,000 won. The expected market cap of the IPO is from 153 billion won to 173 billion won.
- The company had sales of 61.1 billion won (up 9.9% YoY) and operating profit of 8.9 billion won (up 32.1% YoY) in 2021.
PayPal Holdings Inc: Venmo & Other Innovations
- PayPal has seen some level of recovery after the stock nosedived and stayed low in the period from May to July 2022.
- Also, it has reinvigorated its organizational operating model and has been recruiting world-class talent in its product, technology, and engineering functions.
- We see a further recovery in the stock of PayPal Holdings and we give it a ‘Buy’ rating with a revision in the target price.
Verizon Communications Inc: Navigating Through A Challenging Business Environment
- Verizon Communications had a below par performance in the quarter as the inflationary pressure has been impacting consumer behavior resulting in the company failing to match earnings expectations and just about beating revenue expectations of Wall Street.
- The company updated its financial guidance by lowering its expectations of other revenue and service.
- The company launched its plan Welcome Unlimited for consumers wireless which will meet the requirements of budget-conscious consumers without offering device subsidies.
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