In today’s briefing:
- Amazon 1Q22: (Some) Cost Inflation Is Transitory, The Moat Is Not
- Pharmaron Beijing Co Ltd (3759.HK/300759.CH) 2022/2021Q1 Results- Expectations Coexist with Concerns
Amazon 1Q22: (Some) Cost Inflation Is Transitory, The Moat Is Not
- Promised operating leverage is pushed out until likely 3Q22, but only higher employee RSUs is a permanent inflationary impact.
- Overcapacity is almost certainly transitory, as long as the retail business grows, this will be soaked up in a quarter or two.
- AWS backlog is booming again. Amazon’s current valuation = 12x forward AWS sales.
Pharmaron Beijing Co Ltd (3759.HK/300759.CH) 2022/2021Q1 Results- Expectations Coexist with Concerns
- As one of the few CXOs in the industry that has layout of the whole industry chain, Pharmaron carries many expectations. But it cannot compete with WuXi AppTec so far.
- If Pharmaron could make breakthrough either in its CMC services (improving gross profit margin and scale) or the CGT services, the Company’s outlook and valuation logic would improve greatly.
- The valuation of Pharmaron should be lower than WuXi AppTec and WuXi Biologics, but higher than Asymchem, Tigermed and Joinn. Considering the macro uncertainties, short-term trades are advised.
Related tickers: Amazon.com Inc (AMZN.O), Pharmaron Beijing Co Ltd-H (3759.HK)
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